Trump Indictment, PCE Inflation Data, and Markets

We want to get some perspective on that, and the first call we put out was to Tim O'Brien. He's his senior executive editor for Bloomberg Opinion. He's been doing that since twenty thirteen. I think before that he was at the Huffington Post, The New York Times, the Wall Street Journal. My takeaway from all over that is the guy has a hard time keeping a job, but he's

done a pretty good job here at Bloomberg. He wrote a book back in the day, Trump Nation, The Art of Being the Donald, in two thousand and five, that is the definitive biography of Donald Trump. He got sued by the former president of that but he won and if he wants to talk about it, Ken, But Tim, what do you make of the news about the New

York indictment? What's your initial read? Well, well, Paul, the first thing I'm to say, the reason I have a hard time keeping a job is because of mean colleague. You no support? Yeah, I think we don't know, right. I think this is one of those moments in which everyone wants to a pine and analyze, and I think until we actually see the indictment itself, it's underseal, I imagine it we'll get unsealed Monday or Tuesday. Trump is likely to be arraigned on Tuesday. But that's not completely

written in the stone either. I've written before that I think that Alvin Bragg's case is relatively flimsy relative to some of the other investigations and prosecutions that are ongoing. I don't know that this was the best case you would want to bring to him, bring it out of that office at this point in time against a former president,

but he's chosen to do so. And Donald Trump has spent decades weaponizing the law law and avoiding any accountability in courtrooms, and at a minimum that that's been pierced you know, he's going to be indicted for the first time. He's the first president to be indicted. But I think in his own narrow world, it's also the first time he's been indicted, and he's going to react against that in strident ways. Let me let me ask Tim Matt

Miller here, by the way, thanks for joining us. Let me let me ask about Alvin Bragg, because I thought Bragg was less likely to indict Trump. In fact, I thought a couple of the people in his office wanted to indict Trump previously and quit because they were so angry that they weren't able to stopped by their boss, Alvin Bragg. So what's the deal with this? Remember remember the context of that. So Albert Bragge inherits, the case

built by Cybance and sivances on. Prosecutors were very split around whether or not they had enough evidence to take to court on a criminal charge. Remember a criminal charge, the standard is the you have to prove intent on the part of the perpetrator. It's a very high bar, and I think the people in Sivance's office were very split down the middle on this around whether or not they had the mojo to take it to court. Dance basically leaves dumps this on Bragg's desk without resolving it.

Brad comes in, he looks at it. He decides that there's too much division here. We can't bring this particular case involving you know, I think years and years of financial fraud allegation. But he goes down a new path based on other evidence he has involving the payments to store Mey Daniels and bookkeeping fraud attendant to that that. We know that that's one thing he's looked at. Here's

the coveat on that. There's been reporting out there that say there maybe more than thirty counts in this indictment. He could well have assembled other evidence well beyond the Stormy Daniels thing. I think for this case to app gravitas and traction, it needs to have actually much more than that. Well is this reminds me of you know, when Merrick Garland had the FED raid Mara Lago. We all thought, man in order to do that, he must have something serious, But it so far doesn't look like

he has anything serious. Well, wait a minute, you know, we have to let the legal system work through these things. The Moral Lago incident is very serious. Federal authorities believe he violated the Aspeona Jact. Potentially there are classified documents that he took down there without handling it in proper ways that any president, regardless of par or persuasion, should observe. Well, I mean, we have a president in office right now

who don't interrupt me. Matt. I know you're prone to do that, but i'm your cast, so hear me out. The legal system is there as a process to protect all of us, regardless of party. It can be flawed, it can be inexact, but it is there for a reason, and there's very good reason. The Moral Lago incident is being examined, and it should be regardless who was in the in the white outs, and we don't know what they have yet. So we have to be patient with this so we can get properly aired publicly. And I

think that's true of all of these cases. Patience is not one of my virtues. I know that. So Tim, help us put into content. I mean, we have the New York City issue, won't get more clarity on it next week when it's unsealed. Help us frame out the other risks for the former president in terms of this federal investigation as well as the investigation in Georgia, because those seems to seem to be on the first read, more serious and perhaps more of a problem for mister Trump.

I don't know that they are. I honestly think you know. There's a civil case in New York, New York ag she's a Democrat, that one could it's a civil case. It could result in a serious financial penalty. It could put him out of business in New York. It's not going to put him in prison. It's not going to prevent him from running for the president. For the presidency in Georgia, there's a criminal case there by the Fulton County District Attorney Fani Willis that involves voting fraud. That

is also unlikely to put him in jail. It also won't prevent him for running for president. Eugene Debs ran for president as a socialist from jail about one hundred years ago. Lyndon the Lararuge, a serial tax dodger, ran the for presidency for the presidency a number of times, even though he've been convicted of tax run crimes. Don't keep you out of the office. What keeps you out

of the office is if you've led an insurrection. The fourteenth Amendment specifically points at insurrection as a disqualifying factor. It was instituted after the Civil War to prevent Confederate seditionists from running for office. That's in the DOJ case with the January sixth prosecution. In my mind, the moral Lago case, the in the January sixth case, those investigations are the only things that's going to keep him out

of office. And potentially, and even they may not so for I think for people who have an emotional investment in the outcome of these that they think ultimately these are the only things they're going to stop Donald Trump from inhabiting the White House. That's a splender threat. The only they keeps Trump out of the White House ultimately, I think our voters. So by the way, I just want to point out we were talking this morning, and I'm sure a lot of people we'll talk about this.

Tim you probably already know about it. I thought Trump would be would have been the first president ever arrested after office, and some reports of surface that Ulysses S. Grant had been arrested for speeding in the late eighteen on a horse's feeding on a horse, Yes, exactly. I find it incredibly hard to believe that's a good story, though, Tim, what do you think this? How do you think the other I don't know, Republican potential nominees. How do you

think they're going to position themselves here? Are they going to just maybe lay low and let a play out. I think it's tricky, you know. I think Pence came out and defended Trump the Santis has. I think the tricky thing in terms of the politics of this is that Donald Trump has a very firm hold on about thirty percent of the Republican Party. It makes them an

important fact in the primary races. He has I think statally turned off independent moderate Republicans and moderate Democrats, like the sort of middle middle tier of voters I think now know who he is, and it hobbles him as a national candidate. So the party has kind of held hostage to getting new people out on the stage who can get through the primary process without being capped by

Trump while still being viable national candidates. And I think each of those individuals, Santists, Haley, they're all trying to navigate around that. I think they don't want to be appearing to be exactly in the same boat as Trump or supporting some of his you know, some of his greater obscenities. On the other hand, they also know that they need his voters. So it's a tricky balance. I think, Tim,

just about twenty thirty seconds, is a Trump voter? Can a Trump voter be a Decantist voter supporter or a Haley supporter? Yeah, they can, I think so. I mean, I think I think they can. I think that, I think that. I just don't think enough. I don't think you can. I don't think de Santists or Haley can win only with Trump voters. Yeah, I think they need Trump voters plus moderates. And how do you thread that needle. It's like watching a hostage video. Yeah, yeah, all right, Tim,

thanks so much for taking the time. You really wanted to get your perspective and opinion here. Tim O'Brien's is a senior executive editor for Bloomberg Opinion Again. He wrote The Trump Nation, The Art of Being the Donald in two thousand and five. It was described as the definitive biography of Donald Trump. So he has a lot of personal experience reporting on President Trump. We're gonna more coming up.

This is Bloomberg. You're listening to the Team Cancer Live program, Bloomberg Markets weekdays at ten am easting on Bloomberg dot Com, the I Heart Radio app, and the Bloomberg Business App. We're listening on demand wherever you get your podcast. Some latest reporting on this Trump in Diamond that hit the tape late afternoon yesterday. Amory Horder in Washington, correspondent with Bloomberg Television and Bloomberg Law hosts June Grasso. They joined

us here, both in studio. We appreciate that they both get the coveted gold star for being in studio. So, June, I want to start with you from a legal perspective, is this a good case? Well, first, let me say that we do not know exactly what the case is. Yeah, this is all speculation because the grandjury indictment is still under seal. If what we think it is is actually what it is, then it's a novel case. I mean, week or strong. It's it's different, It's never been done before.

It's taking as it's taking a misdemeanor, which is the falsifying of business records and do and in order to make it a felony. I mean, they're not. They don't want to bring a People are complaining that they're even bringing this case. They don't want to bring a misdemeanor

against the president. So former president, and so you take the falsifying business records, and you have to show that that Trump also had an intent to defraud that included an intent to commit we're thinking a second crime of election campaign finance violations. I mean, that's what we're thinking. So you're taking two, you're taking a felony and a misdemeanor and hooking them together. And it's it hasn't been done by New York prosecutors. I don't know if it's

been done by any want anyone. So there's a chance that I don't think a judge would dismiss it before went to trial, because you want to get the jury verdict, and a judge is not going to be the one that wants to say that. People say I threw that out against Donald Trump. So but after on appeal, I mean an appellate cord could reverse Okay, So, Anne Marie from the political perspective, here again, the first time a

former president has been indicted. What's the feeling in Washington, what's the feeling about and the first time Trump's been indicted and the first time Trump's which that's I think more shocking. Exactly exactly what's the feeling from Washington. Well, he's not just a former president, he's also a candidate right on the Republican Party to be their front runner. And he's right now he's is their front runner. He's

winning in all their polls for twenty twenty four. So what you can imagine is that for Washington, this is just hardening those political divides. The one place you will not see a comment from is the White House. President Biden left this morning to go to Mississippi, and he was asked repeatedly, you have a comment asking anything about the indictment, any thoughts at all. I'm not going to comment on that. I'm not going to comment on that.

The Republicans in Congress, though, there's talk of them even sending out a subpoena to Alvin brag because they think that this is well, they're calling it outrageous. So this

is not going away. But we should also know, and this is something that potentially can coalesce around the president in the next few months, is this is only one of a number of cases that their former president is under investigation for and looks like right now, from what we know, and as June points out, we don't yet know what the act looks like the weakest and least important of any right. I mean, you've got a much more important case, it seems in Georgia. You've got a

much more serious civil case. Here in New York you've got a serious federal capital cases. So yeah, but the prosecutor can't look at what other prosecutors are doing. He's got his own grand jury that he called. What is he supposed to say, Okay, grand jury, go home for a year, come back. Wish you can anyway, go home and come back, and will you know, after Georgia indits, then will indite. He's on his own track, and he

has other problems to think about. He has statute of limitations, problems and all kinds of things to think about it. I mean, I do admit. You know Mark Palmerantz, who was a former prosecutor there who made a big deal about Trump, right, he called this case the zombie case. He said, it's been called the zombie case because it's been dead and then revived so many times. So obviously, you know, if it's been dead and then revived that

it's not the strongest of cases. So but you got to sound resilient, are resiliently exactly how you watch that this is us? Yes? Yeah, the last of us that was they did you? I mean, you've heard the criticisms from Republicans that this is you know, personal even um, that it's a witch hunt. Obviously that's the term that they've used since before he was an elected the first time. But does Alvin brag have some kind of personal vendetto or issue with Donald Trump that we've seen any hint

of previously. No. I mean, he did have a case against him when he was in the Attorney General's office, but he wasn't one of the people who ran on I'm going to prosecute Trump. He didn't. He would say I can't really talk about that in case the case comes before me. That old line. So, I mean, there's no And he's also a very careful man. He's a very known as a careful prosecutor who'll go over things

and over things. So I have to believe that if he's bringing this case he thinks he can get a conviction. I mean, he's pretty sure of himself, because I don't think you'd bring a case like this unless you're sure that you can get a conviction. Remember he was the one that initially decided in February of twenty twenty two not to pursue an indictment. Yeah. Well, I mean this reminds me to some extent of the Marlagoid, which we said at the time, like, wow, you can't raid the

ex president's house. We also said that it wasn't a raid because it was it has subpoena to get there. Only people who are divorced from reality only needed a subpoena because they wouldn't turn over these highly classified documents. I just everyone was waiting to see a smoking gun from Merrick Garland and we haven't. Well, no, there's a special counsel. This is being investigated. Special the special counsel

is has been serving subpoenas on people. He's gotten He's gotten Trump's lawyer to testify about attorney client privilege by using the crime fraud exception that tells you that a judge thinks there's a crime there. Otherwise you don't have

the crime fraud exception. Right, He's got all these pieces got Mark Meadows coming in vice president of Evans Mike Pants he also had a He also just won this week his case against Mike Pens, forcing him to come in to testify, but leaving a few things out because of the all the balls in the air, Guys, do we have any sense of timing for the federal case the Georgia? Is this measured in weeks? Months? Even more? Yeah? More more? Okay? But first of all, you know, we

don't know yet when Georgia. That investigation has been going on longer than any other, and special grand jury came back with its recommendations and she's still as as far as I know, has not called another grand jury to indict the you know, the special Council. Who knows how long that'll take. But in this case, the last trial against Trump took up eighteen months I think to get

to trial, and that was the checks Broad case. So who knows how long this will take to get to Well, hopefully it gets steals before November twenty twenty four, right, Well, that would be ideal. But June's point, that's we don't know that this stuff takes a very long time. Also, it doesn't matter, I mean in our history, American history.

We had Eugene Devs who campaigned and ran for president when he was in jail on the Socialist part in the nineteen twenty Okay, this no. What I'm saying is even if the president, even if the president is going through this, maybe his party will want to say, we don't want to deal with this drama and we're going to choose another candidate. But he could still run for president. True, unless he gets busted for inciting an insurrection. Right, I'm

talking about specifically about the New York case. Oh well, I'm talking about the other cases, the big ones. You know, Georgia him from holding federal office one hundred percent. And it's unlikely now that he lacks support from his party, right because complete opposite what you are seeing is the base is coming out, they are donating. He is campaigning off of this. Since he said I will be arrested, he has been sending out campaign letters. He has been

talking about it. You saw his rally in Waco, Texas, saying, I am the one that it is a victim here. I need your support. Look at what these Democrats are doing, and he's forcing every Republican to make decision on who they stand by. So not only going to see the hardening of politics between Democrats and Republicans, I think you'll see a hardening of politics within the Republican Party. Those that say we need to lean into him and support the former president, those that say he didn't win us

the midterm elections. He didn't win the last election. It's time we move on to a new leader. When does it get tiring? The witch hunt thing? I'm a victim. I can't. I can't believe he's still able to raise money on that. He's been saying that for how many years before he became a president. So, I mean, it'd be interesting to see how this shakes out. And from the Washington perspective, how aggressive do you think the Republicans and Congress will get here? Well, they'll be incredibly aggressive.

We already before the former president was indicted, you had Jim Jordan, you had James Komer. They're coming out sending letters to Alvin Bragg. They want him to come to DC. They want a hearing about this. But it's it's adhering to nowhere. Right, the Republicans only hold the House. All of this is going to be posturing and it does remove a lot of oxygen in the room for some other big issues they're supposed to be tackling. I just have to say one thing. I can't imagine Alvin Bragg

going to Washington heard a committee. They want information on a grand jury that's secret, and they want information on what the prosecutor's office is doing before a trial that's not going to happen. Posturing. Posturing is a word, all right. Guys, Hemory Horder and Jeran Grassop, both from Bloomberg News and Bloomberg Television, bring us the latest year. You're listening to the tape Cancer Live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio. Tune in alf Bloomberg dot

Com and the Bloomberg Business Half. You can also listen live on Amazon Alexa from our flagship New York station, Just Say Alexa playing Bloomberg eleven thirty. Take a look again at this story President Trump being former President Trumping indicted by New York and what it really means for the political landscape, not just for mister Trump, but also for the general presidential election coming up in twenty twenty four.

We can do that today with the Director of the Center for American Politics and Policy for Around University, Professor Wendy Schiller joins us professor, thanks so much for taking the time here. I mean, just you know, incredible news broke yesterday about the indictment from New York. What do you think the political implications are for Let's just start first, for the former president. Well, I mean, he'll get a

lot of attention. Trump loves attention, and he will be able to shore up his support within the Party's already asking for small level donations like twenty four, twenty five dollars or something. I think he's doing twenty four dollars for twenty twenty four for his defense, So it'll be

a short term boost for him. And if people like Ronda Santis or Tim Scott or thinking he's already in the race, but Mike Pompeo anybody else is thinking of running, if they wait too long, he'll just soak up all of that momentum, energy and oxygen and he may actually gain a lead that might be hard to surmount, even though voting hasn't even begune in the primers, does this case, Wendy matter to potential Trump voters? I mean, even Republicans

who don't necessarily support them all the time. Do they care if he paid hush money to a former porn star. I'm not sure. It's the nature of the accusations as the fact that the doors now open to indict them for other things that I think they do care about, like interfering with the election results in Georgia or promoting violence on January sixth. I mean, I think that's the big question mark here. The political jeopardy for Donald Trump

is not necessarily in this indictment. It's the fact that he is indicted at all, and that the Manhattan DA has taken this step means that other district attorneys or the United States Justice Department could feel a little bit more comfortable indicting a former president since they won't be the first ones. Now, all right, So let's say your Rhonda Santis or any of the other Mister Mike Pence and the other folks think, hey, Nicky Haley, thank you

that maybe considering running against former President TRUMPO. How do you think they should play her? How do you think they will play it? Well, you know, there's a real big gulf. I mean, it's a really great question. There's a big gulf between how the potential presidential candidates should

play and how the House of Representatives. Republicans are going to have to play it because you know, you can get in, get out, and you can say, well, maybe it doesn't go his way, or you can't give them all that you know, it's just going to cloud everything else is going to be the Trump story. You can't give them all that press all the time, you just will never get any momentum. Nicky Haley already announced essentially, and we're still treating her as a maybe. So I

think this is the big dilemma for them. And if you're Lawanda Santis and your argument is that, well, i'll have to wait till the Florida legislature goes out, I think that's the end of April, if I'm not mistaken. You know that's a whole month away. That's you know, you're leaving a month full of a press hole for Donald Trump. And if you want to be president United States, chops take a risk. You have to be willing to jump in and say I support at the former president,

but I also think I'll be a good president. Pay attention to me. Are there any Republicans who other than Liz Cheney who say I don't support the former president. I think he incited violence at the Capitol and did a disservice to our democracy by doubting the twenty twenty election. Or are they all pretty much behind him, because even Mike Pence, you know, even Mike Pence seems to still support Donald Trump. After Trump essentially like put the knife

in his back. Well, I've actually left him in an extraordinarily dangerous situation, not just like not just you know, literally, it's really it's something to behold. I don't think we've ever seen a former president. Even Nixon when he came back in one in sixty eight, didn't have a hold on the party in sixty four. So it's really you

just haven't seen this kind of hold. And for the House Republicans who just won, particularly in New York and California for example, the newbies, they're worried about a primary. I mean, they're always worried about a primary, but they're really worried about a primary, and that primary challenge will come from an avid Trump supporter. So the House Republicans have to be behind Donald Trump now for their own

individual survival. That means McCarthy has to be behind him a speaker, because he can't stay speaker if he doesn't keep the house. So it puts them in his bind, and then the party can't move forward, and so they're they're really stuck. And unless somebody else is an alternative, they can say they believe everything Trump believes, but without the baggage, then there's nowhere for them to turn and it's sort of almost a stalemate within the Republican Party.

All right, profession we want to get the legal side of this right now. We can do that with a former federal prosecutor and former special counsel to Robert Mueller when you worked at the DOJ, that is Michael Zelden. Michael, thanks so much for joining us here. What do you make of the legal case for New York against former

President Trump? Here that was I know it hasn't been unsealed, but what we know now, Well, first, of course, as you just said, we have to wait for it to be unsealed to see exactly what he's charged with, because

there's been a lot of speculation about that. But going with what's been available to us in the public record, it appears that he'll be charged with multiple counts of business record misstatements that will be each time Trump Org made a repayment to Michael Cohen as quote unquote a legal fee about ten or twelve of those those will

be separate counts of business records violations. Then the question'll be will they make that into that group of misdemeanors into a felony by saying all those payments were made for the purpose of evading federal election or state election violations because they were hiding him from the Federal Elections Commission, and therefore it's a felony. So that's what we're thinking will likely be the case, multiple business records cases and

then federal election felony on top of the business records. Michael, what's the distinction here between state and federal because this is, you know, a New York DA and I've heard a lot of people say, well, it's going to be hard to appeal it to a federal appeals corrid or get it up to that level from here. Well, it's not a matter of whether it's appealed or not appealed. The question is a difficult legal question is can you take a state violation the business records and turn it into

a felony where the felony is a federal felony. If they have a state felony and they say the business records misstatements were made to further the state felony, then they're on solid ground. If they're saying it was to further a federal felony, then you have this tricky business of a state crime being enhanced by violating a federal law,

and that has not been tested, Professor Schiller. To the extent that these federal issues move forward in the does that change the calculus a political calculus for for mister Trump, for maybe presidential Candidas, and maybe in his supporting Congress. He's the political calculation. Mister Dulton's incredibly articulate. And I was listening closely, but not everybody has the time to

listen this closely. This is a complicated case. It's probably the most complicated indictment that might come down against the former president if we look at all the possible ranges of charges he faces in other cases. It's very hard to sell, it's very hard to explain. Republicans know that, and Democrats are just chomping at the bit to have this man held accountable whatever way they can, so they don't really care what the nature of the case is.

It matters, I think also to know that it's unclear this would even prohibit him from running for office. Even it gets convicted and serves time and comes out again, he may still be able to run for office. So I mean, there are all sorts of ways in which the real on the ground applications for most people are, you know, did he d lie, did he break the law, what did he do? Or I just I can't stand

them and I want to see him punished. And I think these are this is the political environment in which these messages are going to be sent out by both parties. He does seem to be the test Tethlon Don does Michael Zelden, do you see in any of these cases in Georgia on the federal level, any likelihood that Donald Trump is you know, found guilty and you know, not able to run for president because he claims he's a completely innocent person. Well, let's leave his claim aside for

a second. The only crime that would in theory bar him from running for president again is if he's convicted of seditious conspiracy. In the January Sixth case, the Florida case, the Georgia case, this New York case. None of them would bar him from running for office again. He might have convicted as a felon not be able to vote, but he can still run. And so that's not really

on the table except for a seditious conspiracy. And you know, whether he is able to capitalize this on political grounds really remains to be seen, because, as the professor indicated, there is a need, I think in the Republican Party for them to move past Trump and his demagoguery. I don't think that is a sustainable general election party, but they're right now tethered to him, and they are unwilling for short term benefit to individual members willing to move

beyond that. So they're sacrificing the long term health of their party for their individual short term benefit, like Speaker McCarthy, and that's you know, their choice. YEP, it is all right, Michael, Thank you so much for joining us. Michael Zelden, former federal prosecutor, the former special counselor Robert Muller when he worked at the DJ and also the professor Wendy Schiller. She's a director of the Center for American politics and

policy for Brown University. You're listening to the Team Cancer, a live program Bloomberg Markets weekdays at ten am easting on Bloomberg dot Com, the I Heart Radio app, and the Bloomberg Business App. We're listening on demand wherever you get your podcast. I'm gonna go rate to our next guest, John Authors. He's an opending columnist for Bloomberg News. And you can probably tell he's not from these parts. He's English, he's not from around He's not from around here. But

somehow he's become a rabid Red Sox fan. I have no idea how that happened. But he's got a piece out today where he's gonna tie in moneyball the opening of baseball season to investing. I have no idea how he tried to do that, But John, give us your thoughts here on moneyball investing. Okay, just first making sure you know that I do have a US passport. Okay, yeah, but you live in New York. Why are you Red

Sox fan? My first experience that this wonderful country was an exchange student of the high school in Belmont, mass And this is true. So I stayed with a family and the oldest brother was away at college, and I had his bedroom, and I slept my first night in this country underneath a signed photograph of Bobby or I had no choice. I have been a hardcore Boston plan even though I've never never picked up a Boston accent, which is which I think it could all be grateful now.

In terms of baseball, basically, the rule changes that they've made for this season are very interesting, and I think they reflect the way baseball has moved in its use of stats and data, and that there's a very close

parallel there with the way markets have moved. That quants and factory investors have steadily got ever more sophisticated in their use of stats, which has required everybody else to get that much more sophisticated, with the result that you have a market where it's very difficult for new entrance to have any success at all unless they've got some really powerful computers, which is not so dissimilar from the baseball revolution of looking at the launch angle with which

you hit the ball, looking at measures for applying the shift, and so on, that ruthlessly using stats to organize your baseball team increases your chance of winning and makes it a much worse spectacle and much harder for others to compete. So that was that's my basic comparison there, and so bringing it to investing, how does that work? Which is much less interesting. So, well, we don't have the same

kind of rule changes, do we. I mean, baseball started yesterday and they got a twenty second shot clock essentially pitch clock. You can only what you can only try and pick off a runner twice. Yes, then apparently the bigger Yeah, the basses are bigger. Fourteenth inning, you get a runner on base if you get out that far on second base. Um, that's I have a bit of a problem with it. But then I'm a purist. That

seems gimmicky to me. Yes, but the I mean, the Red Sox managed to lose their first game of the season ten nine, and even though there was that much scoring, it barely lasted more than three hours, which which is something you'd normally expect the game. If only soccer would do something like that, well, sucker lasting more than nineteen minutes or less than nineteen minutes. And anyway, Okay, I thought you wanted to worth investing, so yeah, in terms

of in terms of investing, yes, You're quite right. There is no um. There's no equivalent of theo Epstein to come in and change the rules on you. In investing, it's ultimately the market. The way people behave, the way they invest, the way they deploy funds changes the way the market behaves. But there is no opportunity to just change the rules. I think what you have is an arms race where more and more people are going to spend ever more money trying to get data for every subtle,

little extra edge they can get. So it's no longer about analyzing, which is this is what happened in money ball. You take these traditional statistics like batting average, which is a really misconceived notion, unfortunately, dating back to a British journalist called Henry Chadwick in the nineteenth century look him up,

who misapplied concepts from crickets. I'm very embarrassed about this, but initially looking for things like value stocks, momentum stocks, and so on was analogous what Michael Lewis wrote about in Moneyball. It's taking the stats we can all see and looking at them more cleverly. This now is like using your laser gun and your brilliant cameras to see launch angles and defensive positioning or whatever. It's a crunching data on trades, on credit card purchases, on you name.

It's analyzing text of every time of CEO speaks in public or whatever, anything that might conceivably get a new edge. Yes, yes, exactly. See who's see who's still got a lot of cars in there in their warehouse or who hasn't or whatever. And I don't see how this ends because there is no CEO epstein of the market to just say no, we're going to stop doing it that way now. So I suspect what you see is that investing will become a game of people investing ever more silly amounts of

money in crunching data ever more precisely. And that does you know. Obviously this concerns about TikTok and so on, about the lack of privacy these days. I think that probably means that the investment industry will come face to face with the people who are worried about that private

privacy in the in the surveillance state. So, I mean, we've had data, high speed trading, all this stuff has been in the market for a while now, I mean in AI yeah, so I guess your contention, John, and you know, get used to it, because it ain't going any word, and in fact, it's going to get become more the piece I wrote, just remember the main point.

There was a very interesting piece of research coming out of Mannumert showing that factors are decaying, that they are not so the value factor, of the momentum factor and so on are not working as well as they used to.

They have ask people have thrown more armory at exploiting anomalies when they can find them, those anomally steadily go away, and so yes, a lot of this has been around for a long time, but we're getting to the point where you no longer have an edge by doing those things in the same way that Billybean no longer has an age by looking on base percentage, and that requires you to pay more money to get ever more. Excuse dates, John, We had some economic data came out today. A lot

of folks are focusing on inflation these days. Came in a little bit better than expect it a little bit a little bit, and what's your region as to how our federal reserve will We'll look at this data. I haven't had the chance to go crunching through all of the angles of it. Yet I, at first glance, I

don't think it means that they don't hike. I think the way the market has recovered as swiftly as it has, and that the early signs that there really is so much deposit flight going on suggest that the banking crisis really isn't a reason for them to stay their hand, and it's still too far above targets for them to seem to change course at this point. Isn't it comforting if they hike a little? I mean, I felt good

after the ECB did exactly There was a risk. I criticized for saying this at the time, and if if they had not hiked at all, or even cutters, some people would have thought that would have been a very clear signal. The said is a charge of regulating the banking system, and they obviously think something really bad has just happened. That confidence does have its own self reinforcing factors,

particularly when you're talking about banking. If people lose confidence in the back, it will lose it will lose all its deposits, even though there's nothing wrong with it. So I think they probably made the right call this month with the twenty five bits, the market at the moment thinks we'll get another twenty five bits and that will be the end of it. I think that's a reasonable baseline.

I'm still nervous about we need more inflation. I'm still nervous about the notion that Rachel will be coming down by the end of being Hey, Johnny, you mentioned that you've gained your US citizenship. Good for you, but I'm guessing you're still an Englishman at heart. May eighth, the Carnation of King Charles the third, How locked in or

are you going to be on that or not? I had forgotten that was happening on I thought you were going to sell me the FA Cup final the day we see I know that's unblazed these it still feels very strange that the national anthem has actually changed to God's Save the King. It's very strange that the barristers who bring prosecutions in course aren't gold QC for Queen's cancel anymore. They oh interesting in the sunshine bands and yes,

so it feels very strange that right this guy's in charge. Well, I suggest just get a nice point, raise a glass and toast your your new King. John Author, Senior editor for Bloomberg Opinion. You're listening to the tape cans are live program Bloomberg Markets weekdays at ten am Eastern on Bloomberg Radio, tune in app, Bloomberg dot Com, and the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa

play Bloomberg eleven thirty. Good way to end the week here on an up note. Good way to end the solid, ending the week, ending the month, ending the quarter. Exactly right, that's not too bad again, sp up nine tenths to one percent. Let's get a sense of kind of what some of these professional folks are doing at there, what kind of advice that they given to their clients? And Ahn equity strategist at Wells Fargo joins us, and she was, I'm going to the part of the Yale varsity sailing team.

That's pretty cool. My son was a sailor at Penn State, so that's kind of cool. Those sailing people are a little strange though, Anna, and thanks for joining us here. What are you telling your clients here these days? After a brutal twenty twenty two, but a nice snapback so far in the first quarter. Well, you know, the good

thing about being a sailor, you have that spatial awareness. Yeah, we're pretty good at that big macro picture, and what we're talking to clients spout right now is to not be fooled by sort of the headstake we've been getting out. You're right, according to date, markets are up. You're seeing pretty strong rally recently, but I think a lot of that's driven by what we've seen aggressive lowering in yields and the perception of the head of the end of

the tightening cycle. I think that's premature and a lot of that's going to give back. This is the opportunity to reposition the portfolio. So do you think that means this is going to be a pivot point for markets as well? The last few days there didn't seem to be much reason for Ralley, and I think a lot of it was window dressing and momentum. Does that change in Q two now? You bring up a good point

about momentum. Part of it was a sort of initial fight to safety, and then another part of it was just the natural mechanics the window dressing lower yield growthier stocks, especially more tech, and you saw the Nastac really rally. But that rotation for US is coming in which we think a lot of those trades could be a longer term We want to see growth in the longer term, but in the immediate term we were pretty much shedding a lot of that value exposure. We're staking for lower

balance sheets. That's kind of the direction we're going in. And how did you in your team at Wells Fargo, how are you kind of factoring in some of the termoil we've seen in the US regional banking space, and then of course the news which made meet idiosyncratic over credit suite. So the regional banking fallout that we've seen, we think there could be much bigger ripple effects because what we're talking about here, it's not just a couple

of banks that had a very peculiar situation. It's interest rate risk. We had the FED tighten at an extremely aggressive pace, almost unprecedented in history, and that interest rate risk affects more than just a handful of banks. We

just haven't seen it all come to light yet. On top of that, you're already seeing regulations coming down, So that combination of additional regulation and what could be more problems for banks as they realize their unrealized losses or as we see more difficulty with credit liquidity due to the caution in the financial industry. This combined just tightened financial conditions even if the FED decides to stop. So that's what we're concerned about here and why we're taking

a little more negative view. But the FED isn't going to stop, at least this next meeting. We still expect them to hike twenty five bases points, right, And I also wonder what your take is on the market pricing in cuts by year, and it seems terribly unlikely to me, but it's happening. If you look at the w RP function on the Bloomber terminal, Yeah, looking at it right now,

and you're right, it's happening. But remember about a year ago, people thought they were going to be cut to mid year as well, and that had to get priced out. As that got priced out, you saw yield rise again and equities have a difficult time. I think that's something that we're going to expect again. I think these cuts, You're right, they're premature and as a market has to reprice that that kind of turmoil is where we want to be cautious and make sure we're position in the

right way. But I think longer term when we talk longer term, right now you've got the ten year nomen of three half. We think that it can go up to about three sixty three seventy. The longer term it's coming back down, and that longer term trend is how we want a position. That's why we're favoring that long duration trade. How about valuation here? A lot of folks say, all right, we might get a trade here on you know, a pause in the FED, but long term valuation still

not our friend here. And given maybe some of the macro uncertainties out there, how are you guys thinking about that. We're being very careful about valuation, very particular. What we want here is growth at the right price. Now that sounds cheesy and it sounds money on that back in the day, right and it sounds obvious, But right now it's easy to grab for growth because you're fearful of a recession, or grab for growth because that's kind of the safety trade that was ingrained in US when we

had that nice growth momentum trade pre pandemic. But what we've got to notice now is the better valuations are slightly down the cap we like, especially the mid growth MidCap growth space. You're seeing more friendly valuations, you're still seeing steady growers, and you're still seeing clean balance sheets.

So this combination is a pretty sweet spot for us that we think there could be more edge rather than chasing these really big large cap growth names that may already be too expensive, in particular with some of the rally we've seen in the last few weeks. What kind of advice do you give just your average retail investor, maybe somebody at a bar or ask your take on a sixty forty portfolio? Is that dead or is that still something to stick with after you know it was

turned on its head last year? You know, I really like that question, because when we're talking for the average investor, I don't think that sixty forty is dead. You know, you look at certain deals, you look at the market volatility. Our price target is forty two hundred on that SMP. We're already at forty eighty five. You know, it's not

the most attractive price return there. But I think what I'm emphasize here is to be lower risk when you're uncertain and we're not sure they fall out, and really the full impact of this regional banking crisis. We're expecting tighter financial conditions and you just have this turmoil. I think as a retail investor, you want to be a little more high quality, lower leverage, you want lower volatility names and kind of a tighten the book a little

bit so you can see where things shake out. Because if things turn out for the better, I think that's something you will have time to reposition into. But for now, the pain point could really be a downturn in the markets. We want to avoid that in particular, you know, no need to get burned in the high risk names. So and as some of the big cap tech names that had been in stalwarts for the last decade plus a' actually had a really good start to the year here.

I think Microsoft, Apple, of course Met has got its own story on the cost cuts. Have they got ahead of themselves? I think a bit. You know, these big cap tech names, it's easy to lump them all together, but you look at a lot of it. It's duration risk, and you know, as you see yields come lower, they can have that nice rally. They also had some tough underperformance from last year, so you're seeing a little bit

of that give back. But to us, when we look at big cap tech, it's too much of a lump sum, you know, it's a darling favorites that we see in the headlines. For us, we like to be particular, you know, within tech, if you want to be a little more defensive, I would suggest more leaning towards software, particularly ven Semis Semmes had a little more of that cyclical exposure traditionally. But still it's not that there aren't opportunities in big

cap tech. We just think it's a little premature because you're seeing that risk rally here. But really, if you're positioning for a year out, then there are opportunities to be had, but look for that right valuation. All right, and I thank so much for joining us. Really appreciate getting your perspective and a hunt. She's an equity strategist at Wells Fargo. Thanks for listening to the Bloomberg Markets podcast. You can subscribe and listen to interviews at Apple Podcasts

or whatever podcast platform you prefer. I'm Matt Miller. I'm on Twitter at Matt Miller nineteen seventy three and I'm fall Sweeney. I'm on Twitter at pt Sweeney Before the podcast. You can always catch us worldwide at Bloomberg Radio