No Complexity in Closing Eclectica Fund, Hendry Says

to a most important interview. Good morning to all of you of Global Wall Street and David, this really frames out the struggle for all of investment, conservative, boring, mutual fund managers, everyone in every flavor of hedge fund and you see it when I quote the VIX ten point seven one. We look at foreign exchange vix, we look fixed income volatility. The dampening and quiet of the market

is challenging for everyone. In conversations at Cantor Fitzgerald on September eleven and that charity event, you talked to the people in the trenches, and I'll tell you, David, it's it's a trade to trade of quiet through two thousand seventeen. Hugh Henry Georges now from our studios in London. He the manager of a collect gasset management, announced in a letter yesterday that that fund closing after fifteen years. Great to have you with us here on bloom brigs Veils.

Appreciate the time this morning. Let's just start with the motivations for for doing this, the complexity, the global complexity that led you to make this decision and tell your investors this yesterday. But there was absolutely no complexity. Um. I'd like to think in my life I've done things differently, don't I don't want to sign like Frank Sinatra. Um, but in my messages, I died and in act of combat, if you go, I died having a goal. Um. I

think what we've seen. Uh, A lot of my contemporaries like we're rich, we're tired, we're fed up, and just kind of you know, slipped out of the back door. I wanted to go out with a buying if you will, when I went together saying I see the word it's huge. I have these trades. I'm here and let me. I think you're missing this. Let's have this dialogue. It just the economics and there's nothing complex. Yeah, you no inks, but against me you Good morning wonderful to come on

with us at Global Wall Street. Listen. You know, across all of our radio you said the Lionel Barber's rag five years ago. We're harshly disciplined by market trends. You will never see us pursue a homegrown idea to the detriment of the prevailing trend. The trend hasn't been there with a damp and vall across all asset classes. Are you a victim of the dampening of Janet Yellen, John Karney,

Mr Corona and Mr drug Um. Far from me to to play my violin and claim to be a victim, but certainly I believe they're whier forces to play, because this is not a story about individuals. This is a genetic story about a great group of some of the most provocative and fantastic brains in the world. Who has a group since two thousand and twelve really have consistently failed to produce Brits Well? But I made the key distinction this morning, hum, and I think this is critically

important in the mathematics failure. You didn't blow up. I mean, you're down nine percent this year. I get that, But you didn't blow up this is a sequence of frankly good subpar returns. How do we end that and get back to alpha generation or alpha lass? I mean, somebody loses, but how do we get back to so called normal where the game is fair when you wake up in the morning. Well, I'm not arguing that the game is unfair.

I would actually say that global macro enjoyed a moment in time which where the fortunes and the great performance of the protagonists perhaps owed much to the context. I believe that we had that inflation drama in the nineteen seventies, and for three at least three decades, if not forty years, it remained long in the market memory, if you will, that we could return to such an environment. It was

also there with the Fed. I mean remember as early as back in the taper transroom of two thousand and thirteen, the FED was proposing to tighten its policy. With the national unemployment where it's seven and a half percent and with no credible sign of inflation, we've just been on this high alert now. The The result of that has been that for decades, the real recurn on US treasury bonds were very, very high, and the macro model was simple you come in, you leverage those returns, you get

a a high risk adjusted return. It pays for the commercial cost of running the business, and it pays for taking like buying convective Veer puts on fixed income or equity Marcus, and periodically they go in your favor and everyone thinks you're a rock star. Now quantitative easing. Now, I estimate the ten year real treasury bond yards are zero point three pc. So even leveraging that which I advise, because they see, you know, well that's where we are.

When do you envision the young kids see a phase? When do they get to play again? Because we've seen X number of years of this dampened idea. When does the game get fun again? Well, the game gets and you know the game will get fun again. But I think I always look at the irony and the paradox of of the path that the world chooses to take.

It will become relevant again because there will be a moment when people will call upon diversifying us as they were discovered, to their great horror, their U S treasuries are not doing the job, and so they will be calling upon global micro but they'll be looking at their allocation they'll be saying, you'd be used to see where all the customers. Yachts will be saying where all the micro managers, and he might retore on the yachts, but

you know where we are. We're de scaling portfolio, diversifying subsector. You don't be a stranger when you're in New York when you take the conquered. He's the only one still talk the concord when when you take the conquered over your private golf stream. Please stop by in New York. We'd love to talk to you for a longer conversation, or when we're in London. Mr Henry shutting down his hedge fund yesterday really global, major global news for Global

Wall Street. David, I really can't convey enough. He didn't blow up. That's the news here. He didn't blow up. It was just the dampening. I can honestly say, I've never seen this, David. There you go invoking Frank Sinatra regrets. I've had a few. Hugh Henre great to speak with him exclusively here on Bloomberg this morning, on the heels of that news. This is Bloomberg Surveillance. On Bloomberg Radio, David Gura and Tom Keane in New York coast to

coast and worldwide. Ben Carton has been in the U. S. Senate since two thousand seven. Before that, he represented third District in Maryland in the U. S. House of Representatives. He's now the ranking member of the Senate form Relations Committee. Joins us now on our phone lines on a day when we are keenly focused on what's happening in the Pacific.

Of course, another nuclear sorry, another missile test last last night by a North Korea intermediate range ballistic missile shot a distance farther than the distance between North Korea and Guam, a protectorate that country has threatened several times now, Senator Carten, great to speak with you. I look at the President's schedule today, your colleague on the Senate Formulations Committee, Senator Bob Corker of Tennessee, is going to be meeting with

the President today. I wonder if you have any insight into what the two of them will be talking about, and if you could tell us a bit about the kind of interface you've had with this administration on issues like these thus far. Well, first of all, good morning, and I'm certain that Senator Corker will be talking about North Korea as one of the subjects on the agenda with the President. We've I've had discussions with the members of the Trump administration and North Korea and other issues.

But clearly, this most recent tests confirms the fact that North Korea not only has the nuclear weapon, but they are developing the means of which it could be delivered um not just in the region, but beyond the region. So it's a matter of it's extremely dangerous and it's a it's an urgent issue for the United States to to change its game plan from the point of view of I believe starting a diplomatic surge working with China

that changed the equation. As you watch all of these tests, and I think there have been thirteen or fourteen of them this year alone, do you regard them as tests, as North Korea trying out to or showcasing technology they've developed, or these simply provocations to you? How do you view them? I believe that they want to have a functional UH nuclear arsenal that is capable of reaching the US and

our allies. This they look at this as an ability to prevent the United States from UH affecting their regime. But you never know how these weapons could be used. It's a it's it's a regime that's unpredictable. It violates international mall. So our objective is to prevent a North Korea from destabilizing the region in our our interest, and that means freezing and hopefully eliminating their nuclear weapon program. The Senor cardon Good Morning, I think Maryland is possibly

the most misunderstood state in the country. Cumberland, Maryland, hundred thirty eight miles away from your Baltimore went plus vote for President Trump. When you travel out to west astern Maryland, what do you see as the reaction to the follies of your Washington over the last two or three days. What's the response you as a die Aard Baltimore Democrat, what do you see in Republican Maryland? Well, you know, Maryland is called American miniature. We have the mountains of

Western Maryland, we have the beaches of eastern Shore. Uh. Clearly, the western part of our state is more politically conservative than either the Baltimore or Warsington regions, which is much more progressive. Uh. It's the western part is traditional conservative areas of our state. Uh. They're good people. If they wavered, they wavered on the president. If they wavered on the president, I think if you, if you, if you deal with

the issues. They're certainly disagreeing with a lot of the policies that have been proposed by the Trump administration, and they are certainly against a lot of the language the president is used. Whether that would translate into votes that would but against the president, I don't know, but I do believe there is disagreement with a manner in which the President is conducting his affairs. Sender Kardin, You're gonna get through the weekend. On Tuesday. Next week there's a

nominations hearing before the Senate to Form Relations Committee. The Honorable John Huntsman is going to be sitting down taking questions from you and your colleagues. He of course nominated to be the next ambassador to Russia. How much is is his nomination clouded by the the scandal involving Russian interference in the US presidential election? And what questions do you have for him about how he's going to move forward if in fact he's confirmed. Well, Mr Hudson is

well qualified to the ambassador to Russia. He is a person who is well respected by both Democrats and Republicans. I'm pleased that he's willing to allow his name to come forward. My guess is that the confirmation hearing is going to focus more about our challenges with Russia than the qualifications of Mr Huntsman. Uh. The the US Russia relationship is extremely important and it is very challenged today.

I bring up bring up that a nation that's a high level one for a big ambassadorship, when when you look at the names the White House is putting forward, how worried are you about how few of them you've seen thus far? Are you getting any indication here that the White House is going to be moving faster to fill some of the vacant positions that still exist in Foggy Bottom. I am extremely concerned by the slow pace of filling critical positions at the State Department. I'm not alone.

Democrats and Republicans have voiced our concern just talking about North Korea, we don't have an Assistant secretary for that region, so we don't have the people in place that can give a clear direction to U S policy in so many parts of the world. So it's not just our ambassadors in important countries, it's key positions within the State Department that are political appointments, such act confirmation about a Senate that hadn't been filled. It's Friday, so I'm allowed

to do gossips. I'm absolutely fascinated by who's sitting on the couch in the Oval office. Do the Democrats have the back of Senator Schumer and Speaker Pelosi? Do they have the support of not common sense Democrats like Cardon of Maryland but the other rabble? Are they in support of the two? Oh? Absolutely. We very much want our political system to work, and the only way it's going to work is with Democrats and Republicans all being involved.

So we applaud our leaders willingness to sit down with President Trump and to work out solutions that the doctor children. We need to protect the Dreamers, and it's one of it's one of our highest priorities among the Democratic caucus. We were pleased to see that we didn't have a default on our government debt. We would see a budgets

passant's keep government open. So look, we were disappointed by the election, but we wanted to make sure that our system works and Democrats need to be part of the process. Senator I was medicated coming in this morning because I had to watch Orioles baseball last night. Come on, guys, doing like a public grant to help Mr Show Walter out any Kenny hit the ball. It's a Nutcome on,

When does this turn around for the dreaded Baltimore Orioles. Well, you know that we've had ups and downs during the sea, some stretches that we we thought we were going to be the world champions, and we're not giving up hope yet We're still in We're still in a pennant chase, and but it's it's been a very disappointing two weeks, no question about it. And we love our Orioles. We just wish they were flying along higher. They play in

the most gorgeous modern ballpark. Senator Card, Thank you so much, Senator for the Baltimore word. Great to speak with him again, the ranking member of the Senate Foreign Relations Committee. Incredibly timely interview. Grateful to have him taking the time on this busy Friday morning to talk to us about North Korean particularly David, did those states like I think in Georgia North South that span geography Maryland is remarkable over a short distance from the West on serious XM to Baltimore,

M Baltimore, Washington. This is Bloomberg. We had one solitary guest this hour, and he brought an entourage with him. Why did you attempt an introduction, David, I'm gonna I'm gonna run down the list you get Mark last year with us, Jeff down in West, Eden's as well here in our Bloomberg eleven three oh studios in New York. And Uh, I don't know who to begin with you. Let's let's start with West if we could talk it,

I'll let you follow up from here. Let me just get your your sense of sort of where things stand from an investment perspective right now, where there's the greatest opportunity as you see it, and and UH just too maybe outline if you could some of the challenges of of being invested right now. Well, good morning, thanks for having us. You know, the UH, I think the environment

right now from an investment standpoint is pretty tough. You know, you've had a long period of very low interest rates and you've got pretty good good growth in the US and nowithstanding kind of lots of challenges, but there's not a lot that is obviously cheap, you know, So it's a it's a time to pay attention to what you're doing. This is a four hour interviews. If you have three guys in the studio, go, can I get into here? David Mark? Last year, I've been dying to talk to

you about the follies of Washington. How did you enter America? Were you were like on? You didn't go through Ellis Island, right comes through? Jfk JFK. I mean, what do you think? I mean, you're Moroccan, you come into the country. You're the definition of success of immigrants. What do you think of what's going on in Washington with Dacca and with the debate over rich or poor immigration and the rest. Look, I think I mean for me, it's probably a little

bit more sensitive. But I think at the end of the day, you know, this country was made on immigrants and what's going on today is a bit ridiculous over all this stuff, So you would hope that people would be able to solve this issue. On doc CO. You came out of one of the coolest schools on the East Coast, Clark University. Would you have to go back home? Now?

I mean you, I mean, I guess you were in the US then, But think of the immigrants that are going through top flight engineering schools and am I right? They gotta go home? Now? Well they do. I mean, good news is I got naturalized, So I guess for me it's okay. But ultimately, at the end of the day, for all these people who are at school, they'd have to return, should be done. Let me let me turn to you have a wide ranging conversation. You're obviously there. Yeah,

well let's let's go there if we could. And and and this is something of particular fascination we we've we've seen the sale here the Houston Rockets recently for for an extraordinary sum of money. Help us understand how you value a basketball team. You hear the three of you investors, owners of a big NBA franchise, What does it? What does a sale like that mean for how you you you assign a value to to an NBA franchise. Jamie, Sorry,

I think we're blood as well. Yeah, we can't get flooded. Um, No, you know it's you know what's at the at the end of the day, which really happening is really a few things. One is the modern NBA game is probably as exciting, if not the most exciting. I think sports thing to watch and as a result, viewers are watching it, kids are watching, millennials are watching it, the world is

watching it. I think it's probably you know, the most popular you know, big type you know sport I can China for example, and after soccer, it's the number two

sports in the world. That's that's really number one. And as you look at what's happening with money for sports, okay, money for entertainment, it's really live sports that basically is the one thing you cannot watch the next day, don't want to watch the next day, you don't you know, want to basically deal with the so called court coloring risk. You have to watch it, you know, live, So it's

real value that. And then lastly, quite frankly, is I think there's a live people who love the you know teams. You know. I would say, of all my investments I've ever done, and I think Mark and West would agree, this is by far the most fun investment. You had more fun at d l J a few years ago, right, it was a long time ago, A long time Mark last three and Jamie dining with us. You know, we're gonna mix it up. We could literally, folks, we could

go worldwide here for four hours. And these three guys, they've got such great experience, an individual and distinct experience. Jamie, let me start with you. You were in the d LJ Orange book years ago, right, Elliott Platt would write the Maroon book for DLJM Fixed Income and you had the whole thing going. Can you tell a kid today to go into global Wall Street given a method two, giving the battle over research? Can you tell some kid coming out of Pennsylvania like you did? Can you tell

him to go into finance be like Mark last? Three? Absolutely, if it is your passion. Okay. I remember when I went into Wall Street and it was one My first job paid me twenty two thousand dollars a year. It was a decent salary, but it wasn't like you know the kind of numbers you're hearing about today. And I went because I was passionate about I actually wanted to do it. If this is the career that you're passionate about, you really want to do, you should do it. I

think it's still a good career. Okay. If if you're going to get rich, I wouldn't do that. If you're going to because you want to make something that you're actually gonna enjoy doing and actually do well. Got absolutely, Let's see this. Let me ask you about infrastructure in particularly. We came out of the election headed into inauguration with a lot of talk about there being a big infrastructure spending package, there being a renewed policy focus on infrastructure

in this country. You know this is something you're keenly interested in as an investor. Are you convinced we're gonna see something? How essential is it in your estimation that we get Washington to play some sort of catalytic role here to to to provide some sort of package that's gonna renew focus on infrastructure in this country. I think it's critical, you know, I think that the returns on

infrastructure are you know, multiplier effects. I think, who do you have great infrastructure and actually is the kind of bedrock of a lot of economics activity. So it's really important and there's lots and lots of need for in the country. Um. I think there will be something on Washington, hopefully by the end of the year or the first part of next year. And uh, I don't know what they're gonna what they're gonna say and how effective it's

going to be, But I think it's desperately needed. What what's the I mean, what what could be most effective? You know, I've listened to the presidency talked about this and you see it sort of Eban flow what he focuses on. And he's talked about infrastructure sum he was out in Io talking about it and the merits of more public private partnerships. Is there a policy tool or something in particular that you think would be more effective

than others at at boosting investment infrastructure. Yeah, I think I think it's very very clear. I think that the essential thing to to provide is uh a mechanism for private capital to fund a lot of it and so and and really the missing link in the capital structure for a lot of this is debt. So I think the government can be a debt provider and not cost the government a lot of money. And I think they can then enable a lot of product and direct investment.

And I think that you could really see a tremendous moment. And so it's true, and jump in here if you we just got it's a phone with Hugh Henry of Scotland over in England. He's shutting down his hedge fun today. And I made a key distinction here. He didn't blow up. A lot of people blow up. We all blow up. I've by mistakes. Everybody else's may mistakes. At three of you, I'm sure have your war stories as well. He was killed by just damp and volatility. You know, he's down

nine percent. That's you're fine, But all the rest of the returns with just the single digitness mark last week to begin with you, is that where we are now as perpetual single digitness or can we actually get back to making elfit within the industry. Look, it's hard. I mean, the biggest issue that's out there today is pretty simple. The risk free rate is sort of zero, right, So you know when if you just look at ten years ago, ten years ago, the risk fy rate if you left

your money in the bank was four percent. So if you did four or five times the risk fy rate, you're fine. You're a twenty. Here today you do four times or five times a risk free rate. Let's just say it's ten bibs. You're making fifty bibs, so you're

taking a lot more risk. It's what West said, I mean It's just you're in a much much harder environment and because of that, you're taking a lot more risk, and you're gonna end up having, in my opinion, fewer and fewer people who do what we do, because you know, people aren't going to tolerate the lower returns west quickly. Is this dampening because of central bank policy? Is as

simple as that. I asked the same question, Hugh. I think if you had to pick one thing, you say, yeah, I mean, I think that it really is keeping rates low as they have been as long as they have been. While it might have been a great idea, you know, in the middle of the financial crisis, financial crisis has been over for a long time, and I think that's

a real challenge. It really is in this lower rate that Mark talks about, that actually is what drives than all other related returns, and that's what makes the challenges everythink. But we're surveillance on bloom Bgradio David Durrett and Tom

Keene in New York. Here with a packed house, we live in three smart you got your seat back, Tom, you should take it away, go go forward here, uh fact asked here with so many things to speak of, but I think it would be unfair to speak to Mr Dinning, Mr last Fore industry and not speak about basketball and television in that we're all fixated by Cleveland and Boston and this and that and the stories on the West Coast. I guess as a team David on

the West Coast it's pretty good. I can't remember. But but is the is the gravy train going to continue that thing? There's one of you three, the TV expert of the three at West is the is the party going to continue for you? That is TV sports? Well, it's a lot of sports. Is UM is very very valuable? Right, It's it's what everyone wants to watch, And even the cable cutting and whatnot, you still want to watch a

lot of sports. Now. The old media companies, I think are struggling and the new media companies are in the in the rise. So I think, UM, the answer is that the content very valuable conn continue to be valuable more valuable. Perhaps the nature of how it's distributed I think could change a lot. Next week it will change in distribution, But will it poured over to the Facebook's, the Twitters, the Googles. I don't understand how I watched The Bucks on a little itty bid computer screen like

you do on the Big four case Sony. I mean, I just I can't get there. Help me get there. You might be a little too old. It's conceived about it. It's uh, I think that people can. So you think that's funny, you're I think I think people can. I think people consume the sports in a lot of different ways. And I think what's gonna happen though, is that unquestionably

it's gonna be distributed many different ways. You know the you saw the big announcement from uh, you know Disney on the streaming you know product, and we haven't really figured out how to monetize it properly as an industry, but it's coming. It's coming fast. We're classic. Let me just ask you about your audience that the Bucks is audience right now, obviously incredibly important to that city itself. But but how connis that are you? How connies are

all three of you? About the national the international reputation of of the brand. What's the focus there? Well, I actually think we're America's team. I mean, I think if you forget about everybody else, if you look at but it's not the Um, I know. I think because of Janice and number are the other players that we have. Um, it is an international team, right and because of that, you could be anywhere. My daughter was on her honeymoon in Greece and she was wearing a Milwaukee Bucks T

shirt and everybody just keeps running up to her. Why are you a fan of your honest? And you know she was like, yeah, I love your honest. I mean it's I think wherever you are, UM, especially for our team and where you've got international players, I think it's huge. How about the issue of of of legalized gambles. I don't know who would take a bite out of this, but Adam Silver talks about the need to have a

better mechanism in place for that. Uh, Marco, have you take a bite of it if you want, and y' all can jump in if you want. Do you think that's gonna happen? Is there is there a lot of money to unlock there? Do you think we're gonna get some sort of legal, legalized system within the context of the NBA for for legalized gambling. Look, my view is you should have it. I mean, it happens so UM, we can stop making believe it doesn't happen, And I think Adams right, I think sooner or later it will

end up becoming legal. And once it does, I don't know what ultimately happens, but I'm sure um ask people are betting um there will be ways for people to figure out. Yeah, you know, I don't pretend to be an expert, but you went inside? Is this right for the GM? The new GM? You had one guy go to Orlando, and you tell me about that decision. I mean the pressure to to to spend huge money to go outside. Why did the bucks stay internal to pick

up the guy that's got to keep the egos in check? Well, we ran a very robust process to look at a lot of people, and in the end we concluded even did they call you they can It wasn't quite that, but we ran a barrow must right. We talked a lot of people and concluded at the end that the guy that worked for us is the best candidate. So it was that simple and we're very happy with them.

But big decision. Mark, just certainly back something Tom asked you about a few moments ago, that being Hedge Funds. We had this conversation with Henry just a little while while ago and we didn't talk about was fees, and he said he's thrown in the towel, not not going out with the disappointedly um is the conversation about fees and ancillary conversation. He said that we were seeing the

end of a global macro moment um. How much readjustment has to happen with fees and hedge funds and is that going to be something that saves hedge funds you're going forward. I don't think people mind paying fees, to be perfectly blunt, if you're giving them the returns right at the end of the day. What gets people upset is if you're charging them two and twenty and you're flat, or you're up one, you're up five, right, It's that's

what gets people upset. It's not so fees become a big part when you sort of look at it and say, all right, the tenure, which is a little bit of what West said. If the safest investment is a treasury and a ten years two percent and you're charging somebody two percent um, that's kind of tough, you know, It's it's just math. I mean, ultimately, at the end of the days, done to that yeah, that's all it is.

We just got forty seconds, Jamie donald Let's go back to the acclaimed Elliott plattet Donaldson generated a few years ago. He never had a deal with negative. The three of you survive when you got a German two year done negative seventy beeps in a Swiss twenty year it I can't remember what it is, just quickly here. When do the negative rates bill a end without? We don't know, but my guess is ultimately it has to end. This is not normal. But I think you know we've all

survived by finding idiots and crack opportunity. Just because markets and markets really globally, particularly risk acid markets are fully priced. You can still find out he's a fully price Jamie Diamond. What's het in the smart Lazarie? Thank you so much. This is Bloomberg for continuing to follow the news out of the Korean Peninsula. The U N. Security Council scheduled to meet at three o'clock this afternoon here in New York to discuss the situation there as Secretary State Rexi

Solurial calls from more action against that rogue regime. Our next guest, without question, the interview of the show. Ambassador Christopher Hill joins us now on our phone lines. Distinguished career in public service in the government. He was most recently US Ambassador to Iraq. Now he's the dean, as I said, of the Corbel Schooled International Studies at the

University of Denver. I should note he was an ambassador to the Pope of Korea as well, and a participant in the Six Party talks on the North Korean nuclear issue. Abastad Hill, great to have you with us today, and Uh, the word of the day is inured. We've seen so many of these tests over the course of the year. Uh is each one different? What was different about the

one that happened last night? Well, at a certain point you have to ask, you know, why are they testing as every week or so, because clearly it's it's more than just you know, to check the flight path. And I think what they're really doing it's kind of an any of the face move. They're trying to say. Christ of all, we're in full for auction with these things, so clearly they don't have to hand make them every cast.

I mean, they've got some production line. And secondly, I think they're trying to make the point that we are a full switched uh uh nuclear power and you're just going to have to deal with us as such. And the more we send up these missiles, the more of a reality and their view will sink. In my own view is we cannot accept them as a nuclear are when we certainly cannot accept a situation where country points uh possibly nuclear tipped missiles at us and uh, We're

gonna have to step up our game. You've lived this, You've watched the deliberations of the U N. Security Council. We certainly saw some heated ones. On Monday, the U. S Ambassador to the UN, Nikki Haley, wanted more severe sanctions yet placed on North Korea with regard to oil that didn't happen because of China in particular. What do you think is going to happen next? I'm going to steal a question that Tom asked a little earlier on the show, that is, what more can the U N

do at this point? Well, I think clearly the Chinese are going to have to do more. I mean it's not enough to say there against it and and sort of go along with these limited sanctions. They've really got to go the full go the full distance. North Korea does not have refining capacity, and so I mean it's amazing they have nuclear facilities, but not on oil refiery. So I think China really needs to look at this

critical issue of gasoline. But looking beyond that, I think the US and China really need to look at what's going to do about this. And it's more than sanctions, because the sanctions train just moves too slowly compared to the legalization train. And so I think we do need to look at some options, and I do I think we need to make China understand that we're going to have their choice. But to go forward, to borrow a line from from the musical Hamiltons, you've been in the

room where it happens. You you were part of the Six Party talks on North Korea. Very few few people have been engaged in direct diplomacy with with the North Korean regime. What's that like and is it likely to be different now? If if at some point in the near future we see all these parties returning to talk to each other one again, What are the particular complexities of dealing diplomatically with North Korea? Well, first of all, these people are aren't not stupid, they're not robots. They're

not just reading from talking points. Uh, they're making their case. So you know you're up against people who know what they're talking about. But I think it's important to understand that when you talk to these negotiators, you're basically talking to the note taker, because the note taker is going to take the message back to Piong Young, and we've not really had any kind of capacity to take a

message to put Pill and Young. Well. I emphasize, however, the North Korean's have shown no interests, zero interests in a in getting back to the original purpose of these talks, which was demo verzations that they've talked about the need to have kind of some kind of limits. And I don't think we should go that way. I think we should really press the Chinese and work together with China on this. If you're just joining us first, Christopher Hill, where us is David and I both degree, this is

without question the interview of the day for Bloomberg Surveillance. Inbassador, I want to go through a little bit of the path here from Moses Brown in Providence to Boden to your continued public services ambassadors to different areas. You work critically in Kosovo and then on the Eastern Europe in Poland, and then your expertise on Asia, You more than anyone we speak to, understands the trenches of the State Department.

How destroyed is the State Department from the actions of the president with Secretary Tillerson, Well, to put it gently, I think there's a problem. Uh. Diplomacy does, after all, needs some diplomats, and it's worrisome to see many of the better ones, some of the best ones leaving. I think Secretary Tillerson has really tried to address some of the main issues, but it's a bit of a team sports, and I don't think the Secretary of State can do

it alone. And I think he needs to understand the secretary of the role of the Secretary of State should be someone who comes into the ninth inning and shuts down a problem, rather than shows up in the third inning and encourages parties to keep on talking or something.

So I think there's a kind of a failure to understand the sort of u uh technology of it all of how why you have lower ranked people, I have middle ranked people, And I think there's a failure to understand that these are career people who have a heck of a lot to offer there. You know, when Secretary Killers have showed up at the State Department in February, there wasn't one person there at the C Street entrance

who wanted anything but full success for for him. And instead he's gotten involved in this issue of reforming the State Department. Look, that's a good idea. I think everything needs to be reformed. But my goodness, we have far more uh you know, urgent matters out there in the world and having some accounting firm. Look at how the State Department is organized. We're we've got all sorts of

new investor. One more question, if I could, one of the few things you have and I have in common, besides a view of the athletic fields of Moses Brown, is we really are concerned about Aaron Judge. The ball he hit last night for the New York Yankees in Fenway Park, Chris, it would have gone over the turnpike, probably would have landed across the Charles River. What are the Red Sox going to do about the surging dreaded

New York Yankees. I think they need to pitch him high in a way and uh, make him bite on sliders as well. I mean, I'm not really sure, but you're absolutely right. We've got to deal with that problem. It is this true national problem. Chris Hill, thank you, Thank you so much. We look forward to seeing you in our Washington and New York studios. He's not, David Is. It's correct with the University of Denver at the University of Denver heading up the Corbel School of International Studies.

They're a fine and growing program there and always incredibly great to talk to him about this issue in particular, and I've talked about the Middle East as well, legendary stories of wearing Red Sox, carrying the Red Sox flag across all of Asia, like he's been known to go into meetings with with swag Kiss reminds you of Megan Green with her Red Sox socks that she will tell our audience, Dave, in the time we've got left, we're waiting for something to happen here. Our team is working

on it right now. David. Why when when we say that's the most important interview of the day. To me, it's the guy's experience. He's in the trenches. Yeah, absolutely, I think what I want to highlight again and I did in the question to him they're about about diplomacy, is that he lived this as the ambassador to to South Korea and then as a part of those talks. You know, many years ago now we were engaging with North Korea diplomatically, with a few other countries in the region.

I think it's just extraordinary to think about how few people have been in a wardroom, sent it around a table, having occasion to exchange words with representatives of the North Korean government and Basterd Christopher Hill, as you said at the University of Denver, one of those few. Thanks for listening to the Bloomberg Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform you prefer. I'm on Twitter at Tom Keene. David Gura is at

David Gura. Before the podcast, you can always catch us worldwide. I'm Bloomberg Radio.