WEBVTT - Surveillance: China Is Overconfident, Carr Says 0:00:00.080 --> 0:00:12.960 Ye. Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keene 0:00:13.480 --> 0:00:17.560 Jay Leie. We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.520 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:28.760 Bloomberg dot Com, and of course, on the Bloomberg. So 0:00:28.840 --> 0:00:32.400 let's begin with our top story. China state media signals 0:00:32.440 --> 0:00:35.360 a lack of interest in resuming talks with the United States. 0:00:35.360 --> 0:00:38.680 Without new moves that show the US is sincere, it 0:00:38.800 --> 0:00:41.680 is meaningless for its officials to come to China and 0:00:41.760 --> 0:00:44.519 have trade talks. This according to a commentary carried by 0:00:44.520 --> 0:00:48.080 state runs Shinhwa News Agency and The People's Daily otherwise 0:00:48.120 --> 0:00:51.800 known as the Communist Party mouthpiece. In the FX market, 0:00:51.800 --> 0:00:54.240 it means dollar strength and it means to Chinese currency 0:00:54.640 --> 0:00:58.040 heading towards the seven mark. Really pleased to say. To 0:00:58.080 --> 0:01:00.520 weigh in on the efex market, Shahab Jala knows joining 0:01:00.600 --> 0:01:05.119 us now credit sweets head of FX and macro Trading Strategy. 0:01:05.160 --> 0:01:08.280 Good morning to Shahab. It's the question we always ask, 0:01:08.480 --> 0:01:12.399 is China tolerating you and weakness or is it engineering it. 0:01:13.880 --> 0:01:18.160 I think it's at the moment accepting your weakness rather 0:01:18.200 --> 0:01:22.640 than necessarily engineering it. UM, you're seeing a widening gap 0:01:22.800 --> 0:01:26.880 between the offshore remembi um and the on shore level, 0:01:26.959 --> 0:01:29.839 the fixing on shore, which generally points to the market 0:01:30.000 --> 0:01:33.840 trying to push the currency weaker as opposed to the authorities. UM. 0:01:34.160 --> 0:01:37.600 So we're getting too important levels now. The offshore remmby 0:01:37.760 --> 0:01:41.160 at six against the dollar is a level the market 0:01:41.200 --> 0:01:43.720 expects to be protected. UM. If that's not the case 0:01:43.720 --> 0:01:47.160 and we rapidly go to seven, there could be a 0:01:47.200 --> 0:01:52.400 backlash to that in emerging markets generally. Actually, I would say, so, 0:01:52.480 --> 0:01:55.320 let's start with the Chinese currency and the tolerance of officials. 0:01:55.640 --> 0:01:57.400 Do you think the line of the sand for officials 0:01:57.440 --> 0:02:01.320 is six on the offshore rates up. That's what the 0:02:01.320 --> 0:02:05.040 markets has felt. The market has felt that that level 0:02:05.880 --> 0:02:09.960 is important because what they wouldn't want to see is 0:02:10.160 --> 0:02:15.919 actual tests of seven, because that's too risky in a sense, UM, 0:02:16.000 --> 0:02:18.280 because once you go through that level, there's always the 0:02:18.280 --> 0:02:22.200 possibility of a major spike. So this six level has 0:02:22.240 --> 0:02:25.120 been for the market key level and has been an 0:02:25.120 --> 0:02:30.400 expectation that, given that talks are still continuing, UM, the 0:02:30.520 --> 0:02:33.400 Chinese would not want to see a big push for 0:02:33.440 --> 0:02:36.480 the dollar above the seven level and go against their currency. Uh, 0:02:36.639 --> 0:02:39.480 simply in order to not antagonize the US. So if 0:02:39.480 --> 0:02:42.200 we now see that happen, perhaps the market will interpret 0:02:42.280 --> 0:02:45.840 that as a green light for authorities. UM. So this 0:02:45.880 --> 0:02:49.040 is this is a potentially big problem because this wasn't 0:02:49.040 --> 0:02:51.840 the case, for example, back in Q four when problem 0:02:51.880 --> 0:02:53.840 when when we had a similar test of these levels 0:02:54.400 --> 0:02:56.880 thrilled you with us this morning, I can't say, now, folks, 0:02:56.919 --> 0:03:00.079 how wrong I was. I thought, you know, Friday, I 0:03:00.080 --> 0:03:04.440 I had the surveillance nap and looking snews of a Friday. 0:03:04.520 --> 0:03:06.839 And let me tell you, folks, to start with John 0:03:07.000 --> 0:03:09.519 News on a Friday works right now, we can talk 0:03:09.520 --> 0:03:13.280 to him for an hour. Muhammad Hillarian rights for Bloomer Opinion, 0:03:13.440 --> 0:03:17.000 Ambrose Evans Pritchard rights for the Telegraph, and the summary 0:03:17.040 --> 0:03:20.400 of these two brilliant essays. And I remember John Llarion 0:03:20.520 --> 0:03:24.880 talking to uh Ambrose at the thing in Lake Como. Um, 0:03:25.240 --> 0:03:28.600 what they're talking about is a dollar shortage, and that 0:03:28.800 --> 0:03:32.960 China is constrained because they and everybody else out there 0:03:33.480 --> 0:03:37.840 has a dollar shortage. Explained to our global Wall Street audience, 0:03:38.240 --> 0:03:42.440 what guys like you think or say or mean when 0:03:42.440 --> 0:03:46.600 you talk about a global dollar shortage, well, to be honest, 0:03:46.600 --> 0:03:49.000 it can mean many different things. But I think at 0:03:49.040 --> 0:03:53.240 the most critical level for the market, what it means 0:03:53.320 --> 0:03:57.960 is that there is a need to refinance dollar loans, 0:03:59.120 --> 0:04:01.920 for example, by the quote its sector in countries like China, 0:04:02.520 --> 0:04:05.520 and a sense that they may find that difficult to 0:04:05.560 --> 0:04:10.280 do under certain circumstances. And when that's the case, that 0:04:10.320 --> 0:04:14.480 tends to put upward pressure on the dollar itself as well. Um. 0:04:14.520 --> 0:04:17.320 So that's one form of dollar shortage. But frankly, when 0:04:17.320 --> 0:04:19.719 you look at the country like China, the market also 0:04:20.160 --> 0:04:23.000 is concerned, tends to be worried about the possibility of 0:04:23.040 --> 0:04:26.800 capital flights. Um. You could argue that given the lack 0:04:26.960 --> 0:04:31.480 of global financial diversification in China, there is a permanent 0:04:31.480 --> 0:04:35.240 dollar shortage there um. And clearly when the currency starts 0:04:35.240 --> 0:04:40.039 to fall, the odds rise that investors and others locally 0:04:40.120 --> 0:04:44.120 tried to find new ways to exactly and put further 0:04:44.120 --> 0:04:46.479 pressure on the currency. So so I think, you know, 0:04:46.560 --> 0:04:49.640 this idea of a dollar shortage is definitely in the 0:04:49.680 --> 0:04:54.240 market's consciousness and it takes many different forms. But talk 0:04:54.279 --> 0:04:58.279 about the fame of capital flight dominated the story back 0:04:58.279 --> 0:05:02.160 in extain how close are we to that? Do you 0:05:02.200 --> 0:05:05.640 still consider a situation that we are nowhere near six? 0:05:07.160 --> 0:05:09.719 I think what's happened since then is that the Chinese 0:05:09.720 --> 0:05:13.960 authorities have ramped up the number of measures they they 0:05:14.040 --> 0:05:19.359 can use to try to keep the pressure on locally 0:05:19.480 --> 0:05:23.560 to stop money leaving China. But that's a different story though. 0:05:23.720 --> 0:05:27.560 Um if uh you get to a point where there's 0:05:27.560 --> 0:05:32.480 such a dramatic loss of confidence in China where locals 0:05:32.800 --> 0:05:35.600 fun new ways and take bigger and I think that's 0:05:35.600 --> 0:05:37.720 something that could come through that. What's so important here 0:05:37.800 --> 0:05:40.080 away from the drama of our two or three standard 0:05:40.120 --> 0:05:45.120 deviation move is the grind of we can't sell our 0:05:45.279 --> 0:05:48.120 US security is fine, We've got to, you know, get 0:05:48.120 --> 0:05:50.400 their yielding and there's no place else to go besides 0:05:50.560 --> 0:05:54.240 US securities. We all know that, but shop what's the 0:05:54.360 --> 0:05:59.479 outcome for their adjacent nations e m. The Pacific rim 0:05:59.520 --> 0:06:04.320 If we yet a grind in rand Mimbi weaker, well, 0:06:04.320 --> 0:06:09.799 I think it's still puts pressure on the currencies regionally, 0:06:09.960 --> 0:06:13.760 if that's what you receive, because what that would probably 0:06:13.800 --> 0:06:17.560 mean is that the Chinese government believes that it needs 0:06:17.560 --> 0:06:20.480 a week to remember longer term because of the higher 0:06:20.480 --> 0:06:23.800 odds of weaker economic growth, and that is trying its 0:06:23.800 --> 0:06:27.120 best to control that um. But once the market perceives 0:06:27.320 --> 0:06:30.479 that that's the way the Chinese government is looking at things, 0:06:31.120 --> 0:06:34.560 it will quickly look at the other Asian emerging markets 0:06:34.760 --> 0:06:38.240 and Asia Pacific currencies and see them as a fair game. 0:06:38.680 --> 0:06:41.680 So I think either way, whether it's a slow grind 0:06:41.680 --> 0:06:45.760 lower or more dramatic collapse in the currency, there's going 0:06:45.800 --> 0:06:47.799 to be a little pressure on on the age of Pacific. 0:06:47.839 --> 0:06:50.640 I mean, good morning, Michael Purvis, John Ferrell a d X. 0:06:50.680 --> 0:06:55.159 Why the Asian basket occurrencies extrapan is down almost three 0:06:55.640 --> 0:06:57.719 since mark. It's been really tough. And what was interesting 0:06:57.720 --> 0:07:00.360 about the session yesterday's we had a running in usquities. 0:07:00.360 --> 0:07:02.520 We did not get any pick up in emerging market 0:07:02.560 --> 0:07:07.880 equities whatsoever. Just didn't participate. This morning, China looks weak 0:07:07.880 --> 0:07:10.920 shahab from a market perspective. The equity market down two 0:07:10.920 --> 0:07:13.520 and a half percent, the Chinese currency is weaker. Is 0:07:13.560 --> 0:07:16.720 we digest the commentary coming out of China? The government 0:07:16.800 --> 0:07:19.760 keeps saying the following it will work to counteract the 0:07:19.760 --> 0:07:22.320 effects of more US tariffs and keep the economy in 0:07:22.320 --> 0:07:26.200 a reasonable range. This is according to the National Development 0:07:26.200 --> 0:07:29.880 and Reform Commission studying the impact of US tariffs, and 0:07:29.880 --> 0:07:34.880 will roll out responsive measures when necessary. Shahab The hope 0:07:34.960 --> 0:07:37.360 is always that we get stimulus. Kitchukes of sock Gen, 0:07:37.400 --> 0:07:41.280 writing this morning, evidence of a global economic slowdown continues 0:07:41.320 --> 0:07:44.120 to build. Bond markets have been beneficiaries. Equities are torn 0:07:44.120 --> 0:07:46.880 between the negative impact of slower growth and the feel 0:07:46.920 --> 0:07:50.640 good of accommodative central banks. What kind of accommodation do 0:07:50.720 --> 0:07:55.560 we get from Chinese authorities? I think the expectation from 0:07:55.640 --> 0:07:59.200 China is more monastoriesing, for example in the form of 0:07:59.680 --> 0:08:04.040 UM again reducing a reserve requirements on the banking system 0:08:04.080 --> 0:08:07.280 for example, something we've seen recently, but potentially even raid 0:08:07.320 --> 0:08:10.600 cuts as well. But there's also great hopes on the 0:08:10.600 --> 0:08:14.640 fiscal side UM and we've seen, for example, measures to 0:08:14.640 --> 0:08:17.760 cut the tax burden on consumers. The problem is that 0:08:17.800 --> 0:08:21.520 there is a sense that China has already used these 0:08:21.600 --> 0:08:24.040 levers in the past it's a great effect, and that 0:08:24.080 --> 0:08:27.200 there's a big credit overhanging China already which might make 0:08:27.240 --> 0:08:30.160 constrained the government so and that this could be exactly 0:08:30.200 --> 0:08:33.040 what the US believes as well. In thinking that it 0:08:33.120 --> 0:08:36.720 can push China to make big concession. And so the 0:08:36.800 --> 0:08:39.280 fact is we don't really know UM. No one can 0:08:39.320 --> 0:08:42.640 really tell the extent to which China's paint thresholds can 0:08:42.720 --> 0:08:45.760 sustain over the next few months. The U S appears 0:08:45.760 --> 0:08:48.920 willing to to test that UM. But the problem for 0:08:48.960 --> 0:08:52.000 the global economy and stock markets is that if both 0:08:52.040 --> 0:08:55.680 sides dig in UM, then the problems can get much worse. 0:08:55.960 --> 0:08:57.880 Right now, there is a sense of a kind of 0:08:57.920 --> 0:08:59.920 a G twenty put you could argue in the sense 0:09:00.080 --> 0:09:04.200 there's going to be a meeting Trump, you know, in June, 0:09:04.280 --> 0:09:08.880 which which some hope will lead to a resolution a 0:09:08.920 --> 0:09:11.560 few months UM. If that was to fail to come through, 0:09:11.600 --> 0:09:14.480 I think then that's when things get much worse. Shocks. 0:09:14.559 --> 0:09:31.640 Thank you so much. Terrific briefing as well. We got 0:09:31.640 --> 0:09:33.720 eight minutes in this black which is way too short. 0:09:33.760 --> 0:09:37.320 Cruel and unusual punishment with Miranda car she's with high 0:09:37.320 --> 0:09:40.440 tongue international. This truly could be a one hour briefing 0:09:40.520 --> 0:09:43.280 this morning. Let's try to get it going. Miranda. I'm 0:09:43.280 --> 0:09:45.360 gonna give you an open question before John goes to 0:09:45.360 --> 0:09:48.360 the dynamics over a mimby, and that You've got to 0:09:48.400 --> 0:09:51.360 get to the weekend, get to the Sunday talk shows 0:09:51.600 --> 0:09:54.120 and see where the trade talks are Monday morning. What 0:09:54.280 --> 0:09:58.959 will you focus on, Well, it depends what the US 0:09:59.080 --> 0:10:01.880 note does in um, whether it tries to ratch it 0:10:02.000 --> 0:10:04.640 up the tensions in terms of right right, let me interrupt, 0:10:04.679 --> 0:10:07.520 this is really important. The Secretary Commerce disagrees with you, 0:10:07.679 --> 0:10:11.480 Wilbert Ross said yesterday, I'm Bloomberg. He feels that Chinese 0:10:11.600 --> 0:10:15.079 have to respond. You're going against the secretary and saying 0:10:15.120 --> 0:10:19.240 it's what the US does well. From China's point of view, 0:10:19.280 --> 0:10:23.680 they regard the Huawei um accusations and as the action 0:10:23.760 --> 0:10:26.839 taken against Huawei this week as further ratcheting up of 0:10:26.960 --> 0:10:32.120 tensions after the after the the tariffs increased, and there 0:10:32.160 --> 0:10:35.120 was an interesting comment from Wang Yang, who's um Um 0:10:35.240 --> 0:10:38.839 Politburo member um SO. He was giving a briefing and 0:10:38.920 --> 0:10:42.040 saying that the maximum hit that the China sees from 0:10:42.080 --> 0:10:45.080 the trade tariffs is only one percent. So if you're 0:10:45.120 --> 0:10:48.840 talking about one percent hit on six to six point 0:10:48.920 --> 0:10:52.280 five percent target UM, this means that basically they're gearing 0:10:52.360 --> 0:10:55.920 up to, you know, to take quite a quite a 0:10:56.000 --> 0:10:58.720 tough stance because they're saying it's not going to affect 0:10:58.800 --> 0:11:01.520 us that badly. We we can copeus this UM so 0:11:01.800 --> 0:11:07.199 expecting China to then um take measures to offset the 0:11:07.280 --> 0:11:10.800 tensions when it's seeing that actually we can cope. Is 0:11:11.000 --> 0:11:14.040 you know that maybe the US is expecting too much, Miranda. 0:11:14.120 --> 0:11:16.480 Let's talk about what the Chinese can do to offset 0:11:16.559 --> 0:11:18.839 some of the tensions. Domestically. A lot of people have 0:11:18.920 --> 0:11:21.800 taken to trying to translate Chinese media and the message 0:11:21.840 --> 0:11:24.240 in Chinese media it's a little bit more explicit today 0:11:24.800 --> 0:11:28.840 whereby a piece of commentary was carried by state run 0:11:29.000 --> 0:11:32.319 media including Shinwa News agency and the People's Daily too, 0:11:32.559 --> 0:11:34.439 and essentially it said without new moves that show the 0:11:34.559 --> 0:11:37.600 US is sincere, it is meaningless for officials to come 0:11:38.000 --> 0:11:41.400 to China. Miranda, translate that for us. How important is 0:11:41.480 --> 0:11:46.760 that statement, that piece of cometary carried by state run media, Well, 0:11:46.800 --> 0:11:49.439 it is. It is interesting that they do feel that 0:11:49.480 --> 0:11:52.280 they can take a take a much tough restance UM. 0:11:52.520 --> 0:11:55.720 You know, because the economy and q world wasn't quite 0:11:55.760 --> 0:11:59.360 as bad as expected, um and because the tariffs don't 0:11:59.400 --> 0:12:03.920 seem to be how thing quite the catastrophic economic impact 0:12:03.960 --> 0:12:07.199 that everyone thought this time this time last year, then 0:12:07.440 --> 0:12:09.400 then it's saying no, we can stand up. And it's 0:12:09.440 --> 0:12:11.679 particularly because if you think some of the measures that 0:12:12.520 --> 0:12:16.960 were put forward, China sees as undermining the very essence 0:12:17.040 --> 0:12:20.280 of its UM state run system UM and and also 0:12:20.360 --> 0:12:23.040 sort of been the entire Chinese system, which is it's 0:12:23.040 --> 0:12:26.080 now sort of promoting both in China and throughout the world. 0:12:26.480 --> 0:12:28.920 And so if it sees a threat to that UM 0:12:29.360 --> 0:12:32.640 but without too bad the economic consequence. I mean, they 0:12:32.720 --> 0:12:36.040 may be a little bit too confident about how um 0:12:36.640 --> 0:12:39.360 how little an impact it's going to have, and obviously 0:12:39.360 --> 0:12:42.120 that's part of the negotiating stands UM but but but 0:12:42.320 --> 0:12:45.560 but yeah, they feel they feel, whether rightly or wrongly, 0:12:45.600 --> 0:12:47.640 they can take they can afford take a tougher stand. 0:12:48.120 --> 0:12:50.880 There was a piece carried by the Nikaation Review in 0:12:50.920 --> 0:12:53.240 the last twenty four hours that I thought was absolutely 0:12:53.280 --> 0:12:55.760 fascinating to read, and I encourage all of our listeners 0:12:55.800 --> 0:12:57.560 to try and find it. You can get it under 0:12:57.600 --> 0:13:00.880 the headline how J J Ping's colleagues rejected an unequal 0:13:01.040 --> 0:13:04.480 trade deal? How much power does the president currently have 0:13:04.920 --> 0:13:07.439 in China right now? We typically usually and I think 0:13:07.480 --> 0:13:09.559 it's a mistake to frame this as a president of 0:13:09.559 --> 0:13:12.319 the United States that faces re election in twenty and 0:13:12.360 --> 0:13:15.240 a president in China that faces no election whatsoever and 0:13:15.320 --> 0:13:18.240 no political pressure. But at home it seems that he 0:13:18.440 --> 0:13:22.959 is under increasingly, relatively speaking, more pressure. Miranda, how do 0:13:23.040 --> 0:13:27.000 you frame that for customers clients at the moment? Well, yes, 0:13:27.040 --> 0:13:32.200 because there's not um universal agreement that that everyone should 0:13:32.200 --> 0:13:35.480 be taking a soft stance um and and the U 0:13:35.640 --> 0:13:37.520 S trade war is the right way to go. But 0:13:37.960 --> 0:13:40.920 the the I mean there is there is much more 0:13:41.000 --> 0:13:45.080 of a idea that China should be standing up to UM, 0:13:45.520 --> 0:13:48.400 standing up to the US, but the idea of of 0:13:48.600 --> 0:13:51.120 of threatening the relationship and also the sort of long 0:13:51.240 --> 0:13:55.679 term cooperation that that generates a lot more obviously the 0:13:56.080 --> 0:13:58.839 debate um and so you're going to have to match off, 0:13:59.000 --> 0:14:02.480 and particularly when the risk is that some of the 0:14:02.920 --> 0:14:07.559 economic um performance has actually is going to come to 0:14:07.640 --> 0:14:12.040 an end because some of the trade was actually front loaded. 0:14:12.160 --> 0:14:14.920 So you've already seen some benefits. Now we're getting to 0:14:15.000 --> 0:14:17.040 a stage where sort of you know, the the economy 0:14:17.080 --> 0:14:20.280 is slowing, the trade impact is actually coming home to 0:14:20.440 --> 0:14:23.720 roost at the very time that the trade tensions are 0:14:23.920 --> 0:14:26.960 just like ratcheting up another stage. And this is a 0:14:27.040 --> 0:14:29.080 time where actually you could see you know, sort of 0:14:29.120 --> 0:14:32.400 the economic consequences being much more negative um and then 0:14:33.040 --> 0:14:36.160 see much more disagreement coming through. Well, let's get real, 0:14:36.560 --> 0:14:39.600 and anybody that spending China knows real means park prices. 0:14:39.680 --> 0:14:43.320 I showed. I showed pork inflation in China a couple 0:14:43.360 --> 0:14:47.080 of days ago. Miranda Karm looking at US hog prices, 0:14:47.200 --> 0:14:51.680 lean hogs. They've been negative one standard deviation price for 0:14:51.800 --> 0:14:55.440 a good three years, and all of a sudden, even 0:14:55.640 --> 0:14:59.640 US park prices are up on trend about one standard deviation. 0:15:00.960 --> 0:15:05.320 What synthesized for us the tension of the base food 0:15:05.360 --> 0:15:09.000 of China? For the Communist Party in Beijing, what does 0:15:09.040 --> 0:15:12.040 it mean if they see elevated pork prices and pork 0:15:12.120 --> 0:15:17.160 inflation in China, Well, that that is I mean, food 0:15:17.200 --> 0:15:19.480 inflation is a is a key issue. But I mean 0:15:19.520 --> 0:15:22.200 a lot of the pork price inflation was caused by 0:15:22.240 --> 0:15:26.400 the by the by the swine, thee yes, and and 0:15:26.520 --> 0:15:30.440 and and so it's uh, it's a consequence of that. 0:15:30.520 --> 0:15:33.360 It's not part of the part of the trade war. 0:15:33.440 --> 0:15:36.280 Although offerusly if you can't then import us pork, then 0:15:37.000 --> 0:15:40.000 the private the domestic prices rise. Um. But but it's 0:15:40.040 --> 0:15:42.880 more I think the question is not so much on 0:15:42.960 --> 0:15:45.240 the on the food prices so much. That's not so 0:15:45.440 --> 0:15:47.880 much of a tipping point, but the um if you 0:15:47.960 --> 0:15:52.360 get there was also expectations. If you did see the 0:15:52.440 --> 0:15:55.080 trade war, economic growth was cut by one percent, and 0:15:55.120 --> 0:15:57.800 then you see unemployment rise to maybe sort of from 0:15:57.840 --> 0:16:02.200 five five to six percent, and it's it's the employment issue, 0:16:02.760 --> 0:16:06.240 which is arguably a bigger, a bigger cause of consult 0:16:06.440 --> 0:16:09.560 but that tends that tends to shift policy. Um. And 0:16:09.640 --> 0:16:12.480 we've we you know, it's always even though everyone focuses 0:16:12.520 --> 0:16:15.880 on the GDP target, focus is always really on it. Okay, 0:16:16.040 --> 0:16:17.560 I got to get this question. We're indo, this is 0:16:17.600 --> 0:16:21.160 what your best at That labor policy? Is it different 0:16:21.280 --> 0:16:25.320 than ten years ago or thirty years ago the cultural revolution? 0:16:25.760 --> 0:16:29.480 Is the Beijing labor policy? Is it a new policy? 0:16:32.120 --> 0:16:36.080 The employment has always been I mean that that's I mean, 0:16:36.280 --> 0:16:39.200 no one's providing a pcent employment anymore. And it's not 0:16:39.320 --> 0:16:41.360 the sort of the if you like the iron rice 0:16:41.480 --> 0:16:44.640 bull that that you would expect. But but but but 0:16:45.360 --> 0:16:47.880 everyone knows that you still have to keep them and 0:16:48.160 --> 0:16:50.720 you have fewer graduates coming in now, you know the 0:16:51.120 --> 0:16:54.320 demographics are slowing down. Um, but you do still need 0:16:54.360 --> 0:16:57.600 to keep a good, healthy employment right um. And and 0:16:57.760 --> 0:17:03.920 that's that's always um. You know there isn't the state support, 0:17:04.240 --> 0:17:08.320 but people need that employment to keep up. And it's 0:17:08.320 --> 0:17:12.160 still it's still very valuable. Miranda Carr, thank you so much. 0:17:12.200 --> 0:17:15.480 With High Tongue International in London, briefing there in China. 0:17:28.560 --> 0:17:31.280 This is the interview of the day. If you have 0:17:31.400 --> 0:17:33.879 any kind of a pulse for American politics, why do 0:17:34.000 --> 0:17:35.920 I say that, because this is not going to be 0:17:36.000 --> 0:17:40.600 a homogenied, sanitized candidate interview. We're gonna actually talk to 0:17:40.680 --> 0:17:44.200 somebody who speaks English. Kate Benningfield works for the former 0:17:44.320 --> 0:17:48.040 Vice President Biden of Delaware, but far more importantly has 0:17:48.119 --> 0:17:52.440 experience with Christopher Dodd, John Edwards, and Jean Shaheen, among 0:17:52.440 --> 0:17:55.600 the others along the way. Kate thrilled to have you 0:17:55.720 --> 0:17:59.000 with us as you do the operational bit for Joe Biden. 0:17:59.119 --> 0:18:01.400 I want to take you act of the Democratic campaign 0:18:01.440 --> 0:18:04.840 of two thousand four in your youth, where John Edwards 0:18:04.960 --> 0:18:10.040 got up and changed the American dialogue. Speaking of two 0:18:10.320 --> 0:18:16.919 America's what are the Two Americas of your candidate, Joe Biden. Hi, Well, 0:18:16.960 --> 0:18:20.000 thanks for having me. I appreciate it. UM. So you know, 0:18:20.440 --> 0:18:22.800 Joe Biden is running for president for three reasons. He's 0:18:22.840 --> 0:18:25.280 been out for the last three weeks making the case 0:18:25.359 --> 0:18:28.880 to voters in all the early states and in Pennsylvania 0:18:29.520 --> 0:18:32.920 about um, uh, the need to reclaim the soul of 0:18:33.000 --> 0:18:36.040 this nation. Uh. You know, he truly believes that I see, 0:18:36.040 --> 0:18:39.120 we are we are at a place of moral reckoning 0:18:39.240 --> 0:18:41.520 for this country, um, and that this is a moment 0:18:41.560 --> 0:18:44.000 for us to get past this, you know, broken government 0:18:44.040 --> 0:18:46.160 that isn't working for people. UM. And to your point 0:18:46.160 --> 0:18:48.040 about two America's, I mean, he's going to be talking 0:18:48.080 --> 0:18:51.680 about this in Philly tomorrow. He's got a big his 0:18:51.760 --> 0:18:55.800 first kind of kickoff rally, um, which is the informal book. John. 0:18:55.880 --> 0:18:58.439 She's promoting, you know, the moment for the vice president. 0:18:58.480 --> 0:18:59.920 She's about to do that. That's why she's on the 0:19:01.119 --> 0:19:04.399 cut to the chase. Okay, it's it's two thousand twenty, 0:19:04.520 --> 0:19:08.800 it's October. You haven't slept since June and Joe bideness 0:19:08.880 --> 0:19:12.720 to talk to to America's secretary. Clinton had a bigger 0:19:12.840 --> 0:19:16.840 popular vote but didn't resonate with two America's, which to 0:19:17.200 --> 0:19:21.960 America's is your candidate going to try to resonate with Well, you're, 0:19:22.000 --> 0:19:23.800 first of all, you're putting the frame from the Edwards 0:19:23.880 --> 0:19:28.240 campaign on our on our current campaigns. But but look, 0:19:28.400 --> 0:19:31.240 he uh, you know, he is somebody who comes from 0:19:31.720 --> 0:19:35.000 from middle class roots himself. Uh. You know, working people 0:19:35.080 --> 0:19:37.280 know that. Working people know that he is somebody who 0:19:37.359 --> 0:19:40.719 understands them, who understands their concerns, who knows what it's 0:19:40.840 --> 0:19:42.639 like to you know, lay in bed at night and 0:19:42.680 --> 0:19:44.560 look at the ceiling and wonder how you're gonna be 0:19:44.600 --> 0:19:47.479 able to afford healthcare or what's going to happen if 0:19:47.520 --> 0:19:49.159 you have a health crisis in your family, how are 0:19:49.160 --> 0:19:50.280 you going to take care of it, How you're gonna 0:19:50.280 --> 0:19:52.720 afford to send your kid to college. Uh. People know 0:19:52.880 --> 0:19:55.920 that he's somebody who has lived that experience himself, and 0:19:56.000 --> 0:19:58.399 so um, you know, Okay, So that's one of the 0:19:58.440 --> 0:20:03.560 Americas I get that is his other America Disaffected Republicans. Look, 0:20:03.720 --> 0:20:06.400 he's he's he believes that we have to come to consensus. 0:20:06.440 --> 0:20:09.440 You know something he said in New Hampshire, Uh yesterday, 0:20:09.440 --> 0:20:12.120 I believe two days ago, the days I'll run together. Um. 0:20:12.840 --> 0:20:16.520 Uh that's what happens when you don't sleep right. Uh. 0:20:16.840 --> 0:20:20.800 That you know, without consensus in our government, power accrues 0:20:20.960 --> 0:20:23.920 to the executive and to the president and and and 0:20:24.040 --> 0:20:26.560 he can abuse it. And so you know, he believes 0:20:26.640 --> 0:20:28.679 that we're never going to be able to get anything 0:20:28.800 --> 0:20:32.400 done for people if we can't come to some kind 0:20:32.440 --> 0:20:35.920 of consensus. Um. And you know he's had experience. Look, 0:20:36.000 --> 0:20:40.159 nobody has has had more success, you know, staring Republicans 0:20:40.240 --> 0:20:43.359 down and exacting concessions from them, uh than Vice President Biden. 0:20:43.400 --> 0:20:45.080 You go back to like the fiscal cliff deal in 0:20:45.119 --> 0:20:47.040 the White House. Um. You know, he was able to 0:20:47.359 --> 0:20:51.040 extract concessions from McConnell. So you know, nobody has uh. 0:20:51.960 --> 0:20:54.520 You know, I'd put his his his chops up against 0:20:54.560 --> 0:20:57.399 anybody's on that. Um. But he also understands, and I 0:20:57.480 --> 0:21:00.479 think that the American people understand that right now government 0:21:00.560 --> 0:21:03.080 is not working um, and we need to change. And 0:21:03.359 --> 0:21:05.680 the kind of change he represents is getting back to 0:21:06.440 --> 0:21:10.560 um a place where uh, you know, government is functional 0:21:10.960 --> 0:21:13.080 and things get done on behalf of the American people. 0:21:13.280 --> 0:21:16.479 That's always the pitch kite to be fair every time 0:21:16.520 --> 0:21:18.280 there's an election, not just in the United States but 0:21:18.359 --> 0:21:21.280 anywhere else. We need to change. But I returned to 0:21:21.320 --> 0:21:23.720 the status quo. It's not really a change. It's not 0:21:23.800 --> 0:21:25.480 a return to the status quo. I mean the status 0:21:25.560 --> 0:21:28.000 quo right now is is broken, right. I mean the 0:21:28.000 --> 0:21:31.440 status quo we have right now is a government where um, 0:21:31.680 --> 0:21:36.640 you know, people's concerns are not uh taken seriously, where 0:21:37.160 --> 0:21:40.680 the you know, wealth is accruing to the top of 0:21:40.760 --> 0:21:44.040 our economy, where you know, people aren't feeling the benefits 0:21:44.080 --> 0:21:47.480 of economic policies. Where we have a president who um 0:21:47.720 --> 0:21:51.800 is trying to divide us along lines of race and gender, uh, 0:21:51.960 --> 0:21:55.320 sexual orientation. That's the status quo right now, and that 0:21:55.520 --> 0:21:57.879 is not that is general. Joe Biden represents the polar 0:21:57.920 --> 0:22:00.359 opposite of that, um and that's that to what he 0:22:00.720 --> 0:22:02.760 that's the you know, kind of leadership that he would 0:22:02.800 --> 0:22:05.159 bring to the White House. Okay, let's wrap things up 0:22:05.200 --> 0:22:08.280 with how much daylight there is between Joe Biden and 0:22:08.359 --> 0:22:11.080 the President United States on China right now? How much 0:22:11.160 --> 0:22:14.800 daylight is that? Well, look, what Joe Biden has said, 0:22:14.800 --> 0:22:16.639 in a point he's made for for many years, is 0:22:16.720 --> 0:22:18.760 that he uh he thinks there's always a mistake to 0:22:18.840 --> 0:22:22.399 bet against American workers. UM. And he believes that this 0:22:22.560 --> 0:22:26.200 president has made some real mistakes by uh not bringing 0:22:26.200 --> 0:22:29.120 our allies along to these discussions with China, not bringing 0:22:29.160 --> 0:22:32.000 the full weight of our negotiating allies to the table, UM, 0:22:32.240 --> 0:22:34.040 and not having labor at the table. I mean that's 0:22:34.119 --> 0:22:36.840 you know, as as president UM. You know, he believes 0:22:37.000 --> 0:22:39.160 is important to too and that in order to force 0:22:39.280 --> 0:22:41.640 China's hand, that we have to be able to bring 0:22:41.760 --> 0:22:44.399 the full negotiating weight of our allies along with us. 0:22:44.440 --> 0:22:47.560 And that's something that he would do UM as president. Okay, 0:22:47.760 --> 0:22:49.600 this is a free pass. I mean, we got through 0:22:49.640 --> 0:22:53.879 this without talking about those those pesky socialist Democrats are 0:22:53.920 --> 0:22:57.359 democratic socialists. Run out of time. There's other candidates that 0:22:57.480 --> 0:22:59.639 we've We've got a lot to do. We'd love to 0:22:59.680 --> 0:23:02.920 have you again, Kate Benningfield, working with Joe Biden is 0:23:03.119 --> 0:23:06.760 UH on the campaign of Churs centered out of Philadelphia. 0:23:06.800 --> 0:23:09.560 The Announcementate, I believe it was yesterday, Kate, and I'll 0:23:09.640 --> 0:23:11.840 make a serious pitch. We would love to speak to 0:23:11.920 --> 0:23:16.080 the Vice president as the campaign goes forward. Clearly an 0:23:16.119 --> 0:23:20.240 important voice across the American political landscape. Kate bending Field 0:23:20.359 --> 0:23:40.520