Bloomberg Surveillance TV: July 31st, 2026

Summary

Bloomberg Surveillance TV: July 31st, 2026 — Detailed Episode Summary

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Episode Overview

This episode of Bloomberg Surveillance TV, hosted by Jonathan Ferro, Lisa Abramowicz, and Karen Moscow, features in-depth conversations about the latest in global finance, economics, and geopolitics. The team is joined in-studio by key figures from the private investment sector, notably Mike (of Ares Management), Bill Dudley (Former NY Fed President), and General Robert Walsh (Academy Securities), to dissect record fundraising in private markets, debate the Federal Reserve’s controversial policy approach, and analyze escalating tensions in the Middle East. The episode is marked by candid, nuanced discussion and incisive questioning from the hosts.

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Key Discussion Points & Insights

1. Ares Management: Record Fundraising & the AI Opportunity

(00:41–11:29)

Main Themes:

• Record $36B quarter in fundraising
• AI as a driver of productivity and margin improvement within finance and portfolio companies
• Navigating crowded trades and over-diversification in private markets
• Continued strength in private credit and investor demand
• Deployment pace and market constraints on "dry powder"
• Lessons from cycles: The importance of diversification and experience

Discussion Breakdown:

• AI’s Impact on Investment and Operations:

  • Mike details Ares’s strategy: deploying AI across the company and portfolio to drive efficiency, with a notable 100 bps margin increase YoY. (“We’re obviously deploying AI across the entire enterprise. We're seeing significant efficiency.” — Mike, 01:45)

• Private Markets Diversification:

  • Ares targets horizontal and vertical diversification — across asset classes and capital structure. Their credit funds, for example, contain 900–1,000 line items, minimizing risk from any single investment.
  • “The way that we think about private markets is we want to be up and down the capital structure, debt to equity…horizontally diversified across all the different private market asset classes.” — Mike, 04:39

• Private Credit Outlook:

  • Despite predictions of collapse, Ares sees strong fundamentals: non-accruals under 2%, healthy cash flow (+10%), and high interest coverage. Institutional interest is accelerating.
  • “Any time there’s a narrative that’s that loud you’ve got to at least ask yourself, you know, what is it that they're looking at? We don’t see it.” — Mike, 06:14

• Deployment Dynamics: "Dry Powder":

  • The $170B capital reserve—once a multi-year deployment—now aligns with annual deployment rates due to faster capital turnover.
  • Significant CapEx needs from hyperscalers ($750B+) are making capital scarcer, leading to widened spreads and slower project pipelines.

• Lessons & Moral of the Story:

  • Mike emphasizes the importance of experience and mixed exposures. ("Be diversified number one, ... combination of smarts and experience through cycles is ultimately important." — Mike, 10:51)

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2. Federal Reserve Policy Critique with Bill Dudley

(12:11–19:08)

Main Themes:

• Critique of current Fed leadership under Chairman Kevin Warsh (as per Bill Dudley’s op-ed)
• The pitfalls of vague communication and outsourcing monetary policy to markets
• Forward guidance vs. reaction function clarity
• Implications for market volatility, credibility, and future Fed actions

Discussion Breakdown:

• Fed Communication Shortfalls:

  • Dudley critiques Chair Warsh’s lack of clarity, especially regarding dissent and reaction to data ("There really was virtually no information about how the Federal Reserve is thinking about monetary policy..." — Bill Dudley, 12:39).
  • Emphasizes the market’s loss of faith, reflected in yield curve moves post-Fed.

• On Forward Guidance:

  • Dudley clarifies he is not advocating for endless forward guidance but for a clear reaction function (“You don’t want to know what the Fed’s monetary policy reaction function is. That’s the real problem.” — Bill Dudley, 13:37).

• Market Volatility: By Design or Not?:

  • Argues that engineering volatility is a poor way to tighten conditions (“It's a very inefficient way of tightening financial conditions. You're driving up risk premium in markets. That's a deadweight loss to the economy.” — Bill Dudley, 15:05).

• Credibility, Policy Tools, and Next Steps:

  • Expresses doubt that balance sheet reduction can substitute for rate increases; expects greater pressure for a policy move in September, possibly a rate hike if credibility is not restored.
  • “If it's a jump ball in September, you almost need to tighten now because you have lost credibility over the last couple of months.” — Bill Dudley, 17:29
  • Warns about the risk of confusing the market with inconsistent moves and signals.

• Political Motivations or Policy Experimentation?:

  • Dudley doubts current Fed actions are politically motivated, seeing them more as a misguided attempt to let markets dictate policy (“Markets do not price to what the Fed should do. They price to what they think the Fed will do... the interest rate path is indeterminate.” — Bill Dudley, 18:34)

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3. Geopolitics: Escalation in the Middle East with General Robert Walsh

(20:12–23:49)

Main Themes:

• Regional isolation of Iran following Hamas’s agreement to disarmament
• Iran’s asymmetric strategy: broadening conflict through proxies
• US and allies’ military and political options in response

Discussion Breakdown:

• Worsening Regional Dynamics:

  • The Gaza/Hamas agreement is a blow to Iran, increasing its isolation. Iran responds by trying to widen the conflict through attacks via proxies (Houthis, Shia militias, etc.).
  • “Iran’s asymmetric approach is to try to widen the war, put more pressure on the US and the US’s partners in the region.” — General Walsh, 21:39

• US Strategic Options:

  • President considering both escalatory military options (e.g., broad regional strikes or isolating strategic military points) and diplomatic avenues.
  • “The President’s desire is to get back to getting a deal...what we’re seeing is that the President again kind of settled things down, stopped those attacks to see if negotiations could continue.” — General Walsh, 22:09

• Potential for Further Escalation:

  • Options range from targeting missile/drone bases to potentially a broader regional campaign if initial pressure does not move Iran back to negotiations.

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Notable Quotes & Memorable Moments

Ares Management & Market Dynamics

• On AI Transformation:
  • “We're obviously deploying AI across the entire enterprise. We're seeing significant efficiency. We had a 100 basis point margin increase in the quarter year over year.” — Mike (01:45)
• On Portfolio Diversification:
  • “You may see 900 to 1,000 line items [in our credit funds]. So we're not going to have any single exposure really drive the long-term performance.” — Mike (04:39)

Federal Reserve Critique

• On Fed Communication:
  • “There really was virtually no information about how the Federal Reserve is thinking about monetary policy...” — Bill Dudley (12:39)
• On Forward Guidance vs. Reaction Function:
  • “The only time you really need forward guidance is when you're at the zero lower bound for interest rates...The rest of the time... it inhibits the Fed...” — Bill Dudley (13:37)
• On Credibility Restoration:
  • “If it's a jump ball in September, you almost need to tighten now because you have lost credibility over the last couple of months.” — Bill Dudley (17:29)

Geopolitics & Middle East Security

• On Iran’s Strategy:
  • “Iran’s asymmetric approach is to try to widen the war, put more pressure on the US and the US’s partners in the region.” — Gen. Walsh (21:39)
• On US Options:
  • “I think the options he’s got now is... to go much larger and really try to increase the number of attacks...along the ways of what we were doing earlier in the war...” — Gen. Walsh (22:09)

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Important Timestamps

• Ares Management & Private Markets:

  • [01:25] Mike joins to discuss record fundraising and AI strategy
  • [05:49] Discussion on resilience of private credit market, performance
  • [09:01] The reality of "dry powder" and deployment rates

• Fed Policy Critique:

  • [12:11] Bill Dudley joins, criticizes new Fed communication strategy
  • [13:37] On need for clear reaction function, not just guidance
  • [15:05] Is volatility by design a viable Fed strategy?
  • [17:29] What Fed must now do to recover credibility

• Middle East Escalation:

  • [20:12] Gen. Robert Walsh assesses the risk in Iran/Gaza
  • [22:09] US president’s options in a dangerous environment

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Tone & Style

The episode balances analytical rigor and practical perspective, blending technical analysis (especially from the portfolio management and central banking guests) with the human insight and tactical thinking brought by General Walsh. Language is straightforward but informed, with an emphasis on clarity for Bloomberg’s investment-savvy audience.

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Summary produced for those who need the heart of the episode—without any of the ad fluff or non-content segments.

Transcript

[Karen Moscow]

Get the news you need in just 15 minutes.

[Mike]

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[Jonathan Ferro]

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[Karen Moscow]

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[Mike]

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[Karen Moscow]

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[Jonathan Ferro]

This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferro along with Lisa Abramowicz and Annmarie Horden. Join us each day for insight from the best in markets, economics and geopolitics. From our global headquarters in New York City. We are live on Bloomberg Television weekday mornings from 6 to 9am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen and as always, on the Bloomberg Terminal and the Bloomberg Business App. So here's the latest this morning. Ares reporting at earnings be highlighting another record quarter of fundraising with over $36 billion of inflows. The CEO Miketti writing our clients continue to reward us due to our strong and consistent fund performance across our strategies. Mike joins us now in the studio for more. Mike, good morning. Good to see you.

[Mike]

Good morning. Good morning.

[Jonathan Ferro]

I wanted to start with a quote of yours from earlier this year when things were pretty difficult with the software issue and you said something really important. You said the following. If you're going to underwrite a narrative of AI disruption, you also then have to say, well, what does that mean for the productivity and margin improvement for the rest of your book? I think that's a good place to start. Where are you seeing value being created right now?

[Mike]

It's I'm glad I said that. So if you, if you look at the way that Aries is playing the AI transformation, it's what are we doing within the data center and digital infrastructure space? What are we doing within our portfolio companies? And what's that? Productivity uplift. And then what are we doing within Ares proper to either improve our investment outcomes or profitability? So if you start with Ares first, we're obviously deploying AI across the entire enterprise. We're seeing significant efficiency. We had 100 basis point margin increase in the quarter year over year and, and we've guided the street to expect 0 to 150 basis points per annum. A fair amount of that is technology efficiency. That's getting created re underwriting processes, re underwriting systems and we are seeing uplift that is also translating into increased productivity and margin expansion within the portfolios. So if you were to look across our private equity portfolios, our private credit portfolios, cash flow growth is still plus or minus 10%. If you look at corporate earnings, I think you're going to see that that's generally the theme. And then within investment space, we are doing our best to stay diversified in the way that we're attacking the digital infrastructure opportunity. Big investors in data center development, but I think our approach has tended to be a little bit more targeted. We're doing 150 to 300 megawatt deals, hyperscaler adjacent in large tier one markets like Tokyo, London, Sao Paulo, pre leased, 12 to 15 year terms with escalators. So we have probably shied away from some of the secondary and tertiary markets and stayed away from some of the frontier model type of opportunities. Two, we're a very large lender in the infrastructure debt space and you're seeing that rolling through our earnings as well in terms of the fundraising and deployment momentum there. So we are one of the largest institutional lenders to other developers and that's been a bright spot. Three, we have a large asset based finance business and we're squaring off with a lot of the banks on srts and portfolio purchases where we're helping them free up liquidity on their balance sheet to continue to deploy into the opportunity. And then four, we have a very large infrastructure equity business where we're investing all around the digital ecosystem, transmission, fiber, battery, storage, etc. So we're kind of attacking it from all angles. But our view has been we want to be global, we want to be diversified and we want to have the full capital structure so that we can move around where we see best relevant.

[Jonathan Ferro]

Second word, I want to dig into diversified and I'm open to the reality check. I'm just going to say it feels, it feels like a lot of people are in the same trades. They're in asset backed infrastructure debt on the credit side and they're taking direct equity investments into say software and models. How do you avoid all the crowding that we're starting to see in other

[Mike]

places in digital, specifically with your firm? Yeah, I think the key in this, this goes, if you look at our earnings this quarter and you put the numbers up on the screen, what screams out to me is just the broad based nature of the business and the diversification. And so the way that we think about private markets is we want to be up and down the Capital structure, debt to equity so that we can move around and find relative value in response to rates or the economic environment. We want to be horizontally diversified across all the different private market asset classes, secondaries, private equity, real estate, infra. And you'll see investor appetite and our own view of relative value shift. And then within the funds we want to be highly, highly diversified. So if you look at our credit funds as an example, you may see 900 to 1,000 line items. So we're not going to have any single exposure really drive the long term performance. And I think that's key. There is a risk in any investment business that you're over diversified and I could argue maybe a thousand loans in one fund is over diversified. But it's served us well over the 30 years that we've been doing it.

[Karen Moscow]

Earlier this year everyone was saying there's going to be a complete collapse, that the private credit space is going to go down in flames because of the retail investors, etc. And your, your compatriots and yourself are coming out and saying whoa, not at all. We're seeing actually performance hang in there and people are still interested. Where are we in that in terms of interest from investors in private credit? How much the pendulum has shifted to the infrastructure and some of the other plays instead?

[Mike]

Yeah, look, we've, we've been pioneers in private credit and people have been saying it's, it's a bad place to be for 30 years and it's grown pretty consistently and compounded at a very attractive rate of return. So any time there's a narrative that that's that loud, you've got to at least ask yourself, you know, what is it that they're looking at? We don't see it. If you look at our direct lending business, which is kind of where I think people are focused, our non accruals across the direct lending business right now are inside of 2%. That is well below the historical averages. Our cash flow growth is plus or minus 10% as I said, and that's been consistent. We are seeing healthy interest coverage, very low loans to value. So the fundamental performance is exactly what was underwritten. A lot of the noise, you know, I don't really know where it's coming from. It could be coming from a competitive set of capital that doesn't like to see the flows. It could be, it could be software related. But there's nothing that we see in the portfolios that would indicate that that credit's weakening. And the interesting thing to your question, and you see it this quarter in earnings. The institutional demand for private credit is probably accelerating right now because they're seeing spreads widening and they're seeing capital leave the market and feel like there's an opportunity to come in and take share. So our last two credit funds, both in asset based finance and opportunistic credit, hit their hard caps and we had demand well in excess for the hard caps and we raised those funds quicker than any prior vintage.

[Karen Moscow]

It's fascinating to hear you talk about the performance of these loans and it's something that we've seen from the likes of Capital One and some of these other credit card companies. The credit performance is hanging in there. It's actually hanging in there better than people expected. Where are we in this economic cycle based on some of the activity that you're seeing in portfolio companies?

[Mike]

Yeah, it's, I, if anything you could say growth is moderating slightly. So if we're growing cash flow portfolio wide 9 to 10% a year ago, that may have been 11 or 12, but it's not negative. So you are slow growth. I mean, where are we? It's still early. And back to the first question from Jonathan. You're seeing margin improvement, productivity gains, balance sheets are healthy, companies are delevered. So it feels pretty good. And it's just not in corporate. We see it in the real estate market too. We're well leased, we're seeing rent increases and, and strong demand. So everything feels really good right now.

[Karen Moscow]

We're talking about leverage coming out of the system. In public markets there was some concern that maybe leverage was building or there was some frothy types of behavior. In private asset management, you talk about $170 billion of dry powder. I'm just wondering how you see some of these structural dynamics in the market in terms of ability to finance, some of the huge bills coming and willingness to do so.

[Mike]

Yeah, Look, I think 170 billion of dry powder feels like a lot, but it's actually kind of in line with our annual deployment. So if you look at the 36 billion that we raised this quarter, we also deployed 36 billion. That's actually a lot quicker than historical used to take us by two to three years to deploy our dry powder. We're now almost on an annual raise and deploy. I think with regard to the digital capex, obviously there's 750 plus billion dollars of capex demand coming from the hyperscalers. That is a large amount of capital. It's beginning to quote, unquote, overwhelm the markets. And that's showing up in two ways. One, spreads are widening which is not necessarily a bad thing and people want to get paid more for the risk that they're taking and it's probably slowing the pace of the belt. So you know, when you're thinking about deployment this is not happening overnight. These are two to four year projects. You've got energy constraints, you've got community engagement and civic discussions that have to go well. So, so there's a lot that's actually constraining the coming online of some of this capex. So at least as we're sitting here today those numbers don't concern me. But your, your point is a good one. And going back to, you know, a year ago people were beginning to ask where is all this capital to come going to come from? The capex numbers have doubled and the market is, you know, is trying to keep pace but it's going to be a little bit of a constraint I think.

[Jonathan Ferro]

I thought you were about to ask whether Leopold had given Mike a call when you talked about a dry powder.

[Karen Moscow]

Maybe, I mean maybe you were the one that was the grim reaper Colleague, did you hear some. I love those quotes. Did he give you a call? Breaking news and we've got any lessons

[Jonathan Ferro]

from that as you see that story and react?

[Mike]

I don't know, I don't know enough to know. I think if anything, maybe back to your prior question is be diversified number one which is, you know, don't be fully exposed to one, one factor or single correlation. I think that's, you know that that might be the lesson. It might be that experience matters and that you know, combination of smarts and experience through cycles is ultimately important and I think, you know, I think about our own 30 year journey and all the lessons that we've learned navigating cycles and painful ones things and you'll learn lessons the hard way and so that, that, that might be the moral of the story to stay with us.

[Jonathan Ferro]

More Bloomberg Surveillance coming up after this.

[Karen Moscow]

Air is entering its most consequential phase where scale, safety and sovereignty will determine who leads and who lags. Join Bloomberg Tech in London on November 2nd and 3rd as global leaders across business, finance and policy examine the defining trade offs shaping the future of AI. Thank you to our presenting sponsor Salesforce and supporting sponsors Ida Ireland and Schneider Electric. Learn more at BloombergLive.com TechLondon.

[Jonathan Ferro]

The former New York Fed president Bill Dudley with a new op ed titled Walsh. His approach to Fed policy is deeply flawed. He writes outsourcing monetary policy to financial markets is a terrible Idea Walsh missed an opportunity to rebuild the Fed's credibility. Bill joins us now for more. Bill, welcome to the program. We were all watching that news conference and it didn't start terribly and then progressively it just got more and more confusing. What was the point in that news conference where you sat up and said this is weird?

[Bill Dudley]

Well, it's weird when you're not explaining why people are dissenting. Yet the committee is deciding on no change in policy. There really was virtually no information about how the Federal Reserve is thinking about monetary policy, how the Federal Reserve is likely to react to incoming information in terms of how they adjust monetary policy. The silence of Warsh was really quite toughening. And the financial markets basically that thumbs down. I mean the fact that the 30 year yield went up, the 10 year yield went up and 2 year yields dropped really was a sign that there was a loss of credibility in that from that press conference.

[Jonathan Ferro]

Bill, I want to highlight a distinction because I think it's important and it's in the body of your op ed and I want to say it for you, you're not against reducing forward guidance. This is important. I think that the complaints about the people doing the complaining often are around the idea that somehow we still want our hands being held, that we want to hold on to the post GFC communication architecture. And Bill, I don't think that's what your criticism is about.

[Bill Dudley]

No, I mean I wrote a group of 30 paper that we published in April and one of the recommendations was to get rid of forward guidance. The only time you really need for guidance is when you're at the zero lower bound for interest rates and you're trying to provide additional monetary policy stimulus. But the rest of the time it really just sort of inhibits the Fed and Prime makes the Fed a little bit, bit slower to react to incoming information. But what, but that doesn't mean you don't want to know what the Fed's monetary policy reaction function is. And I think that's the real problem. Washington in its comments is conflating the two and they're very, very different. If I don't understand how the Federal Reserve is going to react to incoming information, I can't price financial markets correctly. And it's also creating a lot of uncertainty about what policy is going to be in the future. You know, the market response on Wednesday was really the Fed credibility has lessened. And I think this is a really ongoing Kevin Warsh's part. You know, I think one of the problems here, I think is he's overpromised and under delivered. You know, he's talked about, you know, sea change at the Fed, radical regime change, but then the markets are actually getting very, very little in terms of guidance on how to think about the new Fed.

[Karen Moscow]

Bill, we were discussing about whether maybe some of this was by design. There is going to be more volatility. There has been more volatility both at the front end and the long end. In response to, to every economic data point and comment coming from anyone on the Federal Reserve as a result of an absence of some sort of reaction function articulated by the FOMC chair, do you think that this could be by design to help reduce inflation without hiking rates?

[Bill Dudley]

I don't think this is a really great strategy for a couple of reasons. Number one, it's a very inefficient way of tightening financial conditions. You know, basically you're driving up risk premium in markets. That's a deadweight loss to the economy. Number two, how well can you actually control the market process to generate the impulse that you want to slow the economy down sufficiently? And lastly, you know, it's a credibility issue. I mean, if to the extent that the markets reacted the way they did on Wednesday, that's telling you that people are more worried about the Fed's resolve to do the job. That means inflation expectations are less well anchored than they were prior to the press conference. That in itself makes the Fed's job harder.

[Karen Moscow]

Bill, how high is the bar for there to be. I don't want to say mutiny, but the, the bulk of the FOMC committee voting against the chair, potentially with the governors joining suit, I don't think we

[Bill Dudley]

would get to that. I think at that point horse would throw in the towel and vote with the majority. I can't imagine a situation where the chairman allows himself to be outvoted by the committee because if you, if you had that result, it basically would be saying that the chairman has lost control of the committee. And that's just not a very good look for any head of any organization.

[Jonathan Ferro]

But he was also vague about the inflation target. That was confusing. Too vague on the inflation target, whether they'd respond to it and what tool they would use to respond. Can I pick up on that last point, Bill? He's flirting with the idea of using balance sheet instead of short term policy rates. Short rates, I think. What do you think?

[Bill Dudley]

Well, I think the problem here is that even if you reduce the balance sheet, you're probably going to be able to reduce it by about $1 trillion or so. If you want to continue to have an ample rate reserves regime. And I think the commitment of the committee is to maintain the apple reserve regime. And then the question is how much restraint is shrinking the balance sheet by $1 trillion going to be. It's actually very, very small. So the idea that, you know, you pull on this balance sheet lever and that allows you to not have to tighten monetary policy, I think is very much exaggerated.

[Jonathan Ferro]

It's obvious that for the market the primary tool is still the policy rate because you can see that in the reaction this morning to the sensitive economic data we got moments ago on wages. They came in hotter labor costs, you saw yields rise at the front end of the curve. But we talked about this all morning. The credibility here. You say credibility has been here, others agree with you. Let's talk about how you repair it. When you do a job really badly, sometimes you have to do more than you otherwise would have had to do. How much more do they need to do now at this Federal Reserve to regain that credibility?

[Bill Dudley]

Well, I think you have to follow up talk with action.

[General Robert Walsh]

So I think that what's happened in

[Bill Dudley]

financial markets over the last last 72 hours or so basically increases the pressure on the Fed to act in September. If, if it's a jump ball in September. You almost need to tighten now because you have lost credibility over the last couple of months.

[Karen Moscow]

Do you think that it increases the chance of a larger than expected rate hike?

[Bill Dudley]

It's possible, but I don't think that you're so far away from your inflation objective that you know, you need sort of shock therapy. If the Fed Reserve did 50 basis points, move, move, that would be in my mind a little bit of a sign of desperation. Why didn't you, why didn't you hike in July, you do 50 basis points in September? I think that's actually is a confusing narrative as well.

[Karen Moscow]

What do you think the overall motivation is here? I mean we've been talking about this and a lot of people said Kevin Warsh is a 100% respected person by the mainstream of the financial markets, by the establishment. Do you think this is just rookies error, the classic kind of first press conference of a Fed chair, or do you think that there is some political motivation here trying to dodge the ire of the President going into the midterm elections?

[Bill Dudley]

I can't judge that, but I generally think no, he's not trying to do it to sort of mollify the President. I think he really does believe that somehow outsourcing this to financial markets will improve the conduct of monetary policy, but you can't outsource it to financial markets for a very simple reason. Markets do don't price to what the Fed should do. They price to what they think the Fed will do. And so if you try to markets, all you have is the markets looking at the Fed, the Fed looking at markets, and the interest rate path is indeterminate.

[Jonathan Ferro]

It's the spike that we were talking about yesterday.

[Karen Moscow]

Yeah.

[Jonathan Ferro]

Which is everyone's point at each other.

[Karen Moscow]

And I saw a couple versions of that said.

[Jonathan Ferro]

I'm sure you did, but it's good to see you. Thank you, buddy. Phil Dante, that president. Thank you very much, sir. Appreciate your time. Stay with us. More Bloomberg surveillance coming up after this.

[Mike]

As markets move and headlines break, what matters most is context. A Bloomberg subscription gives you unmatched reporting, sharp analysis, and powerful tools that help

[Bill Dudley]

you connect the dots.

[Mike]

Visit bloomberg.com podcastoffer to learn more.

[Karen Moscow]

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[Jonathan Ferro]

Joining us now, General Robert Walsh of Academy Securities. General, welcome back to the program, sir. Is this situation now more dangerous than it was four or five months ago?

[General Robert Walsh]

I think overall the situation Iran has gotten much more dangerous. But I think the last piece that Tyler added, the piece on Gaza, makes it very significant that the, the larger Middle east peace plan, the Hamas disarmament agreement, which will take some time, is a big step in that it's another step in isolating Iran. And what we're seeing throughout the Middle east, more and more of these pieces are coming into place that is isolating Iran more and more. This was a case where the IRGC asked Hamas to delay this decision and not continue with it. And, and in fact they, Hamas went against this and agreed to the disarmament. Now the devil's in the details and we'll see where it goes, but this is a step in that direction. And now the larger question is the situation with Iran getting more dangerous. It obviously is in the sense that we've gone from a phase of really deterrence where a cease fire was in place. We've kind of gone back and forth with these attacks between Iran and the US have been occurring. But now what you're seeing is Iran again using their asymmetric capabilities to try to spread the fight and extend this throughout the region by bringing in the Houthis into it, bringing in the Shia Iraq militias into it, attacking the Saudi Arabia oil fields. So a little bit of a widening going on here, and that's Iran's asymmetric approach, is to try to warden it, widen the war, put more pressure on the US and the US as partners in the region.

[Karen Moscow]

General, what do you think the next steps will be for the US and its regional partners, partners as the war does broaden out more significantly?

[General Robert Walsh]

It's a great question, Lisa. I think the President has a lot of options on the table right now. I think the President's desire is to get back to getting a deal. He continues to say that over and over. And you saw where we had this 13 day significant escalation by the US and this was now for the first time, instead of a tit for tat approach, the US Used a disproportionate approach where if Iran hit us with three missiles, we went back and hit them with, you know, hundreds of attacks on targets throughout the Gulf region or throughout Iran. But with that, now that what we're seeing is that the President again kind of settled things down, stopped those attacks to see if negotiations could continue. And I think the options he's got now is, you know, one that Admiral Cooper has on the plate is to go much larger and really try to increase the number of attacks more along the ways of what we were doing earlier in the war, but again, really trying to isolate the Strait of Hormuz by attacking, you know, command and control facilities, drone and missile capabilities that can strike the Straits of Hormuz, that would probably be a phase one approach, see how that goes. And if you can get Iran to kind of back off and try to, you know, push their will to the point where they want to get back to the negotiating table, get to a cease fire, that would be a step. If that doesn't work, I think another option on the table is to go really big. And that would be to try to isolate the country itself, to really significantly go after probably bringing in Israel, go after infrastructure targets throughout the region.

[Jonathan Ferro]

This is the Bloomberg Surveillance Podcast bringing you the best in markets, economics and geopolitics. You can watch watch the show live on Bloomberg TV weekday mornings from 6am to 9am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen. And as always on the Bloomberg terminal and the Bloomberg Business app.

[Karen Moscow]

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[Jonathan Ferro]

thanks to the demand for which toy car brand?

[Mike]

Hot Wheels.

[Karen Moscow]

Hot Wheels, Hot Wheels, yes. Are those still a thing?

[Jonathan Ferro]

I've stepped on many of those with my children when they were young. Those are not very much on bare feet.

[Mike]

Yeah.

[Karen Moscow]

The Bloomberg this Weekend Podcast. Subscribe today on Apple, Spotify or wherever you listen.

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