2 Burst results for "Richard Caplan"
Bloomberg Radio New York
"richard caplan" Discussed on Bloomberg Radio New York
"He has image himself as a friend of the middle class and organize later labor but i think that you know he's not limited in what he can do you know both legally and you know uh... but uh... i think he can he can you know he what he needs the success of the auto makers as much right because if the auto makers don't have a deal that sustainable and they're not going to support these jobs of the future and a sad reality ford c e o jim farley has a just come out with an interview saying that things you know whatever is being said in public are just not moving what the u eight w is offering us is a choice between going out of business and bankruptcy again the workers are set to target strike at midnight unless there is an 11th hour agreement of some kind house speaker kevin mccarthy today sending a clear message to the right wing of his party government no shutdown i told my conference i know tomorrow is a jewish holiday will be out of session but when we come back we're not going to leave meanwhile house minority leader hakeem jeffrey says the threat is still there house republicans have made clear that they are determined and shut to down the government and try to jam the extreme right wing ideology down the throats of the american people so first there'll be a showdown between mccarthy and the right wing of his party threats don't matter and sometimes people do those things because of personal things and that that's all fine oh yeah and uh then then uh he'll have to fight with the democrats after a deal broke down earlier this summer a plea deal hunter biden has been indicted on federal charges bloomberg's nancy lions has the very latest hunter biden is charged with three counts related to the purchase of a colt revolver in 2018 he allegedly lied on the form that's required to buy the gun that he was not using drugs but that was a period when the younger biden had acknowledged struggling with an addiction to crack cocaine following his divorce and the death of his brother the felonies carry maximum sentences between five and ten years in prison a special counsel is still investigating hunter biden and could file additional tax charges in washington nancy lions bloomberg radio all right nancy thank you and hong kong has kicked off a campaign to stimulate its night life as officials seek to bolster the city's attractiveness and revive an economy battered by years of pandemic isolation the promotion called night vibes hong kong will feature three evening bazaars at waterfront locations next to victoria harbor all right on a jet and going and global news power by more than twenty seven hundred journalists and analysts in over one hundred twenty countries in san francisco i met baxter and this is bloomberg already thank you and now you can get the latest news whenever you want it with bloomberg news now it's the top stories from our global team of reporters at the click of a button get bloomberg news now on the bloomberg business app or at bloomberg dot com or anywhere you get your podcast debra kasia and our special guest is a former head of the dallas fed bank rob caplan with is us uh... robs also c e o and president of the draper richards caplan's foundation it's a pleasure to see you once again thank you so much we've got this fed meeting coming up next week i'm less concerned about what you think may or may not happen and i'm more interested in getting your perspective on how difficult it is it is when you get to the end of a tightening cycle to kind of engineer near this and allow markets to kind of a just but not to become overly enthusiastic that were necessarily done with tightening well every cycle is different and this is one uh different and here's how it's different um a lot of the key drivers of what we're seeing right now are happening away from the fed what do i mean by that government spending unspent arpa money which is in the hundreds of billions of dollars at the local level the infrastructure act inflation money reduction act money is all being spent in significant size in the u .s economy that is helping to stabilize and give resiliency to the u .s economy in my view without those three sources of spending my guess the is fed would have stopped raising rates maybe a couple of moves ago might be at four and a half and four and three quarters and we might even be in a downturn right now so that's significant and the second thing that's significant is because of the energy transition that we're executing here and around the world we're limiting fossil fuel production in the united states we're under supplied globally and oil prices are very significant elements of inflation directly and directly and so the challenge for the fed now is if you if you told people a year ago they'd get to five and a quarter five and a half you'd say oh my god we may not need to go that far and the economy would be very slow it's instead very resilient and inflation is still still but sticky i would argue there are structural drivers away from the fed so decision the for the fed is how do you end this cycle when you have this amount of stimulus and fiscally should you talk about it right now they've chosen not to talk about it thinking it's out of their lane but without it they're going to need to keep their options open that they may still need to do more even though i don't think they'll do anything in
Bloomberg Radio New York
"richard caplan" Discussed on Bloomberg Radio New York
"With us Before we get into your proposed solution to the problem describe the problem How did we get here Yeah I mean it's been a really rough ride for the fed's credibility over the past I'd say probably about 6 7 weeks First news surface that Robert caplan the Dallas fed president traded a lot of stocks last year pretty much And then we had Eric Rosen grant of the Boston fed also trading a lot of real estate investment trust REITs And then just even more recently Richard Clare the vice chair was disclosed to have switched a lot of money from bond funds into stock funds just a few days before the fed really started aggressively easing monetary policy to combat the COVID crisis So a lot of moving parts and Eric Rosenberg resigned last week and tomorrow will be Dallas Dallas fed chair rubber cap once last day And just to be clear first of all neither I think mister Kaplan nor mister Rosen said the reason they were resigning was because of this problem And as far as I know there's no specific allegation of wrongdoing on any of these parts For example when you talk about Richard clarity it said this was a normal rebalancing that was sort of automatic He might not even know what's going on The question I guess Brian is not so much did they do something wrong Is it look fishy Yeah I mean I think it's pretty clear that it's not a good look at all And Richard caplan basically said that my financial disclosure has become a distraction as the reason why he was stepping down but it's all just very strange because I actually Robert caplan the one who has been trading all these stocks was actually among the most vocal critics of the fed policy and saying we should tighten that financial financial markets have gotten too frothy And similarly Eric Rosenberg who was trading REITs was saying that the real estate market was too hot So it was very strange But yeah no wrongdoing really at least based on the fed's current ethics codes But there's reason to suspect that that's going to change They're definitely going through they're going through it now and probably coming up with some recommendations to make it stronger So again just before we get your solution on teasing this now so I really want to know what it is Before we get to that what are the current rules about conflicts of interest in trading Yeah I mean it's a voluntary guide in some ways that should be above reproach that there are some rules around how many actually how much in U.S. securities you should own So U.S. government securities because obviously the fed does have a direct impact on the US Treasury market And there's also rules around the blackout periods surrounding actual decisions in which they can't trade They also have to hold securities for 30 days Pretty standard stuff but at the same time this is the Federal Reserve we're talking about And at the highest levels they're influencing the economy as much as any single body in the world Okay we've waited long enough a drum roll please The answer is I don't think there's exciting as you made it but qualified blind trust is what myself and Alexis Leon came up with It's a tool that's used sometimes in Washington It would basically require fed officials to hand over their assets to a third party that's not a spouse or a friend A legitimate third party who would then go about divesting their assets and then buying a new securities with that Okay so what's the difference with qualified blind testers to blind trust Yeah my understanding is that blind trust can still be subject to you might have a friend or you might have someone who you work with kind of take over the trust and it's blind in that sense But this would be the way that we understand it is it would be a true third party someone who really is a lot more removed from the actual person It's sometimes called there's also things called double blind trust which is where you don't even know who's managing your money But those are pretty rare So this is kind of just to make sure that it is a qualified third party So it's not someone that the fed officials could influence So if there is an argument against this what is the argument As I understand the way this would happen it doesn't mean that whoever is managing the qualified branch would have to trade securities have to sell everything and buy something else right They would just manage it the way you would if you could still manage it Well the issue there is that if you give them all your assets and you have $10 million in Tesla that's not really blind because you know you just hand it over $10 million with Tesla right So they would have to sell substantially all of that And then that's a great example because there might be a small tax bill to attach to that with Tesla given the bases Right exactly So this would just basically be a way to not necessarily discourage people who might be affluent might have had financial success in their life from becoming a fed official but it would prevent them from the temptation of having been in the markets before thinking they know what's coming and then trading on it Because you don't want to have we were joking that you don't want monks to be running the fed right You want people who have substantially knowledge of the economy and of the financial system And so you don't want certain net worth to be prohibitive but you also don't want that to be seen as a conflict of interest What about monks running the Congress or the executive branch Should something similar to be imposed for members of Congress and for senior executives at the executive branch Yeah that's a lot of the commentary that I've gotten back on my column so far today is yes that's a great idea about doing blind trust for the fed Now let's do Congress There is a lot of concern that people come into Congress and pet all their influence And as a result they accrue more money So I do think that there is especially with Congress there's definitely need to improve capital of interests there too because they influence sectors even more than the fed does I wrote that even as the P 500 could be seen as the conflict of interest for the fed and that's true But when you really drill down there are certain sectors big tech for instance that I mean Congress could really really lay into big tech if they wanted to And you could possibly trade ahead of that Well the S&P 500 today if you look at what Mitch McConnell and Chuck Schumer did they really drove the S&P 500 with their budget deal right Right If you find out that everyone's buying S&P 500 calls a couple of days ago that would be a problem.