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tv   Bloomberg Markets Balance of Power  Bloomberg  September 18, 2019 12:00pm-1:00pm EDT

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david westin. welcome to "balance of power," where the world of politics meets the world of business. on the brief today, carl riccadonna on the imminent fed decision. from london, mark champion on saudi arabia's charge against iran. and tyler page from washington on the latest all of democratic presidential candidates. carl, what are we expecting a short time? i think we will see a 25 basis point cut. they can guidance for additional easing later this year but i do not think the fed wants to be too specific on what that will look like ahead of claytor clarity in trade negotiations. one of the -- david: things we have been talking about is this repo. will they address that? carl: they should address that. it will be something probably powell will address in the press conference and i think you will be asked questions about this. there are two issues. one is temporary patches, which
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the fed has to show there on top of issuing, and then the broader issue is later on this year, maybe having a permanent repo facility that could address this and possibly expending the balance sheet. david: a month ago when we heard from chairman powell, there was a lot of talk about uncertainty with respect to trade. we have more uncertainty now with the attacks on saudi arabia. we will hear more about geopolitical uncertainty. carl: they have been very focused on geopolitics and trade tensions as a reason to increase downside risk in the economy and having to lower policy to respond to that. if anything, those tensions have gotten greater in the last couple of weeks, not only with trade tensions continuing to build but also what we see in terms of oil price spikes and geopolitical tension. david: thanks so much. we will be watching with you in under two hours. now we go to london in mark champion.
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it isarabia said unquestionable iran is behind the attacks. what comes next? mark: a very good question. if you think of what has happened so far, president trump has tweeted the u.s. will impose substantial new sanctions. that is a first step. it is the easy one. in a way, that is a tool that -- mike pompeo said 80% of the yuan economy is already under sanction, anything from the sector to cars, planes, metal. once you exclude food and medicine, there is not a lot left to sanction. then the tougher question becomes what do you do kinetically? what you do, if anything, in military terms to hit back. david: to oversimplified, there
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is a defense and offense. some of us were surprised saudi arabia did not have defenses in place. is it possible the united states could have protected them, or does it have to be offense, to strike some of the sources in iran? mark: another very good question. i spent some time talking to military analysts about the kind of attack that was executed. there were two things they said. one was it was surprisingly professionally done. it was highly sophisticated. we do not know for sure everything that was used, but it seems to have been a mix of drones and cruise missiles. the second thing they said is that when those are launched, they still do not know where they come from. if they come in a low altitude and they are in a swarm of drones and a bunch of cruise missiles, that is a difficult thing to defend against, especially with a large dacian area target like the facility
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that was hit -- with a large target like the facility that was hit. 400 are notiles, as necessarily the right thing to shoot all of that stuff down. it is a fairly complicated military question as to how you prevent that from happening again, surely you could do better. surely you could get some of it, but the consensus i seem to get was it would be very difficult to make sure nothing ever got hit again. david: that is pretty sobering, i must say. chanks so much to mar champion in london. now we go to tyler in washington. tyler: the headlines are that joe biden's durability continues. he leads the latest poll with 31%, followed closely by elizabeth warren with 26%. we have seen that trend in recent polls where vice
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president biden has continued to lead despite concerns about his age or appeal to certain voters. elizabeth warren continuing to rise in the polls. she gained 6% and has a lot of distance between her and bernie sanders. early to say, but it looks like it might be turning into a two person race, a moderate and a progressive. are the polls indicating anything about the level of enthusiasm? tyler: we are seeing elizabeth warren leading the way here. she leads with the support among all age groups, where joe biden has a lot of support among older and black voters. elizabeth warren has the most enthusiasm from voters, and particularly she has a lot of support from voters across the trains, particularly younger and wider voters. she is gaining support as well as voters of colors, crucial constituencies.
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david: thank you so much. now it is time to find out what is going on in the markets with abigail doolittle. abigial: we are looking at modest declines for the major averages in the u.s.. all down .3% or a little bit more. not huge losses the head of that fit decision at 2:00. we have a rally for bonds. the 10 year yield down five basis points. a modest risk off tone. investors waiting for the fed. let's look at a multi-day chart of the 10 year. today we had yields going lower, and that is true for the last three days, including today. here is the huge backup in yields. the 10 year yield up eight days, the longest rise for yields since 2017. the most ever on record going back to 1962. we cnet-net going in -- we see net-net going into this meeting. investors are waiting for that
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one quarter hike. as you were talking about the repo issue, the money market squeeze, and will that be factored into the fed language? let's look at a great chart. one pressure that has happened out of this liquidity crunch, we see the upper limit of the fed funds target rate has been breached. whether or not the fed will talk about it in their official language, or as carl riccadonna was saying, in the press conference afterwards. luke kawa suggests there is a chance they could suggest a permanent operation be put in place. oil is down for another day. not a huge decline relative to yesterday, but sizable. down 1.5%. this as the saudi's are committed to bringing supply back online. this is weighing on conocophillips. finally whirlpool down 2.5%. they put up a disappointing quarter. earnings momentum has dissipated.
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all of this ahead of that fit decision at 2:00. david: thanks a much to abigail doolittle. coming up is the economy issue the democrats want to fight president trump on? we talk to james burling, a top economic advisor to president clinton and president obama. that is coming up next and this is bloomberg. ♪
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david: this is balance of power on bloomberg television. i am david westin. we turned to mark crumpton for bloomberg first word news. mark: saudi arabia says the weekend attacks on the oil infrastructure were "unquestionably sponsored by iran." iran has denied responsibility. the country president says it
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was carried out by you many rebels. president trump -- by yemeni rebels. president trump is also blaming iran and says he will impose more sanctions on the country. robert o'brien will replace john bolton who was fired last week. robert o'brien heads effort to secure the release of american hostages held by north korea, iran, and others. the trump administration has scrapped california's authority to set tougher auto emission standards than the federal government. president trump tweeted the move will allow the production of cars, both cheaper and safer. revoking the california standards will have an impact. 13 other states said they will follow california's lead. up -- over theop next few days. the national hurricane center weakened to as
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tropical depression and is located about 25 miles north/northwest of houston. it is the first named storm to impact the houston area since hurricane harvey jumped more than 50 inches of rain on the city in august 2017. global news 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton. this is bloomberg. david? david: thanks so much. the top 10 democratic candidates for president debated one another in houston, with a lot of time given over to issues like health air and gun regulation, but no mention of the economy or jobs. why was that, and what economic message should democrats embrace to counter president trump. we welcome gene sperling who served as the director of the economic council under president clinton and president obama. welcome back. good to have you here. let's start with the state of
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the economy. we are about to have a fed announcement. we expect they will cut 25 basis points. should they do that, and what does that tells about the state of the economy? do they need to do that because the economy may be headed into 12 -- into trouble? gene: it is not an easy time to be jerome powell. you do have a mix of economic numbers. we know job growth was not as great. was not only an contraption, but the new orders index was even weaker. there were a lot of negative signs. on the other hand, you do have a consumer sector that had pretty high savings rate, maybe showing some resilience and maybe helping to see this rather positive housing start number. i think you see a greater chance of recession, but you would probably still predict more of a slowing, something like 1.6% growth next year.
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facescond issue the fed is the trade uncertainty. there is a real question -- will easy monetary policy actually address that. if people feel that president trump is uncertain and it is making them put investments on hold, does an extra 25% basis reduction actually affect that? then you have such division among the fed itself. i think you are in a tenuous situation. i think they will lower the quarter point. i think they will be likely to lower another quarter-point as insurance joint i think powell and the fed will show again some division and a sense of they will cut as much as necessary, but powell not wanting to give the indication they are on a steady path to cut 25 basis points every meeting for the next year or so until they see -- a more certain
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threat of recession than they are right now. say, theirou questions about whether monetary policy can be an antidote to trade uncertainty. maybe there is one place were easy monetary policy maybe helping. that is housing. we saw new housing start numbers the highest they have been in a long time. does that give us encouragement about the economy? gene: on the one hand you always want to be careful about a single month. this was two months because they revised the previous month. people were expecting 1.20 5 million, it was a good 110,000 higher than that. if you look at the reporting, including from bloomberg, the view is this shows the lower interest rate and the fact that consumers have been saving and are a bit more resilient offers a positive spectrum. i think that will be debated in the fed meeting today. as we said, you look at
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manufacturing, it is already in contraction. mixed, you are seeing which is why it probably is more likely that the prediction is the economy is slowing into the , 1.5, 1.6. i think most people would say the chances of a recession have gotten higher. it may be more like one third or 35% and we have seen before, and that this kind of uncertainty and recklessness in the trade dealings by president trump has been harmful. then you see the other issues that come out like saudi arabia, iran tensions, oil tensions. you have to look at the housing start as one positive number in a very mixed picture right now in the economy. what does that mixed picture mean for someone running
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for president on the democratic side? if we look to houston i do not think there was any mention of the economy. do democrats need to stay away from economics and job issues? is there a danger in that? gene: i disagree with that perspective a little bit, which is that -- the economy is not an abstraction people are measuring by gdp. the economy is how people are feeling. when you talk about health care, that is the economy to most people. most people want to know how they are doing, what are they bringing home, do they have enough to care for their family? democrats and trump will battle on the economy. democrats will say he has done very little to help good everything good that was happening was a positive trend he inherited. he will still say my numbers look good and brag. that will go back and forth. what this will be fought on is what is affecting people's lives in the future. those things are health care,
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childcare, do they feel secure, do they feel their children will be better off? that will take you to a lot of economic policies that affect people's well-being, health care, childcare. , democratshose areas will say i'm fighting for you. when this president came in, he gave a true tillie -- a $2 trillion tax cut, lowered the corporate rate, he has not been fighting for your better interest, even on freight where he has been tough on china as a lot of people -- even on trade where he has been tough on china, he has done it in such a reckless and egocentric way it has ended up hurting our manufacturers and consumers. democrats have a lot of room if they talk about kitchen table economics, then get into a debate about the macroeconomy. about, andth care there was a lot of talk about
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health care. it broke down into are we going to go radical or more conservative what we do? it is going to be the affordable care act, as opposed to let's take it all over and make it medicare for all. are people going to be comfortable saying i'm going to throw this up in the air and turn it all over to the government and have the government run all of health care? gene: i think the right message for democrats is to say we believe in health care as a right. we believe everybody should have affordable health care. we are the party that fights for that. i would encourage them not to have a my way or the highway approach. even if you are a government approach, you keep the focus on the end goal. our are people going to have health security? democrats have issues like on pre-existing condition coverage where the public is overwhelmingly for them. i would encourage them to focus on your end goal, which is
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affordable health care as a right, which i think the public will support you. do not get locked into my way or the highway. david: finally, on the economy, a mixed picture. some good things going on in the economy. the republicans claim that is because of what president trump and the republicans did. we talked with mike braun, the republican senator from indiana recently, and this is what he had to say about all trump had done for the economy. >> this recovery, due to the fundamentals that were in place before president trump got elected, we would be in a full-blown recession. there is no doubt about it. david: does he have a point? gene: no. david: a lot of things going on after president obama. one thing not going on was the massive tax cut. would be -- would we be in worse shape if not for the tax cut? gene: the economy today is a case against the tax cut. all of the positive things in the economy were already
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trending that way when president obama. president trump comes in and does a $2 trillion deficit increasing tax cut, which is designed to do what? say it was designed to have long-term business investment, and yet on the one thing they identify as important, we see it petering out. we see business investment low. we see uncertainty. i think even by their own terms, the trump tax cuts have had very little positive effect. i think democrats will persuasively argue that it is encouragement to do more stock buyback, what you hear even from some republicans, and i think democrats will usually argue that if you took that size of tax cuts and helps give that to working people either as an earned income tax credit or childcare, health care, you would have a better and stronger and more resilient economy right than what the trump tax cut
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delivered. david: great to have you with us. that is former national economic council director gene sperling from los angeles. tune into our live coverage of the fed decision starting at 2:00 eastern time. from new york, this is bloomberg. ♪
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david: you are watching "balance of power." worstis on paste for its day since 2008, plunging 14% after cutting its outlook again. kailey leinz is here to explain herself. kailey: third outlook cut this year. citigroup is describing this one is drastic. earnings per share coming in between $11 and $13. that missed the street estimate and would represent a 16% decline in earnings from the prior year. the company is pointing the
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finger at the macro environment, specifically the trade war. we should be able to pull up a quote from frederick smith, it is the weakening global macro environment driven by trade tensions and policy uncertainty. that is why it is crimping demand for shipments. analysts have been quick to react. four downgrades for fedex. i have a chart at gtv showing you how the price targets have come down again. fedex continues to cut but analysts noting there is a lot of idiosyncratic factors for fedex. david: exactly. how much is the lowering tide and how much is specific to fedex? they made a different decision about amazon. kailey: fedex essentially cut all ties with amazon because it ended the air shipping business it still had with them. that will create a $900 million revenue drag for fedex. europe has not been good about cost, deutsche bank noting overspending on its own air
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shipment business. this pointing to a lot of management missteps. they say you cannot blame this on the macroeconomy. that is not to say this macro issues do not still hold. -- ie a chart i ballard borrowed from deutsche bank. the white is global trade volume. you can see how fedex has kind of a lead. when fedex peaks, global trade volume peaks. that happened in the past recessions and it happening now. david: thanks a much for being with us. up next, benjamin netanyahu bet big on a new election and right now it looks like it did not work out so well. we talked to the former u.s. ambassador to israel. live from new york, this is bloomberg. ♪
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♪ is balance of power and i am david westin. we go now to mark crumpton. mark: secretary of state mike pompeo says the united states is
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working with international allies on a coalition to deter iran. the secretary speaking on a plane before arriving in arabia moments ago. this comes as president trump says he plans on ramping up sanctions against iran. on twitter, the president said he has instructed secretary mnuchin to quote, "substantially increase sanctions." that follows weekend attacks on saudi arabia's biggest oil installation. iran has denied any role in the incident, although saudi has said that iran wasn't questionably behind the attacks. boris johnson's governments back in supreme court for day two of hearings. johnson's lawyer promises that the government will file a statement overnight if losing the landmark case over the suspension of parliament. a third and final day of hearings will be held tomorrow.
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they will hear from leading northern island and welsh lawyers and john major. spain's acting prime minister asking voters for an even bigger victory for his socialist party after the failure to form a government triggered a new election in november. pedro sanchez spoke a day after saying that there was no viable candidate that could win parliament's endorsement before the deadline. canada's opposition conservatives are promising major cuts to business subsidies if they defeat justin trudeau. andrew scheer who is seeking to unseat the incumbent liberal prime minister in next month's vote says the cuts will eliminate more than $1 billion in costs. the prime minister triggered the election last week when he and scheer locked in a dead heat. global news, 24 hours a day on air and @tiktoc on twitter powered by more than 2,700 journalists and analysts in over 120 countries.
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i am mark crumpton. this is bloomberg. david: thanks. we want to report on a developing story as we speak. california governor gavin newsom says his state is going to sue over the auto emissions rollback. exemption has had an for years that allows them to have more strict auto emission standards for the the rest of the country. but president trump and the administration says no, you cannot be more strict. the auto industry says that you will have to go with the california standards, but president trump says no, and it will raise the cost and make the auto industry less efficient. california is going to sue the federal government saying you cannot withdraw the exemption, presumably because the federal government has not gone through the proper process. but had the power to do it, you have to go through certain processes.
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that is governor newsom speaking as we watch right now. you can watch full coverage on the bloomberg app at live . this is bloomberg. ♪ >> i am lisa abramowicz. we take you inside the world of private debts, equity, and real estate. bloomberg undercover.
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♪ you are watching balance of power. i am david westin. serving under president obama after serving president clinton as his ambassador to israel, he is now a distinguished fellow at the council of former relations. and we welcome him back, thank you and welcome. >> thank you. david: we do not know the results, but we do not -- have exit polls that basically suggests that prime minister
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netanyahu's party is kokkinakis the other. blue and white, call it a dead even draw. in with theand neck other. blue and white, call it a dead even draw. >> he certainly did not win the election. the magic number is 61. they have to cobble together these smaller parties. only addsal coalition up to 55. that is all of the right wing parties and rich parties. that is with the opposition leader heading the blue-and-white party and has 56 in terms of the national coalition plus the arab list, which has 13 states. so slight advantage, but neither has 61. the labourng vote is
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party, and he says he will not go with netanyahu. he insists on a national unity government which would be three different parties together which would be a standard, broad, secular coalition without the religious or arab parties. david: that something like this happen once before with heanyahu and barak, when was prime minister, didn't they share power? indyk: yes, they did. they was a rotation where were prime minister for two years, and the other was prime minister for two years. that worked well. however, the blue and white and the national
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government without netanyahu. he has the mandates to join if he removes netanyahu. pledgedut people have their loyalty into netanyahu. k: he has madey sure. during that, it is anybody's guess what could happen. netanyahu is wounded and he is the to do everything he can to hold onto power, and he will try to bribe wherever he can. i don't think he is going to succeed in this one. david: as we look at those numbers, the exit polls at least, the arab united list is actually number three. ambassador indyk: yes. david: have we ever had the israeli arabs in the government? ambassador indyk: no. that is essentially because the jewish state has not been
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prepared to engage with the arab parties and they have not wanted to be in the government of the zionist states, but that is changing now. the arabs are feeling much more citizens of israel, want a share of the cake. they have basically given their leadership a mandate to find a better way to serve their interests, which are much more focused on local community interests, health, welfare, education, so on. we have a different situation here. the interesting and ironic thing about the arabs, the third-largest party, netanyahu campaigned with excitement and racism, the same tropes we have heard in this country, and instead of driving them away from the polls and intimidating them and driving his voters to the po, -- to the poll, the arabs came out in record
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numbers. how much difference does it make as far the u.s. and israeli-palestinian relations go whether mr. not -- mr. netanyahu -- ambassador indyk: his grouping is basically center rights, not centerleft. he comes from the national security establishment. he does not have all of the ideological baggage that netanyahu has built up over the years. he is not in favor of the annexation of the west bank that netanyahu has talked about. i think he will be more moderates, more pragmatic, much better partner for the united states in the end. especially when it comes to trump. david: this is helpful, thank you, martin. , former u.s. ambassador to israel. from elections in israel to the elections back here coming up next year. the race for president, mark
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sanford served as governor of south carolina and as a congressman, rep resenting south carolina's first district, but now he is running for president, seeking the republican nomination against incumbent, president trump. he comes to us from charleston. governor, welcome back. you have been pretty open in saying it is a really long shots, the chances of you unseating donald trump, and we can show some of the numbers about his popularity within the republican party, over 84% or something like that. if in fact you do not think it is likely that you are going to unseat him, why do you do it? gov. sanford: because, i think we need to have a conversation of what it means to be a republican. we need to have a conversation on where we are going on debt, i think we are headed for real trouble, i think we need to have a conversation on trade, and i
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think we need to have a conversation on the value of institutions in our country. i think we need to have a conversation on tone. there are a bunch of different conversations to be had, and whether i am successful or not and not achieving the presidency, i think i can be successful in advancing the debates. david: how do you get that done as a practical matter? it will be hard to have a debate with the president and i do not think he is going to want to debate you. we have a lot of states that say they will not even hold a primary. how do you change the conversation if you cannot get a platform? gov. sanford: well, that's not true. we are talking to each other right now on distribution vehicles and hitting lots and lots of people. i do that many times over in a day. i think all we can do in life is what we can do. what i can do is to say that i stand for these ideas, i think that they are important to people's lives, i think it would be a huge mistake not to have a discussion.
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i think it is amazing, frankly, that i have watched a number of different democratic debates. there has not been one sentence to debt, deficits, or government spending though i think we are in a precarious position on those fronts and, their public inside. i am going to do what i can -- and there is no discussion on the republican side. i am going to do what i can because i think it is important. ivid: if you go back to 2016, do not remember either candidate talking about debt or deficit. the only discussion was and increasing it, as far as i recall. various lawmakers, and they tend to be republicans, they say they are concerned about it. do you have people behind the scenes from your party saying this is a real problem. we want you to speak out on it? gov. sanford: yeah. i had an unnamed lieutenant governor who called me in
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this and he said, marco, you need to do this and keep pushing. it,ot know what comes for but we need to have this debate as republicans. i think it is amazing, you saw the numbers last week where is for the first time, this benign economic environments, we are tripping the trade dollar number in terms of deficit. if you look at the numbers over the next 10 years, we are projected to run over well over $12 trillion a year. we are about double the average of the last 50 years which is been about 58 months. we are going to see a downturn at some point. the question is, what tools do we have to deal with it? historically, the lower rates are kind of out of room and on the fiscal side, you see deficits increased by about five points in every recession over the last 50 years. out of room there. i think we have something of a
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box that has been set with regard to financial fire that could hurt markets and frankly, people's savings account and their ability to have a job. david: let's talk about what you might do about it on a practical matter, and one question is can you really address that's and deficit without addressing the military budget specifically -- debts and deficits without addressing the military budget specifically? one of the national security concerns is the amount of debt that we are running up, but this is what he said about sending more on defense. >> right now, we are spending a little over 3.1% of gdp on our military. we can afford to do even more than that if it comes down to our survival. itmatter how much it costs, is a lot cheaper than stumbling into a war because an adversary things we are weak. david: governor, what about it? can you meaningfully address the debts without taking something
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of a scalpel is not a hatchet to defense spending? gov. sanford: no, you will have to cut the fence. you will have to cut everything or reform everything is not cut. because, again, we have systems that by any actual set of numbers, are going to deplete themselves. they will deplete themselves way sure of when people want to retire or when they want health care on the social security are medicaid side. theink it is telling that former chairman of joint chiefs what is then asked, biggest threat to america and to our national security, his answer was not the russians, chinese, the taliban, but the american debts. i believe that to be true. booku look at paul kenny's long ago, what you would see consistently is the ability to maintain economic supremacy was key to maintaining military supremacy. i think that that is a national
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security issue. i would say secondly, and i have thegreatest of respect for general. he is a fabulous human being. general mattis is renowned. with other areas of government and people want to protect what they are used to. if you look at what we spend relative to the other top 10 industrialized countries combined, we spend more than they do. threat assessment also has to be where are we relative to our competitors and i think there is room to work there considering allies we would have in the event that something unfolded with china or russia. david: we started out talking about the future of the republican party which is an important part of why you are running. give us a scenario where president wins -- what does it mean for the future of their public and party and give us one where he loses.
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of the republican party and give us one where he loses. gov. sanford: i think it is real trouble for the republican party. one county went democratic to the first time in 50 years. it is a solidly republican district. it did so because in droves, working women, stay-at-home moms, young millennials went the other direction because they said, what is going on? just was tone alone, it is out of sync with what i'm trying to teach my kids are what my parents taught me. brands take time to develop. i think we are talking about real disillusioned to the republican brand. what do in terms of trade and engagement with the rest of the world? what do we stand for in terms of spending? in terms of tone? we are seeing erosion to rid -- to the republican brand that will have a lasting impact.
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if he loses, it will be time for the republican party to regroup, what do we stand for? david: appreciate your time. one more question. we have the fed about to come in for a decision just a little bit over an hour from now. what do you think they should be doing? it is speculated that they will cut rates. is there any speculation that they are encouraging borrowing by keeping the rates low? gov. sanford: totally. we are not seeing the real costs. if you look at the historical averages, we are out of sync with those averages. if you believe in regression to the mean, at some point we will go back to the averages, and there will be incredible costs to all taxpayers. a one point rise in interest rates at the fed level means on that one point and one year, we will spend more than we do on all uniform military personnel in the united states. that is 2 million people. theint interest rise is
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equivalent of what we spend each year on 2 million folks in uniform. y are creatinghe an asset bubble and they are lulling us to complacency. david: that is republican presidential candidate and former south carolina governor and congressman, mark sanford. coming up, we are in day three of the strike was general motors with no apparent break in strike. this is bloomberg. ♪
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♪ david: this is balance of power on bloomberg television. i am david westin. arabia'sith oil, saudi finance ministers said that
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haramco tax had zero impacts on the revenue, and they will continue to spend as needed. over in >> we are back in two lines, so the interruption is in terms of economy and in terms of revenue a 0, because our reserves for couple of days before we are back in line tonight and today. >> so absolutely no impact neither on spending or revenue, even in the longer term as he looked towards the end of the year? >> absolutely. >> what about additional allocations were defense, would that be something you would be looking at? >> generally, if you look our budgets as of now, there is ofnificant indication of all the affected, but also as far as military including defense.
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there is no change, and we will continue spending as we need on our defense and protection. arabia'sat was saudi finance ministers mohammed al-jadaan. we will focus on the california governor gavin new's and saying he will sue the u.s. government to make sure he can still regulate auto emissions. this is quite a tussle with the president coming out and saying, we are going to stop the ability of california regulators to allow us to make more, better, cheaper cars. >> right. another way that donald trump is not a traditional republican. he is going against states rights. theants to govern economy standards from washington, and a lot of automakers support it including general motors, they would rather have just one standard to meet technologically and with
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the fuel economy of their vehicles, but it all started with the smog regulations in california which is different from greenhouse gas emissions. de factobasically regulating fuel economy as well because that is the only way to cut co2 is like giving better fuel economy. the federal government has allowed this to go on particularly in the obama administration, but it has been this way for a long time, and trump is saying nomura that he is going to do with his way. he did say the standards would not be that much different, but he is still looking to get his hands on fuel economy rules. david westin: i don't quite get that because at the same time, he tweeted out that as they are revoking it california's federal waiver, at the same time, making the cars safer, then how is that going to happen? david welch: great question. he does not explain just exactly what he is going to do or the regulations of how they would
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create jobs or make a cars cheaper. the implication here is by having fuel economy rules that are a little less stringent, you lower the cost because you not need fuel saving technology. one thing he did say is that he wants to get rid of the ev mandates, the electric vehicle mandate. that would save car companies a lot of money because other than makingcarmakers are not a lot of extra vehicles -- electric vehicles. david westin: david welch, our bureau chief reporting from new york. coming up, chairman powell's news conference coming up at 2:00 eastern time. this is bloomberg. ♪
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