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Terminal and the Bloomberg Business app. The former US Vice President Mike Pence taking a critical stance on President Trump's tariffs, writing in a Wall Street Journal op ed in the past few months that since the President announced his Liberation Day tariffs, the only thing America has been limerated from is trillions of dollars in investments. And pleased to say, the forty eighth Vice President of the United States, Mike Pence, joins us now for more. It's the vice president of Mornick.
Good morning, votes for having me on.
Thanks for being I want to pick up on a question I know you've been exploring. What can forty seven then from forty five. Let's start that, and silk Aback's right.
Well, well, first off, I'm want to give President Trump all the credit in the world for a historic political comeback. But in that Republican primary I was traveling as a candidate in twenty twenty three, I mostly heard people saying, we want to get back in the midst of the failed economic policies of the Biden administration. We want to get back to what the Trump pens administration was advancing.
And so in the Wall Street Journal I gave the president great credit, high marks for securing the border, for restoring morale and recruitment in our military, for taking the fight to the Hoho Thies. Since then, I will talk more later. I'm very encouraged about the strong stand that the President is taking on the world stage, particularly in the Middle.
East and in Eastern Europe.
But what I wanted to call attention to was the policy toward tariffs was was changed with Liberation Day. During our administration, we use tariffs in the threat of tariffs principally focused on China to leverage changes in behavior, but the objective was to essentially lower trade barriers and expand trade.
In this administration, I think what we saw several months ago, now it's paused again happily, is the kind of broad based industrial policy that I think ultimately will harm the American economy, will harm American consumers, and so we've spoken out against it. We've tried to take a stand. What I like to say is free trade with free nations. Be tough on China, be tough on trade abusers, but have the objective of ultimately lowering trade barriers, and that's
how America wins and prospers. That's how we won during our first term.
You've identified that change. What's your understanding of what's behind it, what's lent that change?
Well, I think that what's changed is that I think the president feels at least I perceive it. You know, sometimes I tell people that I know President Trump better than his most ardent defenders. We served together for four and a half years. We had a close working relationship, and I've said many times President Trump is not an isolationist. He is someone deeply committed to free market capitalism. But for all of his career he has been very sympathetic
to protectionist thinking in philosophy. You can go back thirty years on YouTube and find Donald Trump saying the same things that President Trump is saying today. He and I had many vigorous conversations during our four years about trade. I come from one of the leading exporting states in the country. What we make, we grow in Indiana, we sell to the world. But at the end of the day, I think what you're seeing is not different influences around
President Trump. I think you're simply seeing him extending out into a philosophy of government and economics that he has long believed.
Were these impulses then there when he during the first administration and individuals like you maybe talked him out of it, well, I don't know.
That it was.
I mean, there were a few times that I saw him change his mind on things, but I think it was more about priorities in the first term, to make sure that we passed the tax cuts, rolled back regulation, unleashed American energy, and we changed the national consensus on China.
In China with its years of trade abuses.
And I played a leading role in articulating that in the early going, and I'm incredibly proud of that record and that at least the Biden administration didn't change the tariff policy towards China. But for me it was more about it was more about driving toward free trade agreement. So I had the privilege of announcing the beginning of a free trade agreement with UK at this in the
City of London. We renegotiated a free trade agreement with South Korea that's back in the news this week with new tariff threats, and I was leading with my counterpart in Japan. I was actually tasked with leading a working group for a free trade agreement with Japan. So for US, it was that we saw an expansion of trade and opening markets as a key part of American growth right now.
I actually believe that President Trump is driving toward a long term change in industrial policy in America where he sees permanent unilateral.
Trade tariff barriers.
As beneficial to America in the long term, and as a free market conservative, as something I just don't embrace.
Can you do that and isolate China with the rest of the world on board at the same time, Well, a, Marie.
I think that's the right question that.
Senator Phil Graham, we had on Capitol Hill with our foundation yesterday, had over one hundred staffers that came out to hear him He had probably the best description of it.
He said.
He said, by going after all of the free nations that you're trading with at the same time that you're trying to bring China farther along in opening markets and ending years of trade abuses, he said, it's like it's like dismissing your front line in a football game and
expecting that you're going to take on the other side. Look, we need Japan, we need South Korea, we need Australia, we need the EU to continue to bring the kind of economic pressure on China that I believe is all that President g and the Chinese Communist Party will will respect.
We saw some change.
Remember that Phase one trade deal in the early days of twenty twenty. Most people have long since forgotten it. There were bigger stories that year by far, but we saw the China when we imposed those two hundred and fifty billion dollars in tariffs. The Chinese came to the table quickly and began negotiations. And I still believe that's the right approach, with free trade, with free nations being the backstop.
Mister Vice President, I want to pick out a line in that Wall Street Journal up ed that John was mentioning that you wrote, mister Trump's proposed tariffs would be the largest peacetime hike in American history, harming consumers and driving inflation. President Trump his administration has been talking about they're not going to be inflationary, that the producers and other countries are going to absorb it. Are you seeing
evidence that that's not the case. Are you really concerned about what this does to the economy?
Well, I really am, and I understand that that's the debate right now. We haven't seen the inflation from Liberation Day, and I think there's several reasons to explain that.
Number one is.
The teriff regime was paused and has now been paused again, and the markets and are responding to that, and businesses are responding. Secondly, I got to tell you the businesses I talked to as I travel around the country have been spending an awful lot of money on inventory right now. You know, there's an old saying where I come from that you know, I was born in the morning, but not yesterday morning. So people say that these tariffs are common, So why don't we Why don't we fill the warehouse
right now? And I think that's wise but you know, at the end of the day, I also think that you know, the President on Liberation Day talked about twenty five fifty seventy percent tariffs on countries, and seeing some of these early frameworks that end up with the UK with ten percent, there's a temptation to say, well, that's just ten percent, And so I think that's the reason why markets, so my businesses have not adjusted prices yet.
But if we have a unilateral tariff of ten percent on the American economy of all imported goods, that's four times the average tariff today. And the reality is that I watch, you know, I spent a lot of time in that cabinet room. I watched a little bit of the cabinet meeting this week, and I saw Secretary Vessant speaking very glowingly about the projection is three hundred billion
dollars in tariff revenue this year. Well, tariffs are attax and American importers and businesses and ultimately consumers pay almost all of that. And so literally a week after we managed to extend the Trumpets tax cuts and prevent a two thousand dollars tax increase on working families, the administration is right now boasting.
Of the fact that.
The average American household is going to see about three thousand dollars increase in the cost of goods because we're paying that. So that's why I referred to a liberation day. I said, could well be the largest peacetime tax hike in American history. We've been pushing back on that. I welcome the pauses, but I I really do believe the antidote here is free trade with free nations. Tough on China, but continue continue to drive toward lowering trade barriers and you know, non tariff subsidient.
He reflects the inflation risk. The White House of don't say like this feder af to cut interest rates. You've been in the room a few times. I'm sure it's talking about this federic f How did the president end up with a the heat dislikes so much? How did that happen?
Well, well, I've been watching a lot of what the presidents had to say about Jay Powell lately.
And.
He did appoint him, So it's part of the awkward aspect here. Well, first, I think the President of the United States is fully entitled to express his opinion about both the FED chair and about the Federal Reserve itself. I have long had great concerns about the dual.
Mandate and the Federal Reserve.
I think it confuses the issue, and the Federal Reserve has his for your viewers, has a dual mandate to protect the integrity of the dollar and achieve full employment. I think the Federal Reserve ought to just focus on the dollar. And I think that the hesitation that I have seen from the Fed chair and ostensibly the Committee is that the uncertainty around these broad based tariffs and the potential for inflation has slowed their intention and and their earlier efforts at at lowering rates.
And so.
How the President got to where he can he considers the Federal Reserve chairman to be worthy of the nickname too late. I can't really testify, but but to me, you're pushing back on on the idea that what's what seems to be holding up the Federal Reserve. Although I read this morning there's now more vigorous debate. I'm sure you've covered here on Bloomberg on the Committee as that there we may have lowering of interest rates, which certainly would welcome.
As you know, the President one of his greatest strengths is to break the status quaid and have very little respect for it. That limits to that, and it's fed independence and example of it.
That's that's right, and I think, look, the President appoints the chairman of the Federal Reserve, and a careful study of American history shows I don't really accept that the Federal Reserve should be a completely.
Separate agency, you.
Know, like a college of cardinals that we never refer to other than in respectful hush tones. John, I think the president ought to be able to express himself. Elected officials ought to be able to express themselves, because it's almost like that old saying about the Supreme Court. You know that justices do read the newspaper, and I expect that's also true of members of the Federal Reserve.
You have taken a balance view on the current administration. You've been somewhat critically of trained. We've discussed that, I would say ringing endulsement about that approach to the Middle East. So let's talk about that. You know where you were in your first term with the president, where he is in his second term, and what went wrong in between from your standpoint on the Middle East.
Well, I just think when Joe Biden returned to a policy of appeasement toward Iran, it really in bold UH the enemies UH of Israel across UH the region. I I I traveled to Israel in about six months UH after October seventh and saw what occurred there, and I I would tell you it's one of the things I'm probably most proud of our administration.
And not only did UH did we we.
Changed the national consensus on China, but UH we were probably UH the most pro Israel administration since the re establishment of the State of Israel in nineteen forty eight. There's just simply to recognize it. Moving the American embassy to Jerusalem, recognizing the gol Onites, these were all historic achievements that everyone told us would foment violence and discord UH across the Middle East. But again, another twenty twenty story that is long forgotten by many.
People's the Abraham.
Of course, I mean we we actually imonstrated that when you stand without UH w W in an unwavering way with with Israel that I call our most cherished ally throughout our history, it sends a very clear scegnal that makes peace more possible. Not less possible. We also isolated Iran as never before. We unleashed our military to take down the ISIS Caliphate, and of course the President made the decision to take down Accustom Solomoni, the head of the Iran Revolutionary Guard. All of that had Iran on
its back heels. The Biden administration changed that went back to the Obama approach of re engaging with the Mullahs in Tehran. I think they were emboldened the violence that we saw, whether it be October seventh with Hamas one of their patron groups, where the Houthis all were a resultd I've always believed that that weakness arouses evil, but peace comes through strength, and the weakness of the Biden administration I think created the conditions for the mayhem that
the new Trump administration inherited. And that's why I've been so encouraged to see the strong stand the President has taken with Israel. We publicly encouraged the use of American military assets.
If Iran was not willing to dismantle their.
Nuclear program, I believe it needed to be destroyed, and I commend the President for his decisive leadership in our incredible airman who delivered those payloads.
You welcomed those strikes on the Irani nuclear facilities. But the President still talks about a deal with Iran. Do you think he'll do a deal at any cost?
Well, I hope not.
I said in that Wall Street Journal piece that you cited. It was about two months ago, and one of my concerns, in addition to some of the tariff issues that we talked about, was that a lot of what we were hearing from the administration in the first hundred days sounded an awful lot like a new Iran nuclear deal, and we pushed back on that pretty hard.
And I.
My hope is that the President, having seen both the run up to the need for American action and also the response by the Malus in Tehran, we'll keep He'll keep his hand on the holster and look ultimately for achieving the objective that that has been the stated US policy through multiple administrations that Ran can never be allowed to obtain a nuclear weapon or have a nuclear program of any kind.
When it comes to foreign policy, you've been very critical and hawkish on Russia. In the debate when you were running with President Trump in the first term, you called putin a small and bullying dictator. Why do you think Trump has only just started changing his tune when it comes to Vladimir.
Well, I've never had any illusions about Vladimir Putin. No, but President Trump has Well, that remains to be seen.
I would tell you that, you know, I was on the Foreign Affairs Committee when I was in the Congress. I've been a student of Vladimir Putin. He's never made a secret of his ambitions in Eastern Europe. It's something he's spoken about, written about. His aim has always been to re establish the old Soviet sphere of influence in Eastern Europe. And I really do believe it was our administration in the Trump Pence years that were the first
to literally provide lethal aid to Ukraine. I think that's what discouraged Putin from crossing.
That border during those four years.
Forget, and I think it continues to be the only pathway toward peace today.
But forgive me, mister Vice President, to go back to Emory's question, what's changed? Because right now we've seen a president who's warned against Russia doing crossing certain real lines that Russia's crossed, and then the sanctions haven't come. Right, what do you think is going on.
Well, I'm hopeful that they will.
What makes you I am I've seen some statements by my friend Senator Lindsey Graham, who just in the last few days said that the President told him to move the bill, and these new Russia sanctions, which are the secondary sanctions against people that are doing business with Russia that are subsidizing the war effort by oil purchases and energy purchases, I think can be enormously impactful.
But you know, I would I would say that, you.
Know, I've made it very clear that that my deep conviction is Vladimir Putin doesn't want piece. Vladimir Putin wants Ukraine, and despite the stops and starts that gave him any of US concern, including that famous Oval Office meeting between the President and President Zelenski, who I came to know, well, I sense that my old running mate is coming around
to recognizing Putin's real intentions here. I mean when I think that the the clear irritation in the President's voice of having a conversation and then to see some of the some of the worst drone attacks launched in Kiev within a matter of hours, is I think having its effect. But look, I just think that I was pleased that the President countermanded what had been a pause of aid to Ukraine last week, which I think was unfortunate wherever
it originated. But I commend the President for reversing that decision. And my hope is when the Senate reconvenes that Senator Thunal will put the Graham Bill on the floor and put it on the President's desk.
I think it's time, and it's my judgment.
I've met Vladimir Putin. I've stood with him closer than I'm sitting next to you. I've told him things he didn't want to hear, and I think he is I think he is not a man who understands anything other
than strength. And this is a moment, I think where it's in the interest of our country, it's in the interest of our allies in the region and long term peace in Eastern Europe for US to continue to provide military support to Ukraine, to put punishing sanctions on Russia until the just and lasting peace can be secured.
President, I appreciate your time, sir, enjoyed the conversation.
Great, it's going to say it. Thank you.
The former Vice President of the United States. There Mike Plans joining US non plays the science Bloomberg's mid Men Low from Kuala Lumpa, Midmen, good.
Morning, good morning.
Yes, I'm here the Asian Summit and it's a big day because the Asian foreign ministers are meeting with many key dialogue partners, including the envoye from Career, Japan, China, the US, and of course the EU as well. And joining me here is the EU's top diplomat, Kayak Kalas. Thank you so much for making time. So tariffs have been looing very large over this entire summit. The EU
hasn't yet received that letter from Trump. What is your team expecting to see you, whether that let it comes, any specific coverouts in particular that you're expecting to have achieved.
Well. Of course, sir, trade team is working very hard to get good agreement, but at the same time we are also working with other countries like here in Southeast Asia or in the world to have trade deals and trade agreement agreements to diversify our trade portfolios.
Okay, so the Chinese Forum MINUSA one is here as well. Are you going to meet him to maybe stabilize relations a little bit? Because it seems like that you China sub it might be partially derailed from what we have reported before.
Well, we had a good meeting in Brussels with my counterpart and we are discussing it's the same format that we have had in twenty twenty three the summit then, and and it's important the substance. What are we discussing?
But you're cutting a shot and you're you're not bringing any additional business.
Now, there was there was no no you know plan that was that was the question that that actually wasn't clear how China wants to hold this summit and now we know that it's one day, and what kind of meetings we have and what discussions we have.
What is your response to China's assertion that the EU's public percubin has been unfair, that the EU does have its own immense subsidies for its manufacturers and producers as well. Is there a double standard being applied.
No, Well, our subsidies are in accordance with the WTO rules.
So this is very very clear.
We want a level playing fields. We are very worried about the economic version of China, and we are also worried about they're enabling Russia's war in Ukraine. So these are the two big.
Issues we have.
Let's talk about Gaza because President Trump said that a ceasfire could be insight this week or next week. What you envision as the EU's role in supporting that ceasfire.
Well, we have been working very hard since the last Foreign Affairs Council that we had in Brussels with these reel is to really improve the situation on the ground with the humanitarian aid for the people, so that the situation would be better. We achieved an agreement on very concrete terms, how many trucks will get in, how many crossings will be opened, distribution points so that people would receive help of water distribution for the Gazan people, so
waste management, a lot of a lot of issues. We reached an agreement and we really need to see also this agreement put in practice the implementation and I'm glad to hear that already today there were improvements like fuel getting to the hospitals and you know, the situation being a bit improved.
Right.
Ukraine's intelligence says that Loos is prepared to stand up to fifty troops to a place in Russia for mining operations. Given that certain love is here in Asia, and to what extent are you worried that he is here to beef up recruitment for the war in Russia in Ukraine.
Well, of course Laos has denied this, and we will have a meeting also with representatives from LAOS to ask because we also give a lot of development aid to Laos and they, you know, they are supporting Russia's war, which is an existential threat to Europe. Then we have to look into our arrangements. It just can't be that getting you know, support from US and at the same time undermining US.
Okay, just very quickly, we know that Miamar's junta has been squarely under Moscow's orbit as well. The cup's chief traveled to Russia and Belarus as well. Any insight as to what sort of cooperation is underway that could support Russia's war machine.
Well, of course we are worried about all these steps, and it's clear if we look at the bigger picture that these autocratic rulers are really teaming up, which is dangerous for everybody. And that's why we really need to stand up for the international law, international rules, face order and defend it. With the countries that share the same values. All right, thank you so much.
There was Kaya Kalas that e US top diplomat speaking to be here at the qual Long for a Convention center at the AS Foreign Minister's meeting.
Listenne Summers a child swap writing. Second quarter earnings calls are critical to assess how companies are handling tariffs in terms of pass through and or profit margin compression.
A place to say that.
Listeners back with us for more Listen and welcome back to the program. We've got to pick up on down to rare lines. They seem to have some clarity and some confidence for the future. Do you think we'll see a repeat of that through this earning season?
Well, John, I heard you earlier. I think you're absolutely right that, certainly within the airline space, it's going to be difficult for any other airlines that might have withdrawn guidance or provided a really wide range or scenario analysis to not narrow that in a little bit. But I found the use of the word stable a little bit odd or at odds with what has been a pretty unstable backdrop, particularly from a tariff's perspective. So I think
I also heard you earlier. I think the passage of the budget builds is good in the sense that you've got that surety from a corporate tax extension standpoint, from an expensing and depreciation standpoint, But it is still a kind of whack a mole environment from a tariff perspective. So I wouldn't describe the backdrop as stable broadly, Lazen.
Maybe not in the headline stance, but from an economic stance, our consumer is getting as tired from all of the headlines in the headline roulette as some of the trading parts.
Seem to be getting.
This idea that people are getting used to this environment of uncertainty, looking at their paychecks, looking at the fact that the economy keeps grinding along, and developing a level of certainty in that well.
Except that, I think, Lisa, you pointed out earlier, we have a bifurcation. I think we may be using the K letter again to describe the backdrop, particularly as it relates to the consumer, because you are seeing pressure on some of the lower end consumers, inclusive of now that there's no more moratorium on the reporting of student loan delinquencies. They've shot through the roof that feeds into credit scores,
credit availability, access to other forms of loans. You see it in the retail sales data that have been generally weaker. The next report coming up in the next week is important. You also saw the downward revision to Q one GDP. A big, pretty hefty chunk of that was a consumption revision lower. So I think there is still some resilience, but it's more up the income spectrum. I think where you're seeing the pressure most acutely is down the income spectrum.
Now to mention the fact that within inflation data, the non discretionary components, the needs components. That's where inflation has been stickiest on the high side and added pressure for lower end consumers because more of their spending goes into those needs buckets.
This really raises a sort of a deep question about the stock market and the sort of cyclicals versus defensives that we've been talking about, and what is defensive at a time where the big tech names seem to be in vulnerable to any potential changes in the broader economy.
I just wonder keen cyclicals rally on the heels of just the high income consumer again and again, or are you going to start to see what you're talking about, that ke shaped economy play out in a much more significant way in the upcoming earnings quarters.
Well, I think what I would guess what happened throughout second quarter earning season is a bit of a continuation of what we have seen in re and quarters, where the beats don't get rewarded anywhere near to the same degree that the misses get hit. So I think there is still that sensitivity, but I do think we are going to get more meat put on the bones in terms of what the strategy is, what the pricing strategy.
We know that a lot of companies built up a massive amount of inventories at a low cost basis insteadsibly giving them an opportunity to kind of experiment with price increases. So I think we're going to our analysts are going to be asking pretty pointed questions about pricing strategy, about
profit margins. In terms of the cyclical ap performance, I mean, industrials is by far the best performing sector this year, up thirteen or fourteen percent, besting even technology and communication services also at play here, and what's doing well ore sectors and industries that have a high portion of their revenue growth coming from overseas sources, and that's where weeker dollar has come into play, and also why a sector like tech is really pulling up the revisions ratio, the
positive revisions ratio. The weaker dollar has been a big part of that, Liza.
When it comes to strategies, we're all aware of the Trump put that was really prevalent as well in Trump's first administration.
But you're pondering something new, the Trump call.
What is that?
Well, the notion, of course of the Trump put was and we saw it come into play on April night, that if there's enough weakness that kicks into the market. In the case of that first week in April, it wasn't just in the equity market. You saw the spike and bond yields, you saw the crush and the dollar. That combination sent a message to the administration woe, hence the announcement of the ninety ish delay for the reciprocal tariffs.
But I think the open question that maybe we're getting a little bit of an answer to is if you get enough resilience in economic data, labor market data, you don't start to see a move higher with any meaning magnitude in the inflation data and the stock market trading at all time highs? Does that behold in the administration to sort of press forward with tariffs? So just the opposite way to think about it from an optioned lingo.
Perspective raises big questions about August one Lazan as always perfect framing of things. Lizanne sunders there a child swamp on the latest in the equity market. Let's stick with the US consumer Bank for America releasing its monthly Consumer Checkpoint, highlighting ongoing softness into the summer months. The report finding spending rebounded in June but didn't fully offset declines in
both April and May. Joining us now to discuss is Liz Everett Chris Berkley, head of Bank for America Institute, Let's got to see you.
Great to be here.
Let's just talk about where we are right now and also where we've been over the last few months, because this has been very confusing. We had this big pull forward and now we feel like we've had some payback.
Where are we now?
So I think it depends on if we're looking at services or if we're looking at retail. If we're looking at retail and we're looking at durables, things like electronics, things like furniture. We are still seeing spending kind of decline in those categories because you've got the payback from the tariff by ahead. But for the first time in frankly a long time, we actually saw what drove the consumer spending up in June was retail spending, and it
was in the you know, things like gas. Some of that was pricing, but it was really broad based other than things like electronics and furniture. But grocery spending was up. General merchandise was up, clothing was up. That's what's driving the spending. Interestingly, also services services spending was actually down, just a little bit down about one tenths in June.
But what breaking that down People are pulling back on discretionary on travel, and we can get into that because you're gonna want me to scare the circle with delta, yes, right, yeah, right away. So travel spending travel categories like airlines did decline. But if you delve into what drives total spending, right, it's the number of households that are spending, it's the average transaction size, and it's the number of transactions they're
making a month, right, what we saw. When you break that down, there are certain households, and we can get into which ones, lower income households who are pulling back completely from making purchases in travel if we look at other categories, discrectionary categories like restaurants. On the other hand, again same analysis, you're seeing fewer but some households pull back completely.
So we have fewer.
Households making a transaction at all, but the people who are still going out to eat are going out more often, went out more often in June and paid more. So you've got a little bit of a disconnect. And it's kind of a tale of two cities.
We've been talking about the K shaped economy and it seems to be just sort of widening the gap between the haves and the have nots, and 're seeing people who have the money to spend spend more and the people who don't spend less and less. And I just wonder if this is analogous to what we've seen over the past few years, or if this is almost an acceleration of that trend, if it feels unsustainable, if you can give us a sense of historically what this trend is heading.
Towards, so there is a disconnect, and I think the best way to understand what's happening is to look at the labor market. The labor market on its whole has been very strong, but digging in again by income higher income households. Last month, we look at the money actually coming into accounts that accelerated third month in a row. It's just shy of three percent. Lower income households actually
decelerated a little bit. They're still up, there's still up one point six percent, but that's down from one point eight percent. So you're seeing this difference. That being said, we go back a year two years, what was happening lower income households, we're having double digit income gains that's come down, whereas hir income households is particularly you know, a year eighteen months ago when we saw a lot
of tech layoffs, hiringcome households had negative wage growth. Now they're coming up, and then they're also supported by hiringcome. Households having more invested in the markets are also being supported by that. So I think that's kind of the explanation for why the consumers behaving the way that it is. It comes down to the labor When you say lower income households are pulling back. Yeah, what's the reasoning you find behind it? Is it because their wages are not
keeping up with inflation? Or is it actually this concern about policy in Washington, tariffs and the like. So one of the things we do at Bank of American Students we don't actually ask people what they think, because we find that when they tell us what they're doing, it doesn't necessarily align with what they say, So we look
at what they are actually doing. So I can't tell you why they're doing it, specifically why they think they're doing it, but I but what I can tell you is that looking at the breakdown in where people are spending non discretionary spending item rents, insurance, utilities, those are growing faster than inflation. They're taking up a bigger piece of people's budget. And now that wages are growing, they're
still growing, but growing more slowly, not keeping up. That's where I think the disconnect is.
The refocus on necessities sort of seems to.
Be which doesn't speak well to their ability to withstand any further increases, but also the idea that higher income households are seeing an acceleration and income at the same time you're seeing a deceleration and lower income that is different though what we saw in the immediate post pandemic reality.
The case shaped economy has been a thing this morning, hasn't it ites?
And I just wonder how sustainable that is. And it is a political issue as well.
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