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No Plausible Legal Grounds To Contest Election: Levitt · 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,
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  Speaker 1: along with essential market moving news. Find the Bloomberg Markets
• 0:13
  Speaker 1: Podcast on Apple Podcasts or wherever you listen to podcasts,
• 0:17
  Speaker 1: and on Bloomberg dot com. We are still counting ballots
• 0:21
  Speaker 1: in a handful of key states. The question after that
• 0:25
  Speaker 1: becomes what legal challenges could and maybe raised, if any.
• 0:30
  Speaker 1: To get some color to there, we welcome Justin Levitt.
• 0:32
  Speaker 1: He is professor of constitutional law at Loyal Law School
• 0:36
  Speaker 1: based in Los Angeles. Justin, thanks so much for joining
• 0:39
  Speaker 1: us here. Let's assume we get through the next couple
• 0:41
  Speaker 1: of days and this is really a close one, But
• 0:45
  Speaker 1: what are some of the legal challenges if former Vice
• 0:48
  Speaker 1: President Biden were to win that a President Trump could raise.
• 0:53
  Speaker 1: I don't really think there are any, at least none
• 0:56
  Speaker 1: that we've seen so far. In order to braise illegal challenge,
• 0:59
  Speaker 1: in order to go to the courts, you need to
• 1:01
  Speaker 1: have some plausible fact scenario that shows a violation of
• 1:05
  Speaker 1: the statutes or violation of the Constitution, and the good
• 1:09
  Speaker 1: news in a couple of ways. Is it. We got
• 1:12
  Speaker 1: done fighting about most of these things months ago. There
• 1:14
  Speaker 1: were a record number of lawsuits this summer and fall
• 1:17
  Speaker 1: that helped resolve a lot of the issues that would
• 1:20
  Speaker 1: otherwise be contested. And beyond that, yesterday, the election day
• 1:24
  Speaker 1: voting was pretty smooth in most of the country. So
• 1:28
  Speaker 1: there really isn't anything we know of now that any
• 1:31
  Speaker 1: sort of legal grounds two protest or contest whatever the
• 1:36
  Speaker 1: final count is. We're still waiting on the final account.
• 1:38
  Speaker 1: We've got to be patient. Um, But a couple of
• 1:40
  Speaker 1: days from now, as you suggested, we'll know what that
• 1:42
  Speaker 1: final count is, and it doesn't look like there are
• 1:45
  Speaker 1: any legal grounds to challenge it at this point. But
• 1:47
  Speaker 1: that's pretty phenomenal. If you're working for the tomp campaign,
• 1:50
  Speaker 1: would you say the same thing, though, So I was
• 1:53
  Speaker 1: working for the Trump campaign, I would do what they've
• 1:55
  Speaker 1: been doing for really five years before the president went
• 1:58
  Speaker 1: office the first time and make some wild claims about
• 2:01
  Speaker 1: action the courts to destabilize and de legitimize the election results.
• 2:05
  Speaker 1: That's in fact what we found from the president last night,
• 2:08
  Speaker 1: declaring victory completely false. Um. Not something he gets to do.
• 2:13
  Speaker 1: And uh so I might well bluster, I might well
• 2:18
  Speaker 1: file lots of things. Um, I might well make a
• 2:22
  Speaker 1: lot of the hand that I'm dealt in the media,
• 2:26
  Speaker 1: But I don't know that I would actually see any
• 2:29
  Speaker 1: legal path to do anything other than that. Uh, just
• 2:33
  Speaker 1: to take us back to two thousand, Bush Gore Florida,
• 2:38
  Speaker 1: could we have something like that? What was the basis there?
• 2:40
  Speaker 1: Just refresh our memory, and could we have something along
• 2:43
  Speaker 1: those lines this time? Sure? I think the only way
• 2:46
  Speaker 1: you're going to have something like that line is when
• 2:48
  Speaker 1: the counting is done. If the counting is five thirty
• 2:52
  Speaker 1: seven votes apartists, if Trump and Biden are separated by
• 2:54
  Speaker 1: five seven votes, as Bush and Gore were in Florida
• 2:58
  Speaker 1: in two thousands, then yes, you could well see litigation.
• 3:03
  Speaker 1: And the question is and over what's it's really about? Everything?
• 3:06
  Speaker 1: So in Florida, there were, as we all remember, problems
• 3:11
  Speaker 1: with hanging Chad's punching through punch card ballots in a
• 3:14
  Speaker 1: way that left it ambiguous about who you were voting for.
• 3:18
  Speaker 1: But there were also other problems with ballot design. There
• 3:20
  Speaker 1: were problems with mail ballots or problems with military ballots,
• 3:23
  Speaker 1: their problems with registration, their problems with purges, their problems
• 3:26
  Speaker 1: with lines, on and on and on and on and on,
• 3:29
  Speaker 1: the election of Florida was a mess, and the margin
• 3:31
  Speaker 1: of error was far larger than the margin of victory,
• 3:34
  Speaker 1: which is to say, seven votes close everything matters. It's
• 3:39
  Speaker 1: unlikely that any of the states at this time around
• 3:41
  Speaker 1: you're going to be that close. It's not impossible, but unlikely.
• 3:44
  Speaker 1: Um And if the election is ten thousand votes apart
• 3:47
  Speaker 1: or twenty thousand votes apart, even though that's a fraction
• 3:50
  Speaker 1: of a percent, that's not the sort of ground tickets
• 3:53
  Speaker 1: overturned in litigation. The election two sixteen was a fraction
• 3:57
  Speaker 1: of a percent in Michigan and Pennsylvania was Hanson in
• 4:00
  Speaker 1: New Hampshire, but that was still way too much of
• 4:04
  Speaker 1: a lead to overcome via any sort of litigation, And
• 4:07
  Speaker 1: I think that's more likely to be the case this
• 4:09
  Speaker 1: time around. I don't know who's going to end up
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  Speaker 1: on top, but unless it's seven votes close, I think
• 4:15
  Speaker 1: the people will decide the selection and not the courts.
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  Speaker 1: It seems ripe for an extraordinarily sharp mind to come
• 4:21
  Speaker 1: up with something new. Is that possible? Do you think
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  Speaker 1: justin that that some flipper snapper out there will come
• 4:28
  Speaker 1: up with some grounds to see somebody on and set
• 4:31
  Speaker 1: a new precedent. It's always possible, but again it's really
• 4:36
  Speaker 1: not likely. Law isn't magic. It's a dispute resolution mechanism.
• 4:41
  Speaker 1: It exists in order to resolve a complaint that we
• 4:44
  Speaker 1: have based on the way the rules are applied, and
• 4:47
  Speaker 1: it's not like magically conjuring a spell reversus a result.
• 4:51
  Speaker 1: There has to be something that you can point to
• 4:54
  Speaker 1: that is a demonstrable problem that violates the current law. Well,
• 4:58
  Speaker 1: what about ballots a riving after a certain point? Is
• 5:02
  Speaker 1: there the possibility that you could find something to dispute there?
• 5:06
  Speaker 1: There is, although I don't know that the results are
• 5:09
  Speaker 1: going to turn on that. I think we're going to
• 5:11
  Speaker 1: have results that clarify when or one way or another,
• 5:14
  Speaker 1: even without counting uh those ballots. The only place in
• 5:19
  Speaker 1: which there's a legal dispute over ballots arriving late are
• 5:22
  Speaker 1: places where that deadline changed, places like Pennsylvania or North
• 5:27
  Speaker 1: Carolina or Minnesota. There were changes based on changes in
• 5:32
  Speaker 1: state law to what that deadline is. By the way,
• 5:36
  Speaker 1: all ballots in those states essentially have to be cast
• 5:38
  Speaker 1: by election day, So we're really just waiting for the
• 5:41
  Speaker 1: ballots to come in rather than worrying about anybody casting
• 5:44
  Speaker 1: a ballot. Now, Um, there's a small window of potential
• 5:50
  Speaker 1: fighting or discrepancy over those balances. Ballots that were didn't
• 5:54
  Speaker 1: arise by election day in those states, but that arrived
• 5:57
  Speaker 1: a couple of days later if they were cast earlier.
• 6:00
  Speaker 1: But I think that's going to end up being a
• 6:01
  Speaker 1: rather small number of votes, and I don't think it's
• 6:03
  Speaker 1: going to be enough to close whatever margin we have. Again,
• 6:07
  Speaker 1: I don't want to suggest that I know what the
• 6:09
  Speaker 1: answer is going to be, but the states that we've
• 6:12
  Speaker 1: seen so far have been close, but not that close. Um,
• 6:17
  Speaker 1: I don't think there'll be enough balance to make up
• 6:18
  Speaker 1: the difference. So, Professor, we we know Donald Trump's history
• 6:22
  Speaker 1: way before the he became president is that he is
• 6:26
  Speaker 1: very litigious. So I think a fair assumption would be
• 6:29
  Speaker 1: that he in fact will try to avail himself of
• 6:32
  Speaker 1: the courts here. If he does, what is the kind
• 6:35
  Speaker 1: of timing that we should be thinking about. Yeah, no question,
• 6:40
  Speaker 1: he is that, you justis. He has been liturgists. That's
• 6:42
  Speaker 1: decades long. That's not just as a political figure, but
• 6:45
  Speaker 1: it's certainly continued since he's been President. UM, a lawsuit
• 6:50
  Speaker 1: without provable facts of a statutory or constitutional violation is
• 6:54
  Speaker 1: just a tweet with a filing fee, and so I
• 6:58
  Speaker 1: think you can expect lots of those tweet with filing keys.
• 7:01
  Speaker 1: I would expect lawsuits to be filed, maybe as soon
• 7:05
  Speaker 1: as today. UM. There are still a few that are
• 7:08
  Speaker 1: lingering again on more minor issues with relatively few ballots
• 7:11
  Speaker 1: at stake. You might see new litigation file today or
• 7:14
  Speaker 1: tomorrow or over the coming days. I don't think any
• 7:17
  Speaker 1: of those are going to impact the process. If you're
• 7:20
  Speaker 1: looking for something that might maybe sort of kind of
• 7:23
  Speaker 1: possibly impact the process, I think we'll really know what
• 7:27
  Speaker 1: that is after we get the initial count, which means
• 7:30
  Speaker 1: next week or the week after. But I don't really
• 7:33
  Speaker 1: see any big dispute large enough to question those results.
• 7:37
  Speaker 1: So expect the lawsuits to be filed. I don't expect
• 7:40
  Speaker 1: them to work. So I know you're a constitutional lawyer,
• 7:42
  Speaker 1: but I can I'll ask your question. If you don't
• 7:44
  Speaker 1: want to answer is, or if you feel like it's
• 7:47
  Speaker 1: it's not your expertise or what have you, then then
• 7:49
  Speaker 1: find just pass you know, say Joe Biden wins right,
• 7:54
  Speaker 1: because right now is maybe looking as sliver more likely
• 7:57
  Speaker 1: that that he wins, but that the Senate remains publican
• 8:00
  Speaker 1: are we looking at the end of major changes like,
• 8:03
  Speaker 1: for example, the filibuster or uh, you know, changing the
• 8:08
  Speaker 1: makeup of the Supreme Court or what have you. If
• 8:12
  Speaker 1: it's a split government, does does that not even enter
• 8:15
  Speaker 1: into the picture. If it's split government, it's going to
• 8:18
  Speaker 1: be very hard to change the composition of anything. UM. Courts,
• 8:24
  Speaker 1: the rest of government, procedure, agencies, etcetera. UM, as the
• 8:28
  Speaker 1: president has discovered, there's there's not all that much you
• 8:31
  Speaker 1: can do through the executive power alone. UM. Combination of
• 8:36
  Speaker 1: one chamber of Congress and the courts will generally put
• 8:38
  Speaker 1: a stop to most of that, not all the most
• 8:41
  Speaker 1: of it. UM. You talked about about rules like Senate procedure,
• 8:45
  Speaker 1: like changes to the filibuster, that's always possible. UM. I
• 8:50
  Speaker 1: honestly don't know whether if the Senate should change hands
• 8:55
  Speaker 1: or if it should remain in Republican hands, whether either
• 8:57
  Speaker 1: party will have any interest in eliminating the cilbuster. A
• 9:01
  Speaker 1: lot depends on whether there's unified government or not. If
• 9:06
  Speaker 1: Joe Biden ends up winning the presidency, And as we said,
• 9:08
  Speaker 1: we just don't know yet give it a couple of days. Um.
• 9:12
  Speaker 1: If the Senate does become democratic, they'll be much more interesting.
• 9:17
  Speaker 1: I think in the Democrats side on ending the celebuster,
• 9:19
  Speaker 1: and that's something they can do on their op It's
• 9:21
  Speaker 1: just a question whether they're gonna want to. Professor, what
• 9:24
  Speaker 1: do you make of this Supreme Court? Obviously six to
• 9:27
  Speaker 1: three here? Uh, conservative? I guess. How do you expect
• 9:32
  Speaker 1: the Supreme Court is going to rule going forward? Do you
• 9:34
  Speaker 1: you have any we have any indications. I think they're
• 9:37
  Speaker 1: going to be a very conservative court generally, there's a
• 9:39
  Speaker 1: little doubt of that. That's exactly what President Trump promised,
• 9:42
  Speaker 1: and in that respect he has indeed delivered. Um. I
• 9:46
  Speaker 1: don't know, uh, And I don't think they're going to
• 9:50
  Speaker 1: really have the opportunity or desire to weigh in on
• 9:54
  Speaker 1: this election. UM. I think there are lots of issues
• 9:56
  Speaker 1: to justices think of themselves as above individual party politics.
• 10:02
  Speaker 1: They're they're on the court for life. They don't need
• 10:04
  Speaker 1: an individual presidential fight. So despite the fact that the
• 10:07
  Speaker 1: President keeps calling on his justices to save him, I
• 10:11
  Speaker 1: don't think they're interested in doing that. UM. I think
• 10:15
  Speaker 1: that they're likely to be a very conservative block, and
• 10:20
  Speaker 1: how they choose to exercise that power is going to
• 10:22
  Speaker 1: be up to the individual issue confronting them. It's not
• 10:24
  Speaker 1: always going to be a conservative outcome in every case. Um.
• 10:30
  Speaker 1: In fact, on some hot button issues, I think they
• 10:33
  Speaker 1: might prefer to go slowly rather than go quickly. I
• 10:36
  Speaker 1: think you'll see the Chief Justice, who is currently in
• 10:39
  Speaker 1: the media and Justice, remains quite powerful on the court.
• 10:43
  Speaker 1: But I think it's also likely that the media and Justice,
• 10:47
  Speaker 1: which is not the same moderate Um, it's quite conservative court,
• 10:50
  Speaker 1: will become either justice. Course, it's your justice, Kabina, depending
• 10:53
  Speaker 1: on the particular issue. It's say, Professor, what would your
• 10:57
  Speaker 1: students at Loyola or indeed other little schools be looking
• 11:01
  Speaker 1: at specifically today? What kinds of questions will they be
• 11:04
  Speaker 1: debating amongst themselves? Well, most of them will be doom
• 11:07
  Speaker 1: scrolling through various social media feeds, I'm sure, um, and
• 11:12
  Speaker 1: or hitting refresh repeatedly on the websites of choice. Um.
• 11:15
  Speaker 1: There's a lot of anxiety out there, and I understand
• 11:19
  Speaker 1: that anxiety has been the year of anxiety, not just
• 11:22
  Speaker 1: in America but globally. UM. And it's reflected in this
• 11:26
  Speaker 1: so far uncertainty about the electoral outcome. I'm sure that
• 11:32
  Speaker 1: people will be paying attention, probably more than they should frankly,
• 11:35
  Speaker 1: to new lawsuits that are filed. There's a lot of
• 11:38
  Speaker 1: wild speculation about where those could go. As mentioned, I
• 11:41
  Speaker 1: don't think they're going much of anywhere. Um. Really, I
• 11:45
  Speaker 1: think if they're smart, and I know they're smart, they'll
• 11:48
  Speaker 1: be paying more attention to us than to anything else.
• 11:52
  Speaker 1: And by that I mean, really, the election process is
• 11:56
  Speaker 1: up to we, the people we had the chance to
• 11:59
  Speaker 1: express to ourselves. Votes are mostly in a few more
• 12:03
  Speaker 1: trickling in. Um. Now it's up to us to be
• 12:06
  Speaker 1: patient enough to wait. We have to give the people
• 12:09
  Speaker 1: who are counting the ballots time to do their job,
• 12:12
  Speaker 1: to count the dots, to dot eyes and cross teas,
• 12:15
  Speaker 1: and when they're making a list, to make sure they
• 12:17
  Speaker 1: check it twice. And if we give it time to work, UM,
• 12:22
  Speaker 1: I think that the election process will actually be smoother
• 12:26
  Speaker 1: than all of us are anticipating right now. Um, what
• 12:29
  Speaker 1: comes next is pretty mundane. A lot of local towns
• 12:33
  Speaker 1: and counties are counting ballot one by one, and I
• 12:37
  Speaker 1: have no doubt that my students in the rest of
• 12:39
  Speaker 1: America will be watching that process really closely. Well it
• 12:43
  Speaker 1: certainly seems like turnout is massively up in general, and
• 12:46
  Speaker 1: we'll know final numbers on that at some point and
• 12:49
  Speaker 1: we'll be talking to you in the meantime, and I
• 12:52
  Speaker 1: wish you the best of luck with your students and
• 12:54
  Speaker 1: with all that scrolling and debating it. Justin levet as professor.
• 12:57
  Speaker 1: Professor Justin Levitt is professor of Constitutional Law at Loyola
• 13:01
  Speaker 1: Law School, and our thanks to him. It is time
• 13:07
  Speaker 1: to turn back to markets which seemed to be quite
• 13:10
  Speaker 1: delighted with themselves, at least equity markets at the moment.
• 13:12
  Speaker 1: David Ko talk as chairman and chief investment Officer at
• 13:15
  Speaker 1: the Cumberland Advisors. David, give us an update on liquidity
• 13:19
  Speaker 1: because we've seen quite the move and treasuries overnight and
• 13:22
  Speaker 1: today again quite the move in stocks, you know, I
• 13:26
  Speaker 1: mean there are definitely individual stories, um, you know, an
• 13:29
  Speaker 1: Alzheimer's drug providing some boost to some some of the
• 13:33
  Speaker 1: healthcare stocks. But in general is this a liquid market.
• 13:39
  Speaker 1: It's a very liquid market in the large cap Bonnie,
• 13:43
  Speaker 1: in the growth stocks. I looked right before the interview, Um,
• 13:48
  Speaker 1: if you looked at the s MP five hundred large
• 13:53
  Speaker 1: camp and I j R. Which is the t F
• 13:57
  Speaker 1: for the s MP six hundreds small cap the difference
• 14:01
  Speaker 1: in performance today was three hundred basis points. So there's liquidity,
• 14:07
  Speaker 1: it's flowing into the nurse take, it's flowing into the
• 14:10
  Speaker 1: large cap growth sector, and other parts of the market
• 14:15
  Speaker 1: seem to be either in disfavor or just ignored. So, David,
• 14:21
  Speaker 1: there was a lot of discussion, you know, over the
• 14:23
  Speaker 1: last several months about when and if investors should think
• 14:27
  Speaker 1: about rotating out of some of those big tech names
• 14:30
  Speaker 1: that do have the proven top line growth stories into
• 14:32
  Speaker 1: some of the more cyclical stories that depend upon you know,
• 14:36
  Speaker 1: us getting to the other side of this pandemic and
• 14:38
  Speaker 1: getting to economic recovery. Where are you now here? We
• 14:41
  Speaker 1: are election a plus one on that thought. Well, we
• 14:46
  Speaker 1: have taken positions in and we have positions in small
• 14:51
  Speaker 1: cap and mid cap and um we are leery of
• 14:57
  Speaker 1: the intensity of the half of ju stocks that make
• 15:01
  Speaker 1: up the fang or how whatever, however you want to
• 15:04
  Speaker 1: spell the acronym, because we've we're continuing right through today
• 15:09
  Speaker 1: to see this bifurcated market. You have the SNP five
• 15:13
  Speaker 1: hundred five giants and you have the other four hundred,
• 15:17
  Speaker 1: and there's a big gap between the two. UM. Last
• 15:22
  Speaker 1: week in the sell off, we saw sentiment reach real extremes,
• 15:27
  Speaker 1: so we went to the buy side. So by the
• 15:30
  Speaker 1: end of last week we're about invested in our US
• 15:34
  Speaker 1: ets portfolios, which is where we are today. UM, it's
• 15:39
  Speaker 1: been great for seventy two hours. If I were to
• 15:44
  Speaker 1: tell you anything other than I am very nervous and
• 15:47
  Speaker 1: leary here, I wouldn't be telling you the truth. David,
• 15:52
  Speaker 1: you're in Florida. I'm just curious as to you know,
• 15:56
  Speaker 1: whether you anticipated the Florida results. Oh, thank you, know,
• 16:01
  Speaker 1: thank you. I listened to the interview you just had
• 16:04
  Speaker 1: with with your colleague about Florida. UM. Florida's that chaotic
• 16:09
  Speaker 1: place these days. It's the outcomes were strange. We saw
• 16:14
  Speaker 1: lots of the Hispanic communities, Cuban and Venezuelan and Puerto Rican,
• 16:22
  Speaker 1: various communities, and how they were surprisingly strong for Trump.
• 16:28
  Speaker 1: If you were in Florida, you could see the field
• 16:32
  Speaker 1: work being done by the Trump campaign people. It was
• 16:36
  Speaker 1: deep here and the intensity of the divide in Florida
• 16:41
  Speaker 1: is really very alarming. M Vanny. I live here. UM,
• 16:46
  Speaker 1: I see two populations, one population of which I'm a
• 16:50
  Speaker 1: part are older, they're worried about the virus. They wear masks,
• 16:54
  Speaker 1: they wash their hands, they stay socially distant, they're careful.
• 16:59
  Speaker 1: There's a lot of us here like that. And there's
• 17:02
  Speaker 1: another cohort younger um thirties, forties, twenties, and they're on
• 17:09
  Speaker 1: the other side. They don't wear mess they don't distance,
• 17:12
  Speaker 1: they get sick, they don't care. They think it's like
• 17:14
  Speaker 1: a cold. We just had an episode in Delray Beach
• 17:17
  Speaker 1: on the other coast where there was a march on
• 17:20
  Speaker 1: main Street and then to the end of the march
• 17:22
  Speaker 1: they had a mask burning event. So we really have
• 17:25
  Speaker 1: a divided state and the intensity of the division is
• 17:30
  Speaker 1: alarming to some of us. I'm one of those, David,
• 17:34
  Speaker 1: Is it is it regional within the state as well?
• 17:37
  Speaker 1: Florida such a big state, you know, it's almost like
• 17:40
  Speaker 1: their South Florida. Then there's Central Florida North Florida. Is
• 17:43
  Speaker 1: it different that way as well? I think it is
• 17:46
  Speaker 1: fault And I think not only is it regional uh
• 17:50
  Speaker 1: north or South or the two coasts in the middle,
• 17:54
  Speaker 1: but really regional in maybe the metropolitan center. So Miami
• 17:59
  Speaker 1: is quite different from Tallahassee, from Jacksonville, from Tampa, from
• 18:03
  Speaker 1: sarah Soota where I am in, down to Naples. So
• 18:07
  Speaker 1: you you go to different places in Florida, and it
• 18:11
  Speaker 1: is it is a micro cosum and they are distinguishable.
• 18:18
  Speaker 1: And for us in Sarasota, we you know, Cumberland is
• 18:21
  Speaker 1: now headquartered here, and we're in many states around the country,
• 18:26
  Speaker 1: but in Florida, we we have clients and relationships from Jacksonville,
• 18:31
  Speaker 1: a Key West, and from Tampa to Fort Lauderdale. So
• 18:35
  Speaker 1: we're on the phone or talking to our people all
• 18:37
  Speaker 1: the time. And you would think you're in six or
• 18:40
  Speaker 1: eight or ten different states, not just one. That's incredible, incredible, David,
• 18:45
  Speaker 1: I'm gonna ask you a question I asked earlier, but
• 18:48
  Speaker 1: I'm just fascinated by it is a supposed election trade
• 18:51
  Speaker 1: yet well, I don't know. We we have we The
• 18:59
  Speaker 1: way I think about it is we have a very
• 19:02
  Speaker 1: unusual transition or not with Trump, who has created a
• 19:09
  Speaker 1: unique presidential environment after two hundred and twenty years. So
• 19:15
  Speaker 1: what is Trump and the Trump supporters? They are a
• 19:19
  Speaker 1: version of a revolution, and a revolution in an early
• 19:24
  Speaker 1: stage has a lot of energy. To see it in
• 19:26
  Speaker 1: the rallies, you see it in the expressions of support
• 19:31
  Speaker 1: for Trump, and you see it in the concern of
• 19:34
  Speaker 1: others who look at it and get worried about it.
• 19:37
  Speaker 1: And revolutions have to evolve, and then they have to
• 19:42
  Speaker 1: get tired and they mature. This is a young revolution.
• 19:46
  Speaker 1: How big it is, what it will do to be sustained,
• 19:50
  Speaker 1: how much of it is idiosyncratic to one unusual political figure,
• 19:56
  Speaker 1: remains to be seen. So how we how we deal
• 20:00
  Speaker 1: with this is a very difficult thing, and from an
• 20:02
  Speaker 1: investment point of view, from from an economics point of view,
• 20:06
  Speaker 1: doubly so, because Trump has changed all global trade patterns,
• 20:13
  Speaker 1: introduced protectionism and tariffs, uprooted agreements with drawn from them.
• 20:19
  Speaker 1: So the disruption is the easy part. It's the reconstruction
• 20:25
  Speaker 1: of whatever the new is gonna be. That's the hard part.
• 20:29
  Speaker 1: We've only seen the disruption and we don't know the
• 20:33
  Speaker 1: degree of it yet. So we're in a remarkable place.
• 20:36
  Speaker 1: I tell my clients and friends we are writing a
• 20:40
  Speaker 1: history book and we are right in the middle of
• 20:43
  Speaker 1: the fifth chapter and it's a ten chapter book. So, David,
• 20:47
  Speaker 1: if former Vice President Joe Biden were to win the
• 20:50
  Speaker 1: White House, what do you think his job one needs
• 20:53
  Speaker 1: to be? Well, he would like to be a healer.
• 20:57
  Speaker 1: He's an old time season politics and he's been in
• 21:00
  Speaker 1: the Senate for a long time. He thinks he knows
• 21:03
  Speaker 1: how the Senate works. Um, we don't know what the
• 21:06
  Speaker 1: Senate is gonna look like exactly, but we know it's
• 21:09
  Speaker 1: going to be very close. And we also know the
• 21:11
  Speaker 1: House didn't expand it doesn't look like it. Pelosi's margin
• 21:16
  Speaker 1: is is difficult, it's narrow. So Biden is a politician
• 21:21
  Speaker 1: with long skills. Can he accomplish some workable relationship and
• 21:27
  Speaker 1: have policy? We know the policy. He wants a climate
• 21:30
  Speaker 1: change that's a big issue. He wants an infrastructure bill.
• 21:33
  Speaker 1: We've that's a big issue. He's going to raise taxes
• 21:36
  Speaker 1: on certain areas of the economy and on wealthy people
• 21:40
  Speaker 1: and on corporations. That's an issue. Can he pass them?
• 21:44
  Speaker 1: How much can he get through the houses of Congress?
• 21:46
  Speaker 1: This is an extraordinary piece. I don't know that anybody
• 21:51
  Speaker 1: can forecast trajectories are outcome sitting here today. Yeah, And
• 21:57
  Speaker 1: I mean, David, you know the president has a limit
• 22:00
  Speaker 1: of powers. If you're talking about you know, traditional presidents
• 22:03
  Speaker 1: that doesn't sign executive orders all the time, and and
• 22:06
  Speaker 1: you know some of those executive orders weren't really even
• 22:09
  Speaker 1: you know, in in law. So if it is Joe
• 22:12
  Speaker 1: Biden and he treats the presidency as a traditional presidency,
• 22:17
  Speaker 1: what at all can he accomplish? Can he even rejoin
• 22:21
  Speaker 1: the Powers Agreement, for example, that's something we know he
• 22:23
  Speaker 1: wants to do. Well, would seemed to me funny he
• 22:27
  Speaker 1: can He can reverse executive orders just as easily as
• 22:31
  Speaker 1: Trump could issue them, and and he can not use them. Also,
• 22:38
  Speaker 1: it would seem that the country want, or some of
• 22:42
  Speaker 1: the country wants, less chaotic governance, more calm, more traditional normalcy,
• 22:50
  Speaker 1: and search for it. So Biden has a way to
• 22:54
  Speaker 1: deliver it. Whether he can accomplish that remains to be seen.
• 23:01
  Speaker 1: But he has his network of people who have governed before,
• 23:07
  Speaker 1: and they have the capability and experience to govern, and
• 23:11
  Speaker 1: he knows them, and he's comfortable choosing the people to
• 23:15
  Speaker 1: work with. In the case of Trump, we didn't have
• 23:17
  Speaker 1: a transition team, we didn't form a government. It was
• 23:21
  Speaker 1: chaotic from the very beginning, and the turnover has been
• 23:25
  Speaker 1: so high, So that would speak in favor of Biden
• 23:29
  Speaker 1: being able to have successes progressively, Let's hope. So, Hey, David,
• 23:35
  Speaker 1: thank you so much for sharing some of your time
• 23:37
  Speaker 1: with us. We really appreciated. David Kotok, he's a chairman
• 23:41
  Speaker 1: and chief investment officer at Cumberland Advisors. A risk on
• 23:48
  Speaker 1: day today, on election Day plus one, let's get a
• 23:51
  Speaker 1: sense of what's driving these markets. We can do that
• 23:53
  Speaker 1: with our good friend Danielle di Martino Booth. She's a
• 23:56
  Speaker 1: CEO and Director of Intelligence at Quill Intelligence. She's also
• 24:00
  Speaker 1: a former advisor at the Dallas Federal Reserve and a
• 24:03
  Speaker 1: Bloomberg Opinion calumnist. She's based in Dallas, Texas. Daniel thanks
• 24:07
  Speaker 1: so much for joining us here. So when you woke
• 24:09
  Speaker 1: up this morning you kind of got a look at
• 24:11
  Speaker 1: the news feeds. What did you think we were going
• 24:14
  Speaker 1: to see in the market today, Well, it was more
• 24:17
  Speaker 1: like when I went to sleep this morning, since that
• 24:19
  Speaker 1: had a few hours um, you know, it was it
• 24:24
  Speaker 1: was pretty apparent that the market started to factor in
• 24:29
  Speaker 1: a lot of the benefit of gridlock, if you will
• 24:33
  Speaker 1: in the coming years. Uh, you know, plus the idea,
• 24:37
  Speaker 1: you know, if Wisconsin and Michigan and Nevada do go
• 24:41
  Speaker 1: to Biden. And I don't really follow polls at all,
• 24:44
  Speaker 1: but I follow Vegas very closely. And that's what Vegas
• 24:46
  Speaker 1: is saying right now. So if we get over the
• 24:48
  Speaker 1: two seventy electoral vote, uh line, you get a camp
• 24:52
  Speaker 1: Down trade war, no sack Supreme Court, no rising corporate taxes,
• 24:57
  Speaker 1: no rising capital gains taxes, neglig dorble antitrust, and stimulus,
• 25:01
  Speaker 1: but not socialism. So I mean, who doesn't win in
• 25:04
  Speaker 1: this scenario? Uh? But you know, we do still have
• 25:08
  Speaker 1: the specter of unlike conspiracy theories that we're running around
• 25:13
  Speaker 1: out there, we do still have the specter of of
• 25:16
  Speaker 1: of the virus sitting out there as well. So but
• 25:19
  Speaker 1: but no, markets are celebrating. They have a lot to
• 25:21
  Speaker 1: celebrate right now. Yeah, I mean, it definitely looks like
• 25:26
  Speaker 1: they're celebrating this immediate sort of results. But if, as
• 25:30
  Speaker 1: our previous guests said, there will won't be anything to
• 25:33
  Speaker 1: sort of challenge on at least in the in the courts,
• 25:37
  Speaker 1: then you know, and and and we have divided government.
• 25:40
  Speaker 1: So let's say, and I know this is all hypothetical
• 25:42
  Speaker 1: because we don't have any answers yet, but let's say
• 25:44
  Speaker 1: there's a President Biden with a Republican Senate. Is that gridlock?
• 25:48
  Speaker 1: Is that what markets are enjoying here? Well, it's it's
• 25:52
  Speaker 1: the things that I said that that that they would be.
• 25:55
  Speaker 1: It's it's the inability to pass, you know, the sweeping legislation,
• 26:01
  Speaker 1: the things that were most feared on the part of
• 26:05
  Speaker 1: the GOP. And and that's why we've seen bondyields come
• 26:09
  Speaker 1: down so hard. And it's not just here in the
• 26:11
  Speaker 1: United States. We've seen bond yields come down worldwide to
• 26:14
  Speaker 1: day and volatility literally crash. So, Danielle, you know, obviously
• 26:19
  Speaker 1: the FED is already in session if you like, and
• 26:22
  Speaker 1: tomorrow there's another meeting after which we'll have a decision
• 26:25
  Speaker 1: and a statement from Fed Jerry J. Powell. Will this
• 26:29
  Speaker 1: change anything about what statement might emerge tomorrow as opposed
• 26:33
  Speaker 1: to if we really did have a you know, a
• 26:37
  Speaker 1: strong mandate on either side. Well, I think you're going
• 26:42
  Speaker 1: to hear the volume turned up even higher. Remember the
• 26:46
  Speaker 1: the SET is not a spender, it is a lender.
• 26:49
  Speaker 1: So you're going to hear the volume turned up even
• 26:51
  Speaker 1: higher because of the prospect for a smaller stimulus package
• 26:55
  Speaker 1: then probably what most SET officials would like to see,
• 27:00
  Speaker 1: and that you know there there are there are a
• 27:02
  Speaker 1: lot of very small band aid but huge macroeconomic stimulus
• 27:07
  Speaker 1: measures that can be taken along with the December the
• 27:10
  Speaker 1: eleventh Continuing Resolution that the government has to vote on
• 27:13
  Speaker 1: that by December the eleventh during laying up lame deck,
• 27:16
  Speaker 1: excuse me to keep the government open. So it would
• 27:19
  Speaker 1: just be a matter of I did the math recently,
• 27:21
  Speaker 1: back of the envelope about a hundred billion dollars to
• 27:25
  Speaker 1: extend the Cares Act unemployment benefit through the end of March,
• 27:30
  Speaker 1: which would match up with when CARES Act forbearance on mortgages,
• 27:34
  Speaker 1: and uh same could be said for rental eviction moratorians. Again.
• 27:39
  Speaker 1: You add those two up and it's it's a rounding
• 27:41
  Speaker 1: era for for Uncle Sam of a hundred billion dollars.
• 27:44
  Speaker 1: But you're preventing a massive fiscal cliff on December thirty one,
• 27:48
  Speaker 1: when the pandemic unemployment assistance, all of the different names
• 27:52
  Speaker 1: of unemployment jobless claims that we talked about every Thursday morning,
• 27:56
  Speaker 1: those are set to expire at the end of the year.
• 27:58
  Speaker 1: So is the rental eviction ratorium that President Trump signed
• 28:02
  Speaker 1: a memoranda to to extend via CDC funding. So those
• 28:08
  Speaker 1: are easy things. I think that that the Congress can do,
• 28:10
  Speaker 1: but I think the Fed will reiterate that they really
• 28:13
  Speaker 1: do want a larger stimulus package in order to carry
• 28:18
  Speaker 1: this economy over what appears to be a growing coronavirus
• 28:22
  Speaker 1: third hospitalization waves. Yeah, so, Danielle, you're you're exactly right
• 28:27
  Speaker 1: that numbers are going in the wrong direction. Is there
• 28:29
  Speaker 1: any appetite do you think for the Republicans to kind
• 28:34
  Speaker 1: of change their tech and and and do in fact
• 28:37
  Speaker 1: deliver a bigger number to whoever is president. Well, you know,
• 28:43
  Speaker 1: it's it's it really is going to come down to
• 28:46
  Speaker 1: and this is just my view, but it is going
• 28:49
  Speaker 1: to come down to some interesting comments that Bloomberg reported
• 28:52
  Speaker 1: on a few weeks ago from Jamie Diamond and the
• 28:55
  Speaker 1: cabinet that Biden chooses from the get go, and those
• 29:00
  Speaker 1: types of acts of goodwill on his part to show,
• 29:03
  Speaker 1: don't tell that he's going to be centrist, that he's
• 29:06
  Speaker 1: going to unify the country instead of unifying the Party
• 29:11
  Speaker 1: of the Democrats. If there are signs that Biden is
• 29:15
  Speaker 1: going to follow through on some of his election promises,
• 29:19
  Speaker 1: that he is going to be the Biden that we've
• 29:21
  Speaker 1: always known, straight down the middle, then I think that
• 29:25
  Speaker 1: you would see a much more amenable Senate Lad gop
• 29:29
  Speaker 1: led Senate daniel D. Martino both, thank you so much
• 29:32
  Speaker 1: for joining us. We appreciate that Danielle's the CEO and
• 29:35
  Speaker 1: director of intelligence at Quill Intelligence. She was a former
• 29:39
  Speaker 1: advisor to at the Dallas Federal Reserve and also a
• 29:42
  Speaker 1: Bloomberg Opinion commist. We always appreciate her thoughts and Vannie
• 29:45
  Speaker 1: getting some headlines coming across the Bloomber terminal. Georgia expects
• 29:49
  Speaker 1: all votes to be counted today and the state of
• 29:52
  Speaker 1: Georgia has two thousand ballots left to be counted. That's
• 29:54
  Speaker 1: according to a state official. So making some headway in
• 29:58
  Speaker 1: the state of Georgia. And we just heard, of course
• 30:00
  Speaker 1: from the state of Michigan as they continue to count
• 30:02
  Speaker 1: their ballots. Yeah, I mean, I think we've heard from
• 30:05
  Speaker 1: many of those states who have ballots left to count
• 30:07
  Speaker 1: at this point. Really, the main message is reassuring voters
• 30:10
  Speaker 1: that their vote won't go astray and it won't get
• 30:13
  Speaker 1: not counted. And you know, whether it's a Republican state
• 30:17
  Speaker 1: or a democratic state, you have been hearing from the
• 30:20
  Speaker 1: governors and state officials that that is the case. So
• 30:23
  Speaker 1: it will be interesting to see what President Trump will
• 30:26
  Speaker 1: do about this and whether he intends to continue to
• 30:30
  Speaker 1: carry out his threat, you know, to have election counting
• 30:34
  Speaker 1: or ballot counting stopped beyond a certain point. I mean,
• 30:37
  Speaker 1: nobody seems to think that that's a politicibility, including the
• 30:40
  Speaker 1: constitutional lawyer we just spoke with. Yeah, exactly right. So
• 30:42
  Speaker 1: I think I guess the common theme we're hearing from
• 30:45
  Speaker 1: these states is in terms of their messaging, is every
• 30:48
  Speaker 1: vote will be counted. You can have confidence in that. Uh.
• 30:51
  Speaker 1: And then obviously so over the next several days we
• 30:54
  Speaker 1: should know something more clearly. Thanks for listening to Bloomberg
• 30:58
  Speaker 1: Markets podcast. You can subscribe and listen to interviews at
• 31:02
  Speaker 1: Apple Podcasts or whatever a podcast platform you prefer. I'm
• 31:05
  Speaker 1: Bonnie Quinn. I'm on Twitter at Bonnie Quinn, and I'm
• 31:08
  Speaker 1: Paul Sweeney. I'm on Twitter at pt Sweeney. Before the podcast,
• 31:11
  Speaker 1: you can always catch us worldwide at Bloomberg Radio