00:00Two things I just real quickly I'm curious about. Do you think the White House is still a risk to
00:05financial markets or with midterms looming, do you think that the president and his team are going to be very
00:11careful about unsettling things in the financial markets? Many have said he certainly keeps an eye on it. Maybe that's
00:18the checks and balances on the White House. And secondly, Kevin Warsh, if indeed he does become Fed chair, will
00:24he be an independent Fed?
00:27Yeah, no, I think I mean, look, I think that this administration and the president, you know, specifically has shown
00:34that, you know, they're going to he's going to kind of operate in his speed. And so I don't anticipate
00:39that we're going to see, for example, you know, this administration trying to lose momentum in what they're trying to
00:46achieve, which which means more of the same.
00:47Quite frankly, it's going to be, you know, it's going to be active. And that creates, you know, periods of
00:53volatility, uncertainty, whatever you want to call it. But I mean, I think the mission and what they're trying to
00:57accomplish is now crystal clear.
00:58They're trying to rebalance the economy on three different planes at the same time. And I think they're having some
01:03success with that. That's why we're seeing productivity increase already.
01:06We're seeing GDP increase. We're seeing earnings broaden out. And so as long as they're seeing results like that, I
01:12think they're going to stay the course with respect to the Fed independence.
01:16I mean, I have probably had a bit different view here. I mean, as far as I can tell, I
01:21mean, the Fed independence has been sort of fading for the better part of 20 years, really, since the financial
01:26crisis.
01:27And when I say independent, I don't mean they're under the thumb of the White House.
01:31What I mean is that they have to play ball in terms of their role to help the government fund
01:37itself.
01:38OK, and we saw that after the financial crisis. We saw that in 2012.
01:42We saw that, you know, when we had a regional banking stress in 2023.
01:47So the Fed is obligated to, you know, help financial markets operate.
01:53I mean, it's their third mandate. They even call it that.
01:57So so that to me is where the Fed independence has been challenged for the better part of two decades.
02:03And I think that's going to continue. I think the Fed and Treasury are going to work closer together.
02:07OK, similar to the, you know, 2000 World War Two period.
02:11And that's a good thing because that means they're going to figure it out.
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