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- [00:00]
IBM Representative
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- [00:33]
Podcast Announcer
Bloomberg Audio Studios Podcasts Radio news. You're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube.
- [00:55]
Joe Matthew
Welcome to the Monday edition. I hope you had a great I hope you had a long weekend and a great passover in Easter as we get back to reality here in Washington, D.C. although it doesn't resemble reality on the South Lawn, it's Easter Egg Roll Day at the White House and the President has been really enjoying it. I mean, he was out there speaking on the balcony with the Easter bunny and the first lady earlier and he's been making the rounds even though we've got a news conference that's scheduled for less than an hour from now. And we're going to bring that to you right here on Bloomberg Radio satellite radio, channel 121 streaming live on YouTube. Search Bloomberg Business News Live if you want to find us. You might have us up already on Bloomberg Originals. We've got a lot to talk about here today. The next 24 to 48 hours are going to be critical. This is a fasten the chinstrap moment. It's got nothing to do with the Easter Egg Roll. The President of the United States doubling down over the weekend. And big thanks by the way to Bloomberg this weekend, the cool kids call it. Btw, I learned for hosting me up in New York. I was in for David Gura. And as it turns out, I'm sitting there with the wonderful Christina Ruffini as all of this news breaks, including the power plant day, Bridge day, that incredible and offensive post that the President put up on Easter Sunday morning that I can't read. I'll get everyone fired and beginning with myself if I do. There are two big headlines, by the way. And of course we had the rescue of the second pilot high drama on Easter. My God, as you were looking for your Easter basket, two big headlines that have been underreported in my Opinion. Unless you're really scouring the news here, you might not know a couple of things. Number one, the President has given Iran another day. He extended the ultimatum. It was supposed to be 8 o' clock tonight. That post that I just mentioned, Tuesday will be power plant day and bridge day all wrapped up in one in Iran. That was one post in which he said, praise be to Allah. Look at that. We had. If you're with us on YouTube, the President, you gotta like bleep the President again. But now 8pm Tuesday is the new deadline, so that's an additional 24 hours. The other big headline nobody seems to be talking about is how they shot down the jet. Did you hear this? He told Barack Ravine at Axios it was a shoulder fired missile that brought down the F15. And of course we have somehow through the miracle of our own strategy and efforts here and the lack of Iran's ability to get them, we got both of these American airmen back. Yeah, that's weird too to think, right? James, 8pm Tuesday is also Wednesday in Iran. Was keeping tabs on all this stuff. Now I mentioned the President's news conference. This normally would be. Well, it is a big deal. He's going to walk into the briefing room, we're told at 1pm Eastern time to meet the press. This is the final line we're drawn in the sand. We could be at war. Well, we already are. We could have a much more intense invasion 24 hours from now if there's no cease fire and Iran has conveyed its response. They're not interested. Still in a cease fire. Yet the President is enjoying, well, Easter Monday when he came out on the balcony earlier. He's got children all over the South Lawn. They're out there with their parents are so excited to take pictures of little Suzy and little Johnny at the Easter Egg Roll. And in comes the President with the Easter bunny to talk about the war. Here he is.
- [04:27]
Donald Trump
They don't want to cry, as the expression goes, uncle, but they will. And if they don't, they'll have no bridges, they'll have no power plants, they'll have no anything. I won't go further because there are other things that are worse than those two. And we might have. Well, the thing. If I had my choice, what would I like to do? Take the oil. Because it's there for the taking. There's not a thing they can do about it. Unfortunately, the American people would like to see us come home. It were up to me, I'd take the oil. I'd keep the Oil, I would make plenty of money.
- [05:02]
Joe Matthew
Take the oil with WTI West Texas Intermediate now just shy of $112 a barrel. Even more than Brent crude, which is settling well right now at the moment trading near 110. By the way, what do we think of the slow jam? The news President Trump on the South Lawn with the Marine Corps band behind him playing I wish from Stevie Wonder extended jam. You might not have known that the Marine Corps band was a jam band. And if you're with us on YouTube there you see him with the Easter Bunny. The first lady spoke from the I wonder who's the Easter Bunny today. It's not Stephen Miller. We saw him on the lawn. But I want to bring Tyler into this conversation. Yeah, right, Matt. War is in the key of life. I mean they were picking great tunes out there. There you see the Marines behind the President on YouTube. But they're playing music through this whole moment. Very surreal of him talking about war in the Middle East. He then carried on three additional gaggles on the lawn and I guess he just went inside. So Tyler's going to have to run over there in a second. I got to stop talking. She's with us now. Bloomberg Washington Correspondent, bring your Stevie Wonder with you. Do we think this is going to happen at one? He just had four gaggles on the South Lawn. Why he just took all the questions.
- [06:22]
Tyler
Well, I have a feeling that it is going to still happen. We'll see. Probably delayed. Things tend to get delayed around the White House as always. I think that's probably what normally happens. But there's still a lot of other questions that the President has to answer.
- [06:37]
Joe Matthew
So let's talk about that. What would you ask if you're in the front row today?
- [06:40]
Tyler
Well, really what the US Needs to see in order for there to be a cease fire. If we are still pursuing the cease fire route after we know that we heard from Iranian state media earlier today saying that they're not going to agree to a short term agreement. They say they're pressing for a longer term solution. But really at the heart of this, Joe, is of course the Strait of Hormuz. And we haven't really seen any indication that there's going to be a let up when it comes to Iran grip over the waterway. And as you well know, last week President Trump said that there needs to be an agreement in place to reopen the strait. But I'm wondering if the administration would be willing to have a short term cease fire and then negotiate out a longer term deal to make sure. That the Strait gets reopened.
- [07:20]
Joe Matthew
So we did hear back from Iran today. At least this is via Pakistan. Right. We're not in actually. It's not like we got a news Release on this. 10 clauses in the response rejecting the cease fire while demanding a permanent end of the war in line with Iran's considerations. And they've been pretty clear about this, right, Tyler. They want reparations, they want US Bases closed. So this is not news.
- [07:41]
Tyler
And they also want sovereignty over the Strait of Hormuz. Now Axios got a reaction from US officials who called this maximalist demands. But you're right, it sounds like that this really just expanded from the five points that we already knew to maybe 10 point plan going. So it feels like we're actually going in the wrong direction here. But no, not, not surprising from this. Now Iran's side is that they're alleging that a short term deal would give the US time to regroup. So there had been reporting that there was some sort of trust mechanism that was trying to be built between the two sides to also give assurances to the US when it comes to the highly enriched uranium, when it comes to the Strait of Hormuz, when it comes to these really critical points that we know the US Needs to see in order for there to be any potential deal. Which then of course brings us to the fact that we are getting closer to 8:00pm Eastern tonight and potentially this escalation when it to attacks on civilian infrastructure. Because the headlines from the President just moments ago, the deadline won't be moved again. And quote, it is highly unlikely that the deadline will be moved and we're
- [08:40]
Joe Matthew
looking at 8pm Tuesday. Right. That's, that's the new deadline. So I guess. So it moved again. It's not, he says it will not move again from here. And by the way, the idea of war crimes and this gets people very upset. I've learned on social media it is a matter of the Geneva Convention when it comes to targeting civilian infrastructure. Of course we also know that the military, in this case the Revolutionary Guard is also using that infrastructure. So there's the argument. The President was just asked about it. He said, I'm not worried about, not worried about it. Is the direct, quote, war crimes allegations. A war crime, he said, is allowing Iran to have nuclear weapons. And I'm not sure how that exactly works, but Democrats are talking about this as the administration covering itself on this idea of bombing power plants and desalination plants.
- [09:28]
Tyler
What we've already heard from the administration in terms of, for example, the attack on the bridge is what you just outlined, that it's going to come down to the size and the scope in terms of the administration's defense of any actions because under international law, the military is allowed to strike civilian power plants and other key infrastructure, but only if it contributes to a military operation and civilian harm is minimized. But it's not definitely raising these legal and humanitarian questions and how the administration is going to navigate that going forward and just how wide scale these strikes could be. When you hear the president say things like we're going to bomb Iran back into the Stone Ages, that definitely ramps up the rhetoric. That ramps up. Yeah.
- [10:07]
Joe Matthew
Well, I'll tell you what, you're going to run over there now. So join us at the top of the next hour. We'll have Tyler at the White House. And we're going to bring you this news conference live right here on Bloomberg with the help of our great Washington correspondent on this Easter Monday. We've got a lot more to follow here, so. So stay with us On Balance of Power. I'm Joe Matthew in Washington. Nathan Dean will join us next as we get a sense of what's happening on the other end of Pennsylvania Avenue where they're anticipating a one and a half trillion dollar budget for defense. That's what the president says. Stay with us On Balance of Power. We'll have much more coming up after this.
- [10:43]
Cincinnati Insurance Narrator
If you follow markets, you know the value of long term thinking. You plan, you diversify, you prepare for volatility. But in life, even the best strategies can't prevent every bad day, a fire, a loss, a disruption that demands immediate attention. When that happens, what matters isn't just what you planned. It's who shows up. That's where Cincinnati Insurance comes in. For more than 75 years, they've helped individuals and businesses navigate life's toughest moments with care, expertise and personal attention. Together with independent agents, Cincinnati Insurance focuses on relationships, not transactions. Their approach is grounded in experience, follow through and trust built over time. Bad days happen. And when they do, you deserve an insurance partner who understands risk, respects what you've built and is ready to help you move forward. The Cincinnati insurance companies let them make your bad day better. Find an independent agent@cin fin.com you're listening
- [11:46]
Podcast Announcer
to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple CarPlay and Android Auto with the Bloomberg Business app. You can also listen live on Amazon Alexa from our flagship New York station. Just say Alexa.
- [12:01]
Joe Matthew
Play Bloomberg 11:30 with the latest on The Monday trade, which, considering the news we're talking about today, is looking pretty good, right? The s and P500 up 16 points. Oil prices barely higher. With an ultimatum less than 48 hours away of what the President calls all hell breaking out in Iran. I can't say anything else that he said because I'll get fired. But he's going to have a news conference coming up at 1 o', clock, top of the hour. Well, that's the schedule at least. He held four gaggles in the last hour on the South Lawn. Wow, look at that. That's our cool promo for everybody on YouTube. We really know how to do this, huh? This could be a stem winder. Or not. It does seem like he's in the mood to talk. I do wonder if they bring in the President's own Marine Corps band into the briefing room because the slow jam. The news that we saw earlier was fantastic. I feel like that should be a new element in this White House. Just a little jazz drums, some brushes, maybe. I mentioned I survived the weekend program when all of this stuff broke yesterday. First of all, we woke up on Sunday and I was sitting there with Christina Ruffini when we learned that the second pilot had been found. And the President's going to talk about this a lot coming up in the news conference. It's a harrowing tale. Something out of a spy novel, an action movie. Netflix probably has the rights already. I secretly wonder if that airman shows up in the Oval Office this week or today. Not so secret. That would be a pretty obvious move, right? To be seen with the President here. One thing I'll note, by the way, before we bring in Nathan Dean about the weekend show, James, do you know they. They've got merch, they have swag. They have like hats and mugs, T shirts and stuff. And I feel like it's time that we get some. For Balance of Power. Is it just me swag? Go on the terminal Balance of Power. We could do it different. We'll have something different. I say if they're going to go with hats, T shirts and mugs. I'm putting in for the first Balance of Power ashtray. I think this is something. Could be a collector's item as we embed ourselves in every smoky back room in Washington. Think about it. Get back to me. Because a lot of negotiations have to take place in those smoky back rooms if we are ever going to get the Department of Homeland Security open again. Do you know it has been 51 days now and people aren't even counting anymore because people are, well, getting paid. President has found money and there is a way forward, apparently with the help of reconciliation. And that's where things start to get kind of foggy with the idea of reconciliation 2.0. And then a big question about what happens with the next fiscal year's budget. The President wants a lot of money, the bulk of it for the Pentagon. And we're lucky to spend some time with Nathan Dean for his take on this. Bloomberg Intelligence senior U.S. policy analyst Great to see you. How was Easter?
- [15:07]
Nathan Dean
Good.
- [15:08]
I was good. Kids are happy, as happy as one could be.
- [15:11]
Joe Matthew
They still get in the Easter basket. Is that something that you stop at a certain age or.
- [15:14]
Nathan Dean
No, they still are.
- [15:15]
Joe Matthew
All right, good. You hide them, you leave them out.
- [15:17]
Nathan Dean
We hit them.
- [15:18]
Rick Davis
You hit them.
- [15:19]
Nathan Dean
Yep.
- [15:19]
Joe Matthew
And they were a sneaky Easter bunny.
- [15:20]
Nathan Dean
And they were up at 6, 630.
- [15:21]
Joe Matthew
Is that right? That's what you get, Dad. I was like, man, I would expect nothing less from America's debt. And I'm not sure where to start here because it's all kind of the same story, isn't it? Republicans arguing over money without the involvement of Democrats. So I guess we'll take it one by one. DHS when everybody comes back next week. Is this over?
- [15:41]
Nathan Dean
Well, I mean, look, President Trump signed an order saying that they Senator, or sorry, former Senator Mark Wayne Mullen, Secretary Mullen should use whatever within his ability to pay the dhs. Now look, that's a one time issue. You know, we could talk about the legality of, you know, doing circumventing Congress. Democrats aren't going to push on that. But ultimately somehow the DHS is going to get funded. And I do think that this strategy of embracing the Senate bill and then saying, look for ICE and Customs and Border Patrol, we're going to use reconciliation. I think that gets enough Republicans on board. Democrats can say, not our hands. We're washing ourselves of this.
- [16:15]
Joe Matthew
Yeah.
- [16:15]
Nathan Dean
And the Republicans move on to reconciliation. This is where it gets tricky though, because if you talk to Lindsey Graham, the Senator, the chairman of the Senate Budget Committee, he says two reconciliation bills, one Defense and National Security and Border Patrol, the next one, Save America, you got a 3.0. Next thing you know, Senator Rick Scott's like, no, I'm not going to do this because the Save America act probably won't get past the Senate parliamentarian and you're probably not going to get one after September 30, right before an election anyway. So, you know, what we've telling our clients is if you Start small. You, you think under 500 billion. This is just, you know, throwing out ideas. If you look at a bill that's probably under 500 billion, that's specifically tied to defense in Iran and so forth, it's feasible. Anything north of that, odds go much.
- [16:56]
Joe Matthew
It's pretty easy to get to a trillion, though, right, when you start talking to lawmakers.
- [16:59]
Nathan Dean
Exactly.
- [16:59]
Joe Matthew
I mean, they will try to do that.
- [17:01]
Nathan Dean
Every smoky room that you were talking about, every lobbyist in town is like, this is the vehicle. We're going to try and get this to the President's desk.
- [17:07]
Joe Matthew
Amazing. With that said, reconciliation also needs to play a role in defense budgeting here. How would, how would this happen? If the President wants a trillion and a half dollar defense budget, does it all come out of regular order or does reconciliation have to help?
- [17:23]
Nathan Dean
So in the, in that 1.5 trillion, 350 billion, it was earmarked for reconciliation?
- [17:29]
Joe Matthew
Yes.
- [17:29]
Nathan Dean
The rest was from appropriation.
- [17:30]
Joe Matthew
So what's the point of that?
- [17:32]
Nathan Dean
Honestly, you know, the point is.
- [17:33]
Joe Matthew
So it's not such a shocking number.
- [17:35]
Nathan Dean
I think it's also to just try and get, you know, these bill, like, look, they were able to get $150 billion through the one big beautiful bill of last year that wasn't really all that controversial. This actually sidesteps the Democrats. It's. President Trump would love the strategy of being able to say, look, I just don't want to deal with the Democrats. We're going to do it for you anyway. But what we're looking at it from an investor point of view is we're trying to see how much of this is tied to munitions, how much of this is tied to counter drone technology, how much of this can be allocated in the first year? Because if you get that cash up front, somebody like Lockheed Martin, rtx, Northrop Grumman, you know, from the investor point of view, that's going to flow into the defense contractors much quicker than something like a five, six, seven year program. So come April 21st, when we get the next round of these specifics, what we're going to be looking for is how much can you bank in the year one and year two? Because that's actually much more of an immediate hit to the.
- [18:26]
Joe Matthew
That makes a lot of sense. So would that suggest that maybe not all of this is factored into these defense stocks because they've been kind of hanging out with some big numbers we're talking about in Washington on the assumption that this is baked in, that people saw this coming?
- [18:39]
Nathan Dean
Well, you know, everybody loves to say, I don't care about the White House budget because they take it and they throw it over.
- [18:44]
Joe Matthew
That's right.
- [18:44]
Nathan Dean
Shoulder. Congress may even throw it into the can.
- [18:46]
Joe Matthew
Yeah.
- [18:47]
Nathan Dean
But a number will pass, whether it's appropriations, continuing resolutions or reconciliation. There will be a number. And that number most likely will increase from the $883 billion the Department of Defense got this year, not including the 150 from the one big beautiful bill. And then those numbers will ultimately fly down to the defense industry. I mean, look, this is the number one priority for President Trump at the moment.
- [19:09]
Joe Matthew
Yes.
- [19:09]
Nathan Dean
He's not focused on affordability. He's making statements like, I don't care states have to pay for Medicaid or Medicaid. Yeah, exactly. This is his number one priority. And you should see those priorities transform into the priorities of Congress.
- [19:22]
Joe Matthew
So if you're Raytheon or Boeing or Lockheed, these are boom times here. And I haven't mentioned the supplemental. So you've got a trillion and a half dollars coming. Presumably, if they can pass that budget, a good chunk of that will be in reconciliation. But there's another request, a supplemental request, reportedly at least to add 200 billion more. Is that still coming?
- [19:44]
Nathan Dean
Well, look, I think the request may come and I actually think it may be included here just because from the, from the standpoint of trying to get it through before the midterms, another supplemental request is just going to really make things messy. So I wouldn't be surprised if they just focused on what you could do in reconciliation.
- [19:59]
Joe Matthew
Got it.
- [19:59]
Nathan Dean
But there are going to be questions from GOP lawmakers saying, and Senator Kennedy from Louisiana, and I'm paraphrasing here, he's like, I want to see the candy or however he phrased it. You know, he does in that great eloquent way. You know, he's like, I'm not going to hand over the money yet until I see what it's actually used.
- [20:15]
Joe Matthew
Sure. Yes.
- [20:15]
Nathan Dean
So when President Trump says things that this is for Iran and other conflicts, I'm using the quotes. For those of you on the radio, you know, there are going to be questions from the Republican lawmakers saying, look, if we're going to give you this money, we need to know what it's earmarked for. I don't think the White House has really provided that level of detail to Congress yet. So we'll have to see how it plays over the next few weeks.
- [20:35]
Joe Matthew
So this is going to take up the rest of the year. Right. I mean, maybe there's some move on Crypto. But this will be essentially the final mission for the Republican controlled Congress until the midterms.
- [20:44]
Nathan Dean
Yep. And the key date here is the 4th of July because that's when President Trump wants it wrapped up, submitted to him so he can sign it on the 4th of July budget.
- [20:51]
Joe Matthew
That is for the budget he wants up by the 1st of June. He wants reconciliation on his desk budget by the 4th of July. Is that right?
- [20:59]
Nathan Dean
I think, I mean I, my take was that you would get all of it, you know, reconciliation package and stuff. But look, you know, the problem for the Republicans here though is this, is that they have to move quick because if you don't get something done by the 4th of July, you get into August, they're not here. You get into September, you're dealing with a continuing resolution to keep the government open. October, they're not here. And for every date past the 4th of July, those Republican moderates who would potentially be on board with something like embracing a war. I'm just throwing it. Pick whatever small group on the Republican side you want. They're going to be thinking about their own election chances and the prediction markets. As of this morning, cow she's contract out there is 83% chance the Democrats are going to take the House.
- [21:41]
Joe Matthew
Wow.
- [21:41]
Nathan Dean
And so if you're one of those 20 or so moderate law lawmakers on the Republican side, you don't want to take any vote that potentially could gamble that outcome. So any bill that doesn't pass within like April or May or get that momentum.
- [21:55]
Joe Matthew
Fascinating.
- [21:55]
Nathan Dean
Can really struggle.
- [21:56]
Joe Matthew
The stores closed after the Fourth of July. When you're out there with the family on the South Lawn watching the UFC fight at the White House, that will be the end of the legislative agenda is what you're saying.
- [22:08]
Nathan Dean
You know, it's either. Yes. I mean I was going to make a joke about the, the IndyCar race in August, but I don't plan, I don't plan to be here for that.
- [22:14]
Joe Matthew
I don't get. All right, it's going to be 120 degrees out here with IndyCar in Washington or people do people know what it's like around here in the summer? It's a swamp.
- [22:21]
Nathan Dean
I'm going to be telling my clients where all the bathrooms are and all the air conditioning are.
- [22:25]
Joe Matthew
You will. UFC does buy hand out like tickets to clients that can. I can get me into that thing.
- [22:31]
Nathan Dean
I'll look into it.
- [22:32]
Tyler
Okay.
- [22:32]
Joe Matthew
That sounds like a no. And on the swag, no one does swag better than bi. Right. Bloomberg Intelligence. Sometimes Nathan will wear it in. You guys have the backpacks. You guys have like all weather gear. I don't know. You probably have skis. I don't know what else you have. Could we do something maybe like a collab where we get like a merch go or so have you, have you put any thought into this?
- [22:54]
Nathan Dean
You know, next time we talk about AI and tech, I'll wear my bi hoodie. Hoodie.
- [22:58]
Joe Matthew
You have a bi hoodie?
- [22:59]
Nathan Dean
Yep.
- [22:59]
Joe Matthew
I think like a bop hoodie would seems like wouldn't be too much to ask. I don't know. I've talked to James about this. It's just never happened before. Thank you for being with us as always, Nathan Find Nathan's Podcast this is pretty simple. By subscribing to ours, we share the same news feed. This is how much we believe in Bloomberg Intelligence and America's Dad. Subscribe at Apple, Spotify and wherever you get your podcast the Balance of Power. And you'll get Nathan's Monday briefing as well. Is that right too? I didn't know that the merch stuck in the straight. We'll assemble our political panel coming up next. Rick and Jeannie are both with us on this Monday after Easter and we've got a lot to talk about as we count down to the news conference that they tell us is less than a half hour away. The President in the briefing room this time at the White House, and there is a massive collection of reporters standing by to pepper him with questions. Stay with us on Balance of Power. We'll have much more coming up after this.
- [23:57]
Cincinnati Insurance Narrator
If you follow markets, you know the value of long term thinking. You plan, you diversify, you prepare for volatility. But in life, even the best strategies can't prevent every bad day. A fire, a loss, a disruption that demands immediate attention. When that happens, what matters isn't just what you planned. It's who shows up. That's where Cincinnati Insurance comes in. For more than 75 years, they've helped individuals and businesses navigate life's toughest moments with care, expertise and personal attention. Together with independent agents, Cincinnati Insurance focuses on relationships, not transactions. Their approach is grounded in experience, follow through and trust built over time. Bad days happen, and when they do, you deserve an insurance partner who understands risk, respects what you've built and is ready to help you move forward. The Cincinnati Insurance companies Let them make your bad day better. Find an independent agent@cin fin.com.
- [25:00]
Podcast Announcer
you're listening to the Bloomberg Balance of Power podcast. Catch us live weekdays at noon and 5pm Eastern on Apple Carplay and Android Auto with the Bloomberg business app Listen on demand wherever you get your podcasts or watch us live on YouTube.
- [25:16]
Joe Matthew
We haven't seen them gather the pool yet, so things could run a little late and that wouldn't be a surprise if that happens. But that's not the only thing we're counting down to today. The presidential news conference in the briefing room about an hour later, 2pm Eastern time. And we might probably will end up with a fascinating split screen here as the President is speaking. The Artemis 2 crew is going to break the record for the farthest distance that any humans have ever traveled from Earth in space, to be clear, surpassing the distance that the Apollo 13 crew traveled in 1970. It's a long way around the moon. That will happen at 2pm Eastern Time, by the way, the official flyby of the moon happens today. And in that same hour, 2:45pm Eastern Time, the Orion capsule will start to turn and orient its windows toward the moon, allowing the crew to take photographs as they go around the dark side of the moon and lose contact with Houston. It's going to be pretty wild stuff. And we'll have a full recap of all of this for you on the late edition of Balance of power around 5pm Eastern time. They'll be getting right around the dark side of the moon while we're coming off the late edition here today. But the actual record when they hit the farthest distance traveled in space will be at 2 o' clock this afternoon when the president speaks. Will be curious to hear his tone and demeanor. He spent a good chunk of time on the South Lawn talking to reporters and people who were there for the Easter egg roll. He in fact, held four separate gaggles less than two hours before a news conference inside the White House. So it's unclear exactly whether we'll get a lot more news, whether he's answered all the questions that he intends to. But the rhetoric has certainly been running hot ahead of another ultimatum. The deadline is tomorrow night, 8:00pm Eastern Time. Tuesday, he added a day for Iran to sign the ceasefire and to reopen the strait. Iran has already today said it rejects the ceasefire proposal that it received. And so when the president gets on Truth Social, he says Tuesday will be power plant day and bridge day all wrapped up in one in Iran. That is when this would take hold. There will be nothing like it, he says. And when we go back last couple of weeks, the rhetoric has been slowly notching up with this president of the United States.
- [27:46]
Donald Trump
Listen, you don't do a ceasefire when you're literally obliterating the other side. We are decimating. They've got no anything. They have to open up the Strait of Trump. I mean, Hormuz. We'll hit some bridges. We've got a couple of nice bridges in mind. We are going to hit them extremely hard over the next two to three weeks. We're going to bring them back to the Stone Ages where they belong. If there is no deal, we are going to hit each and every one of their electric generating plants very hard.
- [28:20]
Joe Matthew
And that's just the beginning. Now, producer James brings up a great point. Wonder if he pushed it back a day so as to not interfere with men's basketball national champion tonight, the Huskies. Well, who knows, Maybe he'll be asked about that in the Oval Office. Let's talk to the panel because we have a lot to prepare for and they're going to stick with us until we hear from the president of the United States. Bloomberg Politics contributors Rick Davis and Jeannie Shan Zaino are back together after the long weekend. Jeannie is our Democratic analyst and democracy visiting fellow at Harvard Kennedy School's Ashe Center. Rick is a Republican strategist and partner at Stone Court Capital. Jeannie, we've been hearing from Democrats and I guess that should be no surprise here. House Minority Leader Hakeem Jeffries slammed the president's post from yesterday morning as disgusting and unhinged. Something is really wrong with this guy, he said. Chuck Schumer, Senate minority Leader, said Trump was, quote, threatening possible war crimes and alienating allies, unquote. Do you agree with both of those remarks and what do you expect to hear from him today?
- [29:29]
Jeannie Shan Zaino
First of all, Joe, I have to say thank you. Producer James. Go Huskies. You know, I am a UConn Husky. So they got a tough road tonight, but they'll, they'll, they'll be okay.
- [29:40]
Joe Matthew
We see stores.
- [29:43]
Jeannie Shan Zaino
That's right. I should be wearing blue. They, you know, I think so many of the words we heard, vulgar, obscene, blasphemous, profanity, laced, obviously, Easter morning Passover, you know, insulting to Muslims, insulting to many Christians. From a political but strategic standpoint, it's also shockingly ineffective. And you know, there's been a lot of talk about Susie Wiles reported to have been concerned that the president is not getting good intel from his team, that it is, I think she said rose colored and she wants them to give him better information. That better information should be coming from experts in Iran and anybody who knows that regime and who understands the Iranian regime, which goes back civilizations, not just our 250 years knows that this kind of tough guy talk that Donald Trump likes to engage in with ultimatums and the rest, it's not going to elicit anything. The only way the strait gets opened is going to be the hard work of diplomacy. And that's where the president has faltered. And so to all of the other descriptors of this really unfortunate truth, social. And it's largely ineffective and it takes up a lot of oxygen but has very little in by way of getting what the President and what we all want, which is to get the Strait of Hormuz back open.
- [31:07]
Joe Matthew
We know what Iran's demands are for a permanent end of the war, not a cease fire, lifting of sanctions, reconstruction efforts, reparations, a new protocol for safe passage through the strait. And at least at one point they wanted the closure of US Bases throughout the Middle East.
- [31:24]
Jeannie Shan Zaino
East.
- [31:25]
Joe Matthew
There was a feeling of progress this morning, Rick. Iran has since rejected the cease fire proposal that was relayed through Pakistan. Does the president double down on the ultimatum here and do you think that he will follow through with this threat?
- [31:41]
Rick Davis
Well, you know, I think he almost has to now. He's done so many threats, so many deadlines that have passed. It's really kind of unexplainable because there's no feedback mechanism. Right. We're not really getting real time info, information between intermediaries on what Iran's attitude is toward all of this. But we see the continued strikes and we see the continued control over the Strait of Hormuz. So, you know, if Donald Trump is going to have any credibility around this sort of muscular approach to foreign policy that he's using when he threatens an attack, at some point he's going to have to initiate that. And I honestly can't imagine a scenario now where come the end of tomorrow there isn't a new level of heightened attacks on Iran in order to make good on these threats that the president has been making. Do I think it's the right thing to do? Probably not. But I think he's boxed himself into this point where I can't even imagine a taco situation right now where he just completely punts on the deadlines or says, I'm not going to, I'm not going to blow up your bridges and your electrical facilities and much, much more. I mean, I think something's going to ultimately have to be done to retain any credibility in this discussion.
- [33:11]
Joe Matthew
It's incredible that oil prices are lower right now. I mean, not by a lot, but the fact that they are not higher. I Guess is one way of putting it. Gini. Stocks are higher. This is a pretty calm market today, considering the conversation that we are having and the warning that came from Goldman Sachs analysts out today predicting the biggest oil crisis in history, global oil crisis with profound and highly destructive consequences. The new report asks, are we running out of oil? And concludes the answer is yes. How will this factor into the response to what the President says today? Jeannie,
- [33:51]
Jeannie Shan Zaino
it's so important. I mean, we're talking about Wall street and how the market's reacting. The President also has to be thinking about what Americans, everyday Americans are thinking as the price of a gallon of gas is what, 412 today, diesel, much higher. And of course, the impact on cost across the board. You know, I was just thinking, Joe, last year seems like a long time ago, we were told that the President was going to focus like a laser beam all of this year leading up to the midterm on the cost of living from housing. And he was touting the low price of gas. And it was, it was around 298. And yet he's done nothing on that yet this year except get us into a war which has raised maybe one of the good things that he had going for him, which again, was the price of gas. So it's all going to factor in. And I think, unfortunately, what we're likely to hear from the President, hard to tell, but it seems like what we're likely to hear from him is more bluster about how much the United States has decimated Iran's military capacity. But what the President doesn't seem to be able to or willing to appreciate is that this is not about what you're able to destroy. It's about what you're able to build in the aftermath and what the day after looks like. And at this point, as that report from JP Morgan showed, what this is likely going to look at, even in the best case scenario, is enormous economic pain, not to mention humanitarian disaster for a long period of time, even if this war ends tomorrow. And so the President just doesn't seem willing or able to appreciate that. And for all of his bluster, he keeps stepping over what should be the only way that he talks about this is to find a ramp off a de escalation ramp. But I agree with Rick when he says it looks likely we're going to see more and more escalation, which starts to be reminiscent of something like Vietnam.
- [35:54]
Joe Matthew
Wow. Well, you know, they are letting more boats through the strait and this might actually be why we are not seeing elevated Prices today, Rick, traffic through the strait at its highest levels. You might have seen this on the terminal since the early days, days of the war. More countries are securing these safe passage agreements with Iran. 21 ships transited over the weekend, which is far more than we have seen the last couple of weeks. The highest two day total since the first days of March. Of those vessels, 13 headed out into the Arabian Sea. Now, I realize in the short term this means, I guess, more oil on the global market, that that makes traders feel better, that makes the energy price stabilize a little bit. But the fact is, Rick, they appear to be in the process of establishing a tolling system. And in the long run, that cannot be good for energy prices. Right? Yeah.
- [36:44]
Rick Davis
They're calling it the Tehran Toll booth. And if you cut a deal with Tehran, you can get your ship out. And you're seeing a sort of a creation of a very unhealthy aspect of this war, which is, in essence, Iran's sovereignty over the Strait of Hormuz. And now they're charging for passage. There's never been an understanding that Iran had any access to the Strait of Hormuz other than through free shipping lanes. And that therefore has not distorted the economics of the oil trade. Now, Iran, in order to get your ship out, will charge you for it. And there's no transparency from what we can tell today about what those costs are or who's getting the money. Anecdotally, we're hearing, you know, the Iranian Revolutionary Guard are the ones who are actually servicing the toll booth. So are the ships getting out actually funding the military in their fight? This could be an incredibly consequential issue if the trade continues. And at some point, I think the US Government's got to decide whether we blockade the Strait of Hormuz in order to stop this kind of illicit trade with, with the Iranians.
- [38:07]
Joe Matthew
Well, this sets the backdrop perfectly for the news conference we're about to hear. Thanks for listening to the Balance of Power podcast. Make sure to subscribe if you haven't already. Apple, Spotify, or wherever you get your podcasts. And you can find us live every weekday From Washington in D.C. at noontime
- [38:25]
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