Balance of Power: Weekly Washington Policy Pulse

Episode Date: October 27, 2025
Host: Joe Mathieu, Bloomberg
Guest: Nathan Dean, Senior Policy Analyst, Bloomberg Intelligence

Episode Overview

This week’s episode of Balance of Power features Nathan Dean with his traditionally deep dive into key policy developments in Washington. Covering everything from President Trump’s Asia trip and its impact on tariffs and rare earth minerals, to updates on the government shutdown, Federal Reserve regulatory moves, and coming changes at major financial agencies, Dean delivers a rapid-fire set of analysis and predictions on what will move the policy agenda this week. Notably, the episode highlights brewing trade issues, a forthcoming Supreme Court argument on tariffs, shifting bank capital rules, and the politics holding up farmer aid.

Key Discussion Points & Insights

1. President Trump's Asia Trip and China Policy

(01:03 – 04:40)

• President Trump departed for Asia, with major stops in Japan, Malaysia, and South Korea, and a significant upcoming meeting with President Xi Jinping of China.

  • Top issues at stake:
    • Rare earth minerals and associated tariffs
    • Ongoing investigations into tariff policy
    • Export controls, technology sector implications
    • Fentanyl supply chain
    • TikTok regulation and shipping trade
    • Soybean and agricultural trade, including potential for additional tariffs

• Key context: Trump floated a 100% additional tariff on China recently, which markets largely discounted until Treasury Secretary Scott Besant teased a possible framework for agreement over the weekend.

• Advice for keeping updated:

  • Bloomberg Terminal users can follow Beco Research/Geoeconomics
  • All listeners can check Bloomberg.com’s live blog for updates

Notable Quote

"So stay close...there's going to be a lot of stuff happening with President Trump's Asia trip."
— Nathan Dean (03:15)

2. Government Shutdown Stalemate

(04:41 – 07:05)

• No progress: House Republicans not in town, Senate Republicans and Democrats sticking to their talking points.
• Public opinion: Independents slightly blame Republicans more, but each side believes it has a political edge.
• Upcoming catalysts:
  • Next military and air traffic controller paychecks
  • SNAP (food stamp) benefits for 42 million Americans, hanging in political limbo
  • Airport delays mounting (more possible over holidays)
• Predicted timeline: Dean does not expect resolution before Thanksgiving; widespread disruptions (e.g., massive TSA sick-out) could force Congressional action.

Notable Quote

"If 42 million Americans can't get their Supplemental Nutritional Assistance Program benefits next week, that may change."
— Nathan Dean (06:23)

3. Federal Reserve: Bank Capital Changes & Stress Test Transparency

(07:06 – 09:40)

• Basel III Endgame:
  • Fed is eyeing a 3–7% capital requirement increase for major US banks.
  • Change in G-SIB (Globally Systemically Important Banks) surcharge methodology (from Method 2 to Method 1) could offset the increase, leading to an eventual net $58 billion capital reduction for top banks (Bank of America, JP Morgan, Goldman Sachs, etc.), per analysis by Arnold Kakuda.
• New proposal:
  • Fed advancing a “transparency stress testing” proposal—greater disclosure for banks, with little expected impact on capital.
  • Fed seeking industry feedback on stress test metrics.

Notable Quote

"If you take those two things into account, you're looking at...a net $58 billion dollar capital reduction if you take those two rules and put them together."
— Nathan Dean (08:46)

4. Fed Chair Succession and Financial Regulatory Appointments

(09:41 – 10:54)

• Treasury Sec. Scott Besant’s shortlist for Fed Chair:
  • Christopher Waller (current governor)
  • Michelle Bowman (current governor)
  • Kevin Morsh (former governor)
  • Kevin Hassett (White House National Economic Council Director)
  • Rick Rieder (BlackRock executive)
• Besant aims to recommend by Thanksgiving; Trump could announce by end of year.
• Mike Selig, crypto specialist and SEC advisor, nominated as Chairman of the CFTC—a win for the crypto industry but also palatable to major traditional market participants.

Notable Quote

"Things are going to move really quick now that we're going to be in November next week."
— Nathan Dean (10:52)

5. Defense, Tariffs, and Legislative Updates

(10:55 – 14:56)

• Senate Banking hearing: Confirmation for Travis Hill (FDIC), expected to provide insight but little drama.
• National Defense Authorization Act (NDAA):
  • Bipartisan talks continue despite government shutdown—traditionally non-controversial but not immune to macro-politics.
  • Aim for Thanksgiving agreement.
• Tariff politics:
  • Senate to vote on a privileged resolution overturning Trump tariffs on Canada and Brazil (mostly Democrats plus a few Republicans).
  • Likely symbolic, as House rule-changes block action, and even if passed, Trump would need to sign (unlikely).
  • Trump announced a 10% tariff hike on Canada (in response to Ontario ad), but no timeline—and direct meeting with PM Carney uncertain.

Notable Quote

"Even if this passes...it's symbolic. The House has actually sort of changed its rules a little bit so that there won't be a vote on this in the House... it's symbolic in nature."
— Nathan Dean (14:24)

6. Supreme Court Tariff Case and ‘Refund Chaos’

(14:57 – 16:07)

• November 5: Supreme Court oral arguments over Trump’s IIPA (Liberation Day) tariffs.
  • Holly Frome, Bloomberg, forecasts a 60% chance the court finds tariffs unlawful (affirming lower courts).
  • If struck down, could require $85-105 billion in tariff refunds, but logistical chaos likely given the shutdown and current refunding mechanisms.

Notable Quote

"You're looking at somewhere between 85 to 105 billion dollars worth of tariffs that there are going to be refunds for. But the question is, it's refund chaos."
— Nathan Dean (15:39)

7. Washington’s Role in AI and Farmer Aid Delay

(16:08 – 17:25)

• Major AI conference in Washington signals the capital’s importance to the sector—expect industry headlines this week.
• USDA farmer stimulus:
  • $10–13 billion in aid withheld until shutdown ends; further delay possible if standoff continues.
  • Previous years: $23B in 2018–2019; House Ag Committee GOP calls for up to $50B.
  • Some farm service offices and loan programs re-opened—but main stimulus will wait for shutdown’s end.

Notable Quote

"[The] $13 billion in stimulus as of right now, they said, is not going to come out until the end of the shutdown."
— Nathan Dean (17:10)

Memorable Moments & Quotes

On Weekly Surprises:

"When I was driving in this morning, I was like, I don't think we have much to talk about...and then as I started putting together the issues, I was like, yeah, we have quite a bit here."
— Nathan Dean (01:07)

On Tariff Uncertainty:

"Treasury Secretary Scott Besant said that there was a framework that was being discussed. Still to be determined on how much of a framework that actually is."
— Nathan Dean (03:30)

"Refund Chaos":

"I actually don't think the government has a way to issue refunds other than checks...I would not anticipate a refund program that's going to be very efficient, especially while the government is shut down."
— Nathan Dean (15:56)

Timestamps for Major Segments

• 01:03 – 04:40: Trump’s Asia trip—tariff issues, rare earths, and trade framework
• 04:41 – 07:05: Government shutdown status and looming catalysts
• 07:06 – 09:40: Fed capital rules and transparency proposals
• 09:41 – 10:54: Fed Chair shortlist, CFTC nomination, regulatory news
• 10:55 – 14:56: NDAA progress, Senate tariffs vote, Canada tariff news
• 14:57 – 16:07: Supreme Court IIPA tariffs case and potential refund chaos
• 16:08 – 17:25: Upcoming AI conference, status of farmer stimulus and aid

Episode Tone

Nathan Dean delivers policy analysis in an accessible, sometimes wry style, using anecdotes (“I go on radio a lot…I always have to say Treasury Secretary Scott Besant”) and real-time examples (his upcoming flight worries, Potbelly’s sandwich shop complaints during DC conventions) to keep what could be dry topics engaging and grounded.

For more:

• Access live policy calls with Nathan Dean by emailing nathan@ndeanlumberg.net
• For ongoing coverage, follow Bloomberg.com’s Washington section

This summary covers all major policy discussions and insights from the episode, omitting advertisements and repetitive closing statements.