This is Balance of Power live from
Washington DC.
From Bloomberg's Washington DC studios
to our TV and radio audiences worldwide.
Welcome to Balance of Power. I'm Joe
Matthew. Tonight, the White House
circles the wagons after President Trump
moved to fire Fed Governor Lisa Cook.
The president absolutely has authority
to uh fire a fed governor for cause and
I think the accusations uh are serious
and I look forward to seeing the
outcome.
We'll discuss the looming legal fight
with Cook's lawyer set to file suit
against the White House when we talk to
President Trump's former special counsel
Tai Cobb. Up ahead, plus the Trump
administration making good on threats to
raise tariffs on India up to 50% as
punishment for the country buying
Russian oil. But will it be effective?
White House senior counselor Peter
Navaro joins us live to talk about what
those tariffs mean for the future of US
India relations and Nvidia sinking after
the close. We'll dive into the company's
earnings report out after the bell with
concerns now about Nvidia's revenue
forecast and still big questions about
its China business and the earnings call
that's getting underway right now. That
is where we begin this evening as
investors react to Nvidia's quarterly
results sending the stock lower in after
hours trading. We've been down just
about 3% for a bit here with concerns in
the market over Nvidia's revenue
forecast. Let's get right to the details
now with Bloomberg's Caroline High,
co-host of Bloomberg Tech and Bloomberg
The Closed co-anchor Roma Bostik.
They're both with us from world
headquarters in New York. Caroline, what
seems to be the problem?
Well, the problem is that they met
expectations, not exceeding them. And I
think many would say actually, if you
look at the Bloomberg intelligence
interpretation of all of this, actually
was a pretty nice in line, if not
slightly above for this fiscal second
quarter. And the third quarter was
incredibly noisy. Joe, we talked about
this earlier in the day, the fact that
the $15 billion spread between the top
end of revenue expectations from the
street to the bottom end for the
forecast. Well, that forecast comes in
basically in line with that and that's
with many interpreting that China's
revenue would be included. It's not. H20
sales did not happen in the second
quarter and no H20 sales have been
factored in to the fiscal third quarter.
Therein lies the concern and I think
that's something that Jensen Hang can
explain away if he does indeed discuss
the idea that look this could only be
upside to the fiscal third quarter if
they are allowed to sell more broadly
into China and I think remain you can
comment on the fact that actually there
is litigation risks that surround this
ongoing US government call for a 15% cut
in any H20 sales. Yeah, and I want to go
there, Joe, because just a few moments
ago, they filed a 10 Q with the SEC and
kind of buried at the bottom of it, they
talk about that agreement earlier this
month, Joe, that President Trump
announced that effectively he would
grant a license for Nvidia to sell those
H20 chips to China, but would take 15%
of the revenue. I'm going to read
specifically what Nvidia had to say. It
says any requests for a percentage of
the revenue by the US government may
subject us to litigation, increase our
costs, harm our competitive position,
and benefit competitors that are not
subject to such agreements. Now,
obviously, this gets into a little bit
of legal ease here, but it seems to get
to the point, uh, Joe and Caroline, that
whatever agreement, uh, Trump announced
earlier this month, apparently that is
not quite a done deal.
Yeah,
that's pretty fascinating. Roma, we've
been talking about this a lot since that
news emerged. And Caroline, that was
supposed to involve AMD as well. Is that
not real?
And if you cast back your mind to Lisa
Sue joining our program just before that
agreement was made with the US
government, her stock was getting beaten
up because she couldn't give any
expectation for what China sales are
going to look like and the street and
investors did not like that. So once
again I think the lack of clarity coming
from Nvidia is a difficult one and to
your point remain they said at the
moment they're receiving 15% of the
revenue generated from licensed H20
sales the government but to date Nvidia
says the US government has not published
a regulation codifying such a
requirement and you're seeing something
else from
I I just want to also bring to our
viewers attention Joe and this is really
important for your audience here in this
10 Q they spend several paragraphs a lot
I mean several pages in fact talking
about the relationship with the US
government talking about the
relationship with the Chinese
government. They go into detail not only
about that 15% uh agreement but also
about legislative proposals in Congress
as well as other things that in its
words says are a potential threat to its
business particularly if some of those
proposals and some of those agreements
aren't applied across the board to all
of the competitors here. It's going to
take a while for us to dig through with
this here, but a potential risk for
Nvidia investors and more importantly
something to chew on for all you folks
down there in Washington.
Really interesting developments here and
this call is just now beginning. So the
the trajectory of the stock after hours
could change and we'll stay close to
Caroline Hyde, host of Bloomberg Tech,
Bloomberg's Roma Bostic as well will be
back with us later this hour. We thank
you both. To the latest now on President
Trump's effort to fire Fed Governor Lisa
Cook as Cook's attorney prepares to file
a promised lawsuit against the
administration. Bloomberg's Michael McKe
joins us now live from our Boston bureau
with more. Are we going to see that suit
today? Michael,
we aren't sure. We've anticipated its
filing today, but it has not happened
yet. It could happen in the next few
hours, we're told, or it may slip into
tomorrow, but it will kick off a major
legal battle with the White House on two
fronts. One, does the president have the
right to fire a Federal Reserve
governor? and what is the bar for cause
to do so? Does the mortgage problem that
she has rise to that level? But the
other Joe is more interesting in the
short run. She is going to ask for an
injunction to prevent the president from
removing her from office until the major
case is adjudicated. If she wins, she
stays on. Trump loses. If she loses, if
they let her uh get fired, as they did
with the Merit Systems Protection Board
and the National Labor Relations Board,
then you have a really weird situation
where there is an opening. The president
could theoretically fill it and yet the
Supreme Court at the end of all this
could say he illegally fired her and
give her her job back, but that person
who filled in would have voted at Fed
meetings. Uh they'd be on the job. uh
what would the status of all that be?
So, it's going to be a very interesting
case and we assume that she probably
will win the temporary injunction and
that it will probably happen very
quickly because of course they want to
get this done by September 17th, the
next Fed meeting.
Really interesting as we now expect
Steven Myron's confirmation hearing to
move up to next week. That conversation
just probably got a lot more interesting
as well. Bloomberg's Michael McKe, thank
you so much for the update and for more
on this looming legal fight. We're
joined by Tai Cobb, the former federal
prosecutor, former special counsel to
President Trump during the first
administration. Ty Cobb, welcome back.
It's good to see you. Do you agree with
Michael McKe?
Absolutely. When it comes to this
injunction, what will Lisa Cook learn?
I think that she's likely to prevail.
Um, you know, the purpose of injunction
typically is to balance um a variety of
things. You know, harm to the parties uh
likelihood of success on the merits and
is usually designed to fashion a remedy
intended to preserve the status quo. The
status quo is she's a Fed member um on
the likelihood of success on the merits.
It's very hard to see how uh Trump's
attempt to be a jury, judge, and
executioner on, you know, mere
allegations at this stage of the game uh
that, you know, never never before
prosecuted uh uh in any way. not not
something that uh uh would typically be
seen to rise to the level of malfeasants
or corruption um associated with the
traditional meaning of for cause. Hard
hard to see how um u he you know strains
the uh limits of his presidential power
uh more by getting this accomplished. So
I I think the courts uh are likely to u
resist this.
This does go to the Supreme Court. We
have covered some of this ground before.
We've been hearing a lot about Trump
versus Will Cox, right? The Federal
Reserve, a uniquely structured quasi
private entity, the court said that
follows on the distinct historical
tradition of the first and second banks
of the United States. So do we actually
know how this ends?
Well, that was set in February. So, you
know, that's that's not ancient. Um and
uh I think the court is likely to you
know sustain that position with regard
to a u a fed member. Um
you know it's it's complicated because
they clearly are on a mission at some
point to overrule Humphrey's executive
which is the um Keystone opinion from
1935 that authorizes independent
congressional agencies. Um but as as you
mentioned in the uh opening uh this the
court has already this year on at least
two occasions made it very plain that uh
the uh president has that uh has that
power as the executive. Um but um as you
just pointed out the Fed is really
different. The court has said that it's
different. Even Alo has indicated that
he views it as differently. So I think
um with with Robert Alo and Kavanaaugh
who've uh suggested that's their views
um and uh and the remaining judges uh um
many of whom will uh agree. Uh I I think
it's unlikely that the uh president
prevails at the Supreme Court assuming
this case gets there.
Okay, got it. You know, we've heard from
both the president and the Fed chair Jay
Powell that they will abide by the
court's decision. You take them both at
their word? I take I take Chairman Pal's
word.
I guess that answers that question. Um,
interesting. You know, it's obvious that
you've been critical of the president uh
in the past, Tai Cobb, and you've even
appeared on a list uh that we've talked
about in the past, and I wonder after
seeing John Bolton's house raided if
you've been checking your door.
Uh, it's funny. I I you know, as you
know, I was interviewed recently about
that and I flippantly said that uh when
I heard about it, I went down and locked
my door. Um uh
was that I'm not uh thinking about it
24/7. Um but uh I think that, you know,
his retribution um and vengeance
campaign is, you know, on full display.
You've got, you know, Bolton, you've got
uh um Chris Christie recently. Um you've
got um all the prosecutors who
investigated him, all the prosecutors
who um prosecuted January 6th uh thugs
um and protesters uh all all the all the
FBI uh people who were involved in those
investigations. So I mean there's a he
has a he has a long track of uh you know
vengeful actions and it's not going to
stop until you know either Congress, the
courts or somebody makes them stop.
There was a there was a good move
yesterday, frankly, by Judge Cullen in
Maryland when he u prevented uh the
president's effort to force out all all
Maryland federal judges from a um one of
the immigration cases. uh Judge Cullen
from uh Virginia um you know uh who was
assigned the case uh because the other
judges had been um um recused from that
um you know made it made it very plain
that the um the the judges are getting
tired of the name calling and the
assault on their um authority and uh and
the third branch of government. Uh he
highlighted in a footnote uh that the
president had called federal judges
left-wing, liberal, activist, radical,
politically minded, rogue, unhinged,
outrageous, overzealous,
unconstitutional, crooked, and worse,
and made it clear that that was uh
unprecedented and unfortunate. Um
ideally uh the courts will be able to
continue in that mode and you know
return the presidency to the norms that
have guided us for 250 years. But um a
lot of damage has been done particularly
the Justice Department, the FBI and um
internally within within the government.
Tai Cobb, great to have you back. Former
federal prosecutor, former counsel to
President Trump in the first
administration. We appreciate the
insights. As we turn now to get the view
from the administration, joined here in
studio by Peter Navaro, White House
senior counselor for trade and
manufacturing. Mr. Navaro, welcome back.
I was going to ask you first about
tariffs, but because Tai Cobb, by the
way, there's nothing awkward about
having Peter over the house when Tai
Cobb is on the phone. He was talking
about
great time. I'm glad to be got
I'm glad you heard everything.
Got to congratulate Kel Kelsey on her on
her.
Kayie had Thank you very much. I'll let
her beautiful boy
Price if she had twins. The jokes was
she would have named the other one
earnings or volume, which
I'll have to ask her that.
She'll be sitting in the chair with us
soon.
Well, I hope that's true. We'll see
Kaylee lines in a couple of weeks. With
regard to Lisa,
let's talk about this thing.
Can't wait to find out if she's gonna be
charged.
What a what a what a what a hateful
anti-Trump guy. I mean, start with
Bolton. I mean, Bolton, he could have t
what Tai Cobb could have pointed out was
Judge Royce Lambert. I saw your rule
speak in the hill that John Bolton
likely jeopardized national security,
gambled with national security and the
Trump administration would have likely
prevailed on the merits of the case if
it had gone forward and Trump had been
reelected. Now what would that would
have meant likely jail term for John
Bolton. So don't tell me Tai Cobb that
we're going after John Bolton English.
That guy took by his own admission
copious notes in places like the
situation room and places where national
intelligence secrets were being done and
then he cashed in on that with his with
his with his memoirs and he's just been
out of control ever since. He's a threat
to national security. The guy should be
be uh investigated if if they find he's
got what we think he might have. that
guy should go to a federal prison.
Why not the same approach to Lisa Cook?
Why not wait to find out?
So, let's talk Lisa Cook. So, here's the
thing. Um, this is a very interesting
case. The way the statute reads is that
the president unequivocally has the
authority to fire for cause. In this
case, the cause would be malfeasant. So,
what do we know here? What we know here
appears to be a slam dunk damning case.
What do we got? I couldn't believe this
when I saw this. Two mortgages
mortgage applications. in two weeks
where she put on they both claimed uh
they they were her permanent residence
the way the rules are you got to occupy
within 60 days and stay there for at
least a year I mean by the math of it
you can't do that in two houses okay so
on the face of it that's malfeascins now
the statute doesn't say the malfeasants
has to happen while you're in office in
the fed it just says malfeasants Now
look at the history. I mean, we've had I
I can I I can go 20 20 names of people
who left administrations because of
allegations like this under a scandal.
The appearance or impression
in this case though because people are
already asking you about politicizing
the Fed. Why not embrace due process?
This is due process. The president has
the power to do exactly what she's
doing. Fire her for cause. In this case,
malfeasants. Now, for those who look
Nixon resigned without a without a
trial. We had uh uh the whole Contra
thing. Uh those people were gone without
a trial.
The ones that's most relevant here is
the independent agency guys who were
fired by Biden. One of my good friends,
Mark Calabria, was at an agency um and
he got fired and the court said Biden
had every right to do it. So,
what's going on here?
Can you imagine a world in which she
gets the injunction and she stays in
that job while this uh criminal
investigation is underway and Donald
Trump is sitting in the White House
truththing at her every day. How ugly
could this
look when she got appointed Joe uh back
when I was outside and Biden was the
appointee. I said flat out it it was a
terrible hire. It was a DEI hire. She's
not qualified. But you look at the the
arc of what she has done as Fed
governor. She was the one who was one of
J. Pal's votes to keep rates
artificially low as the inflation crisis
began because of Biden's overspending.
She fed into the inflation is transitory
narrative which was pure partisanship.
And she's was the one who helped light
light the inflationary spiral that that
we've been fighting with ever since. And
then and then Trump gets in there. What
does she do? She flips and it's like
partisan again. It's like she won't
lower rates. She's a partisan animal who
weaponized a Federal Reserve. This is
not about federal Fed independence. It's
about about I mean, think about it, Joe.
Two mortgages in two weeks claiming
falsely. Now, here's the thing. This is
personal to me.
Well, I understand.
I when I went
using language like
I went to prison. I went to prison, Joe,
for defending the Constitution. And when
I was in there, which is why this is
relevant, is there were at least two
guys I knew in there who were in there
for a long time for similar charges. And
not only you don't only go to prison,
you get your assets seized. There's
forfeite and generally there's a
restitution that has to be paid. So this
is not this is not, folks, this is not a
slap on the wrist. This is not a little
thing. I mean, people are in prison. And
what does it say about the world if she
tries to hide behind the fact that she
hasn't had a trial yet when in fact the
facts are the facts and it doesn't
require a trial.
I read your view on that. I don't think
you want to you you don't want to call
Lisook an animal. You didn't mean that.
An animal
said part is an animal. I just I want to
make sure an animal that we understand.
I understand. I apologize.
Okay, fine. I just want to give you I
don't want you to leave without
partisan. I mean, look, that's a look,
it's a figurative
investigate everyone who disagrees with
Donald Trump.
Of course not. But that's not what this
is about. This absolutely not. Was that
not what that's about before walked out
of the White House in a huff
u and the only thing he shares with Tai
Cobb, it would proves my thing. Never
trust a guy with a handlebar mustache
because both of them had that. He walks
out with a stack of copious notes
screwing both the president everybody
works with. And he goes and it what it
looks like to Judge Royce Lambert, don't
ask me. It looks like he relied on
information that should otherwise have
not seen the light of day under four
possible different statutes. And if he
did that, as Royce Lambert said,
okay,
you know, he
I've never talked to you for this long
without bringing up tariffs, you know.
we got India today.
Let's do
50%. Are we actually in talks with India
right now? Now, is there a potential for
a deal to change that number?
Look, it's it's real easy that India can
get 25% off tomorrow if it stops buying
uh Russian oil and and helping to feed
the war machine.
Not sending that signal.
They're not. And look, I it here's the
thing. I'm I'm puzzled, okay? Because
Mod is a great leader. These people are
are This is a mature democracy with
intelligent people running it. and they
look us bald-faced in the eye on on the
tariff part and say we don't have the
highest tariffs in the world when in
fact they do. There's no dispute about
that if you look at the numbers and then
they say uh we're not we're not going to
stop buying Russian oil. Now what what
does that mean? I mean we've talked
about this but it's worth talking with
your viewers again. When India buys
Russian oil at a discount and then
Indian refiners in partnership in India
with Russian refiners
make that and sell it at a premium to
the rest of the world. Right? Russia
uses the money it gets
to fund its war machine, kill more
Ukrainians. And then the next thing that
happens of course is Ukraine comes to us
and Europe and says give us some more
money.
So we everybody in America loses because
of what India is doing. The con
consumers and businesses and everything
lose and workers lose because India's
high tariffs cost us jobs and factories
and income and higher wages. And then
the taxpayers lose because we got to
fund Modi's war. Okay. that the the the
road to peace runs at least partly right
through New Delhi. I mean Modi's war
because the road to peace runs in part
through New Delhi. I mean that's a lot
of money.
It's a lot of money.
But there are some who say that we're
we're losing leverage with China by
eliminating
the the next biggest economic
alternative.
You know, I'm so tired of these these
these national security strategies being
too cute by half. The reality is you got
to stop India and China from buying
Russian oil. You do that tomorrow when
the war is over.
Okay, the war is over. If if if if
everybody including Europe, this is like
Europe's still buying Russia oil, which
is crazy. Okay, if people just stop
buying Russia oil,
then it's only a matter of time before
Putin doesn't have the money to fund
that war. So Modi's a big part of that.
It's it's it's a million and a half
barrels of oil a day. That buys a lot of
lot of drones and bombs to kill
Ukrainians. Okay. A lot. Okay. So what's
troubling to me, Joe, is that the
Indians are so arrogant about this. They
say, "Oh, we don't have higher tariffs.
Oh, it's our sovereignty. We can buy oil
from anyone we want." India, you're the
biggest democracy in the world. Okay.
act like one. Side with the de
democracies. You're getting in bed with
the authoritarians.
You know, China, you've been at at quiet
war with them for decades. They invaded
Axa A Chin and all your territory. These
are not your friends, folks. Okay. And
the Russians, I mean, come on.
With a direct appeal to the listeners,
viewers here.
Peter Navaro, it's great to have you
back as always. White House senior
counselor for trade and manufacturing.
Thank you for the insights. We've got a
big breaker on our hands here. Of
course, that's Nvidia earnings. The call
is underway right now after posting
results that left some investors
wanting, at least with regard to the
revenue forecast. We get back to
Bloomberg tech host Caroline Hyde in New
York City for the very latest headlines.
Caroline, what are we learning on the
call?
Joe, thank you. CFO Colette Crest is
speaking. Give more granularity to the
outlook on China. Look, we have seen a
56% increase in revenue for the fiscal
second quarter. They're in line for
their third quarter expectations, but
the street wanted to hear more. And in
particular, we're used to Nvidia
managing to go beyond our wildest
expectations. They're even handing back
$60 billion in terms of a dividend. But
however, well, not dividend in terms of
just buying back shares. But more
broadly, Joe, what we're starting to
hear is the devil in the detail when it
comes to China. Crest the CFO is saying,
"Look, they could actually sell two to$5
billion worth of H20 chips could be
shipped to China if these geopolitical
and other issues are resolved." Now
remember they also articulated in that
10 Q that because of this 15% agreement
with the US government to give 15% of
any revenues of H20s to the US
government, it could expose Nvidia to
future litigation. So that's a key risk
for them. At the moment, Crest says
Nvidia is on track to get this book. $20
billion worth of sovereign AI revenue
this year. This is what investors and
analysts want to hear. They are
diversifying away from just those four
key hyperscalers, the alphabets, the
metas, and the like. We're also hearing
them tout what is the capital
expenditure from those customers that
make up about 40% of revenue. Figure
says is $600 billion in this calendar
year. So they're trying to talk big on
the expertise and the opportunity here
in the GPU sector. They say that at the
moment Reuben's already set to be back
on track and seeing the next iteration
of their chips and their architecture is
going to be living up to expectations
coming online next year. And they're
already in the fabs is what the CFO
says. And also at the moment they've
managed to really hit pace when it comes
to the Blackwell architecture too.
Well, what a great readout from
Bloomberg's Caroline Hyde. Thank you so
much, Caroline. We'll let you get back
on the call as I realize there could
still be some more news here. And coming
up, we're going to continue to bring you
details from Nvidia's earnings call. The
stock moving as we've seen after hours
uh down right now about 2 and a half%.
But first, the US is looking ahead to a
potential end of the war between Israel
and Hamas. We'll discuss what that looks
like with Barbara Leaf, former US
Assistant Secretary of State for
Neareastern Affairs. She's next on
Balance of Power on Bloomberg TV and
Radio.
[Music]
It's Balance of Power on Bloomberg TV
and Radio. I'm Joe Matthew in Washington
watching shares of Nvidia tip lower in
after hours trading after giving a
lukewarm revenue forecast in the fiscal
third quarter. It's added to concerns
that the pace of investment in AI is
slowing. Yes, we've heard that before,
but let's look at how markets are
responding here and what we're learning
on the conference call in power moves
with Bloomberg's Roma Bostic live from
world headquarters in New York. This is
the big one, Roma.
It is a big one, Joe. The shares have
been under pressure since they released
earnings a little more than an hour ago.
The conference call started 30 minutes
ago, but the first 30 minutes it was
just the executive speaking just about
uh just a few seconds ago before you
came back on the air. Analysts now
finally have a chance to start asking
questions. The first question is really
about the outlook for data center growth
and that has been the big story for a
company that has been growing at a
headline revenue growth rate in the
triple digits. We're talking about
doubling tripling revenue over the past
few quarters. That growth rate is coming
down pretty significantly to the 50%
range. Normally that wouldn't be cause
for a concern, but that is the concern
going forward here, Joe. And that is
potentially going to have a bigger
impact when we see the broader market
open up tomorrow morning because Nvidia
has been more or less the stock that has
driven the stock market gains basically
since well, you go back to November of
2022 when chat GPT came into the public
consciousness. Nvidia, the primary
driver of those gains. But keep in mind,
Joe, and I want to point your uh viewers
here to a 10Q, a filing with the SEC
that Nvidia did file, and they spend
several pages talking about the
regulatory issues that they're facing in
the US, in China, in France, in Europe,
basically across the globe. And they
make it clear that one of the biggest
threats to their business right now
isn't so much about whether business
customers continue buying their chips,
but whether the governments around the
world will continue to allow it to sell
its chips in the way that it wants to
do, particularly here in the US and that
announcement, Joe, that the president
made just a few weeks ago that it would
let Nvidia sell its H20 chips to China,
but it would take a 15% cut of revenue.
Nvidia saying that's far from a done
deal. They have not received formal
guidance on exactly how that would work
and they are concerned about the
potential that it would open itself up
to litigation.
Yeah, that was incredible listening to
you uh read the report as it came out.
Roma, that is a headline that argues
with everything that we've heard from
the White House and of course AMD was
said to be part of a very similar
arrangement. Would that also suggest and
maybe part of the concern after hours
here that without that 15% arrangement
the licenses to sell H20s to China may
be in doubt?
Absolutely. And we should point out in
the most recent quarter sales of H20
chips to China were basically zero. And
that was expected because we knew that
because of some of the Trump policies.
But the expectation was that into this
quarter and next quarter we would start
to see those sales picks up. And the
company is saying that look it can maybe
get to two maybe$5 billion in sales over
there. But there's a huge question mark
right now, not so much as to whether
China would take those chips and more
importantly whether President Trump and
the White House will allow that to
happen.
Fascinating Bloomberg's Roma Bostic,
great work after hours. We'll keep tabs
on the stock for you. And breaking in
the last hour, the new CDC director,
Susan Monz, is being ousted only weeks
into her tenure, potentially adding
instability to the Trump
administration's public health policy.
Joining us now with details, Bloomberg's
Madison Mueller in New York. Madison,
what do we know about this and how many
leaders of the CDC have we seen in this
administration?
Yeah, so Joe, this just comes on the
heels of a lot of turmoil um at HHS this
year. So far, we've seen, you know,
already a CDC nomination. Dave Weldon
was pulled earlier this year. Um and it
took a a while to get someone else in
there. Susan Monores was only confirmed
at the end of July. And for a while the
CDC was actually without a director. And
so there's been a lot of shakeups
obviously at the various sub agencies
under HHS this year. Um we also saw the
White House pull a US surgeon general
nominee um earlier this year and then
replace her with someone else as well.
And so there has been a lot of changes
within the leadership. We don't know a
ton yet about this situation. Um CDC
director is newly a Senate confirmed
position. Um, and so Susan Monores
actually had to go through a Senate
confirmation process um, in order to get
this position. And it is the president
of the United States that would have to
remove her or fire her or designate
someone to fire her from this position.
Um, and so what we know right now is
that there is a push to get rid of her
and the details from that are still
emerging.
Wow. Does this go to court or are we
waiting to find that out?
We're waiting to find that out. I mean,
RFK, who is the US um health secretary,
cannot just fire her outright without
having the White House being involved in
this because of that Senate confirmation
process. Um unless so, you know, the
White House has sort of given him the
go-ahhead to be able to do this. And so,
we have to we have to wait and see what
happens and and this situation is just
unfolding right now as we speak.
Well, we'd love to stay in touch with
you on this one. Bloomberg's Madison
Mueller with the breaker at the CDC. We
thank you so much. Turning now to the
ongoing war between Israel and Hamas.
Last night in an interview on Fox News,
President Trump's special envoy Steve
Witoff said the president will be
hosting a big meeting soon to discuss a
comprehensive day after scenario, a plan
for Gaza once the war concludes. But
with major military activity still on
the ground in Gaza, there are questions
about whether this type of meeting is
premature. Today on the early edition of
Balance of Power, I asked Hagar Shamali
about that, the former director for
Syria and Lebanon and the National
Security Council in the Obama
administration, the significance in this
case of this type of meeting. Here's
what she said.
Anytime again, you're you're doing day
after. You're thinking about who's going
to pick up the trash the next day. If
Hamas is not governing, which is we've
all seen and the US agrees with this,
Israel is certainly pushing for this. It
is not an option to have Hamas govern.
So if Hamas is not governing, who is
governing that would have the legitimacy
and support from the people? Um how are
you going to have functioning schools,
water, hospitals, all that stuff? And
and what is the role of the United
States in that?
Joining us now on Balance of Power on
Bloomberg TV and radio with her
analysis, Barbara Leaf, former US
assistant secretary of state for
Neareastern Affairs in the Biden
administration and distinguished
diplomatic fellow at the Middle East
Institute. It's great to have you with
us here, Barbara. What are your thoughts
initially on a day after plan? We've
heard a lot of rhetoric from this
president, including the idea of
leveling Gaza, removing everyone who
lives there, and creating waterfront
condos. I'm assuming that's not what
we're talking about here.
No, indeed it's not. And look, uh, a
couple thoughts, Joe. First of all, the
US has focused, uh, first the Biden
administration, now the Trump
administration. The US began focusing on
these questions of what happens after
the war is over. As early as late
October, early November of 2023, we
began talking to Israeli counterparts in
the military, in Ministry of Defense,
the security services, and the prime
minister uh about how to to prod them to
really articulate to think about what
would come afterwards. Um and it it was
a very frustrating it was a very
frustrating uh series of discussions
over the course of a year um which
really went nowhere. I I I for one am
very glad to hear that the Trump
administration that President Trump has
gathered people together today for a
series of discussions but we are nearly
two years into this conflict. So it's
long overdue. I don't believe for a
moment that we're talking about or
envisioning something like the the
February 2025
notion of of the US taking over Gaza and
essentially pushing Palestinians out to
somewhere else and and building some
sort of Riviera. It's not tenable.
There are questions about rebuilding
Gaza, which may be for another day
because we have to talk about what's
going on now. I realize that a day after
plan is necessary, but the fighting
endures and in many cases the starving
endures in Gaza. You were a key adviser
to Secretary Blinken
uh following the attack on October 7 and
we're still having the same conversation
about how to get food into Gaza. This is
something that is not getting easier. It
is in fact getting harder. You tried to
even build a pier at one point in your
administration. What
what can the Trump White House do to get
around these obstacles?
So look, first of all, it was not the
the pier was almost uh in a sense a move
of desperation as were the air drops.
Really, what you need to do is open up
every land crossing possible and surge
aid in. We were never able to get our
Israeli partners to do that on an
constant ongoing basis and it was always
tied to the prospect of of uh of a surge
with tied to the next phase of a of a
hostage deal. But the fact is that is
wholly insufficient because you went
from December in 2023 to uh fully a year
later before there was another such
release. That's unsustainable. It's
untenable. And so really, there is
nothing to prevent um there is nothing
to prevent the Israeli government from
surging aid on an ongoing basis. And you
can do that um deconlicting with your
military operations as as as you go.
Interesting. Um with that in mind here,
the president's going to be talking.
Joe, I'm sorry. If I could add, that is
one way to overwhelm Hamas's ability or
frankly criminals ability to steal
assistance. You surge it. You have it
coming in in four or five different
crossings and it becomes pretty
impossible for it to be looted or
controlled by um an organization like
Hamas. It gets to people.
We're hearing some new blowback uh from
Democrats on Capitol Hill about the
policy. And by the way, it's not going
to sound unfamiliar to you. President
Joe Biden heard quite a bit of blowback
from progressives here in Washington and
around the country when it came to
supporting the military effort on
Israel's behalf and specifically
providing weapon systems. The ranking
member, the top Democrat on the House
Armed Services Committee, Adam Smith, is
calling now on Congress to withhold some
weapon shipments from Israel to create
more leverage over Benjamin Netanyahu.
Would it actually work?
Uh, look, I think there are are there
are tools, there is leverage to be used
by President Trump that comes well
before you turn to something as dramatic
as curtailing arms shipments. He has
that uh leverage now um in in his
relationship uh with Prime Minister
Netanyahu.
It's great to have you with us, Barbara.
Thanks for joining. And Barbara Leaf is
former US assistant secretary of state
for Near Eastern Affairs in the Biden
administration. Distinguished diplomatic
fellow, the Middle East Institute
ambassador. Thank you. Coming up on
Balance of Power, makeorb breakak moment
here for the world's most valuable
company. It's happening as we speak.
Nvidia's earnings call underway right
now after disappointing results.
Highlights next on Balance of Power on
Bloomberg TV and radio.
This is Balance of Power on Bloomberg TV
and Radio. I'm Joe Matthew. Thanks for
joining us. We'll turn back to our
coverage of Nvidia's quarterly earnings
up ahead and we'll assemble our panel as
well. But first, the stories we're
watching in today's Power Brief. Two
children, ages eight and 10, were killed
in a shooting at a Minneapolis Catholic
church that was holding a mass for
elementary school students today. The
gunman fired dozens of rounds through
the windows at people sitting in pews
and injured an additional 17 people,
including 14 children, two now in
critical condition, according to the
Minneapolis police chief. Authorities
say the gunman is dead and there is no
ongoing threat to the community.
Minnesota Governor Tim Walsh and
President Trump have each been briefed
on the shooting. The president
commenting on Truth Social saying he is
praying for everyone involved.
A smaller group of Americans will be
eligible to receive updated versions of
the COVID vaccine this fall. FDA says
people 65 and older and those with
underlying conditions that put them at
higher risk of COVID are eligible to
receive the shot. People over 6 months
old who do not fall into that category
can still get the vaccine with the
approval of a doctor. Health and Human
Services Secretary Robert F. Kennedy Jr.
confirming the new guidance on X today,
saying the American people demanded
science, safety, and common sense. This
framework delivers all three. Novivvax,
Fizer, and Madna finished modestly
higher on this news. And what's old is
new again at Cracker Barrel. The
company's stock up almost 8% just a day
after a major reversal to scrap its new
logo and return to its vintage look in
the face of mounting criticism and even
pressure from President Trump. The
restaurant chain saying, "We thank our
guests for sharing your voices and love
for Cracker Barrel. We said we would
listen and we have." The White House
today taking credit for reviving Uncle
Hershel took liberty to release its own
version of the logo complete with Donald
Trump sitting in Uncle Hersel's place
next to a barrel of oil.
Joining us now with their reaction to
this story and more this evening's
political panel, Rob Waters is back.
Republican strategist, managing partner
at the Madison Group, alongside
Democratic strategist Kristen Han,
partner at Rock Solutions. It's great to
see you both here. I'm guessing Rob
Waters. You sat on the rocking chairs on
the portion of Cracker Barrel.
What are you making?
That is some of the best baked apple you
will ever have. And those hash browns
could be a little crispier, but darn
good.
All right, see there you have it. Maybe
you'll want to go for the chicken fried
steak with chicken and dumplings.
Well, everyone's got an answer.
It's true.
What do you call this? Is Is Donald
Trump the chairman of every corporate
board?
No, I call this a woke agenda that's two
years too late.
There's the Trump version. What do you
think of the new logo?
Cool. I was busy working today. Um, but
seriously, why do you change don't fix
what ain't broken?
Okay, that's fine.
There it is.
But should the commander-in-chief uh be
part of this process?
I I mean, I think that there's there's a
lot of things going on here. I mean the
president is injecting himself in a lot
of different ways into a lot of these
companies into the private sector and on
you know if it were a Democrat in office
we call it socialism but you know he's
talking about the marketing but it I
mean the power of the president the
power of the bully pulpit that they're
afraid of what he might do when they
come after him. So you know let's change
the logo back like immediately. I'm not
sure that I would recommend that my
client do that.
The new look the new streamlined logo
Don Jr. was tweeting about it. Is this a
political story or not?
But if Don Jr. and the president say
it's woke, it's woke. I mean, like when
Wendy's decided to change their logo and
change the the look of um Wendy,
you know, nobody said anything then. I
don't I don't know. He just picks and
chooses and then and then
no
tweets about it. No, then he then he
tweets about it and then and then people
but people that people are very
concerned about what he has to say
because he's the president of the United
States and he is is is looking at all
these companies and injecting himself
the next layer here is the Intel stake.
As a as a conservative Republican, how
do you feel about the government taking
a stake in this company? Does it feel
like
President Obama taking a Chrysler
bailout or something?
I was just about to go.
I mean I I'm going to put it this way. I
would much rather us have an equity
position where there's a payback unlike
other areas of too big to fail which you
know paid back without an ROI.
So I think if we can preserve our
domestic
quantity of chipm Yeah.
and and bring it back over here and get
an ROI on it, it's not that bad a deal.
Well, you know, there's always talk
about picking winners as we heard again
in the Obama administ.
I'm on Bloomberg, brother. I know what a
winner looks like. Celindra wasn't a
winner. And Intel, by the way, is a
company that's struggling to keep up
with the times. Is that the one we want
to invest in?
I mean, it's not the Kodak of our time,
if that's what you're asking.
Well, I don't know.
You know, time will tell. I think we
need to preserve our chipmaking process.
We can't rely upon allies of spherical
influence near China. And, you know,
we're just going to see what we do,
right?
I want to ask you both about um Lisa
Cook. We talked to Peter Navaro, had
quite a conversation about a number of
things here and Tai Cobb as well as the
president tries to become the first
president of the United States to fire a
Fed governor. This is a pretty
remarkable moment and we heard from
Kevin Hasset this morning. They've got
all the economic voices out on this. He
talked about this, of course, director
of the National Economic Council about
what he believes Lisa Cook should do in
the meantime. Listen,
the president absolutely has authority
outcome. If I were her in her
circumstance, I would take leave right
now. I think it's the honorable thing to
do.
Should she recuse herself? There's a
practice in Washington when you know
you're accused of something, you write
the resignation letter and you let the
boss decide. Kristen,
no. I I think that she's got I mean
there there are questions to be
answered,
you know, and I think she should, but in
in the meantime, there are political
considerations I think the president's
making. Um and he he clearly wants his
own governors in there and he's he's
said as much like, you know, once we get
more people in there, I think it'll be
better. Um I think that she has every
right to fight it. um throughout the
process in the court she's going to have
to you know things are going to be
revealed and either you know it it
wasn't malfence so it was but she has
the right to due process and right now
she's not convicted of anything
therefore he doesn't have the right to
fire her it'd be interesting when it
goes to the Supreme Court I'm assuming
it will
and what the court will say so um yeah
should go through the process but uh she
has she has a right to have an attorney
fight though is your answer yes so we
talked to Taikob about this. Let's ask
the lawyer at the table. Trump versus
Will Cox. Didn't the Supreme Court
already give us a sense of how it feels
about this?
I mean, look,
if she did what they say she did,
big if.
Abby Lol's fabulous lawyer.
You know, I used to work for him. So,
then she has to go. If she didn't, then
she doesn't. Where's the question?
Well, I don't know. I asked Peter Navaro
that. He said it's all there is no need
for due process. the documents are there
and she can be fired for us.
There's always a need for due process in
the United States of America.
Well, that's I like the spirit of that
idea. Will she get it?
I think so. I think so. I think, you
know, you've seen um places where the
courts have ruled against Trump even
recently. So, I would hope so. The
second that we don't have due process in
the United States of America, I'm going
to be very concerned.
You're sensitive to the markets. Do you
worry about the politicization of the
Fed becoming a reality?
No, I think the Fed's an independent
agency and will react as such. And I
don't,
you know, I I have more worry about
y'all talking about Nvidia as much as
you do than I do actually the Fed
didn't.
The statement that came from the Fed
today said as much.
Yeah. I mean,
you know, we're going to the courts will
look into this and it will play out, but
at the end of the day, we are an
independent agency.
Fantastic.
So, at the end of the day, process is
process, right? Due process, says
Kristen Han and Rob Waters. This was a
great panel. Thank you both so much for
the insights. And boy, Rob just knows
where we're going here. The Nvidia
earnings call is still going on. CEO
Jensen Wong is weighing in right now on
the importance of China for the company.
Uh close co-host Roma Bostic is back
with us from world headquarters in New
York. Roma, what are we hearing?
Yeah, I hope I don't disappoint Rob
here, but that conference call is going
on. The question and answer session is
underway and as expected most of the
questions are about the company's
exposure to China. The company made
clear that its sales to China if
particularly for those higherend H20
chips basically flat. They did have
revenue in the greater China space and
this includes Hong Kong of roughly about
$2.7 billion but just a couple of
quarters ago it was double that. And the
company says that if it is granted a
license by the United States to sell its
chips to China in the way that it wants
to, that that could mean $50 billion in
revenue just for the rest of this year
alone. But that is a big if and the
company is being very careful to say
that this is not a forecast. And they
make it clear that they that the quote
geopolitical issues out there right now
are holding it back, but that it is
ready to move forward with those sales
if it can get permission from the Trump
administration. The shares are lower
here in the after hours trade, but I
also want to turn your attention to the
shares of other companies in this space
also moving lower like AMD, like
Broadcom, Marbell, uh, and Qualcomm as
well. A few bright spots out there
though, Joe, Intel, believe it or not,
is indicated potentially to move higher
when we get to the cash session
tomorrow. And for our viewers, just a
reminder, the futures do reopen in just
about five minutes time here in the US.
And you'll get a broader look here at
where the broader market goes tomorrow.
So, we're not dumping the stock here,
Roma. I mean, we've seen worse reactions
to Nvidia earnings, and we were near an
all-time high going into this report. We
could actually say that the stock's
holding up pretty well considering these
headlines, right?
Still holding up. Still one of the best
performing stocks of the year. By far
one of the best performing stocks over
the last two to three years, Joe. So,
let's be clear here. A 3% pullback is
not a real sell-off for a stock of this
size. But when we talk about this
company being important to the market,
we also have to point out that it has
become a political football and how
Jensen Wong is able to navigate this is
going to be important. He does say on
the conference call, as does the CFO
that they are working with the Trump
administration. And we should also point
out, Joe, that it's not just the United
States. They're facing issues from the
Chinese government, from the French
government, the German government, and
etc, etc. here. So, this is a company
that, well, quite frankly, would just
like to sell its chips to whoever wants
it. But you have a lot of governments
right now standing in its way.
Isn't that the truth? We'll keep our
eyes on this stock throughout the after
hours session. Bloomberg's Roma Bostic.
We'll have a lot to talk about on this
front tomorrow as well. Roma, thank you
for your coverage. In the meantime,
check out the Washington edition
newsletter. A lot to unpack today. You
can find it on the terminal and online.
And that does it for us for now. I'll
meet you back here tomorrow on Balance
of Power. I'm Joe Matthew in Washington.
Have a great evening. This is Bloomberg
TV and Radio.
guy.