Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg Business Wait inside from the reporters and editors who bring you America's most trusted business magazine, plus global business, finance and tech news. The Bloomberg Business Week Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio.
Well, the world's biggest bond market boosted bets at the Fed will indeed slash rates again next month after inline inflation data, shorter dated treasuries outperforming. You saw that yield on to your notes dropping from the highest since July. Swap traders boosted to about eighty percent, maybe even more. The probability that the Fed will cut rates again on December eighteenth. Bottom line, it's a different trade than it was a couple of days ago.
Yeah, it certainly is. That's the backdrop for Bloomberg's conversation with feder Reserve at Bank of Minneapolis President Neil Cashcari leading that chat Bloomberg News International Economics and Policy correspondent Michael McKee, who joins us here in the Bloomberg at Business Week Studio. Mike first up the CPI print today in line, as Carol mentioned, with Wall Street estimates. As you dug into the details, anything in there that stood out.
I think the fact that there were many categories that did see pricing increases, and some of the ones that have been problems before are problems again, like used cars and housing is still not going down. It actually went up in price. The one area is the two areas that we did see some improvement in were food up just a tenth of a percent the same as last month, and gasoline, which was down. And we all know that.
The other thing that stood out to me was I'm sure Kamala Harris wishes this report had come out before the presidential election because the price of eggs went down six point seven percent, and she's been criticized heavily for the price of eggs.
I don't know if that would have made a difference, Mike.
I don't think the election.
Came down to just that. But I see what you're doing. Well, wait a minute, So when it comes to inflation, I do feel like, you know, we're hearing some mixed messages or some you know, you've a lot of stories on the Bloomberg that there are people concerned about inflation reigniting, and especially thinking about a Trump administration and it's pro growth policies.
Well, there's two things to watch. One is that what you're talking about there with the Trump administration and the tariffs and tax policies. Saint Louis FED President Alberto Muslim was just asked about those and he said, I can't comment on anything that the new administration is going to do. But if you look at a textbook, it will tell you that tariffs raise prices and can create inflation. And Neil cashcarri had roughly the same views today. So the
FED is going to be watching that. But the thing that has really got for the moment Wall Street's attention and some economist's attention is we've been making progress on inflation, but are we going to be stuck where we are? With the headline inflation at about two point four percent, you know, not two percent, and certainly core inflation well above that right now on a CPI basis three point
three percent. Now, those numbers are lower for the PCEE that the Fed uses for its target, but it's still a question of have we stalled out and would that keep the Fed from cutting rates further because they need to keep the pressure on to keep pushing inflation lower.
Hey, we're going to talk about your conversation with the ol Kashkari a little more in just a few minutes, but I want you to weigh in on this Department of Government Efficiency that's getting a lot of attention right now. Elon Musk Vivek Ramaswami are going to be co heads of this department. Must coming out on the X platform saying he wants this like running counter of how your
tax dollars are wasted. Although previous presidencies and previous administrations haven't called this doge, this has been.
Those points didn't exist, they didn't exist earlier.
And this is my suspect.
I suspect this acronym comes from maybe a commercial point of view on Elon Musk's side, but this is it is definitely not new. You go back to Theodore Roosevelt had a commission proposing new authority, followed by William Howard Taft, who also had a Commission on Government Efficiency that actually
proposed and was enacted the first presidential budget. Presidents didn't submit budgets before, and so presidents were kind of in the driver's seat until the nineteen seventy four Budget Act created Congress's responsibility to pass the budget, which they never do. So you know, you can put that on the list.
But you go all the way up through basically the George H. W. Bush administration, and literally Dwight Eisenhower had one, Franklin Roosevelt had two, while he had one and a half because Harry Truman took over the other the other half. And there was a commission under Hoover, there was commission under Coolidge. There were these commissions just get appointed by presidents and they all promise the same thing. We're going to make government work better for the American people. We're
going to cut regulations, we're going to streamline activity. And they all come up with, you know, several hundred ideas and many of them get adopted, and yet here we are again. So you wonder how much success they can actually have.
Yeah, I guess so, right, Like it's I mean, it's a huge task. I think a lot of people talk about though inefficiencies and government.
So you do one, but it's it's not just getting rid of you know, these so called bureaucrats. It's not just firing people because that's actually very small portion.
Well, that's that's a different effort too on the part of the Trump administration. He wants to be able to fire government officials who aren't loyal to him, and so that's this whole schedule F issue that's going to come up, where he tries to move these people from protected civil service jobs into fire at will jobs.
But you do wonder what programs ultimately get cut. And that's the thing, whether it's Medicare, whether Social Security.
It's a recent barackobus.
I think voters actually vot tried.
To remake the Commerce Department and separate out some things from there, and Congress said no.
All right, so TBD right, wait and see and see what happens here. Let's go back to Neil Kushcari, present of the Federal Reserve Bank of Minneapolis. You did talk to him earlier. Let's just share with everybody some of the information that came out of the interview that Mike did with the surveillance team earlier.
Today.
I'm not seeing a lot of upside risks yet, we don't know what's going to get enacted. I'm not seeing a lot of upside risk that inflation is going to take off from here. The bigger risk that i'd be concerned about in the inflation front, is just if we're landing at around the two and a half percent level
instead of back down to two percent level. I think that those risks existed before the election, and I think that there continues to be uncertainty now and we need to just be take our time, let the data come to us, and let that guide us.
All right.
So Neil Kushkari speaking with Mike and the surveillance team earlier this morning on radio and TV. So there is more data before the next FED meeting, right, So a rate move not a guarantee, despite what traders are saying, we know this can bounce around a little bit.
Yeah, I wouldn't put a lot of stock in what you're seeing in the futures markets right now, because we do get a lot of data. We get another CPI report, we get a PCE inflation report, we get a couple of retail sales reports, and we get the jobs report for the month of November, and all those things will weigh on the administration. But you see Kashkari saying what we were just talking.
About, that.
His worry is that we get stuck, and that might call for the FED to stay in one place. Mussalam, who was mentioned was just speaking said exactly the same thing. Gradual cuts if inflation keeps falling, is the way he put it. And Jeffrey Schmid from Kansas City also saying, there's uncertainty about how our rates should fall because there's uncertainty about where inflation is going. And I think you're going to hear this pretty much from every FED official
this over the next couple of weeks. We don't know, but don't count on it one way or another. Don't rule it out, but don't count.
On us the way it goes. All Right, Michael McKee, thank you so much. International Economics and Policy courseponding here at Bloomberg News. Catch his full conversation with Neil Kashgari check it out on the Bloomberg All right, everybody, so, from the economy and FED policy to those who will be helping to shape some of the new policy initiatives in the Trump administration, that's exactly where we go right now.
This as the President elect continues to name names for top cabinet posts and other advisory roles, and as mister Trump goes to Washington meeting today with President Biden and top members of the GOP back with our Washington around. Bloomberg News political reporter Tyler Kendall live for us at the White House. Tyler, President Biden and President elect Trump meeting earlier today at the White House. That meeting wrapping up. What do we know about that? What they talked about, how it went down?
Yeah, I hate him.
So.
White House Press Secretary kree Jiane Pierre coming out just moments ago calling this meeting substantive, saying that there was this exchange of ideas and that they hit on national security, domestic policies, as well as a to do list for Congers in the coming months, including averting a government shutdown when funding runs out on December twentieth, as well as
passing some more supplemental disaster relief funding for Americans. But the Press secretary also honed in on this idea that the meeting was largely symbolic, right it was to ensure this peaceful transfer of power. Important to point out that four years ago, then President Trump did not extend the same tradition to then President elect Biden. However, the two did appear cordial today and brief remarks off the top, both committing to making this transition as smooth as possible.
I'd also quickly add that as we are getting these headlines from the White House Press briefing, it does appear that the two did speak about Ukraine and supplemental assistance
to Ukraine. This confirmed some of our earlier speculations as we were looking at clues on what the two could be talking about, because as we look at what President Biden is pushing for in these final months of his administration, we know that his National Security advisor, Jake Sullivan has said that they will push the Trump transition team to make sure that that security assistance for Ukraine plays out.
But of course he has now Vice President elect jd Vance, one of the staunchest opponents of Ukraine aid, in his oval office. So that's one of the storylines that we're going to be covering closely.
Yeah, I'm glad Tyler brought up the idea of what happened four years ago very different at the White House, extremely different. I mean, think about where we were just a week after the election four years ago that you actually never met at the White House four years ago Obama. President Obama did extend that same courtesy to then President elect Trump eight years ago and he visited the White House.
Yeah, right, like, so it wasn't kind of business as usual certainly last time around. Hey, One thing we also want to ask you, Tyler, is Republicans, for the first time in eighteen years elected someone other than Mitch McConnell to lead them today. That person is South Dakota Senator John Thune. Tell us a little bit of us about those developments coming out of DC as well.
Yeah, definitely, Carol, So not necessarily a surprise. Senator John Thune one of the top contenders for this race against another John, Senator John Cornyn, a Republican from Texas. Also Senator Rick Scott, a Republican from Florida, who appeared to be backed by some of the more conservative MAGA Republicans for that spot. Thune ultimately ended up winning in a
second round ballot. He's been the number two in the Senate, a staunch ally of Senator Mitch McConnell, who, as you mentioned, is ending a historic eighteen run as the party's leadership, but he is going to be absolutely critical. In remarks after winning, he said that he will work with now President elect Donald Trump because, as you both know, working with the Senate is going to be so critical for this incoming president, both for his agenda but also for
some of his cabinet confirmation. There are two areas I'm watching for when it comes to Senator Thune. One is his position on tariffs. He's previously criticized Trump's proposed tariff across the board policy, warning about inflationary effects. And the second is again to bring it back to this idea of Ukraine aid, considering this was a particular area of tension with McConnell and some of his more conservative members
of the party. So those are two of the areas I'm watching to see how they'll shake out as his term begins.
The President elect didn't really come out and endorse anybody for that leadership position in the Senate Tyler, but Elon Musk certainly did, and there were a lot of Trump allies who were saying Rick Scott is the person to choose. How should we look at the fact that Scott didn't get picked as sort of a rebuke of, or at least some resistance to what Trump wants in the new in the new Senate.
Right, well, I would focus on Senator Thune's track record in the Senate. He has won the admiration and respect for many of his colleagues, particularly since he has served as this number two to McConnell for so long, and he had been campaigning for this early and often. Meanwhile, Senator Rick Scott hadn't launched this bit. So we knew, you know, for many months, that Fune was going to be vying for this position. But Rick Scott, for example, was in a tight Senate race down in Florida and
then kind of launched this sort of bid. It's going to be absolutely critical for the Trump administration to try to keep a coalition together. We had Congressman Brendan Boyle on a Balance of Power yesterday. He's a Democrat from Pennsylvania. We asked him about the future of governing with this
incoming White House. He said that he's watching for if the Republicans can keep their conference in order since the most recent iteration recent years have showed us that infighting in the Republican Party has really hurt getting Republican legislation through. I would just quickly add that this morning, when Trump did go to the Hill, did appear that he backed
House Speaker Mike Johnson. That's going to be another critical ally for getting Republican legislation and agenda items over the finish line.
You know. And then of course there is Elan and Vivek, which was I feel like when we read in this morning Tyler, that was the story that was kind of top of mind in terms of president like Trump's appointments or you know, additional Advisory Council, if you will. The President does seem to be moving, though, very fast and furious when it comes to these appointments in these nominees.
Yep, definitely, and particularly on this Department of Government efficiency. I would just say quickly, there are two big outstanding questions here right One, how is this going to work in practice? Trump has said that it will be outside of the government, So would that be some sort of a panel that works with the OMB, the Office of Management and Budget to give its recommendations? And then second, how is it going to do its work? You were
speaking about this earlier with Mike McKee. The federal government spent six point seventy five trillion dollars last fiscal year. Musk came out in that Madison Square Garden speech just ahead of the election saying that he wants to cut two trillion dollars, But the vast majority of government spending
is healthcare, social security, defense, and veterans benefits. So there is this concern that some of those more popular but also politically fraud initiatives like social security, Medicare, and medicaid could be at risk. But also, as you mentioned, Musk has pledged to make this a more transparent process.
I do have one last question thirty seconds, you know, going back to what Tim mentioned about John Thune. I mean, it does look like he is willing to go to back with Donald Trump. Is he there to carry out the president elex mandate or is he willing to kind of go to toe to toe with him? Just quickly?
Right, right, So in his remarks afterwards, he did say that he was willing to work with him. I think you're referencing of prior rift after twenty twenty one, after January sixth, and making sure that that election was certified in the way that it should have been. But John Thune has said that he will be there for the rank and file, even adding some of Donald Trump's priorities in his speech afterwards, including border funding and immigration.
All right, good stuff, Hey, listen, Tyler, thank you so much. In and around DC, Tyler Kendall, she is Bloomberg News political reporter, joining us there from the White House.
You're listening to the Bloomberg Business Week podcast. Catch us Live weekday afternoons from two to five pm Eastern Listen on Apple car Play and then brought auto with a Bloomberg Business act or want us live on YouTube?
All right, folks are staying with news out of DC in the days after the election. Donald Trump and Elon Musk, Well, they seem to be riding the world's most intense contact. Hi, so writes our own Max Chaffkin. Musk is effectively camped out with Trump's inner circle at mar Lago. He shows up in family photos, He joins Trump's calls with world leaders. Perhaps that's what you get when you spend over one hundred million dollars one hundred and thirty two million at
least into the President Alex campaign. So let's get to it. This is the Bloomberg Big Takes story, deemed by our editors as a must read story. It is reported out by Bloomberg's Max Chaffkin and Dana Hall. Max is Bloomberg businesswee correspondent contributor to the Elon Inc. Podcast. Max is also author of the contrarian Peter Teel and Silicon's Valley Silicon Valley's Pursuit of Power. Max joining us here in studio. Yeah, I mean we've all been asking kind of what is
Elon going to do in this job? What can he do and what does it mean kind of as being part of this Trump inner circle.
Well, I mean, you know, last night Trump announced something that he had teased repeatedly on a campaign trail, something that must get talked about, This idea that Musk would be an advisor in the streamlining of government. And there's even a catching name for this. This is the Department
of Government Efficiency. It's not a department in the in the sort of normal sense, and and it's also unclear like how exactly how efficient they're going to be When Elon Musk has a co chair of Vek Ramaswami, that's say, do you know.
What Tim's been saying, Hey, I've been saying that it's like it's supposed to be a fishing Why are there two of them?
All?
Right?
This is and this is a joke that that that Democrats have pointed out and and critics are gonna are gonna seize on And I think that the challenge here is that many of the things that Elon Musk has talked about wanting to do, cutting two trillion dollars from UH from the federal budget, or even if you start talking about some of these very specific things that he personally thinks is kind of dumb or useless, all of
that's going to be politically difficult. When you're talking about gigantic cuts UH two trillion dollars, that's going to mean Congress, it's going to mean hard choices about important federal programs like Social Security that lots and lots of Republicans. You know, that majority in the House is going to be very very narrow.
The midterm is at the midterms.
And so so again that's gonna be hard. But when you even talk about the the sort of smaller things like you know, some defense thing, you know, a lot of this stuff is politically charged.
Right.
You have senators, Congress people in various states who care about the jobs in those states. And Trump is going to need to govern and and he's going to need Republicans in the House and Senate to do that. Even though Republicans control those those branches. But what and you know, seeing the election of selection of John thune Is as Speaker again, that's kind of a bit of a rebuke to Elon and kind of the hard right part of this coalition. They had wanted Rick Scott. So there's gonna
be a lot of challenges here. Of course, there are ways that Elon Musk can get paid.
Even so one thing we should notice, Elon actually accompanied the President elect to Washington this morning. He was with lawmakers earlier too. They gave him a standing ovation in addition to giving the President elect a standing ovation, so certainly gives an idea how he's seen in the Republican Party right now.
Max.
The China part of Elon Musk's story I keep coming back to because he's got this very close relationship that I wonder if it could be, in the words of like Jeff Bezos, a complexifier when it comes to Elon Musk's relationship with Donald Trump. Because he wants to do business in China, and he wants to do business easily, and Jia, it's not just that.
He wants to do business in China, he really needs to do business in China. Tesla unless there is a dramatic change in strategy. Tesla needs it's China business. There's a massive factory, it's the world's largest market for electric vehicles. Tesla is trying really hard to compete there, and Elon must have made that a big part of his strategy. Now,
I think two things are possible. One is, if you know, tensions between the US and China were to heat up further, you know, there are are ways that Elon Musk could deemphasize his reliance on China. The biggest one would be, you know, focusing more on robotaxis, which he's starting to do. The other thing is, you know, Donald Trump ran as
a peacemaker, a negotiator. Yes he wants to, Yes he's gonna, you know, put tariffs, he says, but remember the last time, lots of companies got carve outs, were able to negotiate their own their own you know, basically ways to to avoid paying those tariffs. So you could imagine Elon Musk trying to find, you know, get some exceptions carved out for important industrial companies such as you know, Tesla Motors, the company that he, uh, you know, owns a huge
stake in uh. And the other thing is like, compared to Joe Biden, I think Trump is arguably not as despite the fact that the rhetoric is very hawkish. Biden was also quite hawkish on China. So I'm not sure that this represents such a huge complexifier. But though it is certainly gonna be, you know it challenge, And it's also of course an opportunity for political opponents of Donald Trump on both the right and the left to seize on because he can you can talk tough on China.
But then when one of your partners, you know, has this enormous Chinese factory as a good close relationship with the Chinese Communist Party, like, that's gonna that's gonna lead to criticism.
I keep thinking of a conflicts of interest in this administration. You know, here you have Elon advising Donald Trump in terms of efficiency of government. If a company that does a lot has business contracts right SpaceX with the government, you talked about, how you know Elon can get paid. I mean his stock is already up thirty percent from the election. I mean it just seems kind of complicated in terms of the connections here.
Absolutely. I mean the thing is, if you were paying. If you were watching a campaign, what you understand is the conflicts of interests are the point. I mean, Trump talked about that as an advantage. That was sold as an advantage, and it's going to continue to be sold as an advantage. Elon Musk he's not just some egghead. He really understands business. In fact, he runs a couple
of important businesses. Trump talked about, you know, on the campaign trail, just essentially like ordering up rockets from Elon Musk. So I think that they believe Donald Trump, his advisors Elon Musk, that basically voters and the Republican Party are not going to mind that he's that important. But I think that really remains to be seen.
And you know what.
Happened during the last Trump presidency is that the controversy started to bubble up, right, and then it became harder and harder for people who were kind of in Elon Musk's position to stay in that inner circles. And that's exactly what happened to Elon Musk, by the way, in twenty seventeen, amid all this controversy. It was after the sort of Muslim bands and Trump left the Paris Climate accords,
Elon Musk backed away. He had been on another advisory panel, So I think that is one thing what's different this time around, and I think what's going to put pre pressure on Donald Trump and actually put pressure on moderating forces within the Republican Party is that Elon has all
this money that he's going to spend on politics. Yesterday he was tweeting that he's going to play in the midterm, including the primaries, And if you look read between the lines with that, what he's saying is, if you don't go along with my agenda, Senate Republicans, congress people, I am ready to dump a huge quantity of money into a primary, like are you ready for a primary challenge? And I think that is going to be his leverage,
and we we'll see if it actually works. And I think where it works partly depends on what John Donald Trump decides to do. Does he does he run as this kind of ultra maga guy that he presented, or does he try to move to the center.
But I also wonder if Elon Musk lodes his interest in this in a few months or in a few years.
I mean, you know, that is the I think there's a conventional wisdom that says.
He's got a lot on his plate.
He's got a tention span that that that drifts easily. You know, he's got all these companies, he spends hours a day playing video games. He's got a lot going on. So if this started to get a lot of kids, yeah, he's got a lot of kids, you know, many interests. But well, I'll say is though, what I'll say is though, this is a really great opportunity for him, as a government contractor, as somebody who does a lot of things
having to do with the government, to have influence. So I think he's going to ride this train as long as it'll go. And I think he does have levers that he can pull that will make it harder for Donald Trump to push him away than say it was to be able to push away these other sort of business leaders who got close to Trump the last time around. He's not. You know, he has a lot more ways to influence Trump than say Anthony Scaramucci, you know, who famously lasted ten days as the Press secretary.
MAXs One thing, I'm curious about all that spending that Elon must did on this campaign. I mean, it wasn't just a case of just throwing money. I mean he was involved in like creating, you know, hiring companies, getting people to do it. It was a whole new different way of campaigning for a candidate.
Yes, super unusual. So you're talking about really big money. You said one hundred and thirty two million. I think when all said and done, is going to be closer to two hundred million. So kind of up there with the biggest contributions of any donor. And then this approach that is really different from any other mega donor. You know that Sheldon Edelson was just giving writing big checks and staying behind the scenes. That's kind of the model Elon Musk, as you said, front and center he's made.
He made Donald Trump and sort of trump Ism, you know, the editorial focus of X, his social network. He was on the campaign trail, He's tweeting NonStop. He is he is some he brings things to this that are unquantifiable and that are probably worth more than the two hundred million he put in.
Hey, one thing I want to talk about is the platform X. And you know we talked. In the two years that he's owned it, there have been valuation right downs by Fidelity for example, how should we be looking at the valuation of X, or how should we be looking at X as sort of a platform arm of the Republican or communications arm.
Well, it's both a business and it's a loss leader media arm for the Elon Ink conglomerate, right, Like, those are the two things, those are two functions it serves as a business. It hasn't gone super well, as you said, Fidelity has written down the value massively. Elon Musk essentially taking it over, decided he didn't care about advertising. He decided that, you know, he was going to be okay
with not having a vibrant advertising business. He literally told advertisers to f off, you know, from the stage of a major conference. And what he's done is sort of accepted that this is going to be a less successful business, but try to maintain its influence and maybe even intensified. And I'd argue in that way it's been a huge success. It's been a huge success of political play and even as a community like it may not be super vibrant
in the way it was before. There are a lot of journalists who are you know, currently leaving to go to Blue Sky or Threads or these competing social networks. They're growing very quickly. But among conservatives, among that kind of like base that elected Donald Trump, they are on X. This is where they are getting their news right now.
All right, good to leave with there. Hey, Max asoways, thank you. Max Chafkin, columnist at Bloomberg BusinessWeek.
You're listening to the Bloomberg Business Week Podcast. Listen live each weekday starting at two pm Eastern on applecar Play and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station, Just say Alexa playing Bloomberg eleven thirty.
Yeah, let's see.
Look at shares of Plug Power, the green hydrogen company. They're hired today at one point Caroll by nearly ten percent. This after shares fell yesterday after the company cut its revenue guidance for the full year and missed the average analyst estimate. We've got back with us. Andy Marsh, president and CEO over at Plug Power, joining us from Plug's annual symposium event just outside of Albany, New York. Andy, always get to check in with you. Welcome back to
the program. First, we got to go there. Uh, I'm wondering how you're looking at the Trump administration, the second Trump administration, given that Elon Musk is so close to him, obviously a proponent of EVS. What is having Elon so close to Trump mean for hydrogen and for plug power?
Oh, Tim, I don't get too excited about this, Timmy. I've been watching political elections since I was a kid in nineteen sixty eight, and you know, things are always extreme at the beginning. I think the real question is, uh, you know, think a little bit about what Exon CEO said yesterday where he said that, you know that Trump administration should be thoughtful about their clean climate, clean energy policies. And we had two analysts here are Plug Symposium today,
one Republican, one Democrat. Uh, you know they'll tell you. I think the fueling across the board is that small nuclear hydrogen, sustainable aviation fuel with biofuel rules you know, are in pretty good shape compared to other technologies. And look, if you look at my electoralizer business, uh, ninety five percent of its outside the United States, and that's my
biggest growth opportunity. I had one customer flow of forty five hours from Australia to present, today, so I'm not I don't get too excited about those things.
I will say, though, Andy, there was some disappointment about your forecast, but I do believe you know, you guys came out and said, you know, you're still making progress. Kind accord atoms, they did lower their price target a little bit on the stock. What can you tell us about the outlook and give us a little bit more insight into how things are going well.
I think that if you take a look at it around the world, I think there's a couple of drivers. One, we're working on deals, which are you know, overall for people five to seven billion dollar type projects, and we probably we're probably overly optimistic about how fast projects like that could come to fruition. That being said, they're actually paying us to do the work now to prepare to do those deployments. And look, you know, regulations haven't moved
as fast anywhere around the world. It's tough to get regulations in place, but they're moving.
You know.
We see, as I mentioned, see great progress in Europe, actually see progress here in the United States. So we and we've also look, it's been a bit of a hall here, Carol, and we become a little bit more conservative in how we forecast the.
Future, understood, understood, and respect. Andy, one thing about do you think a Trump administration and any expectations around the policies that impact your business will be positive or negative?
That's really interesting question. I know one of the items which we've struggled with with the IRA is the production tax credit for hydrogen. And you know, we believe we've been pretty clear about we think that the regulations that were initially written included concepts of a three pillars for
the hydrogen economy, which was nowhere in the legislation. We think the Trump administration will probably be more in gear with the recent Loper decision by the Supreme Court and where the rate where Congressional intent and how it's implementing regulations will be more aligned. Look, I'm not naive either too. I don't expect a lot of new programs for hydrogen, but we'll do quite well if the new O programs are implement the way Congress intended.
Hey, Andy, I'm wondering the Inflation Reduction Act and what that's meant for your business and to what extent you could see it parts of it rolled back and how that would affect your business when Trump takes office in January.
So you know, I have a lobbyist who spoke here today at the symposium, who sat on the Republicans houseways and means runs a tax plan he does not expect that he expects to roll back will be on things like offshore wind. Look, I think eighty percent of what I do is actually done in red districts, in red states. I have a large contingent of folks in Houston looking to build a large hydrogen plan in Texas. I have a hydrogen plan operating in Georgia and Tennessee. Most of
my customers are in red states. And so you know, I think, you know, I think Congress still matters, and you know, I think John Thum being centate majority leader is you know, is a sign that you know, you know, activities won't be extreme one way or another. I think there'll be a balance approach. Look, you know, I think, as folks mentioned, I think the mantra is all the above, and what we do is all the above. And look, if we don't do it here in the United States,
you're going to do it in China. And certainly a Trump administration doesn't want it done.
In China, Andy, how much pressure are you feeling from the investment community. I mean, your stock's down about fifty six percent year to date, about twenty five almost a quarter percent of the float is shorted. It's a two dollars stock. I'm just curious what kind of pressure you are feeling from investors at this point.
Yeah.
So, I plug has thirty one analysts. I had twenty of them here today. Actually, the short position is probably larger than that, Carol, it's probably thirty seven percent. And I think a lot of folks believe that as we continue making progress, there's a large opportunity for you short squeeze. So you know, I think our investors want to see it happen. I spoke with a lot of them here today.
But you want to be more than a short squeeze right to investors? Ye, to be to investors a fundamental play.
No, yeah, I would say this, Carol. Uh. We do want to be a fundamental play. And I think the shorts have had a lot of control of the stock, and if we are a fundamental play, the stock will do just fine. All right, good question?
Yess?
Wait?
Sorry?
Can you can you god go ahead?
No?
Please go ahead.
Hey, I want to know about production of hydrogen and how you're able to, uh you do it in a way that's not energy intensive, because that's one thing that we talk about a lot. When you're actually producing this, a lot of energy is used. So yes, it is sort of we you know, people call it a green solution, but it still uses a lot of energy.
It uses a lot of energy, but it also creates a lot of energy too too. So let me tell you where I think hydrogen we'll really see and you're seeing already, is in applications today where hydrogen is used in oil refinery, in concrete manufacturing, in ammonia production. You know where it will be used at first is in substitution, okay, and ultimately and ultimately, you know, what we focus on
is improving the efficiency of electrializers. And you can get to the point where you know, you're never going to be at the point where energy in equals energy out, but you can get to the you can get to a point where it's far superior to even today. It's you know, if you think about the full life cycle, it's superior to natural gas turbines. So I'm not you know, but that is a big, big focus of the company.
All right, Andy Marsh, we're gonna leave it there. President and CEO over at Plug Power joining us just outside Albany, New York.
Romco the journal.
Now about you, let me drive?
Oh no, no, no, no, all right, please, I'll do the gravel.
I want to drive.
It's a good question.
This is the drive to the globe dot com. We'll each other down on Bloomberg Radio.
All right, everybody, just about sixteen minutes left in today's trading session. Crouncing around a little bit, a little bit more of a muted trade, certainly on the equity side of things, but let's get to it. We did get an inflation read earlier this morning.
With us.
Back with us is Doug Cyoka, CEO and partner at Kavar Capital. They've got about one and a half billion in assets under management, joining us from his alma mater, Notre Dame.
Doug.
Good to have you back with us.
How are you hey? I am great, Thank you for having me on and great to be back.
Well, it's great to have you here. Nothing's going on, quiet as could be. The election, the outcome, I don't know, how does it change your thinking about the investment environment and what's to comers. It just really too soon to tell, but we are getting a lot on his cabinet, you know, nominees and key advisor nominee. So I don't know if that starts to paint a picture of maybe what's to come.
Yeah, I mean, I think like the one thing that certainly helps is is we've had a four years of President Trump before, so you know, we're going through and experiencing kind of like the old expression of history may not repeat itself with it often rhymes. So we're having a lot of conversations about like the devilish impact of tariffs and trade war two point zero and what does this really mean for the yield curve? And I think
it's it's early right. There are in politics promises versus policy, and somewhere between the two will actually lie to the outcome of what will transpire. So yeah, I think, look, the momentum that's in place that's celebrating what is purported to be very much a free trade emphasizing low regulation, low tax platform, it likely will be hard to stop that going to year into year end, which is seasonally
pretty strong anyway. But I do think there are gonna be a lot of opportunities that emerge, without question.
What kind of opportunities.
So right now I think you know more than anything. Like we think that's happening in the fixed income markets is really fascinating. I mean, everyone's talking about the yield curve. Oh my god, how can it possibly see like at some some lift in the long end. After the Fed has now cut seventy five basis points and two consecutive meetings, you realize that this is the third time the last five cut undertakings that a month later the curve is
either flat or a little higher. Right, And it makes a ton of sense to us to think about term premium steepens is to reflect the fact that there's an incipient risk of inflation because the Fed is cutting, GOP is still strong, Normalization is validating a labor market that is back in balance, Inflation is under control as we saw this morning, though not creating lower and the dollar
is strong. So we think this is a very positive transformation away from some pretty steep in version of normalization where we can actually pick up yield to make a little longer loan. So we're really happy what's happening in the fixed income market, right.
So what's the specific play then, right now?
Yeah, excuse me. I think the play is in the belly of the curve, and I think the play is in credit, and I think the play is going to be because what happened right in the MEATI market, which is kept such a bid in those bonds throughout the year in spite of a really ho hun performance by the AD, is that this is going to be like this is a mind boggling idea. Right, Local governments and municipalities actually have to balance the budget. So there's a
lot of terming out that had taken place. There's not a lot of paper that's come to market because some of these treasure of this municipalities exhibited very strong foresight and locking in little rates for a longer period of time. Corporation's not as much, government's not as much. So we're seeing that five to seven year period in the curve
very attracted us. You clip a lot of coupons. Oh and if you do get a tailwind from consecutive FED cuts, even if they're not going to be as much or as big as people thought a year ago, that's going to actually give a nice contribution to the total return of yield plus appreciation.
Any any inflationary risks. When it comes to Trump's agenda tariffs, we're gonna be speaking about those. We're going to speak about those a little later.
Yeah, no question, right, And I think that that is an issue. And again you've got to go back and say, Okay, in Trade War one point zero, how much of an impact that I have on CPI forget PZ for a sec very little, Right, So really, if you go back twenty eighteen and nineteen during Trade War one point zero, you saw CPI remain pretty stable at almost exactly the FED targeted two percent. Now you have to take into consideration the backdrop is a little bit different than right.
You had bubble demand for manufactured goods with a little bit weaker slowing trade had already be going to take place, which is not the case right now. But you've got to keep in mind the changing transformation and composition of
the US economy. Spending on services right now is sixty six percent, in goods thirty three percent, So so much of the tariffs that people are fearful going to be passed down to a tax to the consumer, it's just not impacting as much as their pocketbook as it did three, five, seven years ago.
What's good on It's crazy, It's nuts, I mean yeah, everything's coming fast and fear. It's Doug. Thanks for joining us. Always get to check in with you. Starts cut a little short. We had a lot of breaking news today. Definitely appreciate you taking the time. Doug Cioka, CEO and partner over at Kabar Capital Partners.
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