[Music]
Live from Washington DC, this is Balance
of Power with Joe Matthew.
President Trump gathers his cabinet and
the press. Welcome to the Tuesday
edition as the president tries to reset
the narrative today after moving to fire
Federal Reserve Governor Lisa Cook.
We're going to bring you to the White
House for some of this conversation
along with an update from Bloomberg's
Tyler Kendall who's standing by for us.
We'll also be joined by constitutional
lawyer Robert Mcwarter as President
Trump threatens to send National Guard
troops next to Chicago. A lot to cover
as well with our political panel.
Bloomberg Politics contributor Rick
Davis and Democratic analyst Kristen Han
are with us. It's all after a look at
Wall Street. Let's get things started
with Charlie Pellet at world
headquarters in New York and the Tuesday
trade. Charlie,
>> hi. Thank you very much, Joe Matthew.
Lisa Cook says yes she is taking it to
corp right now we have got the Dow the
S&P NASDAQ all advancing little change
though that is the key takeaway at this
hour with the S&P high by seven right
now up one/10enth of 1% we've got the
Dow little change as I mentioned up
three points NASDAQ advancing 43 points
up 2/10en of 1% our MAG 7 index also
little change lower right now down under
one/10enth of 1% Nvidia of course a
member of the MAG7 index it ahead of
earnings tomorrow up now by 1%. The
10-year yielding 4.26% the 2-year 3.68%.
Gold up 510 of 1% 3383 the ounce and
West Texas Intermediate crude down 2.2%
6336 a barrel. Apple says it plans to
hold its fall product launch on
September 9th when the company is
expected to introduce an iPhone 17
lineup that will include a new skinnier
version of its signature device. Apple
shares right now up by 3/10en of 1%.
Balance of power continues. Now back we
go to Washington once again. Your host,
here he is, Joe Matthew. All right,
Charlie. We always thank Charlie Pellet
here starting us off with his look at
Wall Street. And we'll have more on the
Tuesday trade from Charlie Pellet a bit
later on this hour. We've got our eyes
on the bond market as well as the stock
market following this Lisa Cook news.
The president moving to have the Federal
Reserve governor fired. Of course, she's
not leaving that easily, and her lawyer,
Abbe Lel, has already said today he will
be filing a lawsuit to challenge this
move. It's unclear exactly what grounds
the president would have to fire Lisa
Cook as she has not even been charged
with anything. Uh, allegations, yes,
coming from the administration, but the
DOJ criminal investigation into her
mortgage applications is ongoing. The
president has been speaking for almost
an hour from the White House inside the
cabinet room. He's gathered his cabinet
secretaries and they're doing a bit of a
roundroin as we've seen uh basically on
a monthly basis since the president has
been in office getting updates on the
agencies that of course correspond here
when he starts taking questions from
reporters and Bloomberg is in the room.
We're going to bring you there for this
conversation. I will note the name Lisa
Cook I believe has not been mentioned uh
correct me if I'm wrong James since this
has begun. So we'll have reporters bring
us to the news when that begins. To that
end, Tyler Kendall, Bloomberg,
Washington correspondent, is on the
north lawn of the White House right now
to kind of bring us up to date on things
so far. Tyler, we've had a flurry of
headlines. The president talking about
everything from furniture tariffs to
Russia's war in Ukraine. What else do
you have?
>> Yeah. Hey, Joe. Well, it really seemed
that President Trump started his remarks
in the cabinet room to tout his economic
and industrial policies. As you
mentioned, tariffs have come up a lot in
this conversation. and he name checked
some of these private sector companies,
most notably related to automakers,
including Ford and Stellantis,
applauding their efforts to reshore
supply chain, saying that that will help
to bolster the US workforce. Interesting
to point out that he did note that he is
expecting the next jobs report to show
that government jobs are down. Something
that he applauded and private sector
jobs are up in his words. uh just to
sort of uh drill down it seemed like
from him on how uh this idea of
reshoring supply chains he says is going
to help the domestic economy. He also
importantly pointed out that furniture
tariffs are coming soon. Now we knew
that this is going to be h happening.
It's been widely expected after
President Trump posted about it last
week on Truth Social, but perhaps he put
a little bit finer of a point on this,
saying that they are going to be
substantial as we wait to see what those
rates are going to look like. I'll also
put on your radar that President Trump
did say that they are still in active
negotiations with some of these trading
partners when it comes to the trade
framework, but that they did make
progress with South Korea. The South
Korean president was here yesterday. But
interesting to hear the president
highlight that he is working to get
market access for US agricultural
products with our trading partners. And
I bring that up because this has
repeatedly been a sticking point in some
of these negotiations, Joe, including
South Korea, but also importantly with
India. We know that this has really been
a a point of contention between the two
trading partners which have not been
able to reach a more preferential rate
when it comes to Indian exports. And of
course, all eyes are on tomorrow when we
are expecting those tariff rates to go
up even higher when the Trump
administration imposes its so-called
secondary tariffs on India over imports
of Russian energy supplies.
>> As I mentioned, spinning a lot of plates
today with the help of Tyler Kendall.
Tyler, thank you so much for weaving all
that together. Bloomberg's Washington
correspondent will have more at the
conclusion of the cabinet meeting as we
try to have a better sense of where the
president is pushing the agenda today.
Some of us thought he would begin with
remarks about Lisa Cook, but he's
apparently going to wait for reporters
to ask about this move, an unprecedented
move. He would be the first president to
fire a Fed governor if in fact this
happens with many questions about how
that would work. And we'll continue to
explore them a bit later on this hour,
not only in this conversation uh with
the president of the United States, but
Kitty Richards from the Groundwork
Collaborative is set to join us a bit
later on this hour as well. There was a
time we were using the term posi
commatatus here on the program on a
daily basis. That was when President
Trump deployed National Guard troops on
the streets of LA. And there was a
question about whether they may be
deployed elsewhere, confounding many at
the time because of course the idea
behind the Posi Kamatus Act is that US
military troops cannot carry out
civilian law enforcement actions. It's
become a daily uh fact of life for us
here in Washington DC. of course over
the past couple of weeks with National
Guard troops and many agencies, I
believe a dozen federal law enforcement
agencies uh helping to control the
streets of Washington and what the
president describes as a crimeinfested
city. Of course, this comes against the
backdrop of crime in Washington
following to a 30-year low according to
the Department of Justice. But the fact
that these National Guard troops are now
armed has brought a new wrinkle to this
conversation as has as well the
president's threats to send National
Guard troops to other cities. Next
expected to be Chicago. This also will
likely come up in this conversation
today with reporters. It certainly did
yesterday and it's why we wanted to get
back on the line with Robert Mcwer,
constitutional law attorney, practicing
criminal defense civil rights lawyer
from Maricopa County, Arizona. He's with
us once again on Bloomberg TV and radio.
Mr. Mcwarter, it's great to see you once
again. What does the Posi Kamatus Act
think about armed National Guard troops
on the streets of DC? Does it depend
entirely on what their mission is? If
they're helping to protect federal
property, for instance, as opposed to
conducting arrests here in the federal
city.
>> What does it mean? Well, first of all, I
heard you had a birthday, Joe. Happy
birthday. Um,
>> thank you.
>> Sure. uh posi commatatus you know you
know those old western television shows
where it said we got to form a posi to
to go after the bad
>> that's posi commatatus it's it's an old
kind of common law back in the middle
ages it's power of the county it's
getting the county together to go after
bad guys that's where the term posi
comes from it's posy commatatus
um so he's trying to invoke this kind of
you know lawlessness we got to get a
posi together to go after lawlessness in
DC, the president has more power to do
so because ultimately the president is
the head of the National Guard in the
District of Columbia. When he wants to
go into the states like Chicago, no, the
governor is the head of the National
Guard. And the way that normally works,
except for extraordinary circumstances,
is the governor has to request like
there's a big flood or something and you
need national help to deal with it.
Well, then the governor will make the
request or or whatnot. So, this is the
legal basis he's trying to go on. And
you got to note, I mean, most of these
cities he's going after, crime rates are
falling. But more importantly, the
Republican controlled major cities, he's
not talking about putting the National
Guard in with them. It's only the
Democratic controlled cities that he's
doing, which really makes this as just a
political move and a political stunt and
kind of underscores the ugliness of, not
the necessity to fight crime.
The president has uh used federal title
32 orders uh to get us this far because
this is in Washington. And to your
point, he's got a little more leeway
here in the federal city with armed
National Guard troops. Do the guns make
a difference, Robert, or that's just a
development that the Secretary of
Defense decided to move on?
>> I think it's just more for show than
anything else. It's this continual image
that we're tough. Now what the guns do
is you now have people who are not
trained in police work. These these
people, these men and women of national
guards who have done great service for
this country in in foreign wars and Iraq
and Iran, etc. Um Iraq really um that's
what they're trained to do. Now they
have guns in a situation where they're
not trained. Police get a great deal of
training of when they can pull their
firearms and when they cannot. And
that's because the police serve us the
citizens. Well, now you have people that
are trained in a totally different way
of using their firearms walking around a
city street with firearms. Um, frankly,
when Donald Trump says he wants to clean
up Washington DC, I think that's a
really bad look for Washington DC street
because generally speaking in a
democracy, we don't want armed troops
all over the place. It's a bad look for
democracy and the chance for something
happening um is just much greater when
you have a bunch of guns with people not
trained to use them in this context.
They are trained to use their firearms
but not in this context.
>> We're showing people that view on
Bloomberg TV and on YouTube right now.
Some images taken uh night before last
when these troops were first deployed
with uh rifles and sidearms. Governor JB
Pritsker is waiting for something to
happen in Chicago. He's telling Trump
not to come, not to deploy the troops
there. Robert, he made a post on Twitter
to Donald Trump and his administration.
If you hurt my people, and remember
there are of course massive political
overtones here for what could be a
future presidential candidate. Nothing
will stop me, not time or political
circumstance, from making sure you face
justice under our constitutional rule of
law. a political bluster maybe, but does
the governor have any power to keep the
troops out of his city?
>> Well, it's going to be a power to go to
courts. Um, you could have a if you get
to the situation where people are having
this militia versus that militia. Well,
the last time that really happened was
the American Civil War, and I don't
think we exactly want to go back to
that. Uh, remember the firing on Fort
Sumpter in April 1861 was the South
Carolina National Guard essentially that
started the Civil War. So that's kind of
what he's invoking. Look, a president
can invoke the National Guard for a
national interest um and to protect a
federal building. The best example of
that was during the civil rights
movement in Little Rock, Arkansas, where
President Eisenhower nationalized the
National Guard to affect the national
interest of civil right, which was
directly under the dictate of the 13th
amendment, the 14th amendment, and
ultimately the 15th amendment, but
mostly the 14th amendment. So there was
a direct federal interest and a changing
value in this country about the
importance of fairness and education and
racial equality. That's where we're
talking about the National Guard coming
in and Donald Trump just saying, "Oh,
I'm going to fight crime." Well,
fighting crime on American streets
belongs to mayors and governors who are
crying for maybe federal help to have
more police officers to hire. That's why
you get crime,
>> more programs, not sending in the
National Guard, which is all a show, so
the Secretary of Defense can play with a
gun.
>> That's where we are.
>> And hearing those calls from governors
and mayors as well. Robert, I have to
ask, I never thought I would be asking
you about the Federal Reserve, but hey,
you're on Bloomberg, so come on in. The
water is warm. The president wants to
fire a Federal Reserve governor. No one
has tried this uh from the Oval Office
before. It's unclear if he has the
grounds. She's not been charged with
anything. What do you make of this salvo
that came from the White House last
night?
>> Well, Joe, okay, I'm going to risk being
a little too constitutionally geeky
here, so I'll apologize right now.
>> Okay, let's do it.
>> What this really is about is your
concept of the presidency of the United
States. Donald Trump and his people talk
about a strong unitary executive. Okay,
the Constitution gives all executive
power to the president. the president to
article one starts with the executive
power of the United States will be
vested in the president of the United
States but it's always been known to be
what's called a weak unitary so there
are checks and balances on the president
he wants somebody to be a commerce
secretary or you know secretary of state
they got to go get approved by the by
the United States Senate which is the
legislative branch right
>> well okay so they created the Federal
Reserve Board as an independent agency
and there's been several independent
agencies because presidents have a great
interest in making the economy look good
while they're president, but they don't
care when the other guy has to make the
economy look good, who follows him,
right? Which can be really terrible for
the economy. I mean, Donald Trump wants
to make interest rates as low as
possible, which might be great to make
him look good, but that could be
terrible and could cause inflation to
increase and cause ultimately employment
to go down. So, the Fed was created to
be independent of that. And the
constitutional question is, is Donald
Trump's strong executive theory enough
to give him that kind of control over
the independent Federal Reserve? Now,
economists are horrified at that idea
because they want that decision to be
independent. And I I think the real
question for Republicans who want to go
after Cook just as an excuse. I think
the case looks pretty protextual against
her. But the real question is, you know,
if Barack Obama was doing this, would
the Republicans like it? Because, you
know, you want to give the president all
this power. Well, Republicans aren't
going to always be in power. At least I
I hope not. And I hope Democrats aren't
always in power because we have a better
system when there's balance, right?
Well, do you really want a Barack all
these people yelling about Donald Trump
should have all this power? They were
the same ones saying that somehow Barack
Obama was having an imperial presidency
because he issued a executive order
related to DACA kids. So remember, every
constitutional argument, you got to look
at sauce for the goose. Sauce for the
goose is sauce for the gander. And you
want to argue your position in the
Supreme Court. Well, just think if
there's going to be another president
there someday who you don't like so
much. Do you really want him to have
that power? Or do you want what the
framers intended, which is a
constitutional system of checks and
balances with a weak unitary executive,
not a strong one. So that's the
underlying geek.
>> Fascinating.
Leave it to Robert Mcwarter to be our
best guest on the Federal Reserve today.
How did I know this was going to happen?
Um,
>> so Robert, she's fighting back. She's
got Abby Lel. They're going to they're
going to file suit. Does this go to the
Supreme Court?
>> Oh, very well could be. And here's the
issue in the Supreme Court. You know the
Supreme Court has been very this Supreme
Court over the objections of for
instance Justice Kagan Sotomayor and
Justice uh Jackson have been very
accommodating to the president taking
over these independent boards. They were
created to be independent. Well, in the
opinions the conservative justices says,
"Well, this wouldn't apply to the
threat." And Justice Kagan in one of her
descent said, "Well, why doesn't your
reasoning apply to the threat?" You
know, this is coming down if the Supreme
Court underscores upholds the
independence of the federal board, which
I believe they should. Well, then it
begs the question, gee, Supreme Court
justices, you like the Fed board to be
independent because this helps the
structure of our economy and the way
business works. But when it's consumer
protection board, you don't like it.
Maybe it's just because you don't like
the consumer protection board and you
can say Donald Trump can get rid of
these people. But we want to protect the
threat from Donald Trump, even Donald
Trump. It makes these conservative
justices on the court look pretty bad.
But they should uphold the independence
of this because the world needs an
independent central bank for the
greatest economy in the world, which
still is the United States. And that's
why people invest their dollars with
their foreign money in US dollars, which
strengthens our economy because we have
a independent federal board. And 95% of
all economists will tell you exactly
what I just said.
>> Robert, the president is talking to his
cabinet as you and I are having this
conversation. And producer James is
keeping me tabbed uh keeping me posted
uh on on what's happening in that room.
He just suggested the death penalty.
We're doing this in real time, so just
walk through this with me here. Uh
suggesting the death penalty for
murderers in DC. Here's the quote. If
somebody kills somebody in the capital,
we're going to be seeking the death
penalty, and that's a very strong
preventative, and everyone that's heard
of it agrees with it. Is is this
something he could do?
>> Uh, dubious. He would have to have an
act of Congress. And I think the best
response to that is, well, what about
the u what happened on January 6 with
the with his supporters who killed
Capitol police officers? Maybe they
should get the death penalty now. Um,
you know, again, let's go with sauce for
the goose. You want to start doing that.
The death penalty, if you look at it,
um, in terms of its efficacy, it doesn't
reduce crime. Um, there are too many
human behavior connected with crime, is
far too complicated. People don't
usually make that calculus when they're
in the middle of a situation where death
results or commit the crime of homicide.
Um, I have represented many people
accused with homicide and I can tell you
none of them all thought that clearly at
the time they were committing that act.
>> So this is another get tough thing
interesting
>> and what he's talking about with
juveniles and any cash bail are just
things that are going to hurt people and
not make anybody any safer in the long
run.
>> All right, before you go, Robert
Mcwarter, you saw they've been setting
up checkpoints here in Washington. uh
ICE, uh it could be another federal
agency, Department of Homeland Security,
DEA. In some cases, we're seeing uh
officers identified. Tell our listeners
and viewers what they should do if they
run into one of these checkpoints in the
District of Columbia.
>> Well, you got a couple choices. What you
have a right to do is say, "I don't want
to talk to you. I don't have to talk to
you. I can tell you my name. I, you
know, if they ask, what's your name?"
You could, you're pretty much required
to say that. But you don't have to give
in on the statements. Remember, we have
the fifth amendment to the constitution
which says you not be compelled to
incriminate yourself in any way. So you
can say go pound sand. The trouble with
that of course is if you just want to
get to the grocery store, you might not
want to spend the next three hours
messing around with some checkpoint. Um
so you have the right to assert your
rights, but there's going to be
consequences if you do so. Ultimately,
you'll you'll not suffer it, but they
can detain you and that that that could
really make your day a mess, right? Um,
so that's where we are. But you got to
say something. Why are these DEA agents
running around in Washington DC when you
have a fentanyl crisis in Arizona and
DEA agents are being taken away from
protecting
>> the America from the flow of fentanyl
across the Arizona Mexico border.
>> It's a it's a total reworking of
priorities simply because he wants to
try to get his deportation numbers up.
And frankly, Biden's numbers are still
beating him.
>> Yeah, it's a very real question. Do I
have to roll my window down if I get
stopped at a checkpoint?
>> Serious.
>> What the law says is your information
about your name is not constitutionally
protected.
>> Do you have to roll your window down?
It's probably a good idea because they
might do nasty things to you if you
don't.
>> Okay.
>> Um, you know, there's constitutional
rights and then there's if you really
want to, you know, go ahead and get eggs
at milk at the grocery store, right? But
that being said, you have no you have no
constitutional obligation to incriminate
yourself in any way. And you don't need
to answer that question. Are you a
citizen? But of course, like I said, if
you want to get to the grocery store, a
lot of people just say, "Yeah, I'm a
citizen. Why?" So,
>> we always learn a lot. It's an
experience with Robert Mcwarter. Great
to see you again, sir. Uh, from the law
office of Robert Mcwarter live on
Bloomberg TV and radio. They're still
going in the cabinet room and we may
well bring you back if this gets to
questions and answers with the president
of the United States. That's what we're
interested in. Moving the needle on
policy and specifically today, the story
surrounding his attempt to fire Lisa
Cook. The Cracker Barrel post though on
Truth Social was quite remarkable.
Remembering they rebranded the store,
they took some of the brick out of the
restaurant. I don't know if the rocking
chairs are still there. You go to the
Cracker Barrel when you're on a road
trip or something like that. You play
the games. You hang out on the porch.
I'm wondering if Donald Trump has ever
sat on a rocking chair on the porch of
Cracker Barrel because he did get into
this. You know, there's been big
backlash over the new logo. They took
the old guy next to the barrel off the
logo.
President on Truth Social this morning,
Cracker Barrel should go back to the old
logo, admit a mistake based on customer
response, the ultimate poll, and manage
the company better than ever before.
They got a billion dollars worth of free
publicity if they play their cards
right, he says. Very tricky to do, but a
great opportunity. Have a major news
conference today. Make Cracker Barrel a
winner again. Remember, in just a short
period of time, I made the United States
of America the hottest country anywhere
in the world. One year ago, it was dead.
Good luck.
Indeed, the company knows that it
stepped in something here. It issued a
statement just about 24 hours ago
saying, "In the last few days, you've
shown us how deeply people care about
Cracker Barrel. You've also shown us we
could have done a better job sharing who
we are and who we always will be. Yes,
Uncle Hersel is no longer on the logo.
You wonder if they bring him back along
with the barrel as well. We are going to
bring back our political panel as we
wait to hear from President Trump. Maybe
he'll get into this. It's a publicly
traded company after all. Rick Davis is
Bloomberg politics contributor,
Republican strategist and partner at
Stone Court Capital. joined on our panel
by Democratic strategist Kristen Han,
partner at Rock Solutions. Kristen, what
does it tell you when the
commanderin-chief is obsessing over
Cracker Barrel before he walks into a
cabinet meeting like this in terms of
his frame of mind and ability to set the
agenda?
>> Um, well, first of all, I I like you was
totally distracted in the break over the
big news of the day, which is Taylor
Swift and Travis Kelce getting married.
Um, so I'm going to reorient myself
here. No, I think it's he's he he's he's
very distracted and he and I guess it
also goes to show as a company um you
never know when you're going to get in
the crosshairs of the president of the
United States. Um, you know, which is
very interesting and in some more
serious ways, you know, he's he's
weighing in in kind of like a socialist
manner in in some of our largest
companies based here in the United
States of America. So, you know, as a
comms person, I know that their their
team over at Cracker Bell has probably
been, you know, spending overtime trying
to figure out, you know, how how
important this actually is and how much
they need to pay attention to it. But,
you know, it's, you know, you have a
team of of people as the president of
the United States whose job is to, you
know, orient you and make sure that you
have the information that you need and
that you want going into meetings like
this. But these are very um you know,
we've been waiting for big news of the
day to come out and discussions to be
had and and there's just a lot of
rambling and not a lot of coherence to a
lot of what he was saying, at least the
opening remarks. So,
>> it's a little concerning.
>> I'm just going to bet Yeah. I'm going to
bet Rick Davis has spent time on the
rocking shares.
>> Yeah.
>> At the Cracker Barrel. But Rick, you
know, a lot of people may not realize
that is a publicly traded company and
Cracker Barrel is up over 5%. It it
popped on this news immediately. The
president's talking about us. Is this
good or bad to have the president of the
United States weighing in on the
marketing decisions of a publicly traded
company? So far, it's actually helping
the stock.
>> Well, I think more importantly, it's
unavoidable. Donald Trump is going to
weigh in on anything he wants to weigh
in on and it's cheap, right? He just
pounds it out on True Social and away it
goes. Uh why he picked Cracker Barrel
today, nobody will ever know. Honestly,
I think it's a huge step up from how
much water does a toilet have. I mean,
those days hopefully are over. Uh, but
uh, yeah, I mean, you know, look, he's
he's in a different spot than any
Republican who's occupied the presidency
since Teddy Roosevelt. Teddy Roosevelt
was a trustbuster. He had a lot of
concerns about corporate America. Donald
Trump, he wants government to be the in
largest investor in corporate America. I
mean like he is breaking down every
barrier between government and and the
the private sector that you can possibly
make. When I was in the White House
working for Ronald Reagan, we weren't
allowed to distinguish one company from
the other. They were all considered good
American companies. We couldn't promote
one over the other. And look at where we
are now. We're not only promoting
companies over one another, but we are
taking government taxpayer funds and
investing them in these companies. So,
strap it on. You're out for a wild ride.
American uh the corporate CEO today has
more to worry about than he's ever had.
>> Strap on the feedback maybe here. I
don't know your thoughts on uh for
instance the stake in Intel. Uh Kristen,
a lot of investors have questioned
whether this is in fact capitalist or or
conservative, which the White House says
is only fair. We're finally getting
something for the money that we gave
them. That was taxpayer money. Maybe
shareholders feel a little bit
differently about that. But we also know
that there could be a lot more where
this came from. Is the government going
to take a stake in Cracker Barrel?
I mean, who knows, right? Like Rick's
right, there's no way of knowing. Um,
you know, but it it's it's an
unprecedented way of kind of the the
government meddling in the private
sector um in ways that we haven't seen
before. And I would totally agree. you
know, if you're um if you have a
president of the United States that is
sometimes unhinged and um definitely
unpredictable, you know, I would be
concerned as a CEO um with him weighing
in uh on not just that, but also the
decisions that you're making every
single day, marketing and otherwise, um
that can have real uh a real impact on
your bottom line. So, um you know, I I I
agree, you know, strap in. We we don't
know exactly what'll happen uh going
forward with this president.
>> I hate to belabor this whole thing, but
Cracker Barrel's statement says that
Uncle Hersel will still be uh on the
menu on our road signs, Rick, and
featured in our country store. He's not
going anywhere. He's family according to
this very deliberately, very carefully
written statement from the company. Was
this some kind of woke thing to change
the logo or am I confused? I don't even
understand h how a barrel is woke.
>> Uh I I think it was the removal of Uncle
Hershel that was considered a woke move.
And obviously they're very sensitive
about Uncle Hershel's involvement in the
company's promotions. If I were them,
like some of the other companies that
have gotten into the uh target zone
here, I'd immediately start uh getting
uh actors to endorse my product and do a
little advertising because they're on a
roll right now. I mean, a lot of
eyeballs.
>> Exactly.
>> Uh going to Cracker Barrel and uh now
I'm actually getting hungry just talking
about this. I think I don't know if
there's one in Manhattan, but I'm going
to seek it out right now.
Man, if there is one in Manhattan, I
need to know what neighborhood decided
to open a Cracker Barrel. Um, uh, yeah,
you know, Cece has it right. Can't even
be an old man anymore without being
woke. Um, I don't know where this is
going, but it's something that we'll
keep tabs on. We're going to go back
into the cabinet room here in a moment,
and it looks like the Secretary of
Homeland Security is going to be
talking. Kristen, it brings us back to
our conversation we just had with Robert
Mcwarter. Big questions about whether
the National Guard is going to be
deployed in Chicago. Will that be the
next city to see troops?
>> I mean, it's certainly where it seems to
be going. And I know that, you know,
we've all heard reports out of the White
House that they've been focused on
Chicago as as the next city. And um
clearly the delegation uh and the
governor are hearing the same thing
because, you know, you've seen their
press conference um all united, the
mayor, the governor, um Senator Durban,
and other members of the delegation. So,
you know, I I I do think it is, but it
it's not the same as being in Washington
DC. Um you know, for the reasons we've
discussed on this show a little bit
earlier. Um, so I think you'll see a lot
of push back um from not just the
elected officials, but some of the just
um folks in the communities.
>> Yeah. Well, let's hear from the source.
Secretary Christine Nome is speaking
right now. Let's bring you back live to
the White House to hear from the
Secretary of Homeland Security. This is
live on Bloomberg.
>> Make sure we know who's coming into this
country. You've arrested and brought to
justice hundreds of thousands of illegal
aliens of criminals that have
perpetuated violence against American
people. Sir, you've had 1.6 million
people voluntarily go home to their home
countries that were here in this country
illegally. Because of your strong
message and you enforcing the law, they
decided to go home on their own so that
they could come back the right way
someday and be American citizens. But
what I think is one of the most
remarkable statistics is that under Joe
Biden's administration, 88% of new jobs
went to foreignb born individuals. Um,
under your administration, 2.5 Americans
have jobs today that they didn't uh
under the previous administration. And
they have those jobs because you created
opportunities. Uh, you made this country
safe. You opened up the economy. You
enforced the law. Now people can get up
and provide for their families and go to
work every day and be confident in that.
And the the last thing I would say is
that it's incredibly important to know
that every one of those illegal aliens
that has gone home uh they were costing
us about $8700 to $9,000 a piece and
what they were taking out of our social
programs, out of social security. Uh
you've saved this country billions of
dollars, about 15 billion dollars just
in what those illegal aliens were
costing us in social programs. Uh I've
cut over 450 different contracts at the
Department of Homeland Security. Uh
we're getting rid of corrupt ones, ones
that were not um efficient for
taxpayers, weren't focused on our
mission of keeping us safe. Uh and we've
also renegotiated and brought in our
biggest vendors and said, "You have to
do better." and we've saved the
taxpayers over $13 billion doing that as
well. So, we're continuing to be
accountable with taxpayer dollars, but
sir, focused on doing the mission of
what you've committed, and that's to
keep us safe and to make sure we put
Americans first.
>> Well, great job. And great job at the
border. We had millions and millions of
people coming. And to think three months
in a row, zero.
>> Incredible.
>> That's some job. Thank everybody. And
Pete, good job. Not surprised. Thank you
very much, Chris. Please,
>> sorry about that, Mr. President.
Mike,
>> we're going to keep going around the
table here in President Trump's cabinet
meeting, having just listened to Christy
Gnome, uh, with a lot of questions that
we have about the deployment of National
Guard troops in cities including
Washington DC, whether that would expand
to other cities. Her remarks, as you
just heard, were focused entirely on
border security. We still haven't heard
from many of the principles at the
table, including several uh who will
have key remarks here for our audience
on Bloomberg, including the Treasury
Secretary Scott Bessant, as well uh the
Secretary of Defense Pete Hgsth sitting
right next to President Trump and the
Secretary of State Marco Rubio. A lot
that they could add to including uh the
deployment of National Guard troops by
way of Pete Hegth and of course the
potential uh for a Zalinski Putin
meeting that we may hear more about from
Marco Rubio. Following the Alaska summit
just over a week ago, we have not heard
many encouraging headlines when it comes
to Russia's war in Ukraine. Spending
time still with our panel, Rick Davis
and Kristen Han are with us as we walk
through uh the cabinet meeting that is
now approaching about an hour and a half
in length. These can be real
stemwinders. And as I mentioned, we'll
rejoin that conversation when some of
the principles begin speaking here.
What's going on today, Rick? The
president opened with a kind of a
meandering set of of of
pre-rearks, some written, some adlibd.
He talked about the economy. He took a
long turn on our military hardware, got
into some geopolitics, and then started
moving around the room with what, God
forbid, I referred to as some tertiary
agencies here. We haven't really gotten
to the meat of any of the the stories
that have been driving headlines in
Washington. Is that intentional? Is he
trying to change the subject today, or
is there something else going on? You
know, it's kind of hard to tell what the
news of the day is going to be in this,
as you say, me meandering kind of
statement by the president. It's almost
like he came uh just to sort of make
some opening comments. Uh none of the uh
stories being told by the cabinet
members about the accomplishments of the
Trump administration since the last
cabinet meeting seem to be newsy. Uh
it's, you know, statistics that we're
kind of aware of, uh things that they're
doing that are already in the news. Um,
so, uh, I'm kind of scratching my head
to figure out, um, what is it, uh, that
this cabinet meeting is about. Uh,
typically, uh, and I worked in cabinet
affairs in the Reagan White House, uh,
uh, you would have a message that the
cabinet was brought together to hear the
president articulate, a priority, uh,
something that you wanted the American
public to focus on, or something you
wanted to ensure that the government was
working on, uh, of the highest priority
by the president himself. Um, I'm I'm
digging for the pony today to try and
figure out what is it that that is uh
being conveyed today.
>> Yeah. What do you think about that as
well, Kristen? Why not open the session
if Lisa Cook is in fact the story today?
He sent out the letter last evening.
Cabinet room kind of looks like a
boardroom. Why not open this pointing at
the camera saying, "Lisa Cook, you're
fired."
>> I'm actually surprised. I'm not
surprised by the lack of a um a coherent
um and targeted message. Um a lot of
these cabinet meetings tend to be where
he sits around and everybody talks about
how wonderful he is. He seems to really
like to sit down and listen to that and
have the American people tune into that.
Um so this would be definitely
consistent with previous cabinet
meetings in in in that way for sure.
>> Great conversation with our panel.
Kristen Han, Rock Solutions, Rick Davis,
partner at Stone Court Capital and
Bloomberg Politics contributor with us
from the Fishbowl today in New York. Uh,
thank you both for the insights. Shares
of Cracker Barrel on the move. They're
up still over 5% as Kitty Richards
considers the benefits of the chicken
fried steak at her local Cracker Barrel.
She joins us now with a lot of questions
involving Lisa Cook. President says he
wants her fired. This may come up in the
cabinet meeting and we'll bring you back
to that when reporters start asking
questions. But we wanted to spend some
time with a senior fellow at the
Groundwork Collaborative, of course,
somebody we speak to around Fed
meetings, around Fed policy decisions,
uh, having been director of the state
and local fiscal recovery funds at the
Department of Treasury and the Biden
administration. Kitty Richards, welcome
back. It's great to see you. Do we think
that a Fed governor will actually be
fired because the president decided to
go there last night?
>> I think we're in uncharted waters here.
The Fed governor in question, Lisa Cook,
has indicated that she intends to sue.
Um, you know, the Supreme Court ruled uh
this summer on the ability of the
president to fire various agency heads
and specifically seemed to carve out
saying that the Fed was a different kind
of agency and that they were not going
to look kindly on attempts to fire Fed
board of governors members. But it's
anyone's guess how this is going to play
out. Um, I think what we are certain of
is that we're seeing a fairly
unprecedented attempt to influence the
Fed and not just influence the Fed, but
really make members of the board of
governors afraid, afraid that they're
going to face criminal prosecution in
addition to losing their jobs if they
don't tow Trump's line. And I think
that's pretty worrisome.
>> So, we've got the lawsuit that will go
in place today. This is going to take
some time knowing that she's not
actually been charged with anything.
there's a criminal investigation
underway, having been referred by the
administration. So, she says she will
continue to carry out her duties in the
meantime. To what extent will the market
have patience for this? I'm kind of
amazed at the lack of reaction today.
Investors don't care.
>> I'm also amazed by the lack of reaction
and I'm a little bit worried that
investors are getting complacent about
some of these really frightening moves
by the president. Um, and that some
might even be thinking, well, maybe rate
cuts are on the horizon. And so that's
good. We've seen month after month of
investors expecting rate cuts to be
right around the corner. Um not reacting
hugely when they haven't arrived. Um but
you know, I think that investors might
be really underrating the effect that
this can have on future not just
inflation but also interest rates and
the ability of the Fed to actually
control inflation and interest rates. If
you want cheap money, you can't be in a
position where globally investors are
concerned that this is not a place that
they want to lend money anymore.
>> We heard this morning from La Brainer,
who was on Bloomberg surveillance
talking about uh this move and and Fed
independence on a greater scale. Listen
to what she said.
>> This is not about an individual
governor. This is really an
unprecedented attack on the independence
of the Federal Reserve as an
institution. There is nobody in the
Federal Open Markets Committee, the
monetary policy setting committee that
can't be thinking, well, what does this
mean for me?
>> Almost exactly what you just said. The
idea then being that if he does follow
through on this, if President Trump gets
Lisa Cook fired, he gets a majority and
then the rate cuts begin. Is that how
the market might be viewing this? Is
that how he's viewing this?
>> I think that's how President Trump is
viewing this. I'm not sure that he's
going to get what he bargained for. Um,
and as I was saying, undermining trust
in the Fed creates problems for his
interest rate agenda, even separate from
whether he has a majority. Um, this is
also of a piece with other things that
the Trump administration has been doing
and that President Trump has been doing
on attacking and silencing critics, but
also career civil servants. Um, the
firing of the head of the Bureau of
Labor Statistics after a bad jobs day um
sort of kicked off this latest round.
But across the board, we're seeing Trump
put perception of um what's the economy
is doing over actually supporting a
strong economy that will deliver for
American workers and investors. And I
think that that is going to start
causing real problems. It's interesting
today uh in his opening remarks at the
start of this cabinet meeting he was he
was trumping how strong the job market
is which would not be an environment
calling for interest rate cuts right
>> have both that
>> that is one of the unusual things about
his approach he is job owning the Fed
and now you know threatening criminal
prosecution trying to pull down interest
rates while also claiming that the job
market is stronger than ever that is not
going to lead the Fed board to think
that they need to move quickly to cut
interest rates, especially when
inflation remains elevated well above
target and there's a lot of uncertainty
about the direction of inflation given
that it's ticking up and the Trump
tariff policies are really causing a lot
of turmoil in the markets for goods.
We're going to go back to this White
House event in a moment. So, I apologize
in advance uh once the principles start
speaking and the reporters get involved
here. But what do you make of the
reaction in in the curve? The idea that
longer term interest rates actually go
up in this scenario because people worry
about a longer term inflationary trend.
>> I think that's a real risk. And in fact,
by undermining people's sense of the
Fed's independence, you can have a sort
of self-reinforcing cycle there of
inflation expectations go up and concern
that the Fed won't move to keep
inflation in check, won't make
datainformed decisions about what
interest rates should be in the short
term. That can all drive up longun
inflation and interest rates in a way
that the Fed won't be able to control.
What would happen if we did cut to the
extent that President Trump is calling
for?
I think that the big lesson from what
Treasury Secretary Bessant just said is
also what we were talking about earlier,
how eager the Trump administration is to
say whatever will please Donald Trump
>> and make it seem as though the economy
is chugging along um and you know doing
better than it's ever done before. when
he talked about all of that additional
tariff revenue coming in, someone is
paying those tariffs and it's largely
consumers who were really depending on
this administration to bring costs down
as promised. And
>> JD Vans said it's the companies and
countries that have been taking
advantage of us that are paying
>> for the tariffs.
>> That's just not how these things work.
the we've got um retailers who have to
pay more for the goods that they're
bringing in. We've got reduced
competition, which in theory could
redown to the benefit of American
workers, but that's a long-term um
that's a long-term thing that isn't
magic. It would require strong labor
unions and strong bargaining power for
workers. And the Trump administration's
been undermining that. But the thing I
really want to focus on is Scott Bessant
talked a lot about the big policy bill
that the Trump administration pushed
through Congress and um talked about no
tax on tips and some of the small
popular pieces of the bill. He did not
mention the $800 billion in cuts to
healthare for working American people.
that is going to cause much more damage
to the typical American's pocketbook and
to their health over the long run than
um they're going to get from things like
no tax on tips.
>> Just lastly, no tax on tips. When this
was first floated by the president on
the campaign trail, we talked about it
and there was a thought that if this in
fact becomes real policy, if this
becomes law, it will essentially
restructure the way many people are paid
in those industries, maybe they won't be
drawing as many tips. Maybe they're
actually their hourly rate goes up as
employers try to uh try to gauge the
difference here. Are we seeing that? And
should workers expect any difference in
their paychecks?
If you look at the tip income uh
distribution and the way that tips are
earned, um a thing to really understand
about no tax on tips is it is a very
very small um give uh amount of money
for your typical tipped employee. Um,
what we're really worried about is that
this becomes a loophole you can drive a
truck through for higher inome
individuals who are able to start
reccharacterizing their income as tips.
Perhaps you and I should receive
gratuitities for our work. And that can
be something that's very difficult to
police, especially given that the Trump
administration has had no interest in
policing tax cheating by highincome
individuals. I feel like 20% for the
anchor is is uh is pretty fair in this
particular case.
>> Yeah, cash credit.
>> You tell me, Kitty. You're the
economist. I think we've covered some
ground here. This is important. Uh
Kitty, thank you. Kitty Richards, senior
fellow, Groundwork collaborative, former
official at the Treasury Department in
the Biden administration. As we listen
to the round robin here at the White
House, um we want to bring things to New
York uh for Bloomberg Business Week
Daily. They're going to carry the baton
here and we'll likely carry you back
into the briefing room or the cabinet
room in this case because reporters have
been assembled. Press pool has been in
there for about 2 hours now and probably
has a lot of questions about a lot of
stories beginning with Lisa Cook. And
you'll hear those comments uh when they
take place here on Bloomberg. I'll meet
you back for the late edition of Balance
of Power at 5:00 p.m. Eastern time.
We'll review what took place in the room
today and what the president is about to
say about the Federal Reserve governor
he wants to fire. Tim Stenc, Isabelle
Lee standing by in New York for
Bloomberg Business Week Daily. Take it
away, guys.