Surveillance: U.S.-China Trade Risks With Haass

and I'll make real clear. Take it and throw it at any smart mouth college kids you know, and beg them to at least read the first hundred and fifty pages, which is a tour to force on the Western civilization we've all forgotten, or quite frankly, we never took. Ambassador has joins us now from the Council on Foreign Relations. Ambassador. In your book The World, you write about war between countries. Are we now at war with China? No, we're not at war with time China. But the entire trajectory of

this relationship has changed compared to what it was. For what unit station China built a relationship fifty years ago. We originally worked together against the Soviet Union. Then our economic interaction essentially became the foundation of the relationship. That economic interaction has now become a source of friction. But what you're seeing, particularly on the American side, is a real ramping up rhetoric against China at a time China

is becoming more assertive in its foreign policy. We're not at war, but this is a relationship that it seems to have lost any positive dimension, any rationale, and increasingly it's marked by confrontation. Investador. I want you to go to a time and place long ago. James McGregor Burns was great about this, about how we developed the State Department, how we developed a foreign voice as Americans. Please comment on the tone the disc course of our Secretary of

State this week. To me, it's original really within the twentieth century, in this new century, is it? I'm hard pressed, uh to find a parallel. Tome. I hear where you're going, and I'm sympathetic to what you're saying. Our chief diplomat is going out of his way, not just to be undiplomatic, there's a time to be that, but to be publicly provocative, insulting his counterparts in China. Essentially yesterday, in a speech at the Nix Nixon Library, almost de legitimizing and almost

de legitimizing the current leadership of China. UH and essentially it came very close, very close to calling for regime change in China. The parallels between his approach to Iran and the approach we heard yesterday in China I thought were pronounced. You know, Richard, this is really really important. The Peace Hotel over in Shanghai yesterday on Twitter put out a photograph of their claimed British room where Henry Kissinger I believe slept the night before he went to

Beijing to change history. Are we giving up all that was accomplished in the early nineties seventies. I don't know. It's too soon to say that. We don't know how much of this is tactical, political, to be to be blunt in our own context. In the run up to November, we'll have to see what happens. But this is extreme. This is the idea. By the way, this is ironic that the speech took place at the Nixon Library. Nixon was willing to find common cause with China despite all

of our fundamental political and social differences. Yesterday, the secretarire State ignored the potential for the United States to work together despite our political differences, and instead hart on those differences. It's as if he's looking for a fight with China, And I think again, this is this relationship. Any time you have a relationship between a rising power and existing power,

know that it's difficult. It calls for really subtle death, state craft on both sides, whatever else you want to cause. Yesterday's speech, I would not use adjectives like subtle and death. Maybe that's the tactic. I don't know, Richard. Something else I don't know is what it's the strategy. What is the strategy at the moment? Can you identify what it is? No? Certain? Uh if. Traditionally in foreign policy, the strategy is to

change the external behavior of other countries. Now if our goal, you know, we could have legitimate goals about changing China's approach to trade. We could have goals about getting them to ease up in Hong Kong, or not to deal with the weakers the way they are, to stop with their unilateral claims in the South China. Say, all of those would be within the traditional realm of a farm policy.

That would be a strategy. We would work with our allies to bring it about instead, and yesterday's speech, we have the Secretary of Stay brating our allies, including Germany, and again not making clear what exactly it is we want China to do. That is in the realm of foreign policy. Richard tom Kine started this asking are we at war with China? You said, no, that's a stretch.

But is that the outcome that we're getting toward. I mean, what is sort of the trigger points here and the possible tip for TAT escalation That could be a worst case scenario we've had now the tip for TAT we close used and they closed Chang Do. I would think the most dangerous thing for the next few months, UH would be an incident in something like the South China. Say China has unilateral claims, we correctly do not accept their maritime claims. Were sending ships to the region to

demonstrate we consider these orders to be international. The idea that you could have some type of a military incident that could then potentially escalate, I don't think is out of the question. So for me, the next few months, some type of a military incident, and then the question is do these two countries have the ability to manage it? Do they have a desire to manage it? That I would put uh that that to me's the greatest near term danger. Richard, do you buy that the Phase one

trade deal is still on? Well, it's on, it's on on paper. It's never been close to being implemented to some extent. That's because of the context UH giving to the coronavirus. UH. If it's on in paper, there's no movement whatsoever towards the Phase two. I think that would only change if if Mr Trump were re elected, and I think suddenly my guests would be that you see

a slight winding down of this hostility towards China. If he were re elected, there would be a desire for some type of a deal that would that would increase US exports to China. That's been the sentipiece of his foreign policy to essentially try to bring about trade deals that increased US exports. But for the time being, nothing's going to happen. The Chinese have zero incentive to implement the Phase one deal. And that's the ways we wrap

up this conversation. I think you've touched on something really really important. Just reflecting on the thing you've said, Typically diplomacy is surgical. You really think out what you're doing and work out the whole range of responses the other side might respond with. And I have been asking that question this week, just how surgical the approach has been

from this administration. And I think that one thing a lot of people are worried about is the prospect the scope for an accident in some realm of confrontation with China. Where do you see that potentially happening? Well, you're right, first of all, is there anything but circle surgical would have been? For example, rather than closing the Houston Consulate, we might have asked quietly and privately for certain diplomats to leave c Y might a place some restrictions on

certain students. Closing a consulate is the opposite of surgical. That that sledge material. Again, I think you'll see heated rhetoric for the next few months. I think the most two things to look for. One I already mentioned a military incident. The other is I wouldn't be shocked given Secretary pompeios speech, is you saw if you saw some broad actions against members of the Chinese Communist Party. We're talking about something like ninety two million people the leadership

of China. Don't be surprised if you see travel restrictions or something like that, which have been talked about basically escalating not just the rhetoric, but this attack on the leadership structure of China. And I think that's uh, that's a possibility. I want to go back to one of ambassador houses. Older books were trying to sell them all here today. This is a movie. You'll see a Memorial Day next year. Foreign policy begins at home, Ambassador House.

You never imagined a four or five trillion dollar deficit. Granted it's off a national disaster. How is our foreign policy, our projection to the world changed? With this new massive deficit? Raises questions about American competence. It raises questions about the role of the dollar as the world's the factor currency, as that as its reserve currency. Potentially, UH introduces elements

of America of vulnerabilities. Is all fine to run these deficits when interest rates or historic blows, but even small movements up in interest rates would but totally transformed the American economic picture. What I think we've done here is we have introduced a potential source of vulnerability. It's dead. Tom is one of those things that it's fine until it's not so. In a sense we're merely going along ranking it up at record rates, and that will be fine until the day it's not, and that will be

a real day of recording. But I do think it hastens the emergence of of a world not with a clear alternative to the dollar, but where the dollar loses the near monopoly it has on international transactions. Not to be a conversation the next ambassador always fortunate to get you on the show. I appreciate it. Time this morning Richard Hasse of the Council on Farmer Nations. He is the most interesting politician. He's a farm Prime Minister of Latvia,

providing great leadership out of the financial crisis. Waldis Dombrowski brings economics and physics to his duties. Is the European Union Commissioner for Financial Services and he helps us pick up the debris one weekend from exhaustive meetings in Europe. But as I have to broaden out the conversation right now to how Europe approaches these new tensions with the United States, the new tensions with China. Is there a European foreign policy first of all as regards uh the

international tensions in including international trade, tensions. Uh you use UH policy has been a very clear. We are supporting and defending multilateral rules based system and this is an approach which we are taking in the negotiations with US with China. That's why we are not supportive, for example, of unilateral more of US in the area of trade.

But at the same time, we share a number of concerns regarding China, including questions on intellectual property rights uh uh, forced technology transfer, reciprocity in our trade and investment relationships. So there are a number of issues which we seem to address, but we think those should be addressed while

respecting international rules. How do you adapt and adjust to the Secretary of State on a tour through London and to Denmark and then back over to San Francisco this week, the assertive tone of the Trump administration, how do you and mrs Mrs Vester you're in arrest, how do you adapt to that? In Europe? Well, Uh, First of all, as you know, UH, EU and US had its trade attention. We managed to reach an agreement avoiding further escalation, and

currently we are building on that. So one can discuss that the tone is assertive, but at the same time we are negotiating and we have reached a degree of agreement. Well, we know that initially us we're taking unilateral actions like unilaterally raising tariffs. We were responding in a kind in a proportionate way, but at the end of the day we avoided further escalation and reached agreement on which we can now build. Commissioner, we've heard a lot from Europe

about the multilateral response. Can we talk about concrete steps? You yourself have talked about the asymmetry and market access between Europe and China. You talk about reciprocity as well. Can you talk to us about concrete steps. What are

you doing to get the Chinese Communist Party to change? Well, actually, we are currently negotiating with China investment agreement and we are currently preparing the next EU China Economic Dialogue to discuss exactly these issues, and we hope that we will be in a due course actually able to conclude our negotiations on investment agreement and the issues we are discussing with China in these negotiations are exactly the questions of

UH access to China's market, reciprocity, investment conditions, non tarift barriers. So all these issues are on agenda with our investment negotiations with China. Commation how much is the European Union working with United States as tensions increase with China in

both regions. Well, as I said, we share a number of concerns of US and we have a similar concerns and definitely we are working is US to see how most effectively to address these concerns, but we think that it should be done with ZILL within multi multilateral framework, within the framework of World Trade organization. We know that we need a form of World trade organization and we are willing to cooperate and coordinate our actions on this

with US. But what we are saying that one should refrain from unilateral actions because it just escalates attentions further and at the end of the day, negatively affects international trade and negatively affects global economy. Commissioner, thank you for

addressing the news at the moment, particularly this morning. If we can get you to address the news of this week for Europe, which was a massive step forward for the continent and fiscal integration, can you just walk us through next steps from here when we can expect the dead issuance from the European Commission over the next several

months when that money will be raised. Well, indeed, so early this week EU Summit decided on the next seven years EU budgets, so from twenty one to twenty seven, and on the EU Economic Recovery Package worth seven hundred fifty billion euros. So this is a major step forward. So we welcome this, uh this agreement of the summit. Well, there are further procedural steps. Currently we are starting negozlations with European Parliament because also European Parliament needs to agree

today's multi annual budget and the recovery plan. In any case, UH we from European Commission side, we consider that it's important that negotiations are finalized swiftly uh so that the next multi annual EU budget and recovery plan can start acting as of January one next year, and that's when European Commission also would start the Common Issues of dept

in order to finance EU Economic Recovery Plan. Even though it must be said that some elements we will be going to markets already this year because here we are talking about economic recovery plan. But we took lots of crisis measures in previous months, including for example, one billion euros sure program to support employment and unemployment mitigation in EU member states, and we will be going to markets already this year to finance this program. Commissioner, thank you

for time this morning. We really appreciate it. Here a Bloomberg Payter Oppenheimer Government Sex Chief Global equity strategist teach you this now pay the fantastic to catch up with you. Would you believe it that Europe comes out of this week looking clean, looking good compared to the rest of this world. Yeah, what a different decade, HIGs. I guess because obviously Europe but was very slow to respond after the last crisis in two thousand and eight, and it's series.

It's suffered a series of major hurdles over the years that followed that financial crisis, but it's getting it that together from the policy perspective, and as you say in your report, the economies were covering quite nicely from this downturn. Peter tom King in New York, good morning. You've got one of the coolest degrees in the undergraduate world. The geography degree, folks from the London School of Economics is

absolutely legendary. Tell me the geography of cheng Do, how far is chein Do emotionally politically from Washington and from Beijing. I too, that's a great question. U. My geography didn't didn't really stretch to that. But I you know, I think this is a reflection of just the growing tensions, and so far you're getting one action matched by another.

But it looks as if these tensions, at least in the short term, we're going to increase um and uh, you know, this is one of the factors I think that will probably where our markets as we move towards the U S election of these Peter, what's the calculation and how it affects equities because yesterday tensions were also rising, the day before also rising, and yet it wasn't affecting equity prices. Why today and what going forward will be sort of the trigger point for US stock value valuations.

I think it's it's a very difficult thing to to measure the economic impacts because of course we don't know entirely what this means in terms of future trade tensions specifically,

which would have a more direct effects on markets. But I think it's one of these things that just increases the risk cremium, just the degree of uncertainty we have had, of course, a tremendous run in ecting markets as investors are looking through what is likely to be the worst economic downturn for sixty seventy years into a strong recovery. We've already seen that happening, and we've had to boost

from very strong policy stimulus. And I guess now the the you know, the reality of what's likely to still be quite a tough geopolitical environment, which indeed was an issue that really bored down on empty markets in the first half of last year. It is likely to come back. So I think this is a bit of sort of reality coming back to investors as they reassess the risks

over the next few months. Peter, do you think they'll continue to look through the economic data if it looks weaker from here are the signs that we're losing momentum here in the US economy or do you think we're rolling over again? Yeah, I think there is a bit of a lot of momentum with seeing in the in

the labor market. You know, clearly the rebound from in Q three versus Q two is going to look very v shaped, and this is true in pretty much all parts of the world as you start to get easing of lockdowns to varying degrees as an improvement from a very very weak base. But I think the question really for investors is going to be what's the sort of

run rate after this. Bear in mind that most economies are not going to get back to the levels of GDP that we was seeing at the beginning of this year until late next year or two, and I think that that's sort of more cautious reality, together with the geopolitics that you've mentioned, is really going to be one of the constraints on risk assets UM over the near term. Well, Peter, you're constantly talking to the buy side and investors, so

give us some insight into those conversations. Do you get the sense that anemic growth, so long as that growth is positive, that that is sufficient for risk assets? It is partly because and you mentioned this just earlier on, you know, real interest rates have turned increasingly negatives, and that's a positive for risk assets. There's a lack of alternatives for guidance has meant that nominal rates are likely to remain at zero or close to that lower bound

for a very long time. And people are are struggling to get a return. So although the absolute returns may come down from here, there is a willingness I think to look more positively at risk assets like equities, and actually, interestingly, for the first time for a very long time, there's amongst global investors more optimistic view of Europe specifically, which has dealt better with this crisis. But it was also I think surprised on the upside in terms of the

coordination of the policy response. I re peter the idea of index versus active maybe too fancy for you, but maybe we can just say the level of diversification now within our equity holdings. Do you want to be over diversified, spread it out or do you want to make more focused bets? In the late two thousand twenty one, oh, I think that, you know, investors of global investors, and certainly dollar based investors should be looking at diverse fying more.

We do believe that the dollar is likely to be con further over the coming years as interest rate differentials narrow and as as deficits rise in the US, So that's one reason for diversifying geographically. But also bear in mind the last cycle, the last decade was very extreme in terms of differences across geographers, particularly in equities. You know,

massive out performance of the US. That was justified because the US outperforming the rest of the world in terms of profit growth, largely because of its dominance in the technology sector. It still has dominance in that sect and that set is still going to be very important. But other areas of the world are catching up a bit. They're becoming a little bit more growth orientated themselves, not

least of which is that's true in Europe. You know, when the crisis started a decade or more ago in Europe were a quarter of the index that was the epicenter of that crisis. They now accounts about seven percent,

about the same weight as the technology sector. So Europe and Asia are getting a little bit more exposed to growth and technology themselves, and I think that justifies more geographical distribution, and I think probably more focused on out opportunities and less on beta, so more on stock picking and less on indexes. Peter, given the fact that you believe that investors are under invested in Europe, how much could it outperform US equity indices over the reindeer of

the year. Well, if we look out over twelve months and you know, if we look at things in common currency in dollar terms, we would expect Europe to be from these levels going up around where we've got a relatively flat return to the smp A. Part of that is the difference in in the dividend. You know, Europe has a higher yield than the US. Part of it is the currency. We actually have the euro going to one twenty five over the twelve months against the dollar, but some of it is a bit of a catch

up evaluations. Europe still has evaluation gap, a lower evaluation than the US market, and we think with this narrowing with premium, with this increased confidence in Europe, that war narrow a little bit. From here, Peter, great to catch out, but you send up best of the team. Why you're Peter Uppenheim in there of government sacks. Thank you very much, said.

We can speak to one of our leading policy analysts, Bessie Stevenson of Michigan right now, of course writing for Bloomberg Opinion and our work of course formerly with the Department of Labor. Professor Stevenson, good morning, John's got some very direct questions on the immediacy of where we are. I want to go to your Twitter feed. You have a brilliant retweet out on the fact that this is a nation that can bail out an airline. In this case,

it happens to be Delta Airlines. Not cast dispersion there versus what we spend on childcare in this nation. How did that happen versus how Europe takes care of children. Yeah, so, first of all, let me just say I love Delta Airlines, so I don't mean to pick on them, but it does seem to be completely crazy that Congress cares more about saving one airline than the entire childcare industry. And the problem is that in the United States we still

see childcare as a personal problem. Does the women's issue of personal Come on? Not even the fat cats like me. When the child has to go to nursery school, it's like writing a tuition check to Michigan. I mean, come on, it's out. Everybody watching this, everybody listening degrees this is a busted system. What is the Stevenson response to making our childcare on the edge of Spain's. Well, look, this thing is we can't say, oh, we need to make

it cheaper by paying childcare workers less. You couldn't pay those folks any less than we are. What we need to do is invest as a nation. We have a body of research that you know, we could stack as high as a building that tells us that investing in early childhood education reads huge returns for taxpayers. And what people don't understand is if we let our early childhood learning and our childcare systems erode during this pandemic, so

they're not there for us when we come back. It's not just the parents are going to suffer, but it's those kids who are going to suffer. We're gonna have decades of pain that comes from not investing in these children talking about leaving their parents. It's so so important. This is not just a problem for the people on the wrong end of it. It's not about mothers. It's not about people without a job who might miss their payments at the end of this month. Certainly is about them,

but it's more than that. It's an economic problem. More broadly and LISTA. We always frame this as just the problem of the person experiencing it, and if we frame it as a broader problem for the economy, surely the collective will will be there to do something about it.

The U. S Census has started to try to quantify how big of a problem this is for the economy, and actually they released a survey today showing that more than eight million Americans were not in work over the past month because they had a child who was not in school or with childcare. And meanwhile, on the other side of that, Betsy, to your point, we have childcare centers closing at a very quick rate because they cannot stay in business given the fact that they cannot care

for people's children. What are you hoping to see to bridge this gap in the upcoming months And how big of a hit could it be on the economy if we don't have something to remedy the situation. So the permanent closures are the thing that I'm most worried about, because they're not going to reopen. We're we're not going to get a vaccine, and then the next day they brand new childcare center props open. So we have to

keep those businesses going. We need to make sure that we're helping them do the investments they need to do to their infrastructure to make childcare safe during the pandemic. And then we're going to have to make sure that those parents who aren't at work because they're staying home with a kid have a way to get back into the labor market. Our labor market, you think about, the labor market, is a highway. We have lots of off ramps for parents, particularly for women, and we don't have

very many on ramps. And so we're gonna have to be hitting this from every front, subsidizing childcare like crazy and helping the parents get back to work, and making sure that the kids are getting the again that that early childhood education. And I think we often start talking very directly about who really needs childcare in September versus who doesn't. I hear a lot of talk about what should open and what shouldn't open, But we're not prioritizing

the kids and families who need it most. And it's time for us to start prioritizing. If we're not gonna be able to do it for everybody, let's figure out who's gonna be hurt most if we don't get them something. Bessie, it's not clear the collective will down in Washington to a rest these huge issues is actually there right now. Another huge issue, the enhanced unemployment benefits that are set to expire month end. Betsy, let me ask this of you.

Is there any evidence right now the enhanced benefits being offered holding back labor supply. Well, I don't think that's the quite the right question. What we have is a glut of labor supply right now. That's unemployment. We have a bunch of people who want jobs who can't get them. When you if you create a disincentive for some people to take those jobs, that just makes it easier for

the people who want them to take them. So I don't think we have any evidence right now that these enhanced benefits are are changing the number of people who are employed. That's the real question, right And I don't think that if we continue to offer some kind of enhanced benefits right now, with unemployment as high as it is, with permanent layoffs happening every single day, continually happening, I don't think that our problem is that we're paying the

unemployed too much. Um. Paying the unemployed is actually what's keeping the economy going, because that's what's keeping demand stimulated, and that's what you know, keeping food on people's tables. It's gave a massive lift to consumption over the last couple of months, it's undeniable, Betsy. The job number here on Wall Street is getting so so difficult to read going into the next couple of weeks. Continuing claim suggests

it might be okay. Initial jobless claim suggests to store the high frequency data says things aren't great in many states across the sun. Bout how do you view things right now? Well? I do think that those claims data have been really hard to interpret. They certainly didn't predict the last jobs report, and I don't think they're necessarily going to tell us about this one. Look what I

see is I see ongoing permanent layoffs. Those are not businesses temporarily shutting down saying, look, we gotta stay safe for a month and then'm going to bring you back. These are businesses looking ahead at their revenue stream and saying I can't afford this payroll over the next year. They're letting people go with no intention of bringing them back. And those permanent layoffs, those are the people who have a much harder time finding work again. So that's what

I worry the most about. I also think that if you look back to what the reference week was like, we're talking about the jobs report we're talking about, you know, the week that included July twelve. I've thought a lot during that week what's going on this week? And what I saw was new shutdowns happening in the Southwest, And they didn't see a lot of new reopenings, basically people who were gonna companies that were going to reopen, bring

people back, restaurants, things like that. But it mostly happened by by June. So I think we're going to see a negative number. Um, I don't think it's gonna be a big negative number, but I don't think we're gonna see the kind of you know, I don't think we're gonna see enough people brought back from temporary layoff to offset the large numbers of people who are being permanently laid off right now, Betsy, this raises a really important question.

John's been talking about it this morning. Is this a deceleration of the recovery or is this a reverse? Is this a double dip? And what you're talking about is the scope of the second wave, the second order of layoffs, enough to throw us into a double dip recession. So I don't think of this as a double dip recession, right. I think that the data is confusing because temporary lay

up are not a real recession. The real recession comes when people stop spending money and we, uh, we need to shed businesses, we need to shed workers because we're not bringing enough money in. I don't think we've fully seen the scope of our current recession. And what concerns me the most is I haven't seen any real recovery. What I saw was some businesses trying to reopen. Those businesses that reopened, they seem to not exactly be thriving.

So I don't think that's necessarily a double dip. But I don't think we're at the bottom of this thing, Professor. One final question, Lisa from New York emails in and says, could you ask the professor the profound effect of TikTok uck on the children of America? I mean, Professor, what do we do about TikTok um? You know, I have to say, I myself enjoy Sarah Cooper on TikTok um, and I do have my children do seem to like ticktok But I'm no expert in media consumption for children.

I think you just revealed your politics. If people didn't know already anyway, Betsy, fantastic to catch up with your Sarah Cooper on TikTok Betsy, Greg, Bessie Stevenson. There a Bloomberg View columnists joining us, Sam Kennedy with the Boston Red Sox and he was intimately involved John in the acquisition of a small football team in the United Kingdom. John, why don't you pick it up in celebration North of Law can tell you Sam, they're having a Red Sox

co anchor fan that is almost unbearable. Sometimes Liverpool fans are equally as unbearable. They've had their moments. Sam, what an experience for all of you. Can you walk us through what you've learned with this experience Indianata Kingdom with English football? Well, we've we've learned a lot. We still have a lot more to learn. As you know. It is an incredibly global club with following like you've We've

seen nowhere else. But congratulations to Jurgen Klop and Michael Edwards, Billy Hogan everyone at Liverpool that put this club back on top of the English Premier League. Quite an achievement and we're very excited at Fenway Sports Group and now we're hungry for more trophies. As they say, Sam, how do you retain talent in Premier League? How do you

retain talent in Major League Baseball? Well, there's a common theme, and that is that we need to generate the resources on the business side to be able to go out and afford players, whether it's in global football or in Major League Baseball, and consistently reinvest our revenues back into our baseball operation, our football operation. That's been twenty year strategy by John Enry, Tom Warner and Mike Gordon, and that will continue as long as these guys own and

operate these different clubs. We've had our ups and downs. Uh, it is an exciting time right now, um for our organization and excited to get going over here in the US. On the baseball side, the dreaded Los Angeles Dodgers just unloaded a salary package to a baseball player I forget his name. I'm sorry, let's say I'm I mean, come on, there's a pandemic on there's economic slowdown, you've got TV revenue issues. You're trying to get bodies in the stands.

Everybody everywhere else but Fenway and maybe Wrigley Field. Have the Dodgers set up a new war of salary. Well, congratulations to Bookie Bets. He's an amazing player, a great person. We're sorry to see him go with the dreaded Dodgers. I think it's a reflection, frankly, of what a great job the Dodgers have done managing their payroll. They put themselves in this position to be able to make this commitment. And if you're going to make a commitment like that,

Mookie is a guy you want to do it. We we tried. That's on us. Unfortunately we were not able to come to terms with him, but we do wish him well. We don't wish the Dodgers well, however. Well, congratulations to all of baseball for starting a curtailed season yesterday. But it was sort of a disappointing the game, the Nationals manager coming out and saying, it turned out long. Let's to put it that way. We just have to

put this one behind us. Do you think that baseball as an industry had a missed opportunity getting this off the ground earlier, given the fact that this is not a contact sport. You know, I think we started right

at the right time. Of course, you'd always love more baseball, but in terms of dealing with the virus and looking at the schedule on the calendar of the different markets and the surge and spikes in different areas, Commissioner Manfred just deserves the tip of the cap from the whole industry, as does Tony Clark for coming together and getting an agreement together to to to move forward on health and safety protocols. Uh. This is an experiment. It is um It is a high wire act, to be sure, but

the players are taking it seriously. We're taking it seriously in our facilities, and now we need to execute and we have a really exciting brand of baseball sixty games and now an expanded postseason. It'll be great for baseball fans around the world. Sam, You've got a relationship with legendary stadiums Fenway Park and Field. They're going to be empty for the foreseeable future, and surely that changes the business.

Why you spend money, where you cut money? Sam, talk me through that conversation now and what you're planning for a season of no fans, two seasons of no fans. What does that look like. Yeah, we're planning we have our upside, our mid case are are low case. We have disaster scenarios. Um you know. Again a credit to our ownership group, they continue to invest in the product

on the field. But in terms of our business, it is critical that we get fans back in the stands at some point as soon as it is safe and the and the government and health officials say we can do it both at anfield and if Enway Park. For baseball, we rely on gate revenues fifty plus percent of our revenue. So as you can imagine, this has been devastating for the business. But the country needs sports, the country needs baseball, uh and we need to keep going through a pandemic,

and flexibility is the order of the day. Everyone has shown a willing to willingness to be flexible and we'll keep doing that and and readjusting our budgets and evaluating as we go forward. But what's important is we'll be back on the field tonight at Fenway Park. Readjusting your budgets. That goes direct to some of the labor negotiations that hampered the beginning of this season. How much do you expect some of the players to accept accept cuts in

their wages based on what we've seen so far this year. Yeah, amazingly. You know, the players have accepted, um, the fact that we're only playing thirty seven and a half percent of the games regular season. I believe if we get going so they're taking less wages. Everyone in the front office US is taking less wages. Uh, it's everywhere. It's a reality across our country, across the world. It's a very difficult time. None of us have been through a pandemic. I hope we never see it again, and I hope

we get going into knock on Wood. Hopefully a vaccine is around the corner. We'll keep our fingers crossed. Sam Kennedy, it's your fault. Bring up the camera here. I'm doing my hands here, I'm standing outside the battery box doing Nomar Garcia part my son's student and brookline Sam, right off of Beacon Street into the Nomar thing in the batter's box. How are you going to speed up the game? How are you going to speed up as Garcia Par's fault? How are you going to speed up the game? Uh? Well,

we need to. We need to keep working at it with the players. UM. You know, you can add things like a pitch time or a pitch clock. You can limit mound business, you can make mold changes. I agree with you. It's something that we need to do. We're about three hours and eight minutes. Not good. Yeah, be great to get back in the two range if at all possible. It's a priority for Commissioner Manford and his team. Um,

and we'll work on it. But at this point, I think our fans and all of us are just excited to have baseball back. Uh and we'll enjoy having live product, live content on television, on radio, on digital platforms. But I agree with you, we do want to speed up the game. It's a it's a priority, especially as we look to connect with that next generation of fans. Hey, Sam, great to catch up when you come back soon. I'll whisper it. Congratulations for Liverpool. I'm kind of Evost and

Red Silks than by the Tops. 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 Keane before the podcast, you can always catch us worldwide. I'm Bloomberg Radio