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How Chaos In DC Is Impacting The Economy: FHN's Low · Bloomberg Intelligence

0:01
Speaker 1: Welcome to the Bloomberg Markets Podcast. I'm Paul Sweeney, along
0:04
Speaker 1: with my co host of Bonnie Quinn. Every business day
0:06
Speaker 1: we bring you interviews from CEOs, market pros, and Bloomberg experts,
0:10
Speaker 1: along with essential market moving news. Kind the Bloomberg Markets
0:13
Speaker 1: Podcast on Apple podcast or wherever you listen to podcasts,
0:17
Speaker 1: and on Bloomberg dot com. Let's bring in Chris Low,
0:21
Speaker 1: chief economist at h N Financial. A lot to talk about.
0:24
Speaker 1: Chris one of the most expert forecasters when it comes
0:27
Speaker 1: to the labor market. But Chris, oh, we don't mind
0:29
Speaker 1: me jumping first into the president's diagnosis. Now, the market
0:33
Speaker 1: gaped lower at the open, but we have been recovering
0:36
Speaker 1: ever since. The SMP down now just seven tenths of
0:39
Speaker 1: one percent. What does this change in terms of calculations
0:43
Speaker 1: for traders? Essentially, there are just three outcomes, right, the
0:46
Speaker 1: president wins the election, the resident loses the election, or
0:49
Speaker 1: at some point between now and then, he becomes incapacitated
0:51
Speaker 1: for a time. Well, that's right, good morning, funny. I
0:56
Speaker 1: I think what we're hearing on the trading floor this warning, anyway,
1:01
Speaker 1: is most people we're already thinking Biden most likely wins
1:06
Speaker 1: this election, and that for that reason from an economic standpoint.
1:12
Speaker 1: From a political standpoint, maybe what matters is the president's
1:17
Speaker 1: inability to campaign in the last month before the election
1:23
Speaker 1: and as a result, a more decisive Biden win. And
1:27
Speaker 1: that has market implications because a more decisive win means
1:32
Speaker 1: a bigger chance of flipping the Senate, giving the new
1:37
Speaker 1: president a bigger mandate and easier to get his policies
1:42
Speaker 1: through and uh, therefore resulting in a more aggressive domestic agenda. Alright, so, Chris,
1:52
Speaker 1: I guess the question really goes to the Senate, as
1:55
Speaker 1: you suggested here, What do you do you think the
1:57
Speaker 1: market needs to be concerned about, uh, a democratic White
2:02
Speaker 1: House and Senate as it relates to taxes, regulation, trade,
2:08
Speaker 1: those issues. How do you think the market's kind of
2:10
Speaker 1: thinking about that right now? Well, I'd say it's complicated. Uh.
2:15
Speaker 1: And And the reason I say that is, look, if
2:17
Speaker 1: if if Joe Biden gets everything he's proposed in terms
2:21
Speaker 1: of taxes and spending, it's net positive for the economy. Uh.
2:26
Speaker 1: It is certainly a significant redistribution, however, um And and
2:33
Speaker 1: given that equity holders have big capital gains and tend
2:38
Speaker 1: to be high income individuals, I suspect many of them
2:42
Speaker 1: think it would be negative for them. UM. That said,
2:47
Speaker 1: I think that we've already seen a rotation. We've seen
2:50
Speaker 1: people taking profits just in case, uh in the past
2:56
Speaker 1: month or so. UM. And I would caution anyone who's
3:00
Speaker 1: thinking about making a trade based on the outcome of
3:04
Speaker 1: the election. Regardless of who wins, the stock market always
3:10
Speaker 1: does well in the first year. Uh. There is often
3:13
Speaker 1: a correction in the first weeks after an election, but
3:17
Speaker 1: you know, the the public tends to believe that that
3:23
Speaker 1: that new administration's policies will be ultimately beneficial, and as
3:30
Speaker 1: a result, the market does tend to trade higher in
3:33
Speaker 1: the first year. It's fascinating, Chris. You know, the things
3:38
Speaker 1: that we've been waiting for, like, for example, more stimulus,
3:41
Speaker 1: This job's reward only makes that more urgent. Is that
3:45
Speaker 1: a correct statement? I think so. Although Bunnie, I I
3:50
Speaker 1: would argue this was actually a stronger than expected report,
3:54
Speaker 1: given that private payrolls were up eight hundred seventy seven thousand,
3:58
Speaker 1: there was a hundred and two thousand upward revision, the
4:02
Speaker 1: unemployment rate unexpectedly falling to seven point nine percent, and
4:07
Speaker 1: the only reason the headline missed was because local teacher
4:12
Speaker 1: employment was not up enough in September to overcome the
4:17
Speaker 1: seasonal factor, so on a seasonally adjusted basis, is reported
4:21
Speaker 1: down two thousand. But if you have teachers in your family,
4:26
Speaker 1: I've got a couple of sisters who teach public school.
4:30
Speaker 1: You know, they went back early this year. They went
4:33
Speaker 1: back because they had to figure out how they were
4:35
Speaker 1: going to teach, and then they had to be trained
4:38
Speaker 1: so they could teach. And those teacher numbers were huge
4:42
Speaker 1: in July and August. UH compared to a year ago,
4:46
Speaker 1: teacher employment is is little changed. Chris, how do you
4:50
Speaker 1: think about the UH employment structure in this country here
4:54
Speaker 1: before the pandemic where you know, historically low unemployment I
4:59
Speaker 1: think three point six percent or something along those lines here,
5:03
Speaker 1: How do you think it the unemployment situation is going
5:05
Speaker 1: to look over the next couple three years. Is there
5:08
Speaker 1: some permanent or semi permanent change resulting from this pandemic?
5:11
Speaker 1: Do you think? I? I worry that is definitely a possibility.
5:15
Speaker 1: I you know, I think it's really interesting. Economists are
5:18
Speaker 1: talking about this dichotomy between a V shaped recovery and
5:22
Speaker 1: a K shaped recovery, K shaped, suggesting that people are
5:27
Speaker 1: being left behind, even as others prosper I think it's
5:31
Speaker 1: important to realize these are not mutually exclusive. The economy
5:35
Speaker 1: is in fact roaring back faster than expected, and yet
5:40
Speaker 1: people are being left behind, and for that reason, I think, Uh,
5:45
Speaker 1: you know, the thing I was most encouraged by in
5:48
Speaker 1: the report this morning was that the African American unemployment
5:52
Speaker 1: rate fell nine tenths of a percent um, and then
5:57
Speaker 1: the unemployment rate among those with less than high school education,
6:02
Speaker 1: so the sort of least skilled workers in the workforce,
6:07
Speaker 1: that unemployment rate fell by two full percentage points. So
6:11
Speaker 1: it it It does suggest in September at least that
6:15
Speaker 1: some of the less advantaged communities in the US made
6:19
Speaker 1: outsized gains, which is encouraging. What about women were seeing
6:25
Speaker 1: some reports that women fared very badly in this particular
6:28
Speaker 1: jobs report. Have you had a chance to look through
6:30
Speaker 1: that data, Chris, that's that's right, Bonny, And that is
6:34
Speaker 1: a trend that goes all the way back to the
6:37
Speaker 1: beginning of this pandemic. With the March numbers. Uh, it's
6:42
Speaker 1: you know, I think it looks it's one of the
6:44
Speaker 1: reasons New York City, for example, was so late to
6:48
Speaker 1: go back to restaurant dining. That this sort of realization
6:52
Speaker 1: that that a lot of New Yorkers rely on school
6:58
Speaker 1: for childcare, that without in school education, UH, two income
7:05
Speaker 1: families are going to have to make a decision about
7:08
Speaker 1: who works and who stays home. And with uh an
7:13
Speaker 1: outsized number of families. UM, it is women's employment that
7:18
Speaker 1: suffered as a result, and that continued in September. So, Chris,
7:23
Speaker 1: you know, we we look at the economic data and
7:25
Speaker 1: it's it's it's certainly showing an improvement, whether you're looking
7:27
Speaker 1: at the housing data. Get some decent manufacturing numbers come
7:31
Speaker 1: through this week. Uh. We are adding jobs, maybe at
7:35
Speaker 1: a slower pace than what we would like to see,
7:37
Speaker 1: but we are aiding stoves back. UM. I guess the
7:40
Speaker 1: question is what does it mean if I'm sitting in Washington,
7:43
Speaker 1: d C. How do you think the folks in Congress
7:45
Speaker 1: are trying to digest this datas relates to fiscal stimulus.
7:49
Speaker 1: That that is a fantastic question, and I think for perspective,
7:56
Speaker 1: it's it's really important to hold the third quarter pins
8:00
Speaker 1: up against the second quarter losses. Um. We we are
8:04
Speaker 1: recovering quickly. We're looking at something like growth in this quarter.
8:10
Speaker 1: And one way you see that in this report is
8:13
Speaker 1: aggregant hours worked which um which which rose by uh
8:20
Speaker 1: well a little more than but but at the same
8:24
Speaker 1: time they fell by a little more than in the
8:27
Speaker 1: second quarter. So there's we're climbing out of a really
8:31
Speaker 1: deep hole. And the biggest gains were made all the
8:35
Speaker 1: way back in May and June. We're climbing at a
8:39
Speaker 1: decelerating pace as we go into the fourth quarter. I
8:43
Speaker 1: I would argue that it is absolutely reckless not to
8:48
Speaker 1: have at least a skinny pandemic aid bill, but to
8:53
Speaker 1: do no bill at all is reckless. And uh you
8:57
Speaker 1: know this. This is another reason I am worried by
9:01
Speaker 1: the increasing chaos in Washington with the President testing COVID positive,
9:06
Speaker 1: because it's just it's it's one more reason to think
9:11
Speaker 1: that we may not get a bill because we're not
9:15
Speaker 1: going to get the kind of work from both sides
9:18
Speaker 1: that we need to reach compromise. Chris just explained to
9:22
Speaker 1: us how we should read eight thirty seven thousand people
9:26
Speaker 1: filing jobless claims for the first time. That was the
9:30
Speaker 1: data we got yesterday, with sixty jobs created in the
9:33
Speaker 1: non farm payrolls report. How are they correlated? Yeah, you know,
9:38
Speaker 1: normally if you see outsized initial claims um, you would
9:44
Speaker 1: expect to drop an employment And of course we've we've
9:46
Speaker 1: had employment growth since the May report. UM My sense
9:51
Speaker 1: is that the unemployment insurance system is still broken, that
9:57
Speaker 1: states are struggling to keep people on the roles, they
10:00
Speaker 1: are still falling off and they have to refile on
10:05
Speaker 1: top of that. It's it's really hard to square the
10:09
Speaker 1: ten million or so that show up as unemployed in
10:12
Speaker 1: the unemployment report with the twenty six million who received
10:19
Speaker 1: unemployment benefits of one kind or another two weeks ago.
10:24
Speaker 1: I do at times wonder if the Bureau of Labor
10:29
Speaker 1: Statistics has actually captured the full extent of the damage
10:34
Speaker 1: from the lockdowns and the damage that continues in the
10:38
Speaker 1: economy now. Chris, thanks so much for joining us. We
10:41
Speaker 1: really appreciate your thoughts and perspective. Chris Lowe, Chief economists
10:45
Speaker 1: at f h N Financial. So much news to process
10:52
Speaker 1: on this busy Friday morning. We have the President in
10:55
Speaker 1: his diagnosis of COVID nineteen. Also have a busy jobs
10:59
Speaker 1: data day today, US jobs they rise less than forecast
11:04
Speaker 1: as the economic rebound kind of downshifts here, I guess
11:07
Speaker 1: there is a way to say it here in the
11:09
Speaker 1: US economy. To get the latest on the jobs market,
11:12
Speaker 1: we turn once again to Tom Gimble. He's a founder
11:14
Speaker 1: and CEO of LaSalle Network. Found in Sound Network is
11:19
Speaker 1: one of the leading staffing and recruiting firms in the country,
11:22
Speaker 1: so Tom really has his finger on the pulse of hiring. Tom,
11:24
Speaker 1: thanks so much for joining us here. What are your
11:27
Speaker 1: takeaways from the jobs data that we got this morning.
11:31
Speaker 1: I mean, it's it's good signs. Everybody wants it to
11:35
Speaker 1: always be record setting months, but we added jobs, unemployment drop.
11:40
Speaker 1: Those are positive signs. Uh, It's what it's what should
11:43
Speaker 1: have happened. As the weather is still warm, you know,
11:47
Speaker 1: as I've been saying with you guys for a few
11:49
Speaker 1: months now, we'll really get an accurate reading on on
11:53
Speaker 1: how things can stand up when the weather changes. Because
11:57
Speaker 1: what really got hit in end of March, April in
12:00
Speaker 1: May was the hospitality and restaurant sector. That's where so
12:04
Speaker 1: many of the layoffs and the unemployed numbers came from.
12:08
Speaker 1: And with the summer and warm weather, it came back.
12:10
Speaker 1: So we'll see what happens north of the Mason Dixon
12:13
Speaker 1: Line when it gets cold again. It seems like manufacturing
12:17
Speaker 1: jobs didn't you know, show as much progress this month
12:20
Speaker 1: as other months. Or a construction either why is that?
12:24
Speaker 1: Is there a shortage or have developers just stopped being
12:27
Speaker 1: able to find land? Well, I think what you got
12:30
Speaker 1: on the on the manufacturing is on the consumer side,
12:35
Speaker 1: there isn't the surplus of buying that was happening in June, July,
12:39
Speaker 1: and August as people were were in more of a
12:42
Speaker 1: lockdown moment. People feel more comfortable going out. They understand
12:46
Speaker 1: if you wear a mask. So it's people aren't buying
12:49
Speaker 1: in bulk as much so on the on that side
12:51
Speaker 1: of the manufacturing. What we're seeing in Corporate America and
12:54
Speaker 1: on real estate is people are waiting to see how
12:57
Speaker 1: things shake out. Number one with the election, and number two,
13:01
Speaker 1: is there going to be a number another stimulus package
13:04
Speaker 1: and if so, how much and will that go through
13:07
Speaker 1: Corporate America or will that go to the individual citizens
13:10
Speaker 1: and what people will do with that money. So I
13:13
Speaker 1: think again, I don't mean to we only be pushing
13:16
Speaker 1: the ball forward. However, um, we've got to wait and
13:19
Speaker 1: see what happens with this stimulus and UH with the
13:23
Speaker 1: election to see how corporations react. So, Tom, we've had
13:27
Speaker 1: a lot of high profile companies announced layoffs really just
13:31
Speaker 1: in the last week or so. It seems that the airlines, uh,
13:34
Speaker 1: some of the financial institutions, uh, the Walt Disney Company
13:38
Speaker 1: twenty eight thousand employees. Um. How should we think about
13:41
Speaker 1: that as opposed to kind of what we saw in March,
13:44
Speaker 1: April and May, which is some smaller businesses, restaurants and
13:47
Speaker 1: think things like that. Well, the good news is we
13:51
Speaker 1: know it's directly related to the virus and to traveling
13:57
Speaker 1: not happening, So there isn't uh wondering what the cause
14:01
Speaker 1: is to this effect. So whether it's a vaccine or um,
14:06
Speaker 1: a treatment for the for the virus that comes out
14:09
Speaker 1: that as soon as that happens, God willing is that
14:13
Speaker 1: we will we will see that pick up very very quickly.
14:16
Speaker 1: And that's more of that v recovery of when we
14:19
Speaker 1: get a cure or a treatment that works on everybody,
14:22
Speaker 1: you'll see that bounce back. Um. You know, the Disney
14:25
Speaker 1: World stuff is very basic and obvious. What's interesting to
14:28
Speaker 1: track for for our economy here is what's going on
14:32
Speaker 1: in other countries and are we seeing spikes globally versus
14:36
Speaker 1: just in UH North America. What were some of your
14:41
Speaker 1: clients telling you, Can you give us an idea of
14:44
Speaker 1: how they're feeling, who they're looking for that kind of thing. Sure,
14:48
Speaker 1: So what we've seen is our temporary staffing numbers. We
14:51
Speaker 1: do all white collars staffing and then we have UH
14:53
Speaker 1: search practice permanent search practice. Our temporary staffing numbers are
14:58
Speaker 1: pre COVID levels. So now we've got companies that are
15:01
Speaker 1: hiring and bringing people back. So the question is why
15:04
Speaker 1: temporarily And the answer is it's a leading indicator that
15:08
Speaker 1: they're optimistic, but they're still unshare based on the election
15:12
Speaker 1: to do full permanent placement now simultaneously worried about nine
15:18
Speaker 1: of our of our search practice of what it was
15:21
Speaker 1: pre COVID. So that's very healthy too. Um So, our
15:24
Speaker 1: our clients have said, I got I led a CEO
15:28
Speaker 1: roundtable yesterday and people were very bullish. They were they
15:33
Speaker 1: were moving forward with plans, they were hiring. The one
15:36
Speaker 1: thing they're not doing is signing real estate leases and
15:41
Speaker 1: and that is still a fear of how will people
15:44
Speaker 1: want to come to work and are they willing to
15:47
Speaker 1: come to work? And those are two very different questions, Tom,
15:50
Speaker 1: What are your clients telling you, as it relates to
15:53
Speaker 1: maybe the CEOs you spoke to just yesterday about the election,
15:56
Speaker 1: how are they thinking about kind of weighing the pluses
15:59
Speaker 1: and minuses of the Trump versus a Biden administration. Well,
16:04
Speaker 1: the interesting thing was is that you know, for for
16:07
Speaker 1: the past five months, the majority of CEOs have said,
16:12
Speaker 1: you know, we feel that if Biden wins, there'll be
16:14
Speaker 1: a short term hit on the stock market and that
16:17
Speaker 1: the economy and if Trump wins, while they don't approve
16:20
Speaker 1: and almost to a to a person, they don't approve
16:23
Speaker 1: of his behavior, but they think that it will keep
16:25
Speaker 1: their business going and keep their employees employed. Now, there
16:28
Speaker 1: was an article that showed UH the other day that
16:31
Speaker 1: said that if Biden wins, that that means that the
16:34
Speaker 1: government will keep putting a surplus of funds out from
16:37
Speaker 1: the Fed and the Treasury, and that will keep the
16:40
Speaker 1: economy going. While maybe a bit superficially. So I actually
16:44
Speaker 1: saw yesterday or heard yesterday and the the CEO round
16:47
Speaker 1: table I was I was a part of that they're
16:49
Speaker 1: actually more bullish on a Biden presidency than they were
16:53
Speaker 1: three months ago. Can I ask about restaurant workers. Are
16:57
Speaker 1: we seeing any any shift up words in the amount
17:01
Speaker 1: of restaurant workers that you know may have been hired
17:05
Speaker 1: through the cell for example. I mean, I know obviously
17:08
Speaker 1: a lot of people just went back to where they
17:09
Speaker 1: had been working. But what can you tell about indoor
17:12
Speaker 1: dining in places in New York and how that's impacting things. Yeah,
17:16
Speaker 1: so we we don't place people in the restaurants, but
17:18
Speaker 1: we have seen is, for for example, our call center practice,
17:23
Speaker 1: which has moved to almost all virtual where our clients
17:26
Speaker 1: will put let people be in call centers virtually in
17:29
Speaker 1: their home, and we've been seeing people who were restaurant
17:32
Speaker 1: workers moving into those roles. Obviously, they're rolling back in
17:36
Speaker 1: over the summer with outdoor dining in New York and
17:39
Speaker 1: Chicago and other city major metropolitan cities. Um, the challenge
17:45
Speaker 1: in that is and I was talking to the end
17:48
Speaker 1: of last week a couple very large restaurant owners, and
17:52
Speaker 1: they were saying that if if it doesn't get to
17:55
Speaker 1: be more than sev there's absolutely no way they can
17:59
Speaker 1: handle a winter. And if the restaurants do close down, um,
18:03
Speaker 1: you're gonna see a huge spike and unemployment in the
18:06
Speaker 1: service just like we had in March and April. It's
18:09
Speaker 1: gonna be it's gonna be the exact same thing on
18:12
Speaker 1: the on the restaurant side as it was. And as
18:15
Speaker 1: the winter months come, you're gonna see less automobile travel
18:18
Speaker 1: for vacations and you'll see it in the hotel side too.
18:22
Speaker 1: Now coincidentally, the good thing is coming into the holiday
18:25
Speaker 1: season with Amazon, with Target, you're gonna have holiday shopping.
18:29
Speaker 1: So there will be jobs in the warehouse and distribution
18:32
Speaker 1: centers and things like that, and people just have to
18:35
Speaker 1: pivot and go from being UH servers and waiters and
18:39
Speaker 1: bartenders to being in warehouses and picking and packing UH
18:43
Speaker 1: for the hot days. So, Tom, is there any regional
18:47
Speaker 1: variations that you're seeing in your data here certain parts
18:49
Speaker 1: of the country doing better or worse than others. No,
18:52
Speaker 1: what we're seeing is is there there there is a
18:55
Speaker 1: little bit of Red state, Blue state and south of
18:58
Speaker 1: the Mason Dixon line where the weather stays warmer and
19:02
Speaker 1: the hospitality UH workers are are gonna be able to
19:05
Speaker 1: work outside longer. Um that it's doing really well. UH.
19:10
Speaker 1: In in Alabama, the bars just old restaurants just opened again,
19:13
Speaker 1: and so you have that situation and where you've got
19:17
Speaker 1: um in more of the quote unquote blue states and
19:21
Speaker 1: blue governors and mayors that it's a little bit more restrictive,
19:24
Speaker 1: and you're seeing people now what is what is gonna happen?
19:27
Speaker 1: I was I was with UH, a private equity UH
19:30
Speaker 1: partner the other day and they were saying, you know,
19:33
Speaker 1: the restaurants will shut down, but eighteen to twenty four
19:35
Speaker 1: months from now, you're gonna get a lot of entrepreneurial
19:38
Speaker 1: opportunities where people are gonna go in and take over
19:40
Speaker 1: those vacated restaurant spaces at lower rates and reopen. And
19:45
Speaker 1: so you know, the the economy will bounce back and
19:49
Speaker 1: maybe even at a higher level, but it may take
19:51
Speaker 1: two or three years for that to happen. And there's
19:53
Speaker 1: gonna be some there's gonna be some bodies buried around
19:56
Speaker 1: because of UH of the economic uncertainty. We saw today
20:00
Speaker 1: that younger people actually saw a bit of a boost
20:03
Speaker 1: in this job's reporting twenty four for example, presumably because
20:06
Speaker 1: they're cheaper and so on. In terms of age groups.
20:10
Speaker 1: What have you been seeing, you know, coming into the
20:13
Speaker 1: cell or calling the cell, and what have you been
20:15
Speaker 1: seeing requested from the cell absolutely so. What we see
20:20
Speaker 1: a lot is recent college grads called zero to three
20:24
Speaker 1: years out of college, and you're exactly right. The wages
20:27
Speaker 1: have been driven down in this economy, and people who
20:30
Speaker 1: want to work, especially remotely, are going to take less
20:33
Speaker 1: money to work remotely than having to go into the office,
20:36
Speaker 1: and we've seen a spike there. The other thing we've
20:38
Speaker 1: seen as at senior manager and executive level is our
20:44
Speaker 1: contract business of people who will do three to six
20:47
Speaker 1: month engagements that previously we're only looking for uh quote
20:52
Speaker 1: unquote permanent jobs are willing to do three to six
20:55
Speaker 1: months contracts now. And you know that that profile is
20:58
Speaker 1: usually late forties, the sixty year old UH folks who
21:02
Speaker 1: are willing to do more short term positions at an
21:05
Speaker 1: executive level versus holding out because no one knows how
21:09
Speaker 1: long it's going to be and they don't want to
21:10
Speaker 1: be uh They don't want to be the last person
21:12
Speaker 1: standing when the music stops. Hey, Tom, thanks so much
21:15
Speaker 1: for joining us. We appreciate it. Tom Gimble, founder and
21:18
Speaker 1: CEO of LaSalle A Network. We appreciate your thoughts. Let's
21:25
Speaker 1: talk about the potential UH handoff of power even an
21:28
Speaker 1: a temporary basis, should President Trump fall ill to this
21:32
Speaker 1: COVID nineteen. We welcome Josh Green, Bloomberg Business Week National correspondent. Josh,
21:36
Speaker 1: thanks so much for joining us here. Tell us what
21:38
Speaker 1: you know as to to the extent that the President
21:42
Speaker 1: were to become hospitalized, how this might play out, to
21:44
Speaker 1: the extent there might need to be some temporary, uh
21:47
Speaker 1: handover of power and responsibilities. Well, we actually did a
21:51
Speaker 1: big story in Business Week about what would happen if
21:53
Speaker 1: the President tested positive for COVID back in May, and
21:55
Speaker 1: talk to all the constitutional experts then a lot of
21:58
Speaker 1: former White House advisors on the two ways the transfer
22:01
Speaker 1: that power could be transferred under the amendment. UM. The first,
22:04
Speaker 1: and this is not all that uncommon, is that the
22:06
Speaker 1: president could agree to hand over control of the vice
22:09
Speaker 1: president temporarily. UM. This happened twice under the George W.
22:12
Speaker 1: Bush administration while President Bush was undergoing medical procedures. It
22:16
Speaker 1: happened during the Reagan administration. Wants it's not all that unusual. UM.
22:21
Speaker 1: The other way in which power could be transferred is
22:23
Speaker 1: if Trump were stricken suddenly or had to be sedated
22:27
Speaker 1: for intubation. UH. In that case, if he if he
22:31
Speaker 1: didn't voluntarily hand over power. The amendment allows for the
22:34
Speaker 1: vice president and the cabinet to execute that transfer presidential power. So, uh,
22:39
Speaker 1: you know, from what little we've heard from the White
22:42
Speaker 1: House about the president's condition, it doesn't seem as if
22:44
Speaker 1: right now that's something that's coming into play. But in
22:47
Speaker 1: the event that his symptoms worsened, Uh, and it could.
22:51
Speaker 1: He could either do it on his own or his
22:53
Speaker 1: cabinet and vice president could do it for him. Now,
22:56
Speaker 1: what happens if a president contests the ending that he's
23:00
Speaker 1: incapable of carrying out his duties? Josh, can he contested
23:04
Speaker 1: and win? Well, it's it's not really clear, and we
23:07
Speaker 1: haven't we haven't been in this situation before. I mean,
23:10
Speaker 1: there is a clear constitutional line of succession. If Trump
23:14
Speaker 1: were incapacitated unable to fulfill the duties of his office,
23:17
Speaker 1: whether he thought so or not, Cabinet and vice president
23:20
Speaker 1: could vote and decide to take those powers away to
23:22
Speaker 1: transfer them the Vice President Pence. If, however, Trump and
23:26
Speaker 1: Pence both were to be stricken with a virus and incapacitated,
23:30
Speaker 1: the next in line and constitutional succession is how Speaker
23:33
Speaker 1: Nancy Pelosi, a Democrat, of course, very unlikely I think
23:37
Speaker 1: that that would happen. But if we do wind up
23:39
Speaker 1: down that path, this is when constitutional experts say that
23:42
Speaker 1: things get very, very tricky because the Constitution does not
23:46
Speaker 1: define what constitutes the president inability to do it to
23:51
Speaker 1: do the job. So some of the experts I talked
23:53
Speaker 1: to have said, you know, that raises a scenario where
23:56
Speaker 1: Trump and pens could both be sick with the virus.
24:00
Speaker 1: Lucy could declare them incapacitated in herself as president, while
24:04
Speaker 1: Republicans in the White House might argue, no, they're still
24:07
Speaker 1: capable of fulfilling the duties. And in that case you
24:10
Speaker 1: wind up with a full blown constitutional crisis that would
24:12
Speaker 1: probably be to be settle in court. But it's worth
24:15
Speaker 1: it's worth stipulating. So far, President Vice President Mike Pence
24:19
Speaker 1: has tested negative. The White House is saying, and Josh,
24:23
Speaker 1: it appears to I guess, at least to me that
24:26
Speaker 1: Vice President Pence has a good, uh strong relationship with
24:30
Speaker 1: President Trump. Is that in fact the cases or a
24:33
Speaker 1: sense that if there were to be a transfer of
24:37
Speaker 1: power at least temporarily, that Vice President Pence is generally
24:42
Speaker 1: well versed in much of the issues facing the president
24:46
Speaker 1: during his term. Well, I think Pence has shown himself
24:52
Speaker 1: willing to subordinate himself to Trump's desires pretty much, no
24:57
Speaker 1: matter what they are, and so you wouldn't imagine that
25:02
Speaker 1: Pence would make some sort of power grab against Trump's wishes. Um.
25:08
Speaker 1: But but certainly there are are not implausible scenarios under
25:12
Speaker 1: which Trump has to be uh sedated or undergo some
25:17
Speaker 1: kind of a medical procedure, whether it's incubation something like that,
25:22
Speaker 1: where Pence in the cabinet might feel that it's in
25:25
Speaker 1: the best interests of Trump and the country to temporarily
25:28
Speaker 1: transfer that power. But this this isn't something that we've
25:32
Speaker 1: we've seen before. All previous transfers of power um for
25:36
Speaker 1: medically related reason, tended to be things like colonoscopes and
25:39
Speaker 1: things that could be scheduled, predicted and agreed to well
25:42
Speaker 1: in advance, whereas this situation seems much more fluid. What
25:47
Speaker 1: do you imagine campaigning will look like between now and
25:50
Speaker 1: the election, Josh, I mean, if President Trump is you know,
25:54
Speaker 1: quarantining and isolating in fact more than quarantining, because he
25:58
Speaker 1: has a definite diagnosis, and if the former vice president
26:02
Speaker 1: continues to test negative, presumably he can keep campaigning. Will
26:06
Speaker 1: he take the opportunity to campaign way more than he
26:09
Speaker 1: was ever expecting to the vice president? It's a good question.
26:13
Speaker 1: I mean, we don't know whether or not he will quarantine.
26:17
Speaker 1: I mean, he's certainly been exposed to the president as
26:20
Speaker 1: recently as Tuesday. His office said, Um, you know, Hope Picks,
26:24
Speaker 1: the President's close advisor, trust tested positive on Thursday. So
26:28
Speaker 1: it's not entirely certain that Vice President Pence is out
26:32
Speaker 1: of the clear, and I would I would think that
26:35
Speaker 1: until that we're definitively established that he wouldn't be out campaigning. Um,
26:40
Speaker 1: I don't know in a campaign sense whether whether Mike
26:44
Speaker 1: Pence is quite the draw that Donald Trump is, But
26:46
Speaker 1: in theory, if he continues to test negative, he could
26:49
Speaker 1: go out and do some kind of his person campaigning.
26:52
Speaker 1: As far as Trump, my guess is that he will
26:55
Speaker 1: be even more active on Twitter, since that's really I
26:58
Speaker 1: think the only venue has left if he's quarantined in
27:01
Speaker 1: the White House. So it's Joshua that the President has
27:04
Speaker 1: been very public in terms of being out there for
27:06
Speaker 1: his campaign, rallies and so on, including less night here
27:11
Speaker 1: in New Jersey. Um, what have you heard from the
27:14
Speaker 1: White House? About you know, some of the that those issues.
27:18
Speaker 1: The White House hasn't said anything about Trump continuing to campaign,
27:23
Speaker 1: just that he's tested positive, that he is showing mild
27:25
Speaker 1: symptoms and he's quarantined in the White House. The White
27:28
Speaker 1: House Chief of Staff Mark Meadows came out a few
27:30
Speaker 1: minutes ago, uh said that it confirmed that Trump is
27:34
Speaker 1: exhibiting symptoms. Said he expects other White House staff to
27:37
Speaker 1: test positive. So, Uh, it's hard to imagine a scenario
27:43
Speaker 1: in which Donald Trump is out in person on the
27:46
Speaker 1: campaign trail anytime in the next two weeks. Josh, I mean,
27:49
Speaker 1: you can't answer this obviously, but it will be interesting
27:52
Speaker 1: to see if the President continues to tweet or if
27:54
Speaker 1: his phone gets taken away, because I mean, it probably
27:57
Speaker 1: wouldn't be a good idea. People started looking at Twitter
28:01
Speaker 1: and how often he tweets, and then if one day
28:03
Speaker 1: he tweets less. You know, people jumped all sorts of conclusions.
28:06
Speaker 1: It's very important for people around him to sort of
28:09
Speaker 1: keep him in control these days, right I think so.
28:13
Speaker 1: I mean, one of the one of the ongoing complaints
28:17
Speaker 1: about Donald Trump in the White House from friends and
28:20
Speaker 1: foes alike, that he spent too much time on Twitter,
28:22
Speaker 1: too much time tweeting. I think now we're in a
28:25
Speaker 1: condition where all the experts I've talked to said that
28:28
Speaker 1: what's what's most important is to establish who is commander
28:32
Speaker 1: in chief and then that person is out there, alert
28:34
Speaker 1: and capable of doing the job. And so in that sense,
28:38
Speaker 1: I think there might be some some reassurance if Trump
28:40
Speaker 1: were uh to tweet and sort of tweet as himself,
28:44
Speaker 1: uh and assure people, assure markets that you know, he is,
28:47
Speaker 1: he is still in in charge, he's still in control,
28:51
Speaker 1: he's still occupying the Oval office, and that these issues
28:55
Speaker 1: of constitutional succession don't need to come into play. I
28:58
Speaker 1: think I do think that would for a reassurance. And
29:02
Speaker 1: so we'll have to do what I and and every
29:05
Speaker 1: other White House reporter does and just sort of keep
29:07
Speaker 1: our eyes on Twitter to see whether or not the
29:09
Speaker 1: president tweets and what it is that he has to say.
29:12
Speaker 1: Josh Green, thanks so much. We appreciate that as always.
29:14
Speaker 1: Josh Green, Bloomberg Business Week National corresponded, thanks for listening
29:20
Speaker 1: to Bloomberg Markets podcast. You can subscribe and listen to
29:23
Speaker 1: interviews at Apple Podcasts or whatever podcast platform you prefer.
29:27
Speaker 1: I'm Bonnie Quinn, I'm on Twitter at Bonnie Quinn, and
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Speaker 1: I'm Paul Sweeney. I'm on Twitter at pt Sweeney. Before
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