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Zelensky Interview, Trump Week One · Bloomberg Intelligence

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Speaker 2: President Vladimir Zelenski joined Bloomberg News Editor in chief John
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Speaker 2: mclethwaite for an exclusive sit down in Davos, Switzerland. He
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Speaker 2: commented on the relationship between Donald Trump and Chinese President
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Speaker 2: Jiji Ping. Let's listen in the.
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Speaker 3: Phone call during the war not to watch not enough.
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Speaker 3: I think, yes, he can push putin to piece. I'm sure.
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Speaker 3: I think that's only President Trump is strongest ancient zimpion.
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Speaker 3: I think that there's no other allies who can really
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Speaker 3: do it. Yes, because his economy put in a corner
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Speaker 3: after sanch after everything depends worthy much of China.
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Speaker 4: That was Ukraine President Bottomla Zelenski speaking with Bloomberg News
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Speaker 4: editor in chief of John Micklethwaite, want to go to
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Speaker 4: Ras Mathis and now Bloomberg News Director for Europe, Middle
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Speaker 4: East and Africa. Zelenski also telling Bloomberg News the peacekeeping
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Speaker 4: troops in his country must include the US. That's quite
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Speaker 4: a headline. What's the reality of.
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Speaker 5: That, Well, it's a reality that he says any peacekeeping
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Speaker 5: troops supplied by others, including the US, won't be nearly enough.
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Speaker 5: He says he needs many, many more peacekeeping troops to
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Speaker 5: really act as a proper deterrent to Russia in this case.
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Speaker 5: And it's also acknowledgement even in Europe amongst allies, it's
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Speaker 5: going to be a tricky question to get commitments to
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Speaker 5: a sizeable number of peacekeepers. You've got governments in Europe
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Speaker 5: that are fairly fragile at the moment. We've got political
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Speaker 5: chaos still in a couple of countries, elections coming up
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Speaker 5: in Germany, and the mood at home in these countries
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Speaker 5: may not be about putting their own troops potentially directly
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Speaker 5: in the line of five. Because that's what Zelenski is
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Speaker 5: talking about in this interview that we had at Davos.
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Speaker 5: It's not about peace keeping troops back way back behind
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Speaker 5: the lines in cities. It's possibly being directly in harm's way.
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Speaker 5: And so you can imagine for Donald Trump, who really
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Speaker 5: is averse to troops going into conflict zones and to
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Speaker 5: war as a whole, like committing to put US troops
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Speaker 5: potentially in harm's way. That's going to be a very
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Speaker 5: big call.
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Speaker 2: Okay, let's step back a little bit. Ros what's the
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Speaker 2: feeling within your part of the world about President Trump
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Speaker 2: and his administration being able to bring about some type
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Speaker 2: of ceasefire in Ukraine? Is that are the odds hiring?
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Speaker 2: Maybe there were several days ago, and is there center timing.
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Speaker 5: That certainly seems to be the direction of travel. It
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Speaker 5: was happening even before Donald Trump took office. You could
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Speaker 5: see that both Russia and Ukraine are position themselves to
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Speaker 5: get in the best possible space to negotiate. It's clear that,
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Speaker 5: you know, after years of war here that it's grinding on.
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Speaker 5: Russia is still making advances, and the mood, you know,
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Speaker 5: not just outside Ukraine, but increasingly inside Ukraine is do
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Speaker 5: we move towards some kind of negotiated solution. And you
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Speaker 5: can see in the comments from Zelenski in the interview
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Speaker 5: he's really acknowledging that. And so Donald Trump is going
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Speaker 5: to give that a big push, that's for sure, and
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Speaker 5: maybe he's the one who can really push Vladimir Putin
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Speaker 5: to the table, but it's definitely the direction of travel
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Speaker 5: either way.
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Speaker 4: How do you think the next few weeks play out
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Speaker 4: in relation to the chess pieces on the board?
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Speaker 6: Here?
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Speaker 5: An interesting thing is whether there is a phone call
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Speaker 5: between Vladimir Putin and Donald Trump. Is at a preliminary
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Speaker 5: step they have a phone call. Trump has said he
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Speaker 5: is willing to meet Putin in person. That would be
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Speaker 5: a really big meeting. Obviously, you know, thinking about just
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Speaker 5: location where they could do that for a start, and
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Speaker 5: what are the stakes having a face to face meeting.
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Speaker 5: But we're looking for that conversation to happen, and then
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Speaker 5: how does that conversation lead us towards the idea of
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Speaker 5: maybe a formal meeting between the two, and then at
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Speaker 5: some point do we get towards a full sit down?
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Speaker 5: And Ukraine obviously saying it needs to be very much
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Speaker 5: part of any of those negotiations. It cannot be that
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Speaker 5: Trump and Putin do a deal on the sidelines, and
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Speaker 5: very much that's been a vein of the comments in
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Speaker 5: the interview we had today.
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Speaker 2: So Ross, what is this broadly defined? You know that
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Speaker 2: your sources over there in Europe, how are they viewing
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Speaker 2: what's kind of transparent in the last few days here
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Speaker 2: with President Trump at being sworn in and maybe some
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Speaker 2: of the announcements coming out of the White House about
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Speaker 2: of various topics. What's the feeling in Europe generally, Well, you.
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Speaker 5: Can see that it's interesting the conversations at DUBOS because
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Speaker 5: they're very very upbeat on the US, be it CEOs
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Speaker 5: or others, and they're talking about the opportunities in the
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Speaker 5: US economy and the US market and very downbeat in
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Speaker 5: turn on Europe. But for leaders in a mea, it's
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Speaker 5: concerned about are we going to see a trade or
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Speaker 5: are we going to see this really descend into high
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Speaker 5: level trade friction protectionism?
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Speaker 6: What does that look like?
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Speaker 5: Is there a fight between the US and Europe over
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Speaker 5: regulation including a big tech for example, So a lot
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Speaker 5: of worry about how does this play out in practicality.
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Speaker 5: It's very clear Donald Trump is fast out of the
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Speaker 5: gate on a lot of things, and he wants to
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Speaker 5: get a lot of stuff done and he wants to
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Speaker 5: do it fast.
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Speaker 4: Hi, Ras, thanks a lot, really appreciate it. Rids Mathison,
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Speaker 4: Bloomberg News director for Europe, Middle East and Africa, someone
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Speaker 4: we talked to you yesterday on the show is like,
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Speaker 4: if you have something that Donald Trump wants, like, now's
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Speaker 4: the time to show it. A lot of that's in
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Speaker 4: the ground. I don't quite know what Europe brings to
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Speaker 4: that part of the table.
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Speaker 2: No, and as kind of you know, we just look
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Speaker 2: at europeconomically a lot of challenges. There are a lot
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Speaker 2: of headwinds, you know, even with its leading economy's most
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Speaker 2: notably Germany and France.
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Speaker 4: Let's get to Trump Day two here. So the latest,
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Speaker 4: of course, was now talking about ten percent TARA on China,
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Speaker 4: President Trump saying yesterday that other countries are bigger users,
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Speaker 4: though it's not just China. He also mentioned the European
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Speaker 4: Union and the three hundred and fifty billion dollar deficit
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Speaker 4: with them joining us now. Wendey Schiller, Professor at Brown University, Professor,
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Speaker 4: are we overestimating or underestimating what the tariff reality will
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Speaker 4: be at this point.
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Speaker 7: Alex, I mean, I think this is really a sort
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Speaker 7: of restraint by you know, literally restraint by Trump in
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Speaker 7: response to I think who you saw at the inauguration
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Speaker 7: inside the capitol, you know, big business, big tech, you know,
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Speaker 7: on a number of fronts, not just tarifs, but also
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Speaker 7: thinking about visas for workers.
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Speaker 8: You know, he's trying to balance.
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Speaker 7: This so that he doesn't impose a big shock to
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Speaker 7: the economy which would raise prices for goods, while he's
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Speaker 7: also deporting a lot of people who do work in
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Speaker 7: the shadow economy, and labor costs are going to go
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Speaker 7: up to So having all that happen means that his
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Speaker 7: promise to reduce inflation will be much harder to keep.
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Speaker 7: So I think that's where he's sort of walking the
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Speaker 7: line of keeping his word but really keeping an eye
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Speaker 7: on what the impact would.
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Speaker 8: Be on inflation.
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Speaker 2: Wendy, I guess one of the issues that I think
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Speaker 2: has kind of been put on the back burner just
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Speaker 2: a little bit is some of these cabinet nominees they
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Speaker 2: still have to go through Senate approval. Are we can
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Speaker 2: have any real challenges laid down by the Senate for
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Speaker 2: some of these nominees, well, Paul.
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Speaker 7: You know, I would have thought heg Seth would sail through,
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Speaker 7: you know, And you know, there's a pretty good margin
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Speaker 7: in the Senate in terms.
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Speaker 8: Of their margin of votes.
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Speaker 7: They fifty three, so unlike the House where they can't
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Speaker 7: really move without one person defecting then installs everything.
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Speaker 8: So these are only the purview of the Senate.
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Speaker 7: But you know, new allegations have come out about Hexseth's behavior,
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Speaker 7: and this question is that a liability Trump really wants
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Speaker 7: to assume and be commander in chief, and so I
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Speaker 7: think that's a little bit tenuous. I think Telsey Gabbard's
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Speaker 7: a little tenuous, and Robert Kennedy Junior.
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Speaker 8: Still there are some questions among some Republicans.
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Speaker 7: It really depends on where the Senate Republicans want to
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Speaker 7: draw a line in the sand with Donald Trump.
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Speaker 8: We haven't seen any of that line yet.
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Speaker 7: But as sort of reaverb comes back on some of
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Speaker 7: the decisions he's making to executive.
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Speaker 8: Orders, there's more pressure on the Senate to exert itself.
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Speaker 4: We saw a little bit around the pardon of January
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Speaker 4: sixth individuals. There was like a touch of that in
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Speaker 4: the Senate, but nothing's sort of full throated, how long
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Speaker 4: do you think that's going to take for us to
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Speaker 4: get a good read on?
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Speaker 8: Well, I think Republican senators are going to pick their battles.
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Speaker 7: Part of that's going to be who's up for reelection,
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Speaker 7: Like Joni Ernst on the hexeth nomination. She's from Iowa,
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Speaker 7: She's got reelection at twenty twenty six. They're worried about
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Speaker 7: being primary. Do they really think Trump will still have
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Speaker 7: the mojo to get somebody really good to primary them
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Speaker 7: a year from now? They're calculating their electoral future, and
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Speaker 7: then the other senators are trying to figure out what's
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Speaker 7: going to be the most important thing to try to
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Speaker 7: block from the Trump administration when it comes to either
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Speaker 7: their beliefs or their state, it's too early for them
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Speaker 7: to make that move or.
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Speaker 8: Make that call.
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Speaker 7: The only ones I think who could step out are
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Speaker 7: people who are not up for reelection for another four
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Speaker 7: years because they don't really see themselves.
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Speaker 8: As tied to Trump electorally.
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Speaker 7: So this is about electoral politics, but it's also about
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Speaker 7: the center prerogative. Rand Paul's gone out there about using
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Speaker 7: the military in terms of deportations.
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Speaker 8: He said, no, he doesn't want to see that.
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Speaker 7: So we'll have to look to the Senate because the
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Speaker 7: House is just barely hanging on in its majority. The
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Speaker 7: Senate Republicans will be key to either moving things forward,
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Speaker 7: objecting or stalling.
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Speaker 2: Uh, Professor, what's the latest on DOGE. What's the filling
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Speaker 2: in Washington, DC about what kind of efficacy that unit
9:49
Speaker 2: could have?
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Speaker 8: Well, well, this is where labeling matters.
9:53
Speaker 7: Department of Government efficiency sounds really official, like it's a
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Speaker 7: big cabinet department, but Congress has to create cabinet departments.
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Speaker 8: You can't just do that whole cloth as president.
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Speaker 7: So now it's really just sort of a commission seless
10:05
Speaker 7: agency which the president can create. In fact, Obama created
10:08
Speaker 7: sort of a similar thing on digital technology. So when
10:11
Speaker 7: you think about that, that makes it sort of smaller
10:13
Speaker 7: and maybe a little bit less scary.
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Speaker 8: It'll be people who are embedded in all of the
10:17
Speaker 8: agencies and.
10:18
Speaker 7: The departments that say, you know, do we need this
10:20
Speaker 7: many people? Can we do this more efficiently?
10:22
Speaker 6: You know?
10:23
Speaker 7: How can we streamline cost expenses and jurisdiction? You know,
10:27
Speaker 7: can we get the federal government to shrink not only
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Speaker 7: in its size but in its reach? And I think
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Speaker 7: that's where Trump can skirt any kind of congressional stalling
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Speaker 7: or objections.
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Speaker 4: Does it make a difference. Can those little tinkerings make
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Speaker 4: a dent in the deficit or budget?
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Speaker 7: Well, you know, everything adds up when you think about it,
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Speaker 7: not just federal employees, which, by the way, Trump is
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Speaker 7: ordering back to work following a lot of big industries,
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Speaker 7: a lot of big companies are saying it's time to
10:55
Speaker 7: come back to work in the office.
10:56
Speaker 8: And of course we've.
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Speaker 7: Seen the damage to local economies big and small in
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Speaker 7: terms of the loss of all those people coming to
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Speaker 7: and from work. So Trump is going to make the
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Speaker 7: claim that getting people back in the office is there
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Speaker 7: for the economy, and if that happens, if local economies
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Speaker 7: pick up because of that, he'll be proven correct.
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Speaker 8: In that assumption.
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Speaker 2: Hi, Wendy, thank you so much. As always, Wendy Schuler,
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Speaker 2: Professor at Brown University.
11:19
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11:33
Speaker 2: David Kopla joins us. He's a founder, chief executive officer
11:36
Speaker 2: and chief investment strategist at Mainstay Capital Management. Hey, David,
11:40
Speaker 2: early into this earning season, but again, you know, double
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Speaker 2: digit earnings is kind of what analysts are forecasting, and
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Speaker 2: some people see that as a head risk. Which what's
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Speaker 2: your sense as to earnings and kind of support for
11:52
Speaker 2: this market.
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Speaker 6: Well, I think that earnings are going to be the
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Speaker 6: catalyst this year. We need earnings to be strong. We're
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Speaker 6: looking at twelve percent earnings growth our estimate for the
12:03
Speaker 6: fourth quarter. As you said, as the introduction of the segment.
12:07
Speaker 6: We had just blowout bank earnings last week, fantastic. We
12:12
Speaker 6: had Netflix come through with very good news, and we
12:16
Speaker 6: think that we'll have a strong earning season and we'll
12:20
Speaker 6: continue to have strong earnings into this year. There's some
12:23
Speaker 6: pretty lofty forecasts, you know, looking at fourteen to fifteen
12:26
Speaker 6: percent earnings for twenty twenty five, and there are some
12:30
Speaker 6: problems that could come. But you know, if we look
12:33
Speaker 6: what's happened so far. Everyone was worried about tariffs. I
12:38
Speaker 6: was quoted in an article last week about tariffs that
12:41
Speaker 6: I think that President Trump will use tariffs more as
12:44
Speaker 6: a negotiating tool than just a simple economic tool. Just
12:48
Speaker 6: impose them, to impose them. He's threatened tariffs at twenty
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Speaker 6: five percent on Canada and Mexico, ten percent on China,
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Speaker 6: but hasn't done anything yet, hasn't his His announcements on
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Speaker 6: at with everything in the last couple of days at
13:02
Speaker 6: least have been pretty benign. So the market has read
13:05
Speaker 6: that as good news because that would be certainly an
13:07
Speaker 6: impact because of impact costs, input costs, potential inflation driver,
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Speaker 6: that could be an impact on earnings. But so far,
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Speaker 6: we continue to look for good earnings in twenty five,
13:19
Speaker 6: and we're seeing good earning surprises so far for the
13:22
Speaker 6: fourth quarter of twenty four.
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Speaker 4: So to that point, will and I'm kind of laughing
13:27
Speaker 4: at myself as I say this, but I mean it
13:29
Speaker 4: will twenty twenty five be the year of the stock picker.
13:33
Speaker 4: Will this finally be the case that you may not
13:35
Speaker 4: see the whole index rise as much, but individually some
13:38
Speaker 4: of these sectors, some of these names can really outperform.
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Speaker 6: Yeah, you know, we hear that all the time. I mean,
13:44
Speaker 6: we hear it all the time. This will be the
13:46
Speaker 6: year of the stock picker. Right now, it's time to
13:49
Speaker 6: pick stocks. You just can't buy the market. I would
13:51
Speaker 6: say in this year that is going to be true.
13:55
Speaker 6: It's important to us as tactico asset allocators. You know,
13:58
Speaker 6: That's what we've been talking about our clients and the
14:00
Speaker 6: other people we're educating, is you know, in an election year,
14:05
Speaker 6: there's so many people that moved the sidelines. Look how
14:07
Speaker 6: much money went to money market funds last year just
14:10
Speaker 6: because of uncertainty or such a conviction about if this
14:14
Speaker 6: candidate wins or this candidate wins, what that'll mean for
14:17
Speaker 6: the market. What's really most important are what are the
14:20
Speaker 6: policies of each of those candidates. The thing to do
14:22
Speaker 6: is stay invested. Twenty twenty four prove that again best
14:26
Speaker 6: election year in decades, right for the markets, And as
14:30
Speaker 6: we roll into twenty twenty five, we're doing well again.
14:33
Speaker 6: But it's we're seeing where policy is going to matter,
14:37
Speaker 6: and we're already seeing where that's affecting these different sectors
14:41
Speaker 6: and different companies. Look at Oracle, you know, with this
14:44
Speaker 6: five hundred billion dollar project that's been announced they might
14:47
Speaker 6: participate in. They've rallied on that news. So it is
14:51
Speaker 6: going to be going through sector by sector, industry by industry,
14:56
Speaker 6: which with the policies that are going into effect which
14:58
Speaker 6: will be favorably impact which won't. And yes, that will
15:02
Speaker 6: drive I think more of a selection of at least
15:05
Speaker 6: sectors versus stocks, and or sectors and stocks versus just
15:11
Speaker 6: being in the index.
15:12
Speaker 2: So, David, one of the stats I see thrown about
15:16
Speaker 2: a lot money market funds and now it's close to
15:18
Speaker 2: seven trillion in assets. Is it fair to think of
15:23
Speaker 2: that as fuel for potential stock and bond rallies or
15:27
Speaker 2: is that just money that is in money market funds
15:30
Speaker 2: and don't expect it to come into risk your assets.
15:32
Speaker 6: I think it's fair to think of it as fuel
15:35
Speaker 6: or dry powder for the markets to a degree. As
15:38
Speaker 6: I said, we know a lot went into the market
15:41
Speaker 6: or went into money markets last year because of concern
15:44
Speaker 6: over the election. I think that'll start coming back out.
15:47
Speaker 6: But also we have now the highest interest rates right,
15:50
Speaker 6: the highest yields on money market accounts that we've had
15:53
Speaker 6: in years over a decade, and so people can enjoy
15:56
Speaker 6: a four and a half five percent return in a
15:59
Speaker 6: money market account with a guaranteed return and feel very
16:02
Speaker 6: safe about that. But you look at last year, there
16:05
Speaker 6: were people that did that and then saw what the
16:07
Speaker 6: market did and looked at that opportunity cost. So I
16:10
Speaker 6: think that as Trump rolls out his policies, we see
16:15
Speaker 6: that the economy is doing maybe better than some might expect.
16:19
Speaker 6: It certainly doesn't look like a recession right now. That
16:23
Speaker 6: we could see the markets continue to do well, and
16:25
Speaker 6: we'll see that money come back in which came out
16:29
Speaker 6: a lot right at the end of last year early
16:32
Speaker 6: this year. And really, you know, when we're setting a
16:35
Speaker 6: record for money market accounts, that's a lot of cash
16:38
Speaker 6: on the sidelines.
16:39
Speaker 4: All right, we appreciate it. Thank you so much for
16:41
Speaker 4: the insight. Looking forward to how this year unfold.
16:43
Speaker 8: I got to be honest at.
16:44
Speaker 4: David Coodluck, Calendar, CEO and Chief Investment Strategy.
16:47
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