Surveillance: Justice Dept Highly Politicized, Valliere Says

what are they grooming her for? I think this is a brilliant move a CFO. She's been running all of the analysts calls, all of the media calls, for example, leaving last Friday, for example, Jamie Diamond is calling in from Florida and she's the one holding down the fort. No one questions her ability to be a key CFO.

Moving her over to the consumer business a sort of squashes the rumors that we've been hearing about her going to Wells Fargo more importantly, people it could be, but I also think it's very clear about succession planning, and I think putting her over in the consumer business, which

as we know Jamie. JP Morgan is best in class, but as we know, they've been sort of leveraging more and more of the consumer business is equity and fick, and some of the investment banking pipelines have been slowing down. They have been leveraging more that consumer business. Putting her in a clear line to be running that specific franchise I think is also a very smart move. I think a lot of this came as well from the hearings.

One that the House of Representatives had asked Jamie Diamond if a person of color or woman would be the next CEO. He did not raise his hand. He joked with Marian Lake on the earnings call a few days later and basically said, the operating committee makes the decision. I'm not going to so I think this is very smart for them. It's gonna be interesting to sspect a lot of hedhubs is going to be seeing their way to these three women's doors who are at JPMorgan right now.

Other banks not in the position that JP Morgan is in right now. Taylor Riggs, thank you very much. Indeed, it is you know, for particular for those of us at Live Watergate, John Ferrell, it's an interesting moment. We'll see how interesting by say twelve known today, Yeah, twelve new h precisely because at ninth thirty we get the news conference, and I have no idea from that point Tom when we actually see the full report on Wall Street, I also have no idea how many people actually care

and who will be watching. I want to bring in Michael Shell, market Field Asset Management chairman, portfolio manager and CEO. Michael, what does all of this made to you with anything at all? Nothing? Really? Um? I mean, certainly at nine thirty, I won't be watching it. I'll be watching the market open. That's, you know, generally a much better use of time. UM. You know, it's it's going to be dominating the news waves.

I don't think it's going to dominate financial media. I think you guys will will move on, you know, fairly quickly from this. But but this large document will be passed and turned into headlines and turned into commentary for months, months ago. Yeah. I don't want to prejudge the outcome of the report, but it feels like a lot of people go in this with a pretty strong confirmation bias. Michael.

It doesn't seem to change the mind of many people, the more information we get, No, And I think what you'll find is is more and more people get less and less interested in this as it goes on, But there's sort of political die hards. We'll still be preaching from it into the next election. Do you think it

shapes policy outcomes elsewhere? More specifically on the trade story, it was interesting that as this bubbles away in the background in Washington, we take another step potentially towards a deal with China in the United States, perhaps by May time. Do you think that gives us a little bit of a nudge on the trade side. You know, I think this report could have gone worse for the administration. You know, I think it's a president who doesn't mind fighting partisan

fights as goes along. And you know, all the evidence suggests that we are heading towards some kind of a solution in trade, and I don't think this report is going to have any impact on that. Let's talk about the fundamentals and how resilient this secuity market is Eurozone p MS downside surprise and equity market that just shrugs it off. What do you think about that, Michael? This secuity market is looking somewhat bulletproof in the in the face of economic data that is weaker in China and

weaker in Europe. Rather China a little bit better. Yeah, well, China, you know, is better than the European data. You know, isn't that bad? I think if I looked at it coming in the cab, it was Italy and Spain's service data was weak, that Germany's was okay, and for manufacturing still below fifty. But it's closer to fifty. I mean, you know, this isn't bad. Um, it's stuff that people

know is very already. Um. You know, if you look at if you look at economic sentiment in German, it's extremely low, but the Zoo index low single digits with a DAS going up. I mean, but that's generally what I call a positive divergence. I think that markets tend to move in without direction, and economists tend to follow. Uh. There are two brilliant Bloomberg articles today on what we'll call the European banking mess. How do you take advantage

of that? How do you do you know you were the Oscar groose for years with a real European band. How do you become opportunistic given these stories. Well, I'll tell you a story back from and I knew absolutely nothing and was sitting around in Oscar Goose and the story came across the tape that that Manny Hanny was was was being bought by chemicals. And one of the partners turned to me and says, that's it. The market.

You know that the whole cycle just turned. I don't know what he was talking about, but I still think about it twenty eight years later. So you know, I do wonder whether if Deutsche Bank could actually get a deal done with Commers Bank and they could start cleaning up where whether that would be something of a turning sentiment for that banking industry. This is wonderful. Michael Shure, thank you so much. This is a joy Foreign Affairs. I talked about John, I'm a broken record. I'm a

broken seat every month. It's great, except they've topped it all this month. George Packer, who was the definitive IRAQ writer, I would say with the New Yorker, Damn Dressner, Um Ambassador Burns, William J. Burns is in here as well. Gideon Rose. I'm searching for a strategy, and this is not a Brexit issue. We're searching for a strategy when in America aren't we exactly? And it's really it's unfortunately I like the issue too, thank you very much for

your praise of it. I'm it's kind of a depressing issue. I suggested that we shrink wrap some xanax with it as well, because the entire theme of the issue basically is Trump will have ended up killing off the previous foreign policy, but his foreign policy is not particularly uh sustainable or effective, and so the real question is what happens after Trump's feign policy when US hedgemony has been essentially shaken to its core but it is still standing.

What happens next? Does it deteriorate or does it get revived? Every single person listening to this would kill for their children to be William Burns. He is a public servant of the country. He went through the foreign exchange, the foreign policy treadmill, a state department and all that. What are the William Burns of the world doing with our

American foreign policy right now? Uh? The William Burns is are basically like the staff of a US embassy with a political appointee, a rich campaign contributor who gets appointed to a major embassy, and the embassy staff spends the time trying to protect the u S interests in the Bilotle relationship from the sort of rich dufice and charge who's who's things up, And that's happens well when you

have the political appointees come into varieties. There are some of the best American diplomats in history have been political appointees who bring an outsiders flair to things, but some of the worst are people who should never be in government and are just essentially a spoil system. And the problem is now we have the entire government run by a rich campaign donor who's an amateur, and the professionals are trying to make sure that the government doesn't collapse

on his watch. And it's a struggle because the White House right now essentially trying to undermine the independence of the bureaucracy and the civil service and the public service, and everybody is tearing their hairs out in that kind of thing. Getting elections have consequences. That goes without saying. I'm trying to get my hands around the kind of foreign policy the American electorate want. I don't know what

kind of uh farm. If not clear, the American public has a choice on these things, and they don't have a real educated preference because, uh, reading out their preferences from what they vote is very, very difficult. The same people who voted for Barack Obama voted for Donald Trump. Uh, and uh, there's a lot of problems in trying to

figure that out. The real problem is they don't like what's being done now and even though it is successful, and so how do you make it how do you make people understand the alternatives to current policy can be even worse to the elite world In John's question is absolutely brilliant. We have two presidential candidates walk away from a multilateral America. Right this this is the great challenge

which is right now. The country's foreign policy that actually is providing security guarantees for the world and stability for the global economy is benefiting the world in general, and the United States as the leader in that system. But there have been so many flaws in management of American hegemony, both domestically and internationally, whether it's the rock board, the financial crisis, are inequality that the public doesn't see the good things that American geminy is bringing, and so they

just want to give it up. And then the challenges, how do you convince people that global leadership can make sense and is worth paying as a price anybody willing to get on the campaign trail and do that. No, And so you're gonna have two years of reverse Trumpism in which the Democrats compete with each other to make wild and crazy promises that can't possibly to be fulfilled.

And then the next president is going to come in and essentially have to have the challenge of dealing with real problems that have not been addressed after four years of drift. And that's the big challenge that we don't know yet what's going to happen when we try to restart a real foreign policy in two years. I just always feel like we have these discussions and we sit in ivory towers about what should and shouldn't be done.

But I just get the feeling of the electorate just has less appetite for intervention abroad, both in terms of soft and half power power power. It's less appetite to deliver foreign aid. It's always been it's always been the case, but that has changed quite remarkably over the last five years, and not just in the United States, but in Europe

and the UK as well, Gideon. So essentially, I think what's happened is, you know, I was talking, We talked about this a lot, and in fact the next issue is sort of what went wrong, and Tim's gonna like that one as well, which is basically how we screw

up usgemity so madly over the last generation. But I guess my answer would be that a lot of us took our eye off the ball and we didn't focus on things like the internal periphery and how things benefited sort of you know, the in effect what you would

call Trump voters. We can contend did ourselves with progress on general statistics without necessarily understanding the political reality of that and understanding the progress wasn't being conveyed to voters, and then the voters basically rebelled understandably, Gideon, really smart, really appreciate time as always, and your insight and your personal forew Gideon Rose, Foreign Afast magazine editor and Peterson

g Peterson chat. You could go into the podium elector in a department of justice with the one count them two three four flags set up. One is of course the American flag, which will be over Attorney General bars right shoulder, and then there is the acclaimed and important Department of Justice flag in blue, along with two other blue and white flags as well. And this goes back in history. Greg Villier knows it is a unique history

of the Department of Justice. As we await Attorney General bar his comments on this eagerly awaited Bloomberg report, Greg Vllier tell us how through the years that you know that Democrats and Republicans have treated this Department of Justice well, usually as a pinata ton, whether it was Republicans against you know, Jana Reno going back a long time, or whether it's Uh Democrats against Sessions and others. It's a highly politicized agency. And frankly, I think William Barr has

continued that trend. William Barr in all the punditry I've seen I've been told, he can say. We now see Mr Barr beginning to walk down the Marble isisles here at Justice. He's got the usual entourage with him. He's caring about five inches of documents with him. I would suggest the vlier report from Toronto is within there today as well. We will see on that Greg. Uh. The Attorney General is supposedly one who can surprise. Do you

think he can surprise today either Democrats or Republicans? He could, Tom, I mean a lot is unknown. But there's a really interesting story in the Washington Post this morning from Giuliani who says that the Trump team is ready to rumble, that they're going to counter the findings in the report. So the issue then becomes, would Bar be part of that countering Paul Soon? I misspoke Attorney General bar but that was an older film. I have him walking. We

don't know where he's right now. We'll see him here in a number of minutes, nine minutes away from the scheduled panel exactly. I think, you know, Greg, I think probably the first question a lot of people are just asking themselves before we get a chance to look at the report is will there be any new news? What is your thought? I think there will, think I think there'll be new revelations about how the White House handled all of this. I think that it will give Democrats

an opportunity for more hearings, more subpoenas. But I think the bottom line is going to stay the same, and that is chances of impeachment fenty percent, chances of conviction in the Senate. So Greg you mentioned the Democrats here. I mean, let's assume that this report. I think the expectations are that there will be a lot of redactions of this report. If so, presumably the Democrats will fight for greater disclosure. What do you think their strategy will

be in terms of getting more disclosure? How hard do you think they will push or they should push? I think very hard. They're going to listen to the base, and I think they'll go after a lot more. They run a risk, however, of overplaying their hand, just as Newt Gingrich did with Bill Clinton. I think that it backfired on the Republicans, and this you know, and an

overreaction by the Democrats could backfire on them. We should say who the attorney general is, and so those particularly in our Bloomberg eleven three zero New York audience, it's of most interest. William Barr out of New York. His father was at Columbia University and then was headmaster at the Alton School on the Upper East Side in uh

New York. He went on to um all sorts of good academics, including the Horseman's School and George Washington Law as well, and then he's really had Paul Sweeney an interesting Washington career. He's made a lot of stuffs. It's almost George Bush Senior like. And that Greg Valier Attorney general bar has not just been in the legal record, has he. No, he has a very distinguished career. People

who know to speak very highly of him. But I have to be candid, Tom, I think that Trump has an attorney general who is more helpful to Trump than Jeff's sessions was compared to Edmeys that we remember from a number of years ago. So it's interesting, Greg, what what do you think the reaction will be from the White House as this report comes out? Over the next you know, day or two, them people really start to dig into how gressy do you think the White House

will be in in terms of responding. That's a really crucial question. If Trump just hunkers down and let's the store and pass, there's going to be a few days of rocky relations with the Hill, then I think he's in good shape. But if Trump is Trump and he gets he gets furious and reacts angrily, I think that could raise issues. I think that could prolong this if he starts to attack Maller personally. I think this could

drag on even longer. Craig value with us as we await a number of minutes away, seven eight minutes away, and I would suggest the Attorney General may be timely.

We would see that this is not at the White House, This is not in the press room or any rooms at the White House, at the Department of Justice, with the crest uh standing behind Mr Barr with a blue curtain, very typical federal government blue curtain, the crest of Justice on elector in the American flag again to the left, and then that famous blue flag of the Department of Justice over the years to the right with two other flags as well. Gregg Valier, the Democrats come in different flavors.

You mentioned the impeachment idea, but there can be much much more here, including prosecution. Will we see text, do we see footnotes? Do we see appendixes? Do we have any idea appendices? It's going to take hours for everyone to wait through what's in there, and there will I'm sure the speculation about more indictments. But Tom, if I could make a quick point about the markets, you know, we all you know, are in the business of talking about the markets for our listeners, I would say The

bigger story today is the retail sales report. It shows that not only is a recession not imminent, I think that's a growing I think there's a growing chance that this economy could overheat. The economy is clearly rebounding. And I think a chance of a fat rate cut is zero, and I think people may start to talk, well, a second half rate hike. Herman Kane out with a statement today, if you will on his advantages. Does he persist in uh, moving towards some form of domination to the Fed, or

does that become a distraction for the president. The President moves on to saying, hey, look, this is my economy, give me credit for it. Yeah. I mean you've got to say that. The big surprise economically is how strong the economy is now looking as we as we're now into spring. And I think for the White House that's something they can most about. For Herman Kane, I think the chances of him becoming a FED governor aren't close

to zero. Again, we gotta pen right now. Paul Sweeney of the Attorney General's stage in the audience of all I'm not good at guessing crowds. You're much better. What do you think seventy eight in the room, all of their cell phones ready to go. I think so it's people, it's filling up very very quick. You've got your embargoed report over there. But yeah, they it's it's filling up very quickly, and we're you know, four or five minutes away. So, Greg,

you mentioned the markets, it's just been in extraordinaries. Are anything, you know, We've had this great start to the equity markets this year, very much of a risk on field. Things are all okay out there, um, and that obviously is much different from what we experienced in December when one of the issues impacting the markets in December on the negative was, you know, all this political issue out there. Is there anything today in the Mulla report that could

trip up the markets? Maybe the markets not discounting. I don't think so. I think the markets are correct to assume that this will not lead to impeachment or more accurately, to conviction. So you make a really good point. You go back to December, we were fearful of a long trade war. I think that has diminished greatly. I think

we'll get a deal with China. There was a great deal of fear over the Federal Reserve, and I think even though you can rule out a rate hike in the second half, the Federal Reserve is dovish and they're going to stay dovish. So a lot of the anxieties that dominated just four or five months ago have evaporated. We'd like to give details, and of course we dive into Wikipedia in any other sort as we can find for this. Greg, I think it's important to state that

the Attorney General is an avid bagpiper. I mean that that that gives us credit here for moving forward today. Have we ever interviewed a bagpipe? I don't think. I can't imagine. I don't remember bagpipes the studios. It's a reposed the most grating instrument of all times. That from Mr Vilia. It's a Republican sport. I guess that is how we would. But we await the Attorney General, and

of course this important moment for Washington. We welcome all of you on our different radio platforms and particularly serious XM Channel one across this nation Bloomberg, uh Bay Area in a very early morning San Francisco, and of course on the Eastern Seaboard in Boston, New York and Washington as well. Particularly Good morning to FM in Washington, where

we are certain all the Beltway riveted to this. Right now again Bloomberg Radio will give you full coverage of this, not only the comments by the Attorney General, the frenzy, the headlines around all that, but really the further analysis summing up I'm sure at four pm or six pm later tonight, Paul Sweeney with with a lot more analysis of the four hundred I mean again four hundred pages. Think of that there was a yeah, I mean it was a two year investigation and you know, a four

page summary. I think a lot of people are questioning whether that's really sufficient to kind of really dig into what was in the report. Greg, I mentioned Mr McGann as my first word search, Jonathan swanted to Actually I was talking it up as well today. I do agree with that. Who is Mr McGannon. Why should I be words searching him? Well, he test to find a lot. There was a period time where the Trump lighthouse urged to everyone to go candidate to to cooperate, and I

think his testimony could have come back to bite the lighthouse. Now, Greg value stay with us right now. We got to do a day to check into all of this, and it is within rising markets. Is UH our economic strategies. Gregg lu mentioned retail sales better than good and John Bless claims showing that what some would say is a

fully employed America futures flat. They're now up ten doll futures up a twenty six thousand five win three and you see it in the vixen point three two points, not not below twelve to that wonderful eleven handle of a few days ago, but twelve point to eight on the vix as well. Yields have been all over the place within a narrow range. Actually off retail, we did

get higher yields, lower bill note and bond prices. But right now Paul three basis points in two point nine seven percent in the thirty year upon the tenure two point five six percent. I should point out German yields are lower today. They really give back some of the lift that we've seen over the last UH number of days. Dollar stronger, Paul Sweeney, dollar ninety seven point three three on d X. Why really speaks to that American distinction.

The dollar has been just been fantastic, and you think about the dollar, the question is just what the current what can it appreciate against And we haven't seen any weakness really in a dollar So, Greg, you know, one of the things that's been a big issue about this report and the and the release of the report has been this the sections that have been redacted and the reasons why they've been redacted, whether it's you know, an impending investigation or national security issues or what are the

areas or groups of redactions that you think are most you know, that can be challenged the most effectively by Democrats. Well, I'd say a couple of areas. Number One, you could make a case for perjury, that there are people very close to Trump who may have perjured themselves and there may be grand jury investigation into that, you know. And I think another is just the probably the most hotly debated issue, and that was the meeting at the Trump

Tower with the Russians. I think there's still uh an ongoing investigation over whether people close to Trump perjured themselves about that meeting. Well, to be clear here, not that you know, I want to get into the Niete Gritte, but I will. Um. So you're saying within the report there are people that spoke to Mr Muller and his team, and they just in the normal path of speaking, perjured themselves and that will be blacked out if there's still

an ongoing investigation. Absolutely, and I think that still remains a risk for the Trump inner circle, that uh, contradictory statements may lead to some indictments. You know, it's important to note that most legal experts belief you cannot indict the sitting president. So I don't see Trump being indicted, but you could indict people around to We're thrilled to Greg value with us to give us a perspective here on our economics and of course on the political moment.

I should state that we can see within our coverage within the Department of Justice press room, the seven year sold members gathered are very clearly looking at a single sheet of Paul. It's a single sheet of paper. I don't believe it was redacted, but you know, the some form of single page press release, two sided, I should say, reactions of color coded. Actually, yeah, this will be something, and you know very quickly, Greg Villier, as we await, I think we just got a one minute warning from

his staff. Two minute warning. Thank you Colin on that, Greg Villier, this is not nineteen seventy four. I mean, it's it's not what we saw the attorney general of another time and place. Well, that's correct, but I would say that Trump still faces other issues. One is from the Southern District of New York in terms of payments to a porn star in terms of the Trump Foundation, so he's not out of the woods yat. But impeachment

and conviction I still think very very unlikely. Greg Villiers, thank you so much, greatly, greatly appreciate this morning with a g F Investments Toronto thrilled director join us this morning. H 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 before the podcast. You can always catch us worldwide. I'm Bloomberg Radio