The Russians Hacked Our Election, Slaughter Says

Find Bloomberg Surveillance on iTunes, SoundCloud, Bloomberg dot Com, and of course on the Bloomberg Sebastian Galley, senior currency strategist at Deutsche Bank, who joins us now here at the Pierre Hotel, Thank you very much for being here, and let's start with what we're seeing in the currency market in light of that attack yesterday. Not a whole lot

of movement in the power. Let me just expand from that to say, uh, we're dealing with a lot of political risk, and when you look at the four X space, it seems like politics has been continues to be a huge driver here. Indeed it's a big driver. I think the market got used to terror attacks and would like to express my condolences to the people of England and the United Kingdom, but they have basically learned to deal with terrorism in in uh in Europe, and basic it

means that it has very little impact. For example, what you could see is you could see a terror attack ahead of the French election, whether it be the first round, more probably the second round, and what we know from experiences, it will have very little impact on the actual outcome because fears does not actually lead to changes in the in voting patterns, which is somewhat reassuring. It is more anger that drives a change in voting patterns, and that

may be triggered by a different events. For example, in the case of the Netherlands, we saw an incidents with Turkey which had changed the tone for a few days and then the vote for the populist group of Foil Papy essentially disappeared very quickly, and so that kind of incident could be repeated the drive and by an external factor in the French election. And it's a risk which is very hard to measure. But as we've seen in the past few elections in the West, they seem to

be coming in and coming in repeatedly. The highest impact would be one to three days before the French election. That is basically anger would not have enough time to recede, and so they vote, which in this case, if it is one which is driven by anger, would then help the populist vote. After the Brexit referretum. After the US election, there was a lot of concern about polling. Let's look at the Dutch election in particular, didn't turn out the

way uh many people thought it would. Perhaps polling wasn't as disadvantaged as with those other cases. But how do you rely on polling now looking ahead to the French election. In the case of polling, it depends on the country. They don't all have the same methodologies. But the French were absolutely scared by what happened both in the UK and the US. The difference in the in France is the populist party or what you could consider to be a populous party because it is a definition of the

from Madame Marine. It has not historically been different in terms of outcomes in the vote versus the polls, so there's not this bias vote that people would would actually expect. What they've done is they try to improve the poly mythology as much as they could reduce this, and they use what they call rolling polls, so every day you have at least two polls coming out of France and

they're very very stable. They have also what they call stratified pollings, which means it goes into the different groups such as workers, um, you know, employees, staff, CEOs, and to try to see the evolution of each single group, whether it's older or younger voters, to see if the

change there is a change in the patterns. Yet journalists in France do not trust the system and then so what they've decided is in many cases to send out reporters all across France to check directly with the population, asked them questions to see if there was a change in the evolution a pattern that wouldn't maybe be mist and that would have an important impact in on the on the actual vote at the end of the day. So there's a lot of work made to try to

make sure that it isn't a risk. For now, the market has decided, for many reasons, including the stratified polling, that the odds of Martin le Ben winning are extremely small. Then mccona was a very high probability of winning, and

at this point that seems to be a reasonable event. Yeah, we talked about risk events, and I was listening to the hearing on Capitol Hill earlier this week with the FBI director and the n s A director and both basically said Russia had some involvement here or eagerness to be involved in the US election, and other countries having elections should stand on guard when you think of risk events, how how how big a risk event is the potential

for intervention by another country like Russia. Well, I should take a neutral sensor should I should point out that Immanue mccona was actually coached by a mayor ex Mayor Bloomberg, so he received his own training. Mr Almona received the training from the ex training Treasury Secretary, And so these are already existing interventions. From my personal point of view, find it very positive. They have been uh interventions which

some may have considered to be less positive. And they were the case in the Netherlands coming from Turkey at a critical time but too early to make a difference, anger in the pulse to decrease at the very fast rate um so they didn't have the the outcome that one would have expected, and therefore there would be a change if if a nondesirable intervention should happen. What are

the odds of interventions in France? If you look at the different articles or ways that information is transmitted by foreign agents into the French press, there are several of them. They have been very critical of Monsieur Emmanuel Macon. They have been generally very supportive of Marie Lepine as well

as a general called Melach. The reason why they would support Mila Schon, who's a far right supporter who's doing quite well, is because a percentage of the vote of Mr Mino Chan would have a certain probability of actually voting for Marie Lepin in the second round. These are worker type um the odds and the polls suggests this is far less than and then these people seem to think, but they are basically been pushing for for these two candidates.

At this point in time, it looks like they've abandoned Filon, who's too low in the polling. So and Fillon also has changed his stands relative to Russia and has become much less per Russian than he once was. He was accused once by Mr of drinking excessive amounts of vodka, which was a reference to his very close ties to Russia at the time, and since then he has a distance himself considerably, a process which may continual for other candidates.

Let me pivot a little bit here to talk about the Chinese currency you mentioned before we got started here. A pivotal moment coming up here for the I m F, which is placed the REAMINNB in the special drawing basket that the IMF has. What are we gonna learn over these next coming days. Indeed, they has been added to the SCR, which is the official currency used by the IMF, by the b I S, by the World Bank, and

also Jordan and to some extent to Libya. So it is actually a relevant currency, it's a non a negigible one. But what we will learn at the end of the months it's not about the SDR, but about the amount of reserves in the m m B, c n Y or CNH that is being held by foreign reserves as part of what we call the I m F coffer. And this is a great mystery because nobody knows how much the money has been invested by foreign reserves into the HIMMB. It might be in the order of two percent.

We will know exactly how much it is but I think it's people. It is something that a lot of people are starting to pay a strong amount of attention to. It tells you how much of a competitor to the dollar it is. The answer is is very much not one. But the the Chinese have been preparing the way for the in the next decades to be a serious competitor both to the yuro and the dollar. That process will

take many years. For now that amm B is overvalued and should actually devalue, but they count afford this process right now. But in a horizon of ten, fifteen to twenty years, you'll see that the REMAINB becomes a much more used as a currency. There are f X swaps lines between the p bo s and many different central banks, and as they go through that process, Uh, the chinesely maybe should be a much more ordinary currency used internationally,

including as part of foreign reserves. So they do not really fit the criteria whatever the I m F said to be a foreign reserves at this point in time. They will eventually, and they will do very well. We saw this infusion of capital by the PBOs yesterday and indeed in the two days before that as well. Uh, And there wasn't a whole lot of transparency from the PBOC about what it was doing when it comes to currency generally, is the Chinese government talking more about it?

We just had the National People's Congress in Beijing. Uh. Is currency something they're keen or to talk about now than they used to be. From all the information that we have is they are very keen not to talk about the currency. Of The key problem that they have is one is a link to financial stability. If they let the currency go, it might be unhelpful for financial stability. On one side. Number two, there is a big negotiation process happening right now between many countries in the world

and the United States. The United States is complaining, in part quite correctly so, that it's currency is overvalue, and it's overvalued because on the cyclical side, the US is doing well, but also for because many central banks around the world have taken excessive measures to weaken their currencies. That includes the PDOC, but it also includes the ECB and the b o J. And as these negotiations happen in the background, and you should forget a lot of

the noise, which sometimes can be quite disturbing. But there are professionals in the background doing their work. It seems that there's a play at work in which the center banks are going to tighten at the measure which fits basically their mandates, which will help their currencies. To appreciate that maybe that I maybe used to some extent, but it also means that the euro would go higher. The coffee is hot, the weather is called tom Keane. It's

it's like Rochester, New York. You know, there's winter, more winter. In the fourth of July, were inshing ahead, pushing ahead of the weekend. Saturday is supposed to be a little nicer here in New York. Remarkable, folks. I was just over at our world headquarters of course, doing our television

show and David for a radio audience. Just remarkable, uh, this morning to see Prime Minister May speak and then a very somber Mr Corbyn in black black tie and a white shirt, and of course a packed house of Commons in the moment where the speaker turned to the French Foreign Minister in the upper gallery at the House of Commons was really quite really, quite something to observe.

Truly a terrible event yesterday, and as you pointed out on the TV program, the nationalities of those who were killed yesterday varied incredibly very including three French students and in one American. We should point out there's a lot we don't know right now. We're learning a little more, but of course we'll have coverage on that through the day. We're here with Sebastian Galley. He's a senior currency strategy a Deutsche Bank, kind of enough to to be with

us here at the Pier Hotel. We were talking about Europe, talking about the French elections. Let's talk about North America for a little while here. I'm sure that you're watching what's playing out in Washington, and I wonder the degree

which you think that's going to portend something for tax reform. Uh, you're looking at the dollar, Luna, say, how do you factor all of that in for some French So the families in Concano, which must be hurting at this point in time, But looking forward at the taxes, there's been some difficulties basically and the aministration to to pass the law. So we expect that this night there actually will be a vote, so a little continued Senate so it continues

its normal process. I think the market was very frightened that this administration was relatively weak and that it could really not when it rarely mattered, put some political way and actually achieve a breakthrough, and seems said it is achieving it. That means the second stage, which is the taxes, which is a much harder fight in some ways, is

going to go through. That includes potentially the border tax adjustment, which has huge implications for the dollar for taxation in general and for the size of the tax cuts that will affect us all on on our salaries. If it isn't there, that it will be much more difficult. Um but that is a more positive if really that would

go through. The US administration has shown flexive ability. It has basically a flummox center and threatened, but ultimately it actually has proven a well oiled political operator able to actually pass through some some difficult to measures that will see that confirmation probably tonight. So taxes will then be the next step. There are very difficult particularly at the Senate stage, particularly in the case of the B A T. The infrastructure project is mostly dead on arrival, but there

probably will be a fig leaf. That's probably something for the next year. The economy is running well at a at a high pase with probably a Q one, which is relatively low, but it is running in the in the right direction, so it doesn't need that much of an impulse. Nonetheless, the market is betting on that impulse, as betting through equities on that impulse, and if we fail to get a move in that direction, then of

course we could see a significant correction. When you talk about the border adjustment tax, it's it's something that the President didn't bring up in his speech before joined session of Congress. We don't have a clear sense of whether or not the White House is back at Steven manoge In, the Treasury Secretary, WHI was in Berlin before heading on to Boton Botton and was asked about it, and he said that they're weighing a lot of things they haven't

yet committed to backing. And how integral is it to tax reform? Do you think if there isn't that component to a tax reform package, do you think it stands a chance of getting through. It's huge. It's huge in the sense that the amount that one is there's a tremendous amount of resistance coming from the retail, from refiners,

from other industries that are heavily opposed to it. But if you can imagine this is a carrot and stick, and there's a big stick of the stick is the B A T. Whether they're using the B A T is to achieve political gains abroad, and these means of changes in monetary policy, mostly for example, the ECB turning less dovish and mentioning the fact that they could move away from negative interest right before they do QUI, some signs that the p B U C might be marginally

tightening policy. And generally speaking, the center max are on the whole less do wish than they once were. They're trying to weaken their currency less than they used to, and so it is part of a very complex set of policies. You have people who come in on it who are irrelevant, people who come in on it who actually are relevant, and the ones who are commenting the most may or may not be the most relevant. One. Help me your sub galy with with the dynamics of

the dollar. The surprise ending the first quarter hard to believe with the frigid fifth avenue today, but ending the first quarter. Uh, the surprise is the idea of the dollar not in Nancy, it's been I think all in all that consensu surprise, what's the catalyst to get the dollar to lift? You would need to get better data, and unfortunately Q one is is probably going to be relatively weak. So you need to get a sense that

the economic data. It is continuing that labor market has continued to toighten and salaries are continuing to improve, and for now the salary side remains relatively weak. Productivity in the US is relatively weak, and so the catalysts on the pure dollar side, the GDP is not out there. Qen.

We expect for seasonal reasons to be a week we go get in some cases what about the second quarter quickly probably around two, so where you basically average out a wait wait wait, if you get your fiscal package and the likes, then what you can imagine is that trend growth would actually increase quite significantly. That's what part in the market is betting on. Semest Gilly, thank you so much. The wheels A power records so Pierre Hotels

stay with us. Anthony Dwyer with his kindicort jenuity, Tony Dwyer has been a massive bull on the markets. Tony were clumsy on television this morning with all the u reporting from London, and of course with a Prime minister speech a little more quiet now with you, are you still a bull on a bull market? You should never, ever, ever, ever, ever ever sell and get negative unless you can identify a close proximity to a recession. That doesn't mean the

market can't pull back. We're actually kind of calling for one now. But ultimately it's too hard to call the pull back and then get back in if you get really negative and back in is what the amateurs don't understand. That's what the professionals don't understand either. By the way, it's we're getting back. You can get defensive and you call it right, and all of a sudden the market

turns really quickly. It's up four from the loan. You said, wait, hold on, I can't buy it because it's up too much. Turn back. This is different. The two gentlemen over here at table fourteen at the Pier Hotel, they're taking notes, So be careful, be careful. You don't need one of those regulatory disclaimers. Burn the sausage. It's good. Correction underway, opportunity ahead. In your most recent no talk to us a bit about finding that opportunity. Well, that opportunity is

extraordinary because you have a global synchronized economic recovery. When we had upgraded the tape, we had been neutral last summer and upgraded to our opinion of the market and the offensive sectors meaning financials, tech, um in industrials ahead of the election. Not because we thought Donald Trump would win.

I wish I was that smart. I had no idea. Um, what we did it because you had economic improvement in the Eurozone, economic improvement in Asia coming off of last year's January and February low David, it was an extraordinary positive trajectory that nobody was talking about because of the election. That's why you you should be That's why I am positive, is because you're having a recovery and earnings. You're having a recovery and economic activity this morning and while we're

on the show that I didn't feel it was so clumsy. Um, the UK reported retail sales that were better than expected. But wait, say it isn't Britain supposed to fall into the ocean because of Brexit. No, it accelerated, their currency declined, credit opened up. Same thing happened in the Eurozone. The same thing happened in Asia, so you're seeing this better economic activity globally, and for the investors uh that are listening, the market is most closely correlated to the direction of earnings.

That's driven by economic activity. That's driven by the money availability via the slope of the yield curve, and that's driven by Fed policy. So as long as the Fed stays somewhat accommodative, even on more hikes, are going to be accommodative. You have you have probably years before you picked this thing out. This guy is always as tough as critic, by the way, in terms of the clumbliness, clumsiness of the TV. That's think that's why he's so good. You know. I just think that a lot of people

have missed this bullmarket. Let me ask you the question I ask everyone, and Tony has said, with great respect for your intellectual courage, how do you catch up? You have to in a world where all the money is going. Don't love passive? Well, you can at certain times time you don't think about this analogy. It's very hard to stretch a rubber band that has already been fully stretched. It's a lot easier to stretch a rubber band once it's been neutral and gone back to its normal state.

There's periods of time where you have these multi month runs like we recently have, where you just kind of pulling the horns a little bit and you just say, Okay, let's wait for a little bit of a pull at a better opportunity for that rubber band to contract. Once

it does, then you get offensive. Then you buy the financials. Well, most people don't realize is yes, the SMP Dow when all the industries are right up against an all time high, but on a relative performance basis, the banks have underperformed since early last December, the SMP financial sector. So you're hard pressed to say that you're reversing the Trump trade. You've already have Energy has been terrible, Materials meaning you know,

commodity stocks have been terrible. Financials have been up but underperforming the overall market. So the Trump trade has already been reversed. You mentioned, you mentioned the earnings, You mentioned fed policy. You have a lot of people who are watching what's happening or not happening in Washington with with some concern. How are you regarding all of that as a as a strategist, What are you making of what's happening in Washington. You look for excuses versus reasons. The

market is has an excuse to sell off. If the Healthcare Act doesn't to vote tonight, you could have a sell off. But the reason, the only reason you really go defensive sustainably. I mean, I wish I were a

good trader. I'm a terrible trader. The reason that you go defensive or negative sustainably is when you when bank lending shuts down, and you can measure that, as Tom mentioned earlier, um from the three month and five year yield curve war the two tenants is a measured but that's how you measure how close you are to a recession. If you take the current Fed dot plot and you look at where the tenure note is right now and keep it there, you're not going to even invert the

curve until mid two thousand eighteen. Your median inversion is fifteen months, so you're talking about close to two thousand and twenty before you have a prospect for a recession. One of the high points of the week, folks, and and I mean this seriously because David and I are Gerbils with what we do. Your television coverage yesterday the

breaking news out of London was really extraordinary. David with Francie Laquais there at Parliament, but um Tony, one of the highlights is to walk over here to the PR Hotel.

It's about a three block big New York City blocks walk and we can collect your thoughts and you and I on the walk over, we're talking about cash flow and the big to me underestimation fundamentally is we take low single digit revenue growth and it materializes in the high single digit UH growth of IBADA operating income whatever. How do companies do that? Review for us again, how I go from three percent growth to a solid nine

or eleven growth down the income statement. I really think time it comes to technological improvement that allows for productivity gains. We're at full employment, Isn't it kind of strange that you're seeing this load single digit revenue growth and high single digit profit growth with full employment. So I think it really has to come down with capital spending and

investment that creates better productivity. And we've had this a little bit on the show, folks, but it's just as much the conversations we have on our in our commercial breaks and what we're hearing, David, from anybody traveling, is there help The new thing in America is help warming sides.

I mean there's help wanted signs everywhere. That's that's the anecdotal from our stand really is the opposite of what you had UM at the at the financial market low you had every house for sale and you could have gotten any price you wanted, and you had no hiring going on. Now you have bidding wars everywhere around the country for homes and you can't find proper employees, how married,

or how intertwined, or the soft and hard data. At this point we've been so focused on sentiment and the optimism there in UH is it starting to match the is the hard data is starting to match that. It's it's trending that way, David, I I think um And for the listeners, this is like if you look at small Business Optimism Index had a record surge and in December, what you look for is if that fades, so you

look for the next month Stata. It's not the big surge that's important as if it holds and it's held for the next two different reports. So in our view, that's a good leading indicate. Here here's a great statistical example global purchasing manager indices which have been very very strong over the course at the last six months, trending that way leads industrial production by two months. Tony Dwyer,

thank you so much, greatly appreciate it. This morning with kennichord uh Jenoity, we will continue with Mr Dwyer to talk I think we should talk more sectors here, which the broader market, maybe because you know, we saw the industrials I saw ge yesterday restructure their industrial and sentence off the incentives from Nelson Pelts. Here is an announcement of one of our wonderful guests. He is truly one

of the best cross rates strategists in the world. We've talked to him for well in excess of a decade. When Stephen England are working with Villain Powder and the team at City Group, he will leave City Group and he will join Raffiki the Hedge Fund, the acclaimed hedge Fund out of Hong Kong. Mr Englander is reported to be based in New York. Looks for a June start there, but it is um you know, the bodies moving around on Wall Street seeing a lot of it. Drew Maddis

will be with us soon. It met life now from ubs and against Steve Anglinger, we can report to you, thank you, Susie Waite, for this will be leaving City Group a real loss for anyone to see Mr Angliner with his competencies on foreign exchange. When you mentioned fun, you mentioned Nelson Peltz as well. He'll be sitting down with the President and the treachery Secretary today. For I didn't know the White House. It'll be a lunch with Stephen and Nelson Pells. That would be would fly on

the wall for that to be there. Maybe Mr Pelts could help with healthcare. I got bad news, guys. It's twenty eight degrees here or whatever it is. We're not at spring training. Douglas Cass of Semior's partners listening in this morning is from the stands. From the stands, I don't know, Marlon. Somebody today maybe is who's looking at and he has an important question for our guest, Anthony

Dwyer and his usual Tony one. Doug cast is really on the pulse of America away from the banks, away from industrial as we saw with g and Mr Pelts yesterday, is the death of retail. I like what Doug says, the retail evisceration. How do you avoid the disaster of bricks and mortar? Right now, I'm trying to think of anything better than being on air with you and getting a question from my pel Douggie. Um, but I don't

have made money for ninety days, so stop it. What do we do about bricks and mortars and see it? I don't see it changing. It's a secular trend, but that does not necessarily mean that retail spending is down. It's like restaurants and retailers. Bricks and mortar retailers are in trouble because you have Amazon and Netflix. So you've changed the makeup. I don't think human nature has changed. If you give me money, I will spend the money. It's what we do and and money is widely so

you're to avoid a low multiple, low book value. Terry Londren had his retirement dinner, I believe last night a wonderful charity event here in New York City, the giant of Macy's. You avoid those ratios? Does that mean you can buy something like Amazon with Norton with with with massive multiples. I cannot comment on individual stocks, but I will point this out, I breakfast, he would change, but it was burnt, so it's all good. Um So that could have been said four years ago. How long has

Sears been a value trap? How long have some of the other retailer has been a value trap? And how long has Amazon been overvalued? So again not coming in on those specific stocks. We have to be careful to misuse valuation and say low as good and high as bad because the evidence is contrary. So I'm not talking about specific stocks here. How about sector wise, what's most appealing to you at this point again now for the

next six to twelve months. And we've were neutral sectors right now, So in other words, I have no favorite sectors. I just want to be benchmarked out of the way while the market chops around on this political wranglings. When it gets uh worked off some the optimism and overbought, I want to be long what's been working the financials, the information technology industrials, and honestly warming up to energy. You've had an incredible drop in the energy space. Um

So I think that creates opportunity. Maybe even materials and health care is is pretty inexpensive, So there's some seriously fun areas to look at. Once you work off some of the optimism that's out there, you've got these tactical indicators. Walk us through what you're looking at. Stokeysticity asting. It looked like you got t has what he did. I love what they do with the stocaster to kill here. Then I wish the listeners could see the look at

your face when you said that. Anyway, So there's four indicators that we use to tell us when to get into It's not when you're outside of recession. It's not whether you're bullish. It's when you get bullish enough to really be aggressive. That happens when the VIX goes over twenty.

Again for the listeners, the CBOE Volatility indexes the VIX when it it's at twelve, When it gets above twenty, when you get the percentage of stocks on the N Y S, E, R, S, and P when only ten percent of them are above their ten day moving average, in other words, or below their ten day moving average were nowhere near there. Um, when you get the weekly stochasticity or i'll say it right, stochastic below uh fifty.

I think at this point in the market, that would be an indicator and again the Investors Intelligence bowls you want below for now it was at a thirty year high. It's six or three percent two weeks ago, and now it had an uptake of the most recent week to fifty. It's very hard to have a market rally again when that rubber band has already been stretched and hasn't contracted. This is what I love. You're looking at bullishness of newsletters, right?

How does how does it work? They Investors Intelligence releases the data and they pull all the newsletter blogs and all those other places. Has your target for the SMP changed at all? It has? I raised it expecting a pullback, So it seems kind of contrary. But who wants to buy a market for a two percent gain when it

pulls back four percent? I mean, that's no. And also what changed me and Tom and I were talking about this on the way over was I sat down with a couple of company managements and they indicated their enthusiasm for the non negative meaning no new regulations, no new taxes. It wasn't even tax cuts and lower regulation that had them excited. It was just the knowledge there wasn't gonna be anything new. Let's bring the pier hotel to a complete halt right now and go mathematics on everybody. It's

all to David, I don't know. I'm scared now this whole world. And of course you know in the pyrote a lot of heads fun people here that have two in their brand. It's about a log normal world, which means you go down faster than you go up. Is the is the real simple mathematical phrase, This idea of not negative which is a double negative. This goes back

to Leviathan and Hobbs. The fact is guys like you grizzled Prose and the people frankly here at the Pier Hotel spend a lot more time trying to not lose money then to make money. How do I not lose money right now? I think you lose money assets when you underperform the market. Trying to time the drop and then get in at the proper time on the recovery is very difficult to do. It's almost like double buying. If you're negative. Just to go neutral is like a

bullish trade in your emotion, but it's only neutral. So here's our plan. If you are significantly overweight offensive sectors, just pull it back to a market neutral position if you've made a bunch of money in stocks and you want to kind of cut back a little bit and and just be prepared to buy. And David, this is so critical and investment theory. And I'm gonna do a shout at my good friend Jim Kramer over at the Dusk Star and the Jim gets this. Jim gets this.

This is important. It's not by cell, it's not by hold cell. It's more things. You own it, you go to cash, you're in cash, you sell it, or you go the other way. You're in cash, you buy it. You're in cash, you sell it. In the complexity year of Tony Dwyer's world is a lot more than just what do I do today? Should I own it or not?

It's a the complexities what can kill you. And my pal Jim Cramer would also agree with us and say that every single listener has to go by their own view and not the view of day to day people like me that come on the radio or come on to the system, which of course being addicted to Bloomberg. Let's say I say by it and somebody says, well, that's sound smart. I'm going to go out and buy as soon as something seems to go wrong, they'll go

out and sell. So they'll make the mistake of getting out too quick because they got in not on their own confidence. So the tendency is to be short termist. Is that? Is that what you're saying? No, I think that. I think in the market where there's so much passive investments and against that's money going into index funds and ETFs, the best way to create significant outpre forrmants of just putting it in an index fund is trying to time a macro event. And to do that you have to

have money to buy when it weakens. Go back to where we started here, we're talking about what's what's driving the market right now. We haven't talked about central banks very much. We have the FED meeting last week, ECB meeting as well. When you look at what is driving the market right now, political events, can look forward to the elections in France, all these macro events. What roll are central banks playing right now? It's a key role.

It is the it's the role still. The European Central Bank changed the global economy when they announced that they were going to buy private debt. I mean, when you're lowering um monetary policy tend basis points further into negative territory when nobody's up borrowing anyway, that's why you are in malaise. When they decided to buy private corporate debt, you're injecting money directly into the balance sheets of companies. That is a huge deal and has created partially created

the recent recovery in Europe. Tony, thank you so much. Tony Dryer with us today from vestment there on, maybe the basic ideas how not to lose money brought you by Bank of America, Mary Lynch. Dedicated to bringing our clients insights and solutions to meet the challenges of a transforming world. That's the power of global connections, Mary Lynch, Pierce, Fenner and Smith Incorporated Member s I p C too brief of a visit this morning with Nicholas Burns, former ambassador.

Ambassador Burns, there was a moment which I hope all in Washington saw, where the Prime Minister greeted the Foreign Minister of France in the gallery at the House of Commons. What can this administration learn is the United Kingdom in real time goes through a crisis. Well, I think that

we're all in this together. That when an incident like a terrorist attack like this occurs, um you need international cooperation because, as you know, Tom, it's not just the military application of force, it's the police work, it's intelligence cooperation, judicial cooperation, and I you can be sure that the American services are trying to help Britain, as are the European services, because these terrorists are floating across our borders,

especially the European borders, and it's an international fight against them. What happens in Washington in the aftermath of an attack like the one that we saw yesterday, the Secretary State Rex Tillerson had convened a meeting of allies in the fight against isis in bottom what's the what's the procedure, what's the protocol? Well, certainly President Trump did the right thing. He called Theresa May, the Prime Minister of Great Britain,

to offer our assistance and offer condolences. Rex Tillerson made a statement because he had fifty odd foreign ministers there on the talking about the fight against the Islamic State. But more importantly, our intelligence and counter terror personnel. We're reaching out, I'm sure, to their British counterparts to offer assistance.

If that assistance is necessary and the one thing that we've learned, and the British have more experience than anyone else because of the sordid I r a campaign against Britain over so many decades, that you do need to work across international borders when you're trying to combat modern terrorism.

And I admire the way the British have conducted themselves over the last twenty four hours and going back to work, millions of Londoners on the streets, going back into their normal routines, which I think which the British believe is the best answer to terrorism in their right and a certain courage, and of course the international perspective that Prime Minister gave Prime Minister May gave us on the injured,

UH and the dead. We speak with Nicholas Burns of course, with his public service to the United States Ambassador UM. I think there's a lot of value to the fears that people have of terrorism. The President was able to find a residence about this within his campaign. It's a residence that leads to bands to walls, and yet here again is a supposed lone walls that we don't really know the details, a wall or a band here really wouldn't have worked, would it. No, I wouldn't it. But

let me just say, Tom, I think you know. President Trump is right that terrorism is a major threat to the United States, as it is to allied countries like Britain. But you have to fight it on different levels. He convened over the over this week fifty odd countries and the fight against the Islamic State. He was right to do that, President Trump and Secretary Tillerson. So on the one hand, you have to combat the Islamic State and

Syrie interact where they're bases. But on the other hand, to protect Americans here at home or Brits in London, you've got to be It's a different game, it's a different struggle. And this attack apparently came in London from someone who's been living in the United Kingdom for quite some time, as some of the attacks h San Bernardino, for instance, in the United States have come from people

who've been living in our country. So it's a very different level of difficulty, and you've got our employee intelligence and police as well as the military on different fields of this battle. Do you feel is a grizzled pro of bureaucracy that we are spending our intelligent budget intelligently. Is it money well spent or do you wake up every morning saying we're frittering it away or squandering it.

I have I served in the Diplomatic Corps, obviously, but I have tremendous respect for the intelligence community in the United States and for the FBI and our law enforcement community. They are putting their lives on the line. They're very good at what they do. No one's perfect, none of us are perfect, and so sometimes someone gets through like

the London attack or did yesterday. But you see the follow up, You see the speed with which the British authorities are working our authorities under when we've been attacked, and it truly is impressive. So I would say you have to spend this money on our on the FBI and intelligence services to keep us safe. And Tom and your earlier question, it's not really a question of building walls.

Walls aren't going to help. Walls on a border don't help intelligence and police work is what helps master bards. I want to ask you about a relationship with NATO. At that joint press conference last week, Chancellor Merkel and President Trump both talked about NATO we had the President uh saying what many had hoped he'd say for a long time, that is that he supports the Alliance. He pivoted very quickly to talk about how it's financed, or

how he believes it's it's financed. And then we have rex stealers in the Secretary of State saying he couldn't make a NATO meeting, NATO saying we're happy to apply to change the meeting date US to accommodate him. What's your sense of this administration's support of the alliance right now? Well, it's tepid and they haven't really found the right notes

and the right tonality. Because the United States is the leader of NATO, of course, Secretary Tellerston has to be at the meeting of NATO Feur ministers before he goes to Moscow. And it looks like now they're going to try to rearrange the schedules that he can do that. So there's a happier outcome here. I thought that President Trump I was glad to hear him say that he believes NATO is vital, but then it within a second he trans Asian to say, but they're not paying enough.

He's right they're not paying enough, but he almost treats it like a protection racket. If you don't pay, I'm going to withdraw our support, which is not the way that any American president has ever treated our allies who came to our defense on nine eleven. And so I think the administration really needs to get into the leadership mode they've been following on the NATO issue. We are the leaders of NATO, and we have to act like it and believe in it. And I don't think we've

heard that from President Trump yet. Before we let you go, let me put a question to you. I'm gonna put the Emory slaughter here in a few minutes as well. When you look at Rex Tillerson and the kind of diplomat he is shaping up to be, what camp does he fall into. We have structural realism and all of that. What kind of diplomat is Rex Tillerson. What do we know about his diplomatic tax It's just not clear because he's been literally quiet for the last couple of months.

He hasn't been speaking publicly, he hasn't enunciated his view of the world. Uh, it's unclear what kind of influence he has with the White House, and so I think we just need more time to see Secretary Tillerson in action. But I can tell you is the Trump administration is proposing a cut in the State Department in a I D budgets that would be catastrophic. It would cripple our diplomats.

It's the wrong way to go. And I hope Sectary Collison will fight this, and I hope Congress will resist it and bring the Trump position of the administration back to a more realistic posture that our diplomats need to be funded. Abassador Burns, thank you so much for your perspective this day where the Prime Minister speaks to the House of Commons. This is special, folks. We've had a

really wonderful run of strong books. I think of admalst Vetus book out of Fletcher School, in Tom Nichols book out of the Naval Academy on Experts, and then a little jewel shows up the chess board in the web Emery Slaughter and you're like, yeah, yeah, she's great, it'll be great, and then you open it in the joy of how you recapitulate and bring forward this dreaded thing game theory out of Princeton. You know that Avanash ticks it the artist strategy. Uh is it almost a cottage industry?

And my joy as you open with the late Tom Shelling changed how all of us think. We would all say, why did you open this book on networks the chess board in the web with Professor Schilling? Because Tom Shelling defined the framework that we have used for for whip for foreign policy since nine He took the U. S. Soviet relationship, which was a zero sum relationship. So people thought, and he applied game theory and he said, nope, this is actually a bargaining game. It can be chicken where

heres adding straight at each other. It can be prisoner's dilemma, it can be a coordination game. And that structured how we think about other countries. That's the chessboard world, and that for me was the some you know, the text that you looked at. But when I look at the world, I see state to state relations. But I also see a world of networks. Right now, we just had a terrorist attack inspired by the ISIS network. There are criminal networks,

their business networks, their civic networks. We have a strategy of conflict. That was Tom Shelling's book we do not have strategies of connection, and so I set out to try to provide a framework for those. How much does a diplomatic theory change? Uh, Secretary of States and Secretary of State, is he or she choosing his or her outlook on the world or is the outlook on the world governed by the way that the world is shaped at that particular time. Well, I think it's always both.

Every president, every section of state discovers that the world gets in the way whatever it is they thought they wanted to do. Uh, you know, the world serves them up something different. And I remember serving with Secretary Clinton where in one week you had the Pakistani Taliban being within a hundred miles of Islamabad, you had the H one N one virus breaking out in Mexico, and you had what looked like a double dip global recession. So, uh,

you get what's thrown at you. But again, we have better tools for dealing with what states throw at us than what nonstate actors throw at us. You see this networked world, But what's brought it about? Is it? Is it technology that's led us? There? Is it something else? Well, it's technology that's always been true. You know. John Maynard Keynes has this famous paragraph where he describes the London uh you know banker sitting you know in nineteen thirteen

with products from all over the world. That was enormous globalization then, and that was brought about by the steamship and various other uh technologies in the Industrial revolution. Today it is again it's globalization and technology. Those two things are connected. But our kids don't know what it's like not to be connected. We grew up in a world where it's us and then we connect to others. And in our next section we'll get to the politics of

the moment. But what I would use here from electrical engineering is slew rates, which is the right angle a circuitry, which is things move fast, things move a light speed. Now, let's take a corporate landscape. Somebody reading the chess board in the web within a corporate milliew, the new strategy there's no five year strategy. The new strategy in the slew rate is three years exactly if if that I mean, I often say this is no world to predict and planned plan. It's a world in which you have to

adapt and respond. So one of the things you want is to create the kind of fast adaptive network so that whatever happens, you're ready. And indeed I use Stan mc crystals work on team of teams where you know, he had to design a network to defeat al Qaida in the Rock and he says and he says to CEOs, look, I needed to design a very particular kind of network so I could let my people respond on their own on the ground, depending what came out of And you

detail this in the book. The Crystal Group applies this to the forrporate setting. How does it do that? Well, the first thing it does is a network analysis of any business and that's critical because we all all know their informal networks. There's no organization in the world where there's a you know, there's the hierarchy. You report to this person, but how do things really get done? Where's the network? So you've gotta map that and then figure

out how you tweak it. What does this mean for the power structure in the in the diplomatic sense you had world powers before. Is power waning because of this? Is power being more evenly distributed among countries and among leaders? Yes, although one of the reasons it's called the chessboard in

the web is you have to see both. Right, you have to look at the world, the states and the different power changes there, but you also have to look at you know, foreign policymakers who are ceo, civic leaders, university presidents, sadly criminals all on the other side. UH. And so if you're in government, you need to be doing that state to state state craft, but you need to be doing webcraft, and that means bringing in all these actors who are not governments. Were then very slaughter

the chess board in the web. We're going to continue here. Breaking news out of Ford motor It gives pause. They lower the sites dramatically. For their first quarter they were at forty seven cents and they come way down center tendency thirty two to thirty three cents. That is remarkable from Fort Motile. Much more on that they site higher costs, lower volume uh and unfavorable exchange. UM. I want to give you the blurb reward of the year. As everyone

knows it's ever written a book. There's a game to getting blurbs. I was honored when I did flying with one engine. UH that I got I got a blurb from this person, a blur from that person. In your world, you can't do better than your first two names. Night and Kiwen. Did you talk to them at the same time? I mean, that is that is a great honor, isn't it?

It is? And they are dear friends of mine. And they wrote the book in nine Power and Interdependence, and that was the chessboard, Power and Interdependence the Web, And so I see in many ways I'm updating their work and giving you practical This is exactly set, folks. And I would Paul in your Venodaker well at Berkeley as well, and pull it back to Tom showing at the beginning of your book, which is it's one big game of chicken.

And to get to our next section, what does President Trump need to learn about the theory of the game of chicken within power and interdependence and within strategy and conflict showing that's what do we need to learn about chicken? All right? Well, the first thing that it's over exit Bacon.

Did you know, well, except that I think that this is a critical example of So the Russians hacked our election, right, and we responded by you know, putting out a few expelling some diplomats and sanctions, putin responded to that by inviting the American diplomats children to the Kremlin. He basically laughed at us, we need to respond, and this is chicken in a way that actually threatens his secrets, that humiliates him, that puts that really puts him on notice. No,

we will not stand. Where did our timidity come from? Within the constructive game of chicken? David Gurr and I played Chicken every morning, trying to figure out how to get to the next couple of coffees. Well, when did we get timid? So I do think that the sort of national trauma of first nine eleven, but then particularly Iraq and Afghanistan has made us extremely hesitant or made

the Obama administration to use force. And you can't play chicken unless you've got a credible threat, and that means you've got to use force, so people know that you're willing to David, check that China you're heard thrown? Was Charles Vollmer, a technical director, thrown China because the eggs were overcooked? You write in this book of being a student at Princeton and reading Robert Cohen's book and and and Joseph Nye as well, how much is you know,

you've taught for a long time at Princeton. Has the pedagogy change when it comes to foreign policy? You know that you would still read nine Cohen I if you were, if I were teaching, you would you would. But but I do think one of the problems is it's become much much more specialized. Right, so you don't take these braw courses where you're thinking strategy. You take political strategy, you take political economy or data. Well, we're gonna come back,

Emory Slaughter with us. We've got to cut your the chess board in the web, and we're gonna come right back on that idea, the broad strategy reading Kissengers Diplomas at gunpoint you will read this book. No, you need to read about networks in the new digital world, and

you'll do that with Emory Slaughter. We celebrate the chessboard in the web, Strategies of Connection in a networked world with Emory Slaughter, truly must read if you are read on international relations, and again starting with the game theory of time shelling uh and working off of that, I did what any good radio slave would do. I went to the conclusion and you wrote a chapter on Mr Trump the rise of webcraft translate for us, the webcraft

of Twitter and the president. We didn't do this with President Obama, President Johnson, and President Mix and we're now reading our way through policy. Is that in your book? Well, it is in the sense that that you know, President Trump has a brilliant broadcast network, right, He's got twenty six million Twitter followers. That's about half his voters. That's

a a sizeable junk of all US voters. And but that's a one way network, right what President Obama discovered and he had a pretty great network too in two thousand and eight when he tried to convert those people to advocates for Obamacare. And now President Trump would like to have those people be advocates for repealing Obamacare. He's got the wrong network for that. So he's got, you know,

one person at the center broadcasting to million. He needs what I call a pod network, right of where those supporters are actually clustered in ways that you can mobilize them and they can take action. And that's a different net structure of a network. So he needs to actually learn some network theory if he's going to make it work for what he needs to do now, Tom I'm glad that you've brought us here because I look at Secretary of State Rex Taylorson and I wonder where he

fits into this networked at world. We followed his trip to Asia last week. He wasn't exactly broadcasting that trip. He brought one journalist on the plane we got to write up of that. He avowed in an interview with her that he doesn't like the media, doesn't see a need for media. I imagine that public diplomacy is key

to this networked world, being out there talking, expressing your opinions. Absolutely, And he is now back in a very traditional chess board world where it's sort of Manda man in a dark, oak paneled room, and he's not an all secret right like pre World War One secret agreements secretly arrived at where in fact, uh, you know, he needs to do what he needs to be, engaging uh, the public at large, but again creating networks of pockets of support for American policy.

And we're crazy if we think it's only foreign governments we need to influence. Again, look at terrorist attacks. That's not governments, that's people you need to think about, not just public diplomacy. Heat how great America is, But where are the peak in different countries around the world, who themselves are pushing back against the Isle narrative? And how do you connect them first to each other and then and then sort of in a in a broader network.

And that's that is something I think Secretary Clinton started, uh and Secretary carry did did less than she did, and Rex Dillerson is really heading backwards. How do you deal with the overwhelmingness of the networked world. I can understand the tendency because of how big and why it is to find comfort in the wood paneled room to want to go back to that. How do you fight that? How do you see this as a world that you can navigate? You know, I think that that's a that's

a great observation that I think it's right. There's this sort of feeling like, well, I'll just do what I know I can do, But you actually have to do both, so you do still need that room. Like if we're making a deal with Iran, that's not a global network, that's a negotiation, but you have That's part of the reason I wrote the book. Part of the reason it seems overwhelming is we don't have any tools. So if

you think again, go back to shelling. Oh wait a minute, this is a operation game, this is a coordination game. This is what I do in those games. I'm saying, Oh, this is a resilience network. We need to build resilience. This is what it's got to look like. This is a task network. We need to get something done. That's team of teams, or this is a scale network. We need to correct people. And I think it'll be more

manageable when you think about it that. I want to take the time we've got left and ask the question. I got a wonderful email the other day from Carol driving with her daughter, Uh, you know, listening to the hot air coming out of the Mr Gera and Mr King, and it brings it back to the hallmark of your academics. And I'm going to take this back to Charlottesville and St. Anne's a million years ago, which you've always been the

adult academically in the room. You've got an understanding of the heritage and the reading of the literature like nine King, and you've also got a more modern twist as well. What's your recommendation to parents trying to get boys and girls motivated to get off the phone and to read the original literature. It's out there. Who did that? I did? And and actually I think you put your finger on it, which is and it goes back to they're overwhelmed, right,

There's so much coming at them, so it's unfashionable. But I would say you need to go back to create a cannon, right, like here are basic text. Since November, I've gone back and I've been reading the Founders right, I've been reading sort of key document volume on Thomas Jefferson right now. Absolutely, and John Mitcham Jefferson is just wonderful. So I think we need to remind our kids to be able to process this infinite amount of information, you need a set of texts and you need to and

you can master those. And that is exactly what I think the strategy of conflict is in in internationalition very quickly. Or what was it like to be intimidated by Professor Holman at Princeton three years ago? My god, he was a giant, he was, but he was very nice to

me by the time I got there, not helped. I was his dean, so I was his boss, but he I was his boss, I was, but was yeah, but he was a power not enough time, don't be a stranger the chessboard in the Web Strategies of Connection in the Network World, A Marie Slaughter hits a home run by dragging Thomas Schelling a nine Q and I hope Professor Nice hearing this. I mean dragging them and dragging them into the modern day and age of network and

digital his books. His thick tone is familiar to anyone who's been through law school Constitutional Law in its fifth edition, Criminal Procedure in its second Irwin Chamerinski, the founding ding to the School of Law at the University of California, Irvine joins us now as we've watched the hearings unfold on Capitol Hill. In the heart Senate Office up building, Judge Gorse has taken questions from members of the Senate Judiciary.

Comin Marinsky joining us now in the Spectrum, Enterprise, Phoneline, Specium, Enterprise, Nation y I T and Infrastructure Solutions. Great to have you with here, sir, and I want to ask you, first of all, what we're getting out of all of this. We see the marathon hearings, We we hear the questions answered by the judge hoping to be a justice what are we learning about him over the course of this week.

We're learning he's very smart, he's very articulate, and that he refuses to answer questions but anything constrained to his legal views. Has that always been the case? We watched the production here every few years as this happens. It's not a regular thing. It's it's a rare thing. But it seems like that's the game, dodging these questions, trying to perhaps pretend that there is no inherent jurisprudence that

these guys have. So long as the Senate is controlled by the same political party as the president, the hearings are largely meaningless. There are fifty two Republican senators now one of them is indicated a desire to vote against Neil Gorcich. He knows that he knows he doesn't have to answer questions. If the additive and controlled by the Democrats, it's then a very different story, because then they can say, if you don't answer our questions, we're not going to

confirm you. How early on do somebody who's entering the law develop his or her own jurisprudence. You're teaching students that you see, Irvon you taught students at Duke before that. I'm sure many of them aspire to be judges someday. Is there an inclination now to be private about one's belief because of this? In other words, how long is the historical record for candidates? I think you have two different questions. One is how soon do students develop their

jurisprudential philosophy? And I say that many students have that in law school. I hear it expressed by my constitutional law students all the time. The second, to me is a much harder question. Are people now more private because they think someday they're nominated for a federal judge that their views should not be known. Maybe there are some that way. I once talked to a young law professors said he didn't want to take positions on controversial issues

because he wanted to be a federal judge someday. But I think that's pretty rare. I think that um certainly being on the Supreme Court of like being struck by lightning. I don't expect that people are planning their careers from law school with a state hope that that might happen. Uh. Wonderful to have you on professor, this morning. I guess it required read along the way as Bernard Schwartz one volume on the Supreme Court, which regrettably ends long ago

and far away like near seven. Help me here with the distinction between Judge Scalia's theory and Judge core such as theory, what's the difference and how they look at the original document you mentioned seven? And what's interesting about that year is it's when Robert Borke was denied confirmation for the Supreme Court. And Robert Bourke was the nied confirmation because of the so called originalist views, his view that the meaning of a constitutional prevision is the same

today as it was adopted. The meaning of the constitutional provision is six when it's adopted, we changed only by amendment. Justice Scalia was also an originalist, and both Judge Bourke and Justice Scalia set from their originalist philosophy. There's no protection of the right to privacy under the Constitution like for reproductive freedom. There's no protection for women from discrimination under equal protection because the drafters of the Fourteenth Amendment

eighteen sixty eight didn't contend that. Neil Gorsich is also an originalist, and so far as we know, his views are the same as Robert Bourke or Antonin Scalias. Because he hasn't been willing to talk about any legal issues. Hard to know when, if at all, he would disagree with them. Does his natural law treatment and the complexity of how natural law is studied, does it move him beyond Scalia and the others too? Maybe a more modern treatment. Well,

natural law is quite different originalism. Natural law would say that there are rights that exist just by virtue or being humans, and that courts should protect those rights even if they're not in the Constitution. Neil Gorsich wrote a book about euthanasia that expressed the natural law velocity. But I've read hundreds of his decisions from the United Sates Court Appeals to the Tenth Circuit, and I don't see

an expression of natural law there at all. Glad you took us there, because that's what I guess we have to look at. Here is his record, hundreds thousands of decisions. If you were to put them together, what kind of picture could you paint? For is here of the way that he's acted as a federal judge, a very conservative judge. Yesterday I gave a talk to lawyers who handled death penalty cases in Federal Defenders Offices, and I talked with them about his record in criminal cases and especially in

death penalty cases. He is a consistent vote for law enforcement and prosecutors, often in dissent. So I think that he would very much be like Justice Scalia, because I think he'd be more conservative than Justice Scalia when it comes to criminal cases. Um, he's going to be exactly like Justice Scalia. When it comes to religion cases. He rejects the idea of a separation of church and state. He favors the ability of people diffree exercise religion, even

it means inflicting injuries on others. You know, I think of the way that academia works. When a professor retires of say American literature, there is a tenure line. There's an effort to replace that person with somebody else who studies American literature. Is the same thing becoming true on the Supreme Court. We heard from President Trump saying he wants to find an air apparent to Justice Scalia. You want to replace one with with kind of a clone

or someone like that person when it comes to jurisprudential philosophy. No, I don't think so. If Hillary Clinton had been elected president, she would want to pick the antithesis incident Scalia. In terms of political philosophy. Um, I think she would have nominated jud to Judge Merrick Garland, maybe even somebody more

progressive than Merrick Garland. Um. He had Donald Trump decided he wanted to be a moderate rather than a far right conservative, he would have picked a moderate sal Court of Appeals judge or a moderate individual for the School of Seat. But he said from the time he campaigned that he wanted to pick someone just like school ideologically, he wanted to give this nomination to the far right.

And the day after President Trump nominated Judge Corsets, the National Review and Ted Cruz were loud in their enthusiastic praise. I think that tells you were now Gorges on the ideological spectrum. Let me pick up where we left off with the Charlie Pellett and Gregg's story. There just a moment ago they're talking about the death penalty. Of course, the Supreme Court weighing in on those issues from time

to time. Help us understand you the role that a justice course which might play when you look at the cases, the kinds of cases that the Supreme Court is waging. We've seen four four decision after four for decision here over the last few months. I think with the guard of the death penalty, there are four justice on the current court, led by Justice Brior and joined by Justices Ginsburg, Senter, and Kagan, who would vote to eliminate the death penalty

so that it's inherently cruel and the unusual punishment. There are four justices to reject that, Chief Justice Roberts and just Kennedy, Thomas, and Alito. I think he had a Democratic appointee replaced Justice Scalia, there would be a fifth vote to declare the death penalty unconstitutional or at least

greatly restricted to application. From everything we know about Judge Gorcich from his votes on the Tenth Circuit, he's going to be with the Conservative The death penalty will have five votes boppolted, five votes to reject any significant restrictions. A lot of people criticize this court for being overly corporatist, ruling the lot for corporations. We had Judge corc responding to questions from senators this week saying he's ruled for the big guy, and he's ruled for the little guy. Again,

you've gone through many of these decisions. Can you can you estimate? Can you say how often he's gone for one or the other? Well, it's always hard to do those kinds of numbers. But I think when you focus on the divided cases where there's a majority in the descent, he comes down very much on the side of employer

over employee, of business over consumer. There was one case they got a lot of attention in the hearings that it involves a truck driver whose truck broke down and it was extremely cold, and finally he felt literally his life was going to be in danger if he didn't move the truck. He did so and got fired for that. And it was Judge gors that you said he could be fired for doing that and if nothing else, that

chose a lack of empathy. But I think what the point was the Democratic senators is it shows that he really sized that the employer over the employee. He I think again, it's going to do with the Conservative majority on the whole range of cases where it's business firsus employee or consumer. A lot of Conservatives would say professor, But the Conservatives won the election, so they get to

tilt the Supreme Court. And there's a great certitude about picking judges and you know, literate in our history going back before Marshall. Frankly, you never know what a justice is going to do. What is the modern probability of any conservative justice versus Suitor or or or or Byron White or others? Is there something different in the kool aid now that makes a conservative a conservative forever? Well, you ask two questions. First, is winning of presidency the prerogative?

And then determined on the Supreme Court only if you can get a majority of the Senate to agree. In the nineteenth century, the Senate rejected about of all presidential lemies, including one from George Washington. Um. In the twentieth century you had examples of John Parker in ninety one, claimant Hensworth hild Car as well Robert Cork. So it's not a presidential prerogative. The Senate as that advise and consent, seken Um. There's certainly instances were individuals appointed that the

Supreme Court didn't turn out as expected. Um, David Suitor wasn't the conservative that the George H. W. Bush administration wanted. But what's notable is that David Suitor, if you read his opinions from the New Hampshire Supreme Court, didn't have a definite ideology. Um. If you look at the last four Supreme Court nominees, Roberts, a, Leader, and Kagan, they've all turned out exactly as would have been predicted. Most justices turn out exactly as predicted, especially if they have

an ideological track record. Relatively few people have major ideological transformations in their sixties and their seventies. Antonin Scalia was as conservative when he died on February two thousand sixteen. Is went on the court in. Ruth Bader Ginsburg's liberal today as when she went on the court in I'll offer your prediction, Neil Gors which is going to be conservative next year, ten years, twenty years, thirty years, maybe

forty years from now. He's forty nine years old. If he remains on the Supreme Court until these nineties, the age was just down past Stevens rehired, he'll be a Supreme Court justice. Let me ask you lastly to drop on your experience in the classroom once more. We we we've seen what happened to Sally Yates. We've seen what

happened to pre Perar. When you talk to students who are interested in getting into the law to work in government, what do you tell them about what we've seen here over these last few months about the way the Justice Department is operating now under President Trump. I always encourage my students to go into government in public service. I'm very proud that of all the law schools in the country, we were ranked second in placing our students in government

and public service. I think now when it comes to going into the federal government, assuming there's going to be any hiring letter, it depends on what they're going to be doing. My oldest son is a federal profit toitter doing gangs and crime cases. It's not going to be

effected by whose Attorney General. But if a student wants to go now into environmental work on behalf of helping the environment, for civil rights work on behalf of the African Americans and gays and lesbians and women, I don't think the Sessions Justice Department is gonna be the place

to go. Iin Schamarinski, thanks very much for joining us set today or Chamarinska, dean of the School of la at the University of California Irvine joining us on the Spectrum Enterprize, Phoneline, specrument FRISE and nationwide fire based network and i T Infrastructure solutions. I wasn't joking at the top of the show. I think that every student who takes criminal law or constitutional law uses his textbook. So

you're leading. I mean he's huge using Duke right for a long while, and then there was a huge battle when he went to u k L Irvine. I mean he blew up the state legal uh community with the debate on a liberal conservative and all the work and founding dean of that school. So leading a fairly young school out there in California, trying to give you a little more informed coverage of what we're seeing in the

Supreme Court. And one idea here I might see just David very quickly, is is we just assume there'll be other discussions. I mean, it's not a one off for President Trump, That's right, And I think that's what Democrats are weighing right now in terms of how they approach this particular nomination, how how full throatedly they'll go against this nominally looking ahead to who the next might be.

Thanks for listening to the Bloomberg Surveillance Podcast. Subscribe and listen to interviews on iTunes, SoundCloud, or whichever podcast platform you prefer. I'm out on Twitter at Tom Keene. David Gura is at David Gura. Before the podcast, you can always catch us worldwide. I'm Bloomberg Radio, brought you by Bank of America Mary Lynch. Dedicated to bringing our clients insights and solutions to meet the challenges of a transforming world.

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