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Speaker 1: Runt You by Bank of America Mary Lynch. With virtual reality,

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Speaker 1: virtually everything will change. Discover opportunities in a transforming world.

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Speaker 1: Be of a, mL dot Com, slash VR, Mary Lynch,

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Speaker 1: Pierced Fenner, and Smith Incorporated. Welcome to the Bloomberg Surveillance Podcast.

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Speaker 1: I'm Tom Keene with David Gura. Daily we bring you

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Speaker 1: insight from the best of economics, finance, investment, and international relations.

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Speaker 1: Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, Bloomberg dot Com,

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Speaker 1: and of course, on the Bloomberg Good Morning everyone, David

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Speaker 1: Gura and Tom came. Mr Gura on assignment in Sun Valley, Idol.

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Speaker 1: How do you be scarlet? How do you be on

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Speaker 1: assignment in Sun Valley Idole? Myself? Come on, you know

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Speaker 1: they never say scarlet food. Please go to Idaho or

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Speaker 1: no they and you know it's it's so odd. He

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Speaker 1: goes for an entire week at a time in the

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Speaker 1: middle of July. It's it's all very suspicious. It's very suspicious.

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Speaker 1: Scarlet food with us. If you didn't notice that, it's

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Speaker 1: always a good thing. We will try to refrain. Diminished down,

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Speaker 1: the hockey, diminished down, the New York Rangers discussions. There's

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Speaker 1: a lot to be excited for on that front. There

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Speaker 1: is two and Howard Word will be with us here

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Speaker 1: in a moment. Sometimes Howard where's his New York Rangers

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Speaker 1: tie into Bloomberg surveying? Not doing it today though exactly

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Speaker 1: Bluin blew what white Bluin it's British, It's it's it's

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Speaker 1: British to do. We'll get to Howard Ward in a minute.

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Speaker 1: We say good morning, economics, finance, investment, politics, international relations.

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Speaker 1: Huge day, huge news flow out of Washington, will do

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Speaker 1: that along the way. Bloomberg surveillance this morning, Howard Ward

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Speaker 1: with us, with Gabelly. And it's a wonderful time to

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Speaker 1: talk to Howard Ward because he stated earlier how you're

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Speaker 1: more cautious here the the elevation the multiples in such

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Speaker 1: when do or are we even close to getting back

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Speaker 1: to where yield is competition for dividend? Are we are?

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Speaker 1: We miles away from where we go? I can make

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Speaker 1: this in a bond, I can make this in a

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Speaker 1: stock um well not really. When you look at the

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Speaker 1: historical numbers where you had, let's say for the last

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Speaker 1: thirty years and average yield on the tenure treasury of

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Speaker 1: six and now it's two point four percent. That's still

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Speaker 1: in that very attractive dividend yields right around two percent.

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Speaker 1: So dividend really is for people that can have the

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Speaker 1: patients to buy stocks and let the dividends grow. You're

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Speaker 1: probably if you can handle the f altility of stocks,

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Speaker 1: probably better offgoing the dividend route. I think that's been

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Speaker 1: a major source of demand for stocks in recent years.

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Speaker 1: So bonds bonny yields have a long ways to go

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Speaker 1: before they really start to uh be competition for stocks.

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Speaker 1: That's not to say that higher interest rates will not

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Speaker 1: uh force a penalty on stocks, because I think they will.

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Speaker 1: But I will say this that with all the talk

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Speaker 1: about where bond yields are today, they're basically where they

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Speaker 1: were in December of two thousand and fifteen when the

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Speaker 1: FED made their very first tightening measure of this cycle. So, um,

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Speaker 1: we've been trading between let's say a two percent yield

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Speaker 1: and a two point six percent yield ever since, and

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Speaker 1: right now we're sort of in the middle of that.

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Speaker 1: How are you one of those people who are worried

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Speaker 1: about an unwind of the risk parity trade? Uh, specifically

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Speaker 1: in what sense well, with bonds and stocks falling. I mean,

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Speaker 1: things have stabilized the last two days, but for a

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Speaker 1: while last week there was a lot of talk that

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Speaker 1: there is going to be this unwinding of UH risk

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Speaker 1: parity trades in which stocks and bonds would fall at

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Speaker 1: the same time, and there are so many lever bets

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Speaker 1: on that positive rate stock correlation. Yeah, I Scarlet, I

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Speaker 1: think that's a possibility, and it it certainly could happen

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Speaker 1: over a very short term. But what I do think

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Speaker 1: is more likely to happen is that bond yields decline

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Speaker 1: in the face of weakening economic activity, and the stock

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Speaker 1: market declines um due to issues that might have to

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Speaker 1: do with growing trade friction, because I think that's going

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Speaker 1: to be a big issue over the next several months. UH,

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Speaker 1: because the FED is also tightening. I think that's another

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Speaker 1: problem in terms of policy. Trade policy is a problem

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Speaker 1: headwind for stocks, Monetary policy is a headwind for stocks.

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Speaker 1: Fiscal policy is doing nothing to help stocks, and so

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Speaker 1: I think the economic news deteriorates, UH bonny yields go down,

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Speaker 1: not up, and the risk parity trade may they may

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Speaker 1: go down. In sympathy every now and then, But but

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Speaker 1: I think the primary trend for the next five percent move.

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Speaker 1: Let's say in stocks, I think stocks are down UH

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Speaker 1: is the next five percent move and UH and bonny

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Speaker 1: yields will likely be going down with them, all right,

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Speaker 1: so we'll continue to see a move into the safe

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Speaker 1: haven of bonds UM. You mentioned the economic surprise index

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Speaker 1: and how the rate of surprises from the data has

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Speaker 1: been coming down. There's been some research done. People have

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Speaker 1: pointed out how if you look at a sitecre economic

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Speaker 1: surprise index over the last seven or eight years, it

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Speaker 1: bottoms around June and each of the previous six years,

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Speaker 1: and this is a self reverting, self correcting mean for

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Speaker 1: reverting index for the most part, and we've bounced back up.

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Speaker 1: What does that tell you, Well, we've had a little

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Speaker 1: bit of a bounce after a really a three month collapse.

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Speaker 1: And so if we look a little bit deeper at

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Speaker 1: some of the underlying economic data, we know that auto

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Speaker 1: sales are soft and production cuts have been announced for

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Speaker 1: this quarter. We know housing activity has slowed. We know

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Speaker 1: commercial industrial loan growth is slowing. We know credit delinquencies

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Speaker 1: are growing across the credit chain. We know retail sales

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Speaker 1: have been soft, and inventory to sales ratios have been rising.

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Speaker 1: We know durable goods orders, especially X defense and aircraft

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Speaker 1: are soft. We know payroll growth is slowing. NIPPA profits

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Speaker 1: actually declined in the press when somebody get by medications, please,

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Speaker 1: NIPPA profits actually declined last quarter. They didn't rise like

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Speaker 1: S and P profits. And uh we we've we And

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Speaker 1: as I mentioned earlier, trade policy is about to get

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Speaker 1: I think very heated because the one hundred days that

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Speaker 1: Trump gave China to negotiate a trade deal expires next week.

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Speaker 1: So are we in cash? No, because you know this

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Speaker 1: is this is really hard, this market time and stuff.

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Speaker 1: I don't advocate it. I'm just saying that you will

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Speaker 1: probably get a better entry point for stocks and and

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Speaker 1: otherwise you should try to be defensively. What does that mean.

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Speaker 1: That's a great phrase. It's a famous Howard word phrase

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Speaker 1: to help our our our audience. What is the tactical

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Speaker 1: to do given an uber bulls caution, Well, if you

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Speaker 1: want to stay in the market, you you you gravitate

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Speaker 1: towards the more defensive names, the names that have lower beta,

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Speaker 1: specifically lower beta, because that's been the most reliable banks metric. No,

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Speaker 1: not not the banks. The banks the bank trade has

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Speaker 1: been conditioned upon rising rates and rising loan growth, and

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Speaker 1: I don't think either one of those is going to

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Speaker 1: pan out. So what's a lower beta defensive position. Healthcare,

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Speaker 1: consumer staples, utilities would be the three primary sectors. In fact,

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Speaker 1: the latest new position in my portfolio is next Era Energy,

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Speaker 1: which is in electric Italy, the old Florida Power and Light.

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Speaker 1: It's the meeting. It's the leading generator of UH solar

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Speaker 1: and principally when alternative energy in the United States where

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Speaker 1: you're you are CEO of Growth Equities, right, Yes, So

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Speaker 1: this is a business that is growing at around in total,

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Speaker 1: including the regulated part, at about eight percent. And I

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Speaker 1: will challenge you to find consumer staples names that are

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Speaker 1: growing at eight percent. They're probably growing much less and

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Speaker 1: they're priced much higher. This is fascinating. This is the

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Speaker 1: old Florida Power Light. It is back in our back

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Speaker 1: on Scarlett. How did I remember this? Where you owned

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Speaker 1: like six utilities and one was always FPL And this

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Speaker 1: is next What separates them from Dominion or the other

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Speaker 1: victims of our ute, it's their large presence in wind

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Speaker 1: power and solar power. And I think it's not well

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Speaker 1: known than in much of the South and central United States.

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Speaker 1: Right now, without any subsidies, wind power is cheaper than

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Speaker 1: the alternatives. Can you can you book in here five

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Speaker 1: year dividend growth of ten percent per year, that's a

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Speaker 1: phenomenal number for for next Terra Energy, I would feel

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Speaker 1: more comfortable with an eight percent dividend growth. That's yielding

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Speaker 1: two point eight percent now. And UH there is a

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Speaker 1: much smaller cap subsidiary that they have a big stake

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Speaker 1: and called next Era UH Energy Partners. It's about a

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Speaker 1: one point two or three billion dollar MLP, and the

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Speaker 1: dividend yield is higher, and the dividend growth rate is

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Speaker 1: going to be tied to their growth and alternative energy,

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Speaker 1: and that might be a better play for people that

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Speaker 1: are really focused on the income. And you tell these

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Speaker 1: four scurs you can't make money in utilities ten year

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Speaker 1: track record of Florida Power and Light thirteen point one

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Speaker 1: percent per year. It's just a scarlett. You can't make

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Speaker 1: money and you tie per years extraordinary, that is the cliche.

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Speaker 1: And looking here at the utilities index in the SMP

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Speaker 1: five hundred, price earnings eighteen point two times for next

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Speaker 1: to any that took her correct. Uh, the pe is

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Speaker 1: twenty two and the estimated p the and I think

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Speaker 1: and again, if you go back and look at the beta,

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Speaker 1: you'll probably find it's something like fifty. So Uh, it's

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Speaker 1: going to give you a lot of protection. Historically has

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Speaker 1: provided a lot of protection in a down mark. It's

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Speaker 1: outperformed in the last decade dominion by two fifty basis points.

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Speaker 1: This is a very wonky This is almost like a

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Speaker 1: pim Fox conversation. Scarlett. We've gotten into the land of

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Speaker 1: fox Well on a Tuesday morning. How appropriate, right? That

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Speaker 1: would be very good. Yeah, there's a lot going on

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Speaker 1: this morning. We'll have much more for you, including the

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Speaker 1: politics of Land State Bank rumor has it. Will have

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Speaker 1: that on news as well. Features yet Futures negative to

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Speaker 1: Doubt features Negative. Seventeen, Bloomberg Business Week relaunched. I want

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Speaker 1: to bring into your attention every week an issue has

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Speaker 1: a different theme. Last week it was technology. Uh, the

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Speaker 1: week before it was Job's a really good jobs issue

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Speaker 1: as well. They'll be out with a new issue in

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Speaker 1: forty eight hours. But Bloomberg Business Week we launched. I

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Speaker 1: really can't say enough about it. Uh is a is

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Speaker 1: a great overview of whatever their theme of the week is.

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Speaker 1: I like the thematic approach to it as well. David

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Speaker 1: gurn Tom Keane, Mr Gurra on assignment in Idaho, scarlet

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Speaker 1: food the short straw. We'll get here a few more

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Speaker 1: minutes with Howard warding than we have to turn to

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Speaker 1: an important global debate. Um, Howard, I look at the

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Speaker 1: equity markets. I look at all the mumbo jumbo of Graham,

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Speaker 1: Dott and Coddle and an investment finance. The bottom line

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Speaker 1: is a lot of people are wrong. The certitude was

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Speaker 1: it's a single digit world and we haven't had that.

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Speaker 1: Do you regress to the mean? Do you say, look,

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Speaker 1: we had a double digit reality and are we going

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Speaker 1: to be negative to get back to a single digit world?

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Speaker 1: I don't buy that for a minute. I just can't

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Speaker 1: get that defeatist. No, but Tom thinks have changed. So

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Speaker 1: we got a ten percent long term compounded return on

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Speaker 1: stocks by way of essentially a seven percent nominal GDP

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Speaker 1: number and a three percent dividend yield. That's and and

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Speaker 1: the GDP number correlated exact almost exactly to the rate

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Speaker 1: of earnings growth. And we're no longer in a nominal

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Speaker 1: seven percent world. We're in a at the moment a

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Speaker 1: nominal three and a half percent GDP world, and maybe

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Speaker 1: we can get that to four or four and a

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Speaker 1: half percent, and we have a two percent dividend yield

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Speaker 1: on the SMP. So from this vantage point, the longer

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Speaker 1: term returns on stocks are no longer going to be

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Speaker 1: ten percent. They're more like seven percent um. And in fact,

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Speaker 1: if you now look back over the last ten years,

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Speaker 1: I think that's just about exactly what we've had, although

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Speaker 1: with a lot of volatility in between. So, uh, you know,

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Speaker 1: and this this, this, this is part of the you know,

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Speaker 1: we had for thirty years or so real g D

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Speaker 1: real GDP growth of three point three percent in the

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Speaker 1: US that was the trend line, and that's now closer

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Speaker 1: to two. You talk about the dividends and how it's

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Speaker 1: not as rich as it could be or it has

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Speaker 1: been in the past. We've seen companies, of course plowed

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Speaker 1: their extra cash back into share buy backs, but that's

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Speaker 1: tapered off quite a bit because prices are pretty high.

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Speaker 1: And Gina Martin Adams and her team at Bloomberck Intelligence

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Speaker 1: have done the research that show that the rate of

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Speaker 1: buybacks has slowed down quite a bit. What are you

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Speaker 1: looking for this earning season when it comes to returning

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Speaker 1: cash to shareholders? Well, I think Scarlett, it's worth mentioning

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Speaker 1: that corporations went on a binge of borrowing money in

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Speaker 1: the in the debt market and using the proceeds to

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Speaker 1: buy back stock to the extent that their balance sheets

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Speaker 1: are not nearly as secure are safe as they were

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Speaker 1: prior to all this. And I think it's also worth

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Speaker 1: to look at to ask yourself, is the stuff? How

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Speaker 1: how fairly valued or how attractive the stock market is? Uh,

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Speaker 1: don't even look at earnings, but but look at the

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Speaker 1: value of the entire stock market relative to GDP, and

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Speaker 1: currently it's one. There's only one time in history when

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Speaker 1: it's been higher, and that was in the first quarter

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Speaker 1: of two thousand when it was one d and sixty

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Speaker 1: seven of g d P. So having said all that,

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Speaker 1: when you're looking at earnings expectations for the current quarter,

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Speaker 1: I don't think that they're going to be bad. I mean,

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Speaker 1: we all know that these corporate managers are so good

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Speaker 1: at managing earnings that every single quarter, seventy some percent

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Speaker 1: of the earnings beat the estimates and continue to be there.

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Speaker 1: That's going to continue to be the case. So I'm

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Speaker 1: not so focused on that. I think the guidance could

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Speaker 1: be critical. I do expect that there will be some

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Speaker 1: negative surprises on the guidance front, but in terms of

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Speaker 1: the overall market, I'd be looking at the evaluation and

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Speaker 1: the fact that we we typically have three five percent

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Speaker 1: corrections every year and we haven't had one for the

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Speaker 1: last year. We're going to rip up the script here

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Speaker 1: with the Howard Ward right now, Scarlet fod with this

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Speaker 1: is well for a global audience. Um I I can't

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Speaker 1: begin to convey the excitement about Howard Ward and Scarlet Foods.

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Speaker 1: New York Rangers. There's a gentleman named Shatton Kirk who

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Speaker 1: I first saw with the St. Louis Blues Good Morning Bloomberg,

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Speaker 1: one of six one FM Boston, who was a pride

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Speaker 1: of Boston University and Howard. Before that, he was playing

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Speaker 1: pond hockey just north of New York City, wasn't he well,

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Speaker 1: Kevin's from New Marshall, and you know, he spent some

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Speaker 1: time local boy and he wanted to come back to

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Speaker 1: the Rangers, and he spent some time at the Brunswick

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Speaker 1: School in Greenwich, where he played hockey with my son Chriss,

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Speaker 1: and uh, it was evident from the moment that Kevin

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Speaker 1: hit the ice that this young man was a very

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Speaker 1: special hockey player. And he progressed from Brunswick to the

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Speaker 1: us UH Olympic or Junior Olympic programming on Arbor, spent

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Speaker 1: a couple of years there before becoming a terrier at

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Speaker 1: BU And Mrs Lund, quiz, this is good for your husband,

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Speaker 1: isn't it? This is very good. This is very good

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Speaker 1: for for the goaltenders of the New York Rangers. UM.

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Speaker 1: One thing, of course that people were worried about last

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Speaker 1: spring was that he signed on with the Washington Capitals

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Speaker 1: and that that was our one opportunity to get him,

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Speaker 1: But of course it ended up not being. It was

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Speaker 1: a tactical move on his part to get into the layoffs.

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Speaker 1: And yes, Kevin wasn't Kevin was in big demand as

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Speaker 1: one of the top defenseman and and an offensive defenseman

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Speaker 1: at that and UH, he did not go for the

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Speaker 1: top dollar. Everyone knows that he wanted to be a Ranger.

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Speaker 1: He wanted to come home and play for his the

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Speaker 1: team that he grew up with and so there's no

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Speaker 1: doubt he took less money and he took a shorter

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Speaker 1: contract than he could have had elsewhere. I should point out, folks,

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Speaker 1: for those of you that follow basketball, it's the same idea.

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Speaker 1: There's a huge pressure to leave college early, and he

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Speaker 1: stayed at BEU. He could have left be you early. Well,

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Speaker 1: I think he left a year earlier. He left year early.

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Speaker 1: But a lot of other people have to win national championship,

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Speaker 1: I might add, but they leave after their freshman of

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Speaker 1: their sophtware year. He didn't do that. Hockey, it tends

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Speaker 1: to be more I think the more standard situation if

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Speaker 1: you are a college hockey player that Ghost Bros. You

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Speaker 1: typically go after your junior Yearkay, is this a hockey

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Speaker 1: talks so you'll stay around at the end of the show? Okay,

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Speaker 1: very good, Howard Ward, Thank you so much. She's our

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Speaker 1: expert on the New York Rangers, and we're Shuldis here today.

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Speaker 1: I can say without question this is the most important

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Speaker 1: interview for all of us today across economics, finance, and politics.

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Speaker 1: And no, we don't have to talk about the madness

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Speaker 1: of the Beltway. David Schulkin has about eight other things

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Speaker 1: to do besides serve the nation. He does that now

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Speaker 1: in the tinder box known as Veterans Affairs. He is

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Speaker 1: the President's Secretary of Veterans Affairs and has brought a medical,

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Speaker 1: tactical approach to what we do with their veterans. Secretary,

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Speaker 1: wonderful to have you with us, uh today. I remember

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Speaker 1: whatever the Politzer Prize winning article was about the scandal

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Speaker 1: of Walter Reid Hospital a decade ago or whatever. We

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Speaker 1: all have our horror stories of veterans affairs. You've brought

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Speaker 1: a can do, solution braced approach. Give us one example

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Speaker 1: of what you did day one. Well, first of all, Uh,

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Speaker 1: it's good to be here. And I think that the

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Speaker 1: country agrees that we're tired of reading about all the

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Speaker 1: ways that we failed our veterans and it's time to

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Speaker 1: fix this. And everybody agrees on this. This is not

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Speaker 1: a political debate, is it. No, this is really a

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Speaker 1: bipartisan issue. And um, so we're serious about making these changes,

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Speaker 1: and this is something that the President actually ran on

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Speaker 1: and is committed to doing this. So we're doing a

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Speaker 1: lot of things, but one of the things we're making

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Speaker 1: sure is those who have healthcare needs are being seen

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Speaker 1: and being seen in a timely fashion. So we've put

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Speaker 1: into place same day services and every one of our

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Speaker 1: v A medical centers throughout the country for primary care

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Speaker 1: and mental health, and we've also posted all of our

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Speaker 1: weight times for everybody to see. I mean, they don't

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Speaker 1: they scarlet. They don't do that. At the hospital up

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Speaker 1: in Westchester, they don't do that. You know, it's a

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Speaker 1: it's a revolutionary idea. How bureaucratic is it? You did

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Speaker 1: service at the Great Institution in Pittsburgh, you did service here,

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Speaker 1: service there in general medicine, did you expect a bureaucracy

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Speaker 1: of doctors and nurses saying no, no, no, we don't

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Speaker 1: do it that way. Guy, Well, uh, what my experience was,

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Speaker 1: I've spent my entire career in the private sector, so

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Speaker 1: I came expecting it was going to be tough to

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Speaker 1: make change. What I found was was that, um, what

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Speaker 1: the system needed was just new ideas and needed people

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Speaker 1: to show them the way. But people want to be successful,

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Speaker 1: particularly when they work in the v A. Their very

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Speaker 1: mission driven, and when you show them a different way

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Speaker 1: of doing things, they're very open to it. And so

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Speaker 1: I have not found it to be resistant to change.

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Speaker 1: Do you have the institutional support though for UH to

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Speaker 1: make all these changes? You were confirmed by the Senate

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Speaker 1: one zero, which is unheard of in this very partisan

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Speaker 1: environment right now, What kind of support do you have

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Speaker 1: from Congress, from the executive branch. Well, I'm very fortunate

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Speaker 1: that there's just great leadership in Congress. Um are chairman

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Speaker 1: of our committees and our ranking members, both the Democrats

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Speaker 1: and the Republicans are completely united around making the changes necessary.

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Speaker 1: And so when we have our committee hearings, there's of

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Speaker 1: course debate over the right approach, but in the end

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Speaker 1: they get in a room, they decide what the right

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Speaker 1: decision is, and they move forward. And does it matter

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Speaker 1: that you were part of the Obama administration as the

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Speaker 1: Undersecretary or of Health at the Department of Veterans Affairs.

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Speaker 1: Does that play into anything? Well, I think that people

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Speaker 1: understand that I don't approach to this job in a

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Speaker 1: political way. I approach it that this is a job

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Speaker 1: that the country needs to get done, and I'm here

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Speaker 1: to get it done. I also think it does help

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Speaker 1: that people understand that I haven't changed my position on

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Speaker 1: what needs to happen to fix the v A. Whether

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Speaker 1: I was in the administration or in the Trump administration.

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Speaker 1: I think that President Trump wasn't as concerned about anything

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Speaker 1: other than getting this fixed for our veterans. Veterans medicine

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Speaker 1: has been a lightning rode back to the Revolutionary War.

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Speaker 1: Had to be honest, I've got ancestors has fought in

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Speaker 1: this war that warn't forty years later they were trying

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Speaker 1: to get a check cut from somebody like Veterans Affair.

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Speaker 1: Help our audience that believes it's a money pot for

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Speaker 1: anybody that wants to come get it. How is the

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Speaker 1: budget integrity? Folks, we say this about the guy that

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Speaker 1: were in Morristown Memorial Hospital, like a real practicing hospital.

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Speaker 1: How do you handle the cash and the money so

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Speaker 1: that we know it's fair and audited. Well, I think

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Speaker 1: what we've seen over the past couple of administrations is

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Speaker 1: more and more money flowing into v A, and it's

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Speaker 1: not necessarily translated into better service or better results. So

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Speaker 1: I've been very clear, I do not believe that fixing

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Speaker 1: and reforming v A is a money issue. This isn't

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Speaker 1: that we need, um, you know, more funds to get

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Speaker 1: this fixed. What we need are the best practices from

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Speaker 1: the private sector, and we need to modernize the system

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Speaker 1: and in terms of auditing where our money is going.

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Speaker 1: Right now, one of my major initiatives is to bring

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Speaker 1: much more integrity to our fraud wasted abuse systems because

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Speaker 1: I do believe that there are inefficiencies and areas that

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Speaker 1: we do need to audit much closer to make sure

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Speaker 1: taxpayers are getting the best value. Well, speaking of modernizing

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Speaker 1: the system, there are a lot of concerns for anyone

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Speaker 1: who runs a huge bureaucracy about how to protect your

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Speaker 1: system from cyber from hacking. What are you doing on

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Speaker 1: that and how do you make the v A department

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Speaker 1: hack proof or as hack proof as possible. Yeah, I

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Speaker 1: wish that there was a way to be hack proof.

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Speaker 1: But we have invested significantly in the last few years

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Speaker 1: in cybersecurity, and we have systems in place that I

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Speaker 1: feel confident in. We essentially identify and protect against thousands

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Speaker 1: of threats every day, and some of the recent threats

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Speaker 1: that have hit hospitals we have been able to detect

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Speaker 1: and stop. So you've you've it's been tested several times,

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Speaker 1: absolutely tested every day. Your father had the courage to

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Speaker 1: deal with psychiatry. I believe it forth shared and ages ago.

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Speaker 1: This is a very delicate topic, the psychiatric framework of

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Speaker 1: our veterans, the trauma of battle and combat. What is

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Speaker 1: the new new there? We've been fighting two wars and

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Speaker 1: what I noticed, Sir, is the is the chronic nature

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Speaker 1: of a year after your commitment to Afghanistan interact. What

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Speaker 1: will the v A do on the mental health front

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Speaker 1: to assist these people? Well, first of all, when I

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Speaker 1: talk about the priorities that I have a secretary, there's

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Speaker 1: only one clinical area that I talk about, and that

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Speaker 1: is reducing veterans suicide. Twenty veterans a day are taking

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Speaker 1: their life, which is really just a statistic that just

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Speaker 1: hard to ever get used to accepting. And so we

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Speaker 1: are focused on this in a way that unlike any

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Speaker 1: other problem that we have in the v A UM,

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Speaker 1: no other system is doing as much for behavioral health

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Speaker 1: as the v A. And having said that, we have

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Speaker 1: to be doing more, and that more includes reaching out

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Speaker 1: to the community, making sure that we're involving family members

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Speaker 1: and others in veterans lives, making sure that they're getting

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Speaker 1: access in the right treatment, but also additional research so

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Speaker 1: that we can find way is to make sure that

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Speaker 1: we have more effective treatments. Obviously for those who have

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Speaker 1: fought on the front lines, there's a lot of damage

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Speaker 1: done to you. If you've been at the forefront of

430
00:24:09,840 --> 00:24:13,400
Speaker 1: the fighting. What about from drone attacks? What kind of

431
00:24:13,720 --> 00:24:16,800
Speaker 1: psychological impact does that have? Have you started to see

432
00:24:16,840 --> 00:24:21,560
Speaker 1: that yet, Yes, we have UM. I believe that UM.

433
00:24:21,600 --> 00:24:25,800
Speaker 1: In every war, there's a different way of experiencing conflict.

434
00:24:25,920 --> 00:24:29,200
Speaker 1: Of course, in our most recent conflicts, they have been

435
00:24:29,240 --> 00:24:31,840
Speaker 1: the I E. D s that have caused not only

436
00:24:31,960 --> 00:24:38,240
Speaker 1: tremendous physical damage, but significant invisible wounds and emotional damage.

437
00:24:38,760 --> 00:24:42,719
Speaker 1: And so in drones it's a very similar type of

438
00:24:43,440 --> 00:24:47,120
Speaker 1: emotional experience as an I E. D. You're having UH

439
00:24:47,280 --> 00:24:52,040
Speaker 1: devices come out of nowhere UH and surprise attacks, and

440
00:24:52,119 --> 00:24:56,000
Speaker 1: so it causes an emotional startle reaction that is very

441
00:24:56,040 --> 00:24:58,600
Speaker 1: similar to what we see in post traumatic stress. You

442
00:24:58,640 --> 00:25:01,200
Speaker 1: think you're visiting us today, David Schalkin Folks is the

443
00:25:01,320 --> 00:25:05,600
Speaker 1: ninth United States Secretary for veteran MR Secretary. Look forward

444
00:25:05,600 --> 00:25:09,280
Speaker 1: to seeing our studios at Washington as well. David Short,

445
00:25:09,359 --> 00:25:19,920
Speaker 1: Conductor Schulkin, thank you, Brunch you by Bank of America,

446
00:25:20,000 --> 00:25:24,960
Speaker 1: Mary Lynch. With virtual reality, virtually everything will change, discover

447
00:25:25,040 --> 00:25:29,440
Speaker 1: opportunities in a transforming world b of a mL dot

448
00:25:29,440 --> 00:25:34,800
Speaker 1: Com slash VR, Mary Lynch, Pierced Fentner and Smith Incorporated.

449
00:25:40,640 --> 00:25:43,359
Speaker 1: That wasn't David Gurria heard that was Scarlet Foo and

450
00:25:43,480 --> 00:25:46,280
Speaker 1: I told her, if the Rangers pick up Kevin Shatton Kirk,

451
00:25:46,359 --> 00:25:48,760
Speaker 1: you have to host. We did that with Howard Ward.

452
00:25:48,760 --> 00:25:50,600
Speaker 1: Thank you to Howard Ward for and I'm going to

453
00:25:50,640 --> 00:25:54,040
Speaker 1: be here all week as a results resul. We talked

454
00:25:54,040 --> 00:25:56,560
Speaker 1: about the Rangers and this big trade they had for

455
00:25:56,720 --> 00:25:59,760
Speaker 1: Mr Schatton Kirk and so then Scarlett will stay through

456
00:25:59,800 --> 00:26:02,320
Speaker 1: the which is a good thing. Mr Gurra on assignment

457
00:26:02,800 --> 00:26:07,119
Speaker 1: and has it been a Gura siding Scarlet? You know

458
00:26:07,200 --> 00:26:09,280
Speaker 1: what he did post on Instagram. I did spot some

459
00:26:09,400 --> 00:26:13,200
Speaker 1: kale in the background. So he's he's holding true to

460
00:26:13,280 --> 00:26:16,439
Speaker 1: what he normally does. Yeah. Um, Doug Bondo with us

461
00:26:16,560 --> 00:26:20,480
Speaker 1: with a Cato Institute libertarian some would say more conservative,

462
00:26:21,000 --> 00:26:24,040
Speaker 1: but on an idea that that is away from the

463
00:26:24,200 --> 00:26:28,280
Speaker 1: normal budget things of the Cato Institute, and that's North Korea.

464
00:26:28,320 --> 00:26:32,240
Speaker 1: He's senior fellow. Uh, working a few years ago with

465
00:26:32,320 --> 00:26:36,080
Speaker 1: President Reagan. That ages him right there. We're thrilled that

466
00:26:36,160 --> 00:26:40,080
Speaker 1: he's with us right now. Uh, Doug, wonderful to have

467
00:26:40,200 --> 00:26:43,560
Speaker 1: you with us. What is the distinctive CATO view on

468
00:26:43,760 --> 00:26:48,119
Speaker 1: how we should adapt and adjust to a unique North Korea.

469
00:26:49,400 --> 00:26:51,680
Speaker 1: I think we have to kind of look for some

470
00:26:51,800 --> 00:26:54,800
Speaker 1: alternatives to the current policy that we're at. I mean,

471
00:26:54,880 --> 00:26:57,680
Speaker 1: the North Korea is a very problematic actor, and no

472
00:26:57,840 --> 00:27:00,520
Speaker 1: one that I know of wants them to have nuclear weapons.

473
00:27:01,280 --> 00:27:03,760
Speaker 1: But the reality is they want them, not because they're

474
00:27:03,800 --> 00:27:06,879
Speaker 1: crazy and nubs. They want them, I think largely because

475
00:27:06,960 --> 00:27:08,840
Speaker 1: they fear the US and view this is being the

476
00:27:08,920 --> 00:27:12,360
Speaker 1: best to terror possible. You know, they've looked at Afghanistan,

477
00:27:12,440 --> 00:27:14,920
Speaker 1: They've looked at the Rock, They've looked at Libya, where

478
00:27:15,400 --> 00:27:19,440
Speaker 1: the more market Dafi negotiates away his nuclear weapons and

479
00:27:19,680 --> 00:27:22,639
Speaker 1: his missiles, and as soon as the opportunity arises, the U.

480
00:27:22,800 --> 00:27:25,159
Speaker 1: S And Europe helped take him out. You know, this

481
00:27:25,320 --> 00:27:28,119
Speaker 1: is a regime that's committed to moving ahead. You know,

482
00:27:28,200 --> 00:27:30,840
Speaker 1: it's not at all clear that even sanctions supported by

483
00:27:30,920 --> 00:27:33,919
Speaker 1: China would necessarily stop them. We don't have any good

484
00:27:33,960 --> 00:27:37,240
Speaker 1: options here for more threats we make, frankly, the more

485
00:27:37,359 --> 00:27:40,440
Speaker 1: justification we give them from building unclear weapons. One of

486
00:27:40,480 --> 00:27:43,600
Speaker 1: the characters of your note is you worry less about

487
00:27:43,720 --> 00:27:46,399
Speaker 1: bombing Alaska or for that matter, the circle of that

488
00:27:47,040 --> 00:27:49,320
Speaker 1: missile if they ever developed it would go to Ueen,

489
00:27:49,480 --> 00:27:53,760
Speaker 1: Queensland in Australia. And you take a real interest in

490
00:27:53,880 --> 00:27:57,960
Speaker 1: the border between North North Korea North Carolina. Help me,

491
00:27:58,000 --> 00:28:01,800
Speaker 1: Scarlet nor I stayed up for the home run. Yeah,

492
00:28:01,840 --> 00:28:04,359
Speaker 1: this is your speechless after the home in Derby, Doug,

493
00:28:04,480 --> 00:28:08,680
Speaker 1: I look at the China border. It's really the first

494
00:28:08,880 --> 00:28:12,639
Speaker 1: order condition give us an update. As you see that

495
00:28:12,960 --> 00:28:16,680
Speaker 1: river between China and North Korea, Well, the Allu is

496
00:28:16,760 --> 00:28:19,520
Speaker 1: not much of a barrier. You know, the North Koreans

497
00:28:19,520 --> 00:28:22,000
Speaker 1: are working harder now to stop people from going across.

498
00:28:22,080 --> 00:28:24,680
Speaker 1: But what if you want Chinese support? What you have

499
00:28:24,760 --> 00:28:28,000
Speaker 1: to recognize. China looks at that and thinks, oh boy,

500
00:28:28,480 --> 00:28:31,880
Speaker 1: we put sanctions on North Korea, collapses, we get five

501
00:28:31,960 --> 00:28:35,480
Speaker 1: million refugees across the Yalu, we get factional fighting, we

502
00:28:35,560 --> 00:28:39,040
Speaker 1: get maybe military combat, you know, we get stuff flowing across.

503
00:28:39,640 --> 00:28:42,160
Speaker 1: This is not good for us. They also look at

504
00:28:42,240 --> 00:28:44,520
Speaker 1: that and say, you know, isn't that nice? The US

505
00:28:44,640 --> 00:28:47,400
Speaker 1: wants us to essentially give them North Korea so they

506
00:28:47,440 --> 00:28:50,200
Speaker 1: can have a United Korea aligned with America and US

507
00:28:50,240 --> 00:28:53,080
Speaker 1: troops on the Yalu. We went to war in nineteen fifty.

508
00:28:53,200 --> 00:28:55,880
Speaker 1: Stop that. You know, we're trying to put pressure on

509
00:28:56,040 --> 00:28:59,760
Speaker 1: China without acknowledging why they view this as a security interest,

510
00:29:00,360 --> 00:29:03,560
Speaker 1: and again very problematic. Unless you're willing to acknowledge what

511
00:29:03,840 --> 00:29:06,200
Speaker 1: is motivating them, it's very hard to get them on

512
00:29:06,440 --> 00:29:10,320
Speaker 1: our side. You just came back from North Korea as well,

513
00:29:10,400 --> 00:29:12,440
Speaker 1: didn't you. That's what I was there a month ago.

514
00:29:12,960 --> 00:29:15,920
Speaker 1: What did you observe. I mean, there's obviously the official version,

515
00:29:16,120 --> 00:29:19,240
Speaker 1: what the Korean officials want you to see, want you

516
00:29:19,360 --> 00:29:25,080
Speaker 1: to report back on, versus what you saw in the undercurrent. Well,

517
00:29:25,160 --> 00:29:27,480
Speaker 1: let's say interesting, I was there twenty five years ago.

518
00:29:27,560 --> 00:29:29,959
Speaker 1: I mean peong Yang has changed a lot. I mean

519
00:29:30,040 --> 00:29:32,959
Speaker 1: it's much more kind of money. Their newer buildings, has

520
00:29:33,040 --> 00:29:36,960
Speaker 1: private automobiles, people have cell phones. You know, women dressed

521
00:29:37,080 --> 00:29:39,320
Speaker 1: very nice. They were very plain twenty five years ago.

522
00:29:39,680 --> 00:29:41,840
Speaker 1: Men are still very plain. But you know that there

523
00:29:41,880 --> 00:29:45,400
Speaker 1: are changes that suggests there's money, and to some extent

524
00:29:45,520 --> 00:29:47,320
Speaker 1: that's good in the sense that it suggests they have

525
00:29:47,440 --> 00:29:50,040
Speaker 1: something to lose, and the other hand, it also shows

526
00:29:50,080 --> 00:29:53,520
Speaker 1: that they've done reasonably well despite the sanctions. Regime, you know,

527
00:29:53,600 --> 00:29:55,920
Speaker 1: reasonably well over the years, despite you know, all of

528
00:29:56,000 --> 00:29:58,160
Speaker 1: the pressure of the US has put on them. You know,

529
00:29:58,240 --> 00:30:01,360
Speaker 1: the consistent message I got to that, you know, was

530
00:30:01,520 --> 00:30:04,440
Speaker 1: they look at this as being you Americans who put

531
00:30:04,520 --> 00:30:07,640
Speaker 1: pressure on us, threatened us. We're doing this because we're

532
00:30:07,720 --> 00:30:09,320
Speaker 1: we don't like that, and we're afraid of that. We're

533
00:30:09,320 --> 00:30:11,840
Speaker 1: gonna match nuke for nuke, as they put it. And

534
00:30:11,920 --> 00:30:14,240
Speaker 1: it struck me that as part of the challenge, which is,

535
00:30:14,600 --> 00:30:16,720
Speaker 1: you know, they look at this as being a national

536
00:30:16,840 --> 00:30:19,680
Speaker 1: security you should they don't. You know, this is a

537
00:30:19,760 --> 00:30:23,120
Speaker 1: weird political system and there's one person there. It's Kim

538
00:30:23,200 --> 00:30:26,760
Speaker 1: Jong un, the supreme leader. He's the guy everybody refers to,

539
00:30:27,440 --> 00:30:30,920
Speaker 1: you know. But despite that, it doesn't mean they're not rational.

540
00:30:31,320 --> 00:30:33,720
Speaker 1: I mean, they're evil, but they're not crazy. And I

541
00:30:33,800 --> 00:30:36,000
Speaker 1: think that's the problem of the US as yet to

542
00:30:36,080 --> 00:30:39,400
Speaker 1: really address their reasons why they do what they do.

543
00:30:40,160 --> 00:30:42,600
Speaker 1: That came out of the meetings I had very consistently.

544
00:30:43,200 --> 00:30:45,160
Speaker 1: You know, there's an argument and I think you referred

545
00:30:45,160 --> 00:30:46,920
Speaker 1: to it as well, that some people make about how

546
00:30:46,960 --> 00:30:50,040
Speaker 1: the US could just accept the reality of North Korea

547
00:30:50,280 --> 00:30:53,720
Speaker 1: having nuclear weapons. Um, we spent more than a decade

548
00:30:53,840 --> 00:30:56,800
Speaker 1: before finally acknowledging, for instance, that Indian Pakistan have nuclear

549
00:30:56,880 --> 00:30:59,720
Speaker 1: weapons for us to get there, what would need to

550
00:30:59,760 --> 00:31:02,160
Speaker 1: have then? Well, I think that what we need to

551
00:31:02,280 --> 00:31:04,600
Speaker 1: look at, you know, is the question of do we

552
00:31:04,680 --> 00:31:07,360
Speaker 1: think it's possible. Again, this is the issue of bringing

553
00:31:07,480 --> 00:31:11,360
Speaker 1: China in, you know, to get a verifiable freeze on activity.

554
00:31:11,880 --> 00:31:14,360
Speaker 1: I don't think they will ever voluntarily give them up,

555
00:31:14,760 --> 00:31:16,360
Speaker 1: you know. So then the question is is can you

556
00:31:16,440 --> 00:31:18,959
Speaker 1: put pressure on the regime, can you destroy it? Can

557
00:31:19,040 --> 00:31:21,760
Speaker 1: you get regime change? All of those are things which

558
00:31:21,800 --> 00:31:26,040
Speaker 1: frankly everybody would like, but the process of getting there

559
00:31:26,080 --> 00:31:28,840
Speaker 1: is what scares the Chinese. So could we come up

560
00:31:28,880 --> 00:31:31,719
Speaker 1: with this process and say, look, the reality is they

561
00:31:31,800 --> 00:31:34,240
Speaker 1: have them. I mean we're talking perhaps twenty or so. Now,

562
00:31:34,960 --> 00:31:37,080
Speaker 1: how better if you could freeze that to deal with

563
00:31:37,200 --> 00:31:39,080
Speaker 1: them a few years from now and they have a

564
00:31:39,160 --> 00:31:41,880
Speaker 1: hundred and they're still building more. Those are two very

565
00:31:41,960 --> 00:31:48,280
Speaker 1: different scenarios, Doug, is our traditional military off the coast

566
00:31:48,360 --> 00:31:51,680
Speaker 1: of North Korea? Is there a benefit to that? I

567
00:31:51,760 --> 00:31:54,960
Speaker 1: think of six thousand sixty two is the crew of

568
00:31:55,080 --> 00:31:57,080
Speaker 1: the Carl Vincent. I don't know if that's the number.

569
00:31:57,120 --> 00:32:00,600
Speaker 1: That's what Wikipedia says, but does it does it matter

570
00:32:00,720 --> 00:32:03,400
Speaker 1: that the Navy has planted off North Korea again as

571
00:32:03,440 --> 00:32:07,200
Speaker 1: a deterrent? Well, I mean the problem here is the

572
00:32:07,280 --> 00:32:10,720
Speaker 1: North Koreans, I don't believe have any interest in starting

573
00:32:10,800 --> 00:32:15,040
Speaker 1: a war. They know they lose. So sending another aircraft

574
00:32:15,080 --> 00:32:17,760
Speaker 1: carrier there's you know, sending B two bombers flying over

575
00:32:18,400 --> 00:32:21,280
Speaker 1: in and of itself is probably more relevant to South

576
00:32:21,360 --> 00:32:23,560
Speaker 1: Korea than North Korea. That is, if you want to

577
00:32:23,640 --> 00:32:27,160
Speaker 1: reassure the South Koreans were there, It doesn't. It doesn't

578
00:32:27,200 --> 00:32:30,120
Speaker 1: really tell the North Koreans anything. They don't know. You know,

579
00:32:30,200 --> 00:32:32,280
Speaker 1: they know the U s could bombom them out of existence.

580
00:32:32,280 --> 00:32:34,000
Speaker 1: And we don't even have to have an aircraft carrier

581
00:32:34,040 --> 00:32:36,360
Speaker 1: that we could use. I mean, if we really wanted to,

582
00:32:36,480 --> 00:32:40,240
Speaker 1: we could use nuclear weapons on our cb ms. So

583
00:32:40,360 --> 00:32:44,560
Speaker 1: the question is what are you achieving anything in terms

584
00:32:44,640 --> 00:32:46,880
Speaker 1: of the North Are you making them more pliable? I

585
00:32:46,920 --> 00:32:49,400
Speaker 1: think the answer is no. So then the question, well,

586
00:32:49,440 --> 00:32:51,760
Speaker 1: does it help with China? Does it help with South Korea?

587
00:32:52,360 --> 00:32:55,280
Speaker 1: Those are the questions you've really got to ask. I

588
00:32:55,600 --> 00:32:57,680
Speaker 1: do think the problem is that when you're out there

589
00:32:57,720 --> 00:32:59,840
Speaker 1: saying we planned to bomb them, we're going to threaten them.

590
00:32:59,840 --> 00:33:04,080
Speaker 1: We're thinking preemptive action. From this standpoint, if the US

591
00:33:04,200 --> 00:33:07,160
Speaker 1: is thinking about launching a preventive war, that's an even

592
00:33:07,280 --> 00:33:09,479
Speaker 1: good better reason to have a missile that could hit

593
00:33:09,520 --> 00:33:13,400
Speaker 1: the US. So the US knows there's a cost to that. Well,

594
00:33:13,480 --> 00:33:17,240
Speaker 1: let's thank you so much. We look forward to continuous discussion. Unfortunately,

595
00:33:17,280 --> 00:33:20,440
Speaker 1: I think we will given the news flow. That's other UH.

596
00:33:20,960 --> 00:33:23,720
Speaker 1: It's out there. Mr Bando's with a CATO Institute their

597
00:33:23,760 --> 00:33:28,160
Speaker 1: senior fellow, and we speak on our international relations with

598
00:33:28,320 --> 00:33:44,200
Speaker 1: North Korea. It was a few years ago and it

599
00:33:44,320 --> 00:33:49,760
Speaker 1: was an important discussion and essay commitment, rules and discretion.

600
00:33:50,480 --> 00:33:54,280
Speaker 1: Charles Plasser has said this for his career, this at CATO,

601
00:33:54,800 --> 00:33:57,320
Speaker 1: but also really across every other speech as a former

602
00:33:57,360 --> 00:34:01,479
Speaker 1: president of the Federal Reserve System in Piladelphia. Professor Plaster

603
00:34:01,600 --> 00:34:06,040
Speaker 1: joins us UH. Now Charles Plaster is Randall Corals is

604
00:34:06,160 --> 00:34:09,759
Speaker 1: vice Chairman and regulation is he the beginning of a

605
00:34:09,920 --> 00:34:15,920
Speaker 1: rules based Trump Federal Reserve System. Good morning, Tom, It's

606
00:34:15,920 --> 00:34:18,120
Speaker 1: good to be with you as always, and I'm very

607
00:34:18,200 --> 00:34:22,040
Speaker 1: pleased with the appointment, our nomination of Randy Quarrels. I

608
00:34:22,120 --> 00:34:24,960
Speaker 1: think he's going to be a great addition to the board.

609
00:34:25,200 --> 00:34:31,200
Speaker 1: And um so I'm actually a very UH encouraged by

610
00:34:32,200 --> 00:34:34,960
Speaker 1: his his nomination and I think he'll be a great addition,

611
00:34:35,120 --> 00:34:38,920
Speaker 1: particularly in supervisionary. See that he didn't he didn't answer

612
00:34:39,000 --> 00:34:41,880
Speaker 1: my question. He ploster is taped to answer around it,

613
00:34:42,239 --> 00:34:44,839
Speaker 1: just like a pro FEDERSTI come on, come on, Charl,

614
00:34:44,920 --> 00:34:48,160
Speaker 1: We've known each other forever. Randy Corals has published on

615
00:34:48,360 --> 00:34:52,840
Speaker 1: rules based UH advantages are we Is this the beginning

616
00:34:52,880 --> 00:34:57,320
Speaker 1: of a rules based Trump Federal Reserve? Readjust it's I

617
00:34:57,440 --> 00:35:00,440
Speaker 1: think Randy can contribute to that debate and how push

618
00:35:00,680 --> 00:35:03,520
Speaker 1: the debate along, as you know, As you said, I've

619
00:35:03,640 --> 00:35:06,120
Speaker 1: tried to push this along for many, many years. It's

620
00:35:06,120 --> 00:35:08,759
Speaker 1: not it's an uphill battle. But I do think that

621
00:35:08,920 --> 00:35:11,279
Speaker 1: he will be a contribute to help do that, and

622
00:35:11,400 --> 00:35:13,920
Speaker 1: I think depends on what other appointments are made and

623
00:35:14,000 --> 00:35:19,160
Speaker 1: other things that um I'm hopeful that we can make

624
00:35:19,239 --> 00:35:21,600
Speaker 1: progress in that direction with Randy. I think it very

625
00:35:21,680 --> 00:35:23,680
Speaker 1: much depends on what other poems are made. And I'm

626
00:35:23,680 --> 00:35:27,200
Speaker 1: glad you bring that up because our Bloomberg Intelligence analysts

627
00:35:27,520 --> 00:35:30,040
Speaker 1: Nathan Dean and Ben Elliott have made the point that

628
00:35:30,560 --> 00:35:33,600
Speaker 1: Randy Karl's as the Fed Vice Chair for Supervision would

629
00:35:33,600 --> 00:35:36,600
Speaker 1: have limited clout as long as Janet Yellen is chair

630
00:35:37,200 --> 00:35:39,680
Speaker 1: um and of course he still needs to be confirmed

631
00:35:39,719 --> 00:35:41,760
Speaker 1: as well, so his start day may not be until

632
00:35:41,920 --> 00:35:44,680
Speaker 1: fourth quarter or later. What does he do in the

633
00:35:44,800 --> 00:35:52,520
Speaker 1: meantime to get his ducks in order? Who, Yeah, he's

634
00:35:52,520 --> 00:35:56,120
Speaker 1: got He's got to prepare for confirmation hearings, and that's

635
00:35:56,400 --> 00:36:01,120
Speaker 1: that's a huge undertaking for anybody. So he has he has, Uh,

636
00:36:01,200 --> 00:36:02,960
Speaker 1: he has a lot of work work to do. I

637
00:36:03,000 --> 00:36:06,799
Speaker 1: suspect in preparing himself for that, both for questions coming

638
00:36:06,960 --> 00:36:11,080
Speaker 1: from on on the regulatory side and supervision, but also

639
00:36:11,160 --> 00:36:14,480
Speaker 1: on monetary policy. So I think he has he has

640
00:36:14,719 --> 00:36:16,719
Speaker 1: a lot of homework to do, But I think he's

641
00:36:16,760 --> 00:36:21,040
Speaker 1: perfectly capable and a good person for this. What would

642
00:36:21,080 --> 00:36:23,760
Speaker 1: be his first order of business presuming he is confirmed

643
00:36:23,920 --> 00:36:28,839
Speaker 1: and Janet Yellin is still sent share. I think he's

644
00:36:29,160 --> 00:36:34,000
Speaker 1: certainly on the supervision side. Uh, he is vice chair

645
00:36:34,080 --> 00:36:37,160
Speaker 1: for Supervision and he will have a lot of responsibility

646
00:36:37,239 --> 00:36:42,360
Speaker 1: about how the supervisory process unfold, how the set approaches

647
00:36:42,400 --> 00:36:46,359
Speaker 1: regulatory issues, whether they cut back on things like UH

648
00:36:47,160 --> 00:36:50,879
Speaker 1: reviews of community banks and and I means there's lots

649
00:36:50,920 --> 00:36:53,000
Speaker 1: of things on the table. Dance Rule left the whole

650
00:36:53,080 --> 00:36:55,600
Speaker 1: menu of things in his last speech about things that

651
00:36:55,680 --> 00:36:59,160
Speaker 1: the FEND needed to consider. So I think there's a

652
00:36:59,239 --> 00:37:03,120
Speaker 1: lot of opportunities he can his leadership can do. Professor

653
00:37:03,200 --> 00:37:07,160
Speaker 1: Plats or cher Yelling, will will speak, will have testimony

654
00:37:07,239 --> 00:37:11,760
Speaker 1: tomorrow before the House. Is she presenting a limited central bank?

655
00:37:12,360 --> 00:37:14,360
Speaker 1: Or is a central bank of which you remember for

656
00:37:14,440 --> 00:37:17,279
Speaker 1: a bit, would you suggest they have overreached and be

657
00:37:17,400 --> 00:37:23,799
Speaker 1: gone and gone beyond your acclaimed phrase a limited central bank? Well,

658
00:37:23,840 --> 00:37:26,839
Speaker 1: I take the central central banks around the world have overreached,

659
00:37:26,880 --> 00:37:29,480
Speaker 1: and I think it's it's it's very dangerous. And it's

660
00:37:29,480 --> 00:37:32,120
Speaker 1: because then the risks we face in the coming years

661
00:37:32,160 --> 00:37:34,640
Speaker 1: of the consequences of that could be long time. What

662
00:37:34,760 --> 00:37:36,799
Speaker 1: could be felt. Are the risks there that we need

663
00:37:36,880 --> 00:37:38,960
Speaker 1: to be a coordinated action. As we see out of

664
00:37:39,000 --> 00:37:43,719
Speaker 1: Portugal a few weeks ago. Will coordination diminished the overreach

665
00:37:43,840 --> 00:37:48,719
Speaker 1: of central banks? No? In fact, I'm afraid that if

666
00:37:48,760 --> 00:37:51,719
Speaker 1: their efforts, if their efforts to coordinate, it will be

667
00:37:52,640 --> 00:37:55,600
Speaker 1: quite the opposite, because they'll be central banks reacting to

668
00:37:55,680 --> 00:37:58,719
Speaker 1: what other central banks are doing in other countries. And

669
00:37:59,239 --> 00:38:01,440
Speaker 1: you know who's to say, do I reacted. Does the

670
00:38:01,480 --> 00:38:03,920
Speaker 1: Central Bank react to Portugal to the act of ECB,

671
00:38:04,440 --> 00:38:08,279
Speaker 1: the react to Russia. It's just it's I think that's

672
00:38:08,280 --> 00:38:11,480
Speaker 1: a dangerous path to go down. The coordination ought to be.

673
00:38:11,640 --> 00:38:16,640
Speaker 1: Setting setting common inflation targets would be a better way

674
00:38:16,680 --> 00:38:19,399
Speaker 1: at form of coordination. Charles Plaster, thank you so much.

675
00:38:19,440 --> 00:38:22,600
Speaker 1: He's a former president of the Fullers Bank of Philadelphia,

676
00:38:22,600 --> 00:38:26,680
Speaker 1: of course associated with Chicago, Vanderbilt, and of course with

677
00:38:26,800 --> 00:38:30,600
Speaker 1: his years at Rochester and the Simon School or Mr

678
00:38:30,640 --> 00:38:33,080
Speaker 1: Kachel Coote as a shingle out. I believe at the

679
00:38:33,120 --> 00:38:47,560
Speaker 1: moment we are honored to bringing out someone that David

680
00:38:47,600 --> 00:38:49,600
Speaker 1: Remnick wrote about. I believe it was yesterday for the

681
00:38:49,640 --> 00:38:53,399
Speaker 1: New Yorker magazine. Let me quote completely. There has also

682
00:38:53,480 --> 00:38:56,360
Speaker 1: been a great deal of solid journalism committed by Adam

683
00:38:56,480 --> 00:39:00,120
Speaker 1: Davidson of The New Yorker, Timothy O'Brien of Bloomberg and

684
00:39:00,239 --> 00:39:04,120
Speaker 1: others on Trump's business history and his links to etcetera, etcetera.

685
00:39:04,520 --> 00:39:07,560
Speaker 1: Not joining us from Bloomberg view Timothy O'Brien, Tim, I'm

686
00:39:07,560 --> 00:39:09,480
Speaker 1: gonna go to the heart of your reporting and the

687
00:39:09,600 --> 00:39:12,400
Speaker 1: heart of your acclaim. I'm looking at the president of

688
00:39:12,400 --> 00:39:15,319
Speaker 1: the United States. In your acclaim book of years ago,

689
00:39:15,400 --> 00:39:18,400
Speaker 1: you said, this guy is not as rich is we

690
00:39:18,600 --> 00:39:22,080
Speaker 1: think we are. With everything that's going on. Do you

691
00:39:22,280 --> 00:39:25,040
Speaker 1: have a sense or do you have reporting that there

692
00:39:25,080 --> 00:39:29,680
Speaker 1: were agreements made with outside parties because he wasn't that

693
00:39:29,880 --> 00:39:32,560
Speaker 1: well off. Were there periods in oh eight, oh seven,

694
00:39:32,640 --> 00:39:35,040
Speaker 1: oh nine, or he had to sign some kind of deal.

695
00:39:35,480 --> 00:39:37,000
Speaker 1: I mean, I think if you look at his his

696
00:39:37,120 --> 00:39:40,160
Speaker 1: business career, Tom he hits the skids in the late

697
00:39:40,239 --> 00:39:43,080
Speaker 1: eighties and early nineties, He loses the real estate, he

698
00:39:43,239 --> 00:39:45,840
Speaker 1: ends up giving up a big chunk at the casinos,

699
00:39:45,920 --> 00:39:49,440
Speaker 1: and from the early nineties really until The Apprentice launches

700
00:39:49,680 --> 00:39:53,440
Speaker 1: in two thousand and four, Um, the large banks have

701
00:39:53,520 --> 00:39:56,880
Speaker 1: shunned him. He's lost most of his key holdings, and

702
00:39:56,960 --> 00:40:00,400
Speaker 1: he's really willing to do deals almost any Boddy who

703
00:40:00,440 --> 00:40:02,600
Speaker 1: walks into Trump Tower. I mean, so much of this,

704
00:40:02,800 --> 00:40:05,320
Speaker 1: And there was a great essay today about just the facts.

705
00:40:05,440 --> 00:40:08,560
Speaker 1: Just what everybody just get back to, you know, reporting

706
00:40:08,600 --> 00:40:11,160
Speaker 1: and not getting ahead of the facts, like Woodward and

707
00:40:11,239 --> 00:40:14,320
Speaker 1: Bernstein ran into some trouble even with Watergate. To you

708
00:40:14,640 --> 00:40:19,800
Speaker 1: animals who are doing adult journalism, what's the focus in

709
00:40:19,840 --> 00:40:23,120
Speaker 1: the cacophony of Washington right now, What are the pros

710
00:40:23,280 --> 00:40:26,920
Speaker 1: focusing on who are grinding the story out every day?

711
00:40:27,160 --> 00:40:29,560
Speaker 1: I think it's always got to be on the money trail, Tom.

712
00:40:29,640 --> 00:40:32,560
Speaker 1: I think it's this is an old adage, follow the

713
00:40:32,600 --> 00:40:35,719
Speaker 1: money in journalism, but it's it is the source of

714
00:40:35,840 --> 00:40:40,880
Speaker 1: power and influence ultimately in all things. And um I

715
00:40:41,040 --> 00:40:43,560
Speaker 1: think that that's a very fruitful path to people to

716
00:40:43,640 --> 00:40:46,080
Speaker 1: stay on with Trump. We've obviously looked at it here

717
00:40:46,080 --> 00:40:48,759
Speaker 1: a bloomberg in terms of both his and his son

718
00:40:48,840 --> 00:40:54,000
Speaker 1: in law and his children's relationships with UM Russian business partners,

719
00:40:54,280 --> 00:40:59,240
Speaker 1: and and funds that have come through unexpected locales like Iceland.

720
00:41:00,040 --> 00:41:02,640
Speaker 1: When we look at the fact that this is Don

721
00:41:03,080 --> 00:41:07,400
Speaker 1: Trump Jr. Who has reportedly had these conversations, can we

722
00:41:08,040 --> 00:41:11,279
Speaker 1: presume that the president directed any of this or is

723
00:41:11,320 --> 00:41:13,520
Speaker 1: it something where Donald Trump Jr. Acted out on his

724
00:41:13,600 --> 00:41:15,520
Speaker 1: own accord that he did it on his own and

725
00:41:16,239 --> 00:41:18,439
Speaker 1: there was a Chinese wall between him and his father.

726
00:41:19,040 --> 00:41:21,160
Speaker 1: I don't think we should presume anything, Scarlett, I think

727
00:41:21,200 --> 00:41:25,000
Speaker 1: we should wait for the facts. Having said that, there's

728
00:41:25,040 --> 00:41:27,760
Speaker 1: never really been a Chinese wall between Donald Trump Junior

729
00:41:27,800 --> 00:41:31,279
Speaker 1: and his father in their whole existence um in fact

730
00:41:31,360 --> 00:41:33,960
Speaker 1: in uh in the In the last one of the

731
00:41:34,040 --> 00:41:36,920
Speaker 1: last articles I wrote about the Trump family's relations with

732
00:41:37,200 --> 00:41:40,920
Speaker 1: Russian business partners, one of Trump's old business partners gave

733
00:41:40,960 --> 00:41:43,719
Speaker 1: me this very great quote, a guy named Jody Chris,

734
00:41:43,800 --> 00:41:46,320
Speaker 1: about how Donald Jr. And his father operated, and he

735
00:41:46,400 --> 00:41:49,640
Speaker 1: said Donald was always in charge. Donald had to agree

736
00:41:49,640 --> 00:41:51,799
Speaker 1: to every term of every deal and had to sign

737
00:41:51,880 --> 00:41:54,719
Speaker 1: off on everything. Nothing happened unless he said it was

738
00:41:54,840 --> 00:41:57,960
Speaker 1: okay to do it. Even if Donald Jr. Shook your

739
00:41:58,000 --> 00:42:01,040
Speaker 1: hand on a deal, he came back downs renegotiate if

740
00:42:01,080 --> 00:42:03,640
Speaker 1: his father told him to. And that would be the

741
00:42:03,719 --> 00:42:07,040
Speaker 1: case now as well. Oh, I'm certain of it. Yeah,

742
00:42:07,120 --> 00:42:11,160
Speaker 1: And I think they've had very flimsy um trust set

743
00:42:11,239 --> 00:42:15,520
Speaker 1: up to insulate the family business from White House decision making.

744
00:42:15,880 --> 00:42:19,040
Speaker 1: I don't. I I think they've shown actually disdain for

745
00:42:19,239 --> 00:42:22,280
Speaker 1: having strong barriers between their business life and their pology.

746
00:42:23,280 --> 00:42:27,320
Speaker 1: Your new essay in Bloomberg Few I think encapsulates great

747
00:42:27,680 --> 00:42:30,839
Speaker 1: defining presidential downward. And we have many people listening who

748
00:42:30,840 --> 00:42:34,240
Speaker 1: are supporters of the president, many people who have levels

749
00:42:34,360 --> 00:42:38,080
Speaker 1: of outrage. How do you perceive Tim O'Brien, the counsel

750
00:42:38,719 --> 00:42:41,640
Speaker 1: that he's receiving within the White House, and let me

751
00:42:41,800 --> 00:42:46,359
Speaker 1: reverse that, how alone is his president? Um, he's someone

752
00:42:46,400 --> 00:42:48,920
Speaker 1: who's never really taken counsel from anyone. He has his

753
00:42:49,080 --> 00:42:52,719
Speaker 1: own first and last counsel. There's a there's a little

754
00:42:52,800 --> 00:42:56,680
Speaker 1: separate tier there that I think involves Ivanka, his daughter,

755
00:42:56,840 --> 00:42:58,719
Speaker 1: and Jared Kushner has done in law. He will listen

756
00:42:58,760 --> 00:43:00,359
Speaker 1: to them at the end of the day, and then

757
00:43:00,400 --> 00:43:03,439
Speaker 1: it just drops off a steep cliff there in terms

758
00:43:03,480 --> 00:43:06,719
Speaker 1: of him listening to other people. Uh So, in that sense,

759
00:43:06,800 --> 00:43:09,040
Speaker 1: he's always been a loner. But that's how he prefers

760
00:43:09,080 --> 00:43:11,920
Speaker 1: to operate. Would we have heard of all the stuff

761
00:43:11,960 --> 00:43:14,320
Speaker 1: of the last two or three days unless somebody was

762
00:43:14,400 --> 00:43:16,800
Speaker 1: getting in front of the news slow like Mr Mueller's

763
00:43:16,840 --> 00:43:19,279
Speaker 1: coming out with something or this, that or other thing.

764
00:43:19,600 --> 00:43:22,160
Speaker 1: Are they essentially front running what was going to become

765
00:43:22,239 --> 00:43:25,880
Speaker 1: news as well? I don't know. I think the Times,

766
00:43:25,960 --> 00:43:28,480
Speaker 1: I think the Time stories are from just good, solid,

767
00:43:28,719 --> 00:43:32,000
Speaker 1: gum shoe reporting, and I think they intersued a storyline

768
00:43:32,680 --> 00:43:35,799
Speaker 1: knowing Trump as you do from writing his biography, um,

769
00:43:35,920 --> 00:43:39,040
Speaker 1: which he didn't appreciate because he sued you. Um and

770
00:43:39,239 --> 00:43:44,600
Speaker 1: the case was later dismissed. Right right, Um, what he

771
00:43:44,680 --> 00:43:47,040
Speaker 1: participated extensively with the book, and I think it's a

772
00:43:47,640 --> 00:43:51,839
Speaker 1: I think the book is a fairly row toned, three

773
00:43:52,320 --> 00:43:54,239
Speaker 1: sixty degree look at his life and career. I like

774
00:43:54,320 --> 00:43:57,160
Speaker 1: that rotuned Look what did you was looking at me

775
00:43:57,239 --> 00:44:00,760
Speaker 1: when he said it? What do you think is happening

776
00:44:00,840 --> 00:44:03,400
Speaker 1: when it comes to his discussions with his lawyers? I

777
00:44:03,440 --> 00:44:06,000
Speaker 1: mean that the president now has so many different legal

778
00:44:06,320 --> 00:44:10,160
Speaker 1: consultants or or folks um consulting him on legal issues.

779
00:44:10,840 --> 00:44:14,360
Speaker 1: What what? What are the conversations he's having because Mark Casswitz,

780
00:44:14,440 --> 00:44:17,360
Speaker 1: his personal attorney, does not exactly have a background in

781
00:44:17,920 --> 00:44:19,919
Speaker 1: doing what he's being asked to do well. In fact,

782
00:44:20,080 --> 00:44:21,920
Speaker 1: Mark cass Wits was the attorney he used when he

783
00:44:22,000 --> 00:44:26,839
Speaker 1: sued me and when they litigated with with my legal

784
00:44:26,920 --> 00:44:30,560
Speaker 1: team and myself um. Mark Casswitts had no background in

785
00:44:30,640 --> 00:44:34,399
Speaker 1: libel litigation. He was somebody who filled Trump's comfort zone.

786
00:44:34,920 --> 00:44:37,719
Speaker 1: And the issue now in Washington is Casswitz has no

787
00:44:37,840 --> 00:44:42,520
Speaker 1: background in handling congressional investigations, but Trump is comfortable with

788
00:44:42,560 --> 00:44:45,000
Speaker 1: the way he rolls, and is Trump also directing him

789
00:44:45,080 --> 00:44:47,040
Speaker 1: as a result, if you're talking about a lawyer who

790
00:44:47,080 --> 00:44:51,640
Speaker 1: doesn't have familiarity with congressional testimony, with congressional investigations, with

791
00:44:52,120 --> 00:44:54,239
Speaker 1: libel laws for instance. This is all being directed by

792
00:44:54,239 --> 00:44:56,239
Speaker 1: the president. Well, I think he's going to have to

793
00:44:56,280 --> 00:44:58,280
Speaker 1: try to take some advice around some of this stuff

794
00:44:58,320 --> 00:45:02,200
Speaker 1: because it's unfamiliar territory. But again, Trump often does what

795
00:45:02,360 --> 00:45:04,880
Speaker 1: he wants to do. Let me talk like a Republican

796
00:45:05,080 --> 00:45:07,600
Speaker 1: woman one of our listeners who maybe they voted for Trump,

797
00:45:07,640 --> 00:45:10,280
Speaker 1: but they're not a big Trump fan. All the Democrats

798
00:45:10,360 --> 00:45:12,920
Speaker 1: are an outraged liberal media is an outraged The Post,

799
00:45:13,040 --> 00:45:15,080
Speaker 1: the Times, and all the rest of it. Do you

800
00:45:15,239 --> 00:45:20,160
Speaker 1: see Republicans wavering that maybe supported the president, but just

801
00:45:20,280 --> 00:45:22,400
Speaker 1: the day after day drip of all this stuff is

802
00:45:22,440 --> 00:45:24,759
Speaker 1: beginning to have an effect or are they still dying?

803
00:45:25,200 --> 00:45:27,120
Speaker 1: You know, we're going to support the president. Look, I

804
00:45:27,320 --> 00:45:31,960
Speaker 1: think the people who supported the president um are looking.

805
00:45:32,360 --> 00:45:34,399
Speaker 1: One part of his support group wants jobs. I think

806
00:45:34,440 --> 00:45:38,239
Speaker 1: that's the post industrial blue collar worker that's voted for him.

807
00:45:38,360 --> 00:45:41,800
Speaker 1: I think affluent Republicans who voted for him wanted tax cuts,

808
00:45:42,080 --> 00:45:45,280
Speaker 1: and they wanted to see smart deregulation. He's not delivering

809
00:45:45,360 --> 00:45:49,560
Speaker 1: on policy so to the extent that they like his

810
00:45:49,719 --> 00:45:52,719
Speaker 1: mojo and the way that he runs in Washington. Great,

811
00:45:52,800 --> 00:45:54,800
Speaker 1: but at the end of the day, the president, like

812
00:45:54,880 --> 00:45:57,040
Speaker 1: all presidents, are gonna have to deliver the goods. Uh.

813
00:45:57,080 --> 00:45:58,719
Speaker 1: Tim O'Brien, thank you so much. Let me do a

814
00:45:58,760 --> 00:46:00,960
Speaker 1: shout out, folks for bloom Review. You can make it

815
00:46:01,400 --> 00:46:04,600
Speaker 1: a regular morning and a Twitter feed kind of thing.

816
00:46:04,800 --> 00:46:06,880
Speaker 1: What do you get? Let me explain what O'Brien and

817
00:46:07,000 --> 00:46:10,680
Speaker 1: David Shipley have done just on the cover of Bloomberg

818
00:46:10,760 --> 00:46:13,280
Speaker 1: View today. First of all, you don't get Tim O'Brien,

819
00:46:13,560 --> 00:46:16,840
Speaker 1: they buried him before. Below the fold. You get Muhammad

820
00:46:16,960 --> 00:46:21,240
Speaker 1: Larrian Nariana cauche Lakota, who we just mentioned that Rochester

821
00:46:21,400 --> 00:46:24,919
Speaker 1: were professor Plaster used to be. You get a view

822
00:46:25,000 --> 00:46:30,040
Speaker 1: of Grand Rapids, Michigan and the great economist Tyler Cowen,

823
00:46:30,120 --> 00:46:34,160
Speaker 1: the great George Mason. Uh joy on what China may

824
00:46:34,280 --> 00:46:39,359
Speaker 1: never moved to? A more modern China. Bloomberview, smart and eclectic.

825
00:46:39,719 --> 00:46:43,640
Speaker 1: Look for that from Shipley and O'Brien. This is Bloomberg.

826
00:46:52,560 --> 00:46:56,600
Speaker 1: Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and

827
00:46:56,760 --> 00:47:01,480
Speaker 1: listen to interviews on Apple Podcasts, on Cloud or whichever

828
00:47:01,640 --> 00:47:05,279
Speaker 1: podcast platform you prefer. I'm on Twitter at Tom Keene

829
00:47:05,440 --> 00:47:09,759
Speaker 1: David Gura is at David Gura. Before the podcast, you

830
00:47:09,800 --> 00:47:24,320
Speaker 1: can always catch us worldwide. I'm Bloomberg Radio. Runt You

831
00:47:24,440 --> 00:47:28,480
Speaker 1: by Bank of America Mary Lynch. With virtual reality, virtually

832
00:47:28,680 --> 00:47:33,920
Speaker 1: everything will change. Discover opportunities in a transforming world. Be

833
00:47:34,080 --> 00:47:38,600
Speaker 1: of a mL dot Com, slash VR, Mary Lynch, Pierced

834
00:47:38,640 --> 00:47:40,600
Speaker 1: Fenner and Smith Incorporated,