June 1, 2025 • 20 mins
Tariff headlines are once again dominating markets after a legal back-and-forth last week on the status of Trump’s century-high levies. On Friday, President Trump said he would double tariffs on steel and aluminum imports and accused China of violating an agreement with the US to ease levies. We got reaction from Carol Schleif, Chief Market Strategist at BMO Private Wealth.
Plus- we go to New Zealand, where demand for 'golden visas' has increased under looser rules. The country has eased its rules in February to attract more foreign investment. We got reaction from Stuart Nash, Former Minister of Economic Development in New Zealand and co-founder of Nash Kelly Global.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio news. Welcome to the Daybreak
Asia podcast. I'm Doug Chrisner. Tariffs and other policies from
the Trump administration do remain a major risk for markets.
It was on Friday we had the S and P
falling more than one percent intra day. That's when President
(00:25):
Trump accused Beijing of violating an agreement with the US
to ease tariffs. Then later in the day the market
was able to recover. And that came after Trump said
he's expecting to speak with President Chi over the weekend.
The White House said that call could happen this week.
Here is Kevin Hassett. He is the director of the
National Economic Council, speaking on ABC's This Week.
Speaker 2 (00:49):
We expect it's going to have a wonderful conversation about
the trade negotiations this week with President she That's our expectation,
But the bottomlight is that we've got to be ready
in case things don't happen the way we want.
Speaker 1 (01:00):
That's Kevin Hassett. He is the director of the White
House National Economic Council. So let's take a closer look
at what tariffs mean for the economy. I'm joined now
by Carol Schleife. She's on the line from Minneapolis. Carol
is the chief market strategist at BEMO Private Wealth. Carol,
it's always a pleasure. It's been too long since we
(01:20):
last spoke. I'm glad you could join us. Thank you
so much. I don't know how anyone these days can
go about predicting the impact of tariff policy, especially the FED,
But I would like to begin with the impact on
the consumer. And I'm wondering, from your point of view,
whether the tariff story has been the primary driver of
this weakening that we have seen in consumer sentiment.
Speaker 3 (01:43):
You know, it's one factor in sentiment, and it's always
important with the caveat or when you're talking about either
consumer sentiment, business sentiment, market sentiment, investor sentiment is that
the consumers can tell pollsters they're krabby and then go
out and purchase anyway. So it's consumers actually, in the
(02:04):
long run are much more tied to job prospects and
employment prospects, whether or not they have a job and
feel like they can continue to have a job.
Speaker 4 (02:14):
If they do, they'll spend.
Speaker 3 (02:15):
But it is overurking, particularly in that very sensitive top
tier consumer who are responsible for so much of the
aggregate GDP, and they're tied as well to how they're
feeling about their portfolios. And fortunately or unfortunately, markets can
react very quickly to changing tariff news. Companies can't. And
(02:38):
so the tricky thing for us in the wealth management
spaces to watch does consumer sentiment translate into what they
actually do on the one hand, and do fundamentals does
the fundamental stasis, if you will, that business is put
in by all the uncertainty translate into economic changes And
(02:59):
so far consumers are spending and the economy's in pretty
reasonable shape. So so far, so good, But it's a
very fragile relationship.
Speaker 1 (03:08):
So we're now at the end of the earning season
and I'm sure you've been listening to many calls and
getting the guidance. Much of it reflects the fact, yes,
that these tariffs are in place and higher prices are
clearly a part of the equation right now. You can
debate whether or not these companies are in a position
to pass on those higher cost to consumers. But to
what extent are you concerned now about margin pressure?
Speaker 3 (03:32):
Yeah, there's definitely that potential. It's important to remember that
the starting ground for that margin pressure is margins that
by and large inaggregator at all time highs. It was
a very instructive earning season, and then companies did We're
trying to threat a very fine needle in trying to
outline what the impact or the potential impact of tariffs
(03:53):
were without waving too big of a red flag because
that's obviously a sense of politically sensitive issue. But I
think as investors we got a lot of good read
and particularly in the most recent batch of retail earnings,
where a lot of the retail were outlining what their
impact was, what steps they were taking where they could
(04:16):
to try to shift supply chains, and they also by
and large illustrated a lot of sensitivity because they understand
this is not like in the pandemic when we had
inflation for the first time and they could just simply
pass it all through. This time around, consumers are highly
tired of price increases and it's going to be very selective,
if at all, and you've seen that creep through in
(04:38):
the economic numbers, where on the producer side is where
some of that's absorbed. But hopefully company by company they
can find some offsets for some of that. In terms
of deployment of artificial intelligence, deployment of technology, slow walking hires.
You know, there's a lot of things that companies are
trying to do behind the scenes to minimize that margin
(05:00):
pressure because they understand that they're going to have to
eat more of this than they did last time.
Speaker 4 (05:04):
Around.
Speaker 1 (05:05):
One of the conversations on the street, and I know
that you're well aware of this is the gap between
what the hard data is indicating and what some of
the softer, more sentiment driven data is kind of indicating.
And I'm wondering how you make sense of that.
Speaker 3 (05:19):
Well, I think a piece of it is is, you know,
because even share Paul and several of the different press
conferences from recent FOMC meetings will tell you that sentiment
data has a very loose correlation typically through to the
hard data. And we saw some hints last week that
you might have seen that start to shift in both
(05:40):
the Yumish survey and the conference board, where you saw
some snap back and consumer confidence that came after the
thawing in relationship or in the thawing in the trade
war between the US and China. And I think the
hard part is in the last two weeks, in particularly
We've had so many flip flops on tariffs that it
(06:00):
feels like consumers and definitely investors want to move on
to some other topic, So the sooner we can get
the narrative focused on growth in the economy or the
more pro business friendly pieces of the administration's tax policy,
as long as they keep it to a reasonable price
tag and don't upset the bond markets, which is a
(06:21):
whole other issue. But right now we're watching it very
closely to see if it translates through to economic activity.
It hasn't translated through yet, but we're watching it very,
very carefully.
Speaker 1 (06:34):
I'm glad you mentioned the bond market will get there
in a moment, but we were talking about margin pressure
companies trying to contain cost. We get the employment data
this week, which is significant, I guess, probably the most
important piece on a monthly basis what are your expectations here?
What are we going to learn about the labor market
that we don't already know?
Speaker 3 (06:56):
Well, I think the one thing I want to see
is I've heard some inclin from some hinting from economists
that for the first time since well before the pandemic,
we may get to a point where job openings are
below job seekers because as you recall some of the
tightness we've had in the labor market off and on
(07:17):
for the last five years, it's been we were at
a point at one point where there are two openings
for every seeker, and so a better balanced job market
means people have it's tougher asking for raises. They're more
likely to hunker down and stay put and not change jobs,
which is more helpful for employers. And I think watching
(07:39):
employers too, because selectively you're seeing some cutbacks, although they're
being very quiet and not not necessarily announcing them with
big media headlines because they don't want to overly concern
the workers they do have because of the understanding how
hard it was to get those workers in place. But
(08:00):
you know, some of the different manufacturing seminars and gatherings
I've been going to since the first of the year,
that has been a theme all years at the there
that employers are able to hang on to employees, and
so there's the job market has been less of an issue.
Speaker 4 (08:19):
But we'll definitely want to watch.
Speaker 3 (08:21):
If the wages are going up or if they're staying
in line, because they've been moderating quite a bit in
the last couple of quarters.
Speaker 1 (08:29):
So the Senate returns to Washington this week and lawmakers
are going to be taking up the spending build it
recently passed the House. You know well that during that
process there were some ructions in the bond market. Now,
we heard recently from Jamie Dimond, the head of JP
Morgan Chase, and he was saying that a crack in
the bond market is going to happen, and I'm wondering
(08:51):
what he knows that maybe we need to know.
Speaker 4 (08:55):
I'm not certain he knows anything.
Speaker 3 (08:57):
I mean, keep in mind the heads of banks for
called for serious recessions a couple of years ago.
Speaker 4 (09:02):
That never emerged either.
Speaker 3 (09:03):
But I do think and I wrote about this a
couple of weeks ago because I wrote up the issue
coming out of the House, and I noted then that
you'd had the twenty year bond auction had been very squishy,
and that it was I don't want to say cute
or amusing, but it's interesting that Congress thinks they have
(09:25):
a big vote in this, because I think ultimately the
bond market's going to have the biggest vote in what
the size of the potential deficit is because the thing
that will be interesting is one of the things I'll
be talking to our field about this week too. To
watch is that now that the Senate's back this week,
they've on paper allowed themselves a bigger potential deficit than
(09:45):
the House had, and that the market.
Speaker 4 (09:48):
Won't The bond market will not take kindly to that.
Speaker 3 (09:50):
And we saw what happened last week in Japan with
the longer yields. They're having very poor auctions. Our bond
markets were little reassured this week because we had shorter
auctions and they all went off well and yields drifted
back down a little bit, but they're still with the
tenuere at four and a half percent and the thirty
(10:12):
year having flirted with five. Investors will be watching that
very carefully, and I sincerely hope the Senate does too.
Speaker 1 (10:21):
Are you wary of the bond market right now? Maybe
you would be disinclined to take a position even if
it were let's say at the shore to medium part
of the curve.
Speaker 3 (10:30):
Now, I think, I think that bond market will help
keep them on line. And I think the fact that
Secretary Vescent is so plugged in, and I mean because
he started coaching President Trump very early on, even before
he was had secured Senate approval, he was getting President
Trump to focus on that tenure.
Speaker 4 (10:51):
In the yields there.
Speaker 3 (10:52):
So I would assume that if you start to see
serious things come out of the bond market that you're
going to you're going to get Congress to toe the
line on that.
Speaker 4 (11:03):
So I'm less concerned there.
Speaker 3 (11:04):
And I think you know our estimate of fear value
on the ten years four and a quarter, four and
three quarter in the near term, So you're right in
the middle of that range right now. And we've been
short recommending staying shorter on the curve for a very
long time. But I wouldn't mind stepping out a little
bit because we are not in the camp where we
(11:26):
think yields are going to blow out marketly to the
top side.
Speaker 1 (11:29):
Okay, we'll leave it there. Carol, always a pleasure. Thank
you so much. Thank you for joining us. Carol schlive
from Minneapolis. She is the chief market strategist at Demo
Private Wealth. Joining us here on the Daybreak Asia podcast.
Welcome back to the Daybreak Asia Podcast. I'm Doug Chrisner.
(11:51):
Recently US Commerce Secretary Howard Lutnik said a new US
visa program backed by President Trump was nearing launch. Lutnik
told Axios that a government website for the gold Card
visa would be live within days. Well, that was more
than a week ago, and so far it hasn't. The
five million dollar Trump Gold Card visa would give wealthy
(12:13):
investors US residency and an expedited path to citizenship. Well,
Forbes magazine said it's still just a concept of a
marketing plan without nearly enough potential buyers. But that's not
to say golden visa programs aren't working. In New Zealand,
for example, the country has streamlined its program and it's
(12:34):
been able to attract more wealthy investors. For a closer
look at golden visas, I'm joined now by Stuart Nash.
He is former Minister of Economic Development in New Zealand.
He's also a co founder of Nash Kelly Global. Stuart,
thank you so much for making time to chat with me.
Why do you think there is this interest in golden
(12:55):
visa programs these days?
Speaker 5 (12:58):
Well, certainly I can speak about New Zealand. Is there's
a lot of global uncertainty at the moment. You've got
obviously a war going on, in Europe, you've got the
tinder box which is the Middle East. You've got a
change in the US administration, which again in itself was
causing a lot of uncertainty. And in a country like
New Zealand, we're sort of seen as an oasis at
the bottom of the world where by and large the
(13:20):
ultra high networth they tend to seek out tax havens
for their wealth. But at the moment there's a number
who were seeking out safe havens as opposed to tax havens.
Speaker 1 (13:28):
You also have a background in law enforcement, so I'm
going to ask you about the vetting process in the
situation like this. Described to me what it looks like.
Speaker 5 (13:40):
Yeah, well, I was the Minister of Police and what
we're very clear about with regard to our Golden Visa
is that it has to have integrity. So there is
a process you've got to go through. You've got to invest.
There are two schemes. One of them is five million
New Zealand, which is about two point eight million US dollars,
and you've got to prove that the money was through
(14:00):
legitimate means, and that's a reasonably robust process. And there's
another scheme where you can invest ten million dollars again,
that's about just under six million US. Again, you've got
to prove the money was was going through legitimate processes.
You've also got to go through health checks and your
stock standard checks to prove that you are a suitable person.
(14:21):
So you know, we don't want rogues and vagabonds into
the country. We want people who are legitimate investors, who
play into the New Zealand brand and who bring not
only their wealth, but for me, one of the really
important things is they bring their experience, their competencies, their capabilities,
their networks and their connections.
Speaker 1 (14:39):
What about the requirement to speak English.
Speaker 5 (14:42):
That was in the old visa. The visa has now
changed and there is now no English language requirement. The
other thing about New Zealand's Golden Visa as well, and
this is important for a number of our clients at
Nashcally Global because as mentioned we bring in the ultra
high networth into New Zealand through Nashale Globe, is that
once you have the visa, you do not have to
(15:03):
reapply for it, and that is reasonably unique in terms
of Golden visas globally. So once you've got your permanent residency,
you've got it for life.
Speaker 1 (15:11):
So are there requirements or at least guidelines in terms
of the people who would apply for these visas the
expectation that they would put money to work in the
economy to invest. Is there a kind of a structure
to that part of the process.
Speaker 5 (15:26):
Yeah, there is. So there's two categories. There's the growth
category that's the five million kiwi and then there's the
balance category and that's ten million kiwi. As mentioned about
two point eight million UIs about just under six million
US and the others category. And the businesses that people
can invest in they must be vetted by our New
Zealand Train Enterprise, which is like an Economic development of
(15:48):
the government. So there are a number of companies that
have been vetted by the government to prove that they
are of majority of New Zealand citizenship. People can also
put their money into bonds or manage funds, and again
the managed funds have to be approved by the Ministry
for Economic Development. Now there are two reasons for this.
First and foremost, we need to make sure that when
(16:09):
people are investing in New Zealand companies that the companies
themselves have integrity. You know, we don't want investors coming
over here from the other side of the world and
feelings if they've been ripped off it all. And it's
one of the services that we offer at Nationally Global actually.
But the other thing is that it's got to be
companies or funds that are predominantly New Zealand owned, because
you know, why would you seek money to invest in
(16:33):
a company or a fund in New Zealand when it's
not helping the New Zealand economy.
Speaker 1 (16:37):
So Nash Kelly Global helps to facilitate this process. But
when I think of the economy in New Zealand, I
think of the rising property market, how expensive the cost
of living is, particularly on the housing front, and I'm
wondering whether or not the local community has been supportive
of this program or whether there has been a pushback.
Speaker 5 (16:59):
It's a really good point, Doug. We're not dealing with
hundreds of thousands of people here. And you know, there
was a point in time when when I was in
cabinet where we put a foreign buyer ban on because
what we were seeing is literally planeloads of people coming
over and buying houses in New Zealand because we have
no capital gains tax, and so we put a stop
(17:22):
on that. But you know what we're now seeing is
ultrah networth people coming in and if you're spending you know,
five million kiwi or ten million kiwi, you're not competing
with first home buyers in New Zealand. You know, I say,
you're competing with the lotto winners.
Speaker 4 (17:36):
Right.
Speaker 5 (17:37):
So the people who are coming and they're settling here,
they are buying houses, you know, five million plus and
so buy and large the business community and the vast
majority in our communities get the fact that the people
coming over under the Golden Visas scheme are bringing actually
wealth and connections and money that will actually create economic
(17:58):
development and jobs. So look, there's a little bit of
pushback on the fringe that by and large the vast
majority you're very supportive of this.
Speaker 1 (18:06):
That's said, does the government need to or is it
in the process of creating restrictions around this program?
Speaker 5 (18:14):
Not at all. In fact, we've opened it up a
little bit more. Whilst other countries are putting restrictions. New
Zealand has taken off the English language test. We've reduced
the amount of time that you have to spend in
the country. So in the growth category you've only got
to spend three weeks over three years in order to
get your permanent residency. In the balance category, it's forty
(18:36):
nine days over five years. So we've reduced some of
the barriers. But we also acknowledge, as back to the
earlier point Doug, that we want people with integrity. Hence
the reason why the process you've got to go through
to be to get your visa is robust.
Speaker 1 (18:56):
I'm curious as to whether or not there has been
any economic analysis as to the extent to which this
may contribute to overall growth in the economy.
Speaker 5 (19:07):
Yeah, we have seen a lot. That the new visa
was only launched in the first of April, there was
quite a lot of analysis done under the old visa
scheme and it showed I can't remember the exact amount,
but it was certainly billions into the economy. One thing
we have tightened up on though I launched this visa
(19:31):
in twenty twenty two, what we did tighten up on
is the money has got to be invested in stay
in New Zealand as opposed to repatriating it out of
the country. So our immigration ministry will check that people
are actually investing in a way that they said they
would to ensure that the money is staying here and
helping the New Zealand economy and the number of our
(19:51):
companies go global. If that's what they want to.
Speaker 1 (19:52):
Do, Stuart will leave it there. Thank you so much
for joining us. A great conversation with Stuart Nash of
Nash Kelley Global. He is a former Minister of Economic
Development in New Zealand. As we talk about golden visas
here on the Daybreak Asia Podcast. Thanks for listening to
today's episode of the Bloomberg Daybreak Asia Edition podcast. Each weekday,
(20:15):
we look at the story shaping markets, finance, and geopolitics
in the Asia Pacific. You can find us on Apple, Spotify,
the Bloomberg Podcast YouTube channel, or anywhere else you listen.
Join us again tomorrow for insight on the market moves
from Hong Kong to Singapore and Australia. I'm Doug Prisner
and this is Bloomberg
Bloomberg Audio Studios, podcasts, radio news. Welcome to the Daybreak
Asia podcast. I'm Doug Chrisner. Tariffs and other policies from
the Trump administration do remain a major risk for markets.
It was on Friday we had the S and P
falling more than one percent intra day. That's when President
(00:25):
Trump accused Beijing of violating an agreement with the US
to ease tariffs. Then later in the day the market
was able to recover. And that came after Trump said
he's expecting to speak with President Chi over the weekend.
The White House said that call could happen this week.
Here is Kevin Hassett. He is the director of the
National Economic Council, speaking on ABC's This Week.
Speaker 2 (00:49):
We expect it's going to have a wonderful conversation about
the trade negotiations this week with President she That's our expectation,
But the bottomlight is that we've got to be ready
in case things don't happen the way we want.
Speaker 1 (01:00):
That's Kevin Hassett. He is the director of the White
House National Economic Council. So let's take a closer look
at what tariffs mean for the economy. I'm joined now
by Carol Schleife. She's on the line from Minneapolis. Carol
is the chief market strategist at BEMO Private Wealth. Carol,
it's always a pleasure. It's been too long since we
(01:20):
last spoke. I'm glad you could join us. Thank you
so much. I don't know how anyone these days can
go about predicting the impact of tariff policy, especially the FED,
But I would like to begin with the impact on
the consumer. And I'm wondering, from your point of view,
whether the tariff story has been the primary driver of
this weakening that we have seen in consumer sentiment.
Speaker 3 (01:43):
You know, it's one factor in sentiment, and it's always
important with the caveat or when you're talking about either
consumer sentiment, business sentiment, market sentiment, investor sentiment is that
the consumers can tell pollsters they're krabby and then go
out and purchase anyway. So it's consumers actually, in the
(02:04):
long run are much more tied to job prospects and
employment prospects, whether or not they have a job and
feel like they can continue to have a job.
Speaker 4 (02:14):
If they do, they'll spend.
Speaker 3 (02:15):
But it is overurking, particularly in that very sensitive top
tier consumer who are responsible for so much of the
aggregate GDP, and they're tied as well to how they're
feeling about their portfolios. And fortunately or unfortunately, markets can
react very quickly to changing tariff news. Companies can't. And
(02:38):
so the tricky thing for us in the wealth management
spaces to watch does consumer sentiment translate into what they
actually do on the one hand, and do fundamentals does
the fundamental stasis, if you will, that business is put
in by all the uncertainty translate into economic changes And
(02:59):
so far consumers are spending and the economy's in pretty
reasonable shape. So so far, so good, But it's a
very fragile relationship.
Speaker 1 (03:08):
So we're now at the end of the earning season
and I'm sure you've been listening to many calls and
getting the guidance. Much of it reflects the fact, yes,
that these tariffs are in place and higher prices are
clearly a part of the equation right now. You can
debate whether or not these companies are in a position
to pass on those higher cost to consumers. But to
what extent are you concerned now about margin pressure?
Speaker 3 (03:32):
Yeah, there's definitely that potential. It's important to remember that
the starting ground for that margin pressure is margins that
by and large inaggregator at all time highs. It was
a very instructive earning season, and then companies did We're
trying to threat a very fine needle in trying to
outline what the impact or the potential impact of tariffs
(03:53):
were without waving too big of a red flag because
that's obviously a sense of politically sensitive issue. But I
think as investors we got a lot of good read
and particularly in the most recent batch of retail earnings,
where a lot of the retail were outlining what their
impact was, what steps they were taking where they could
(04:16):
to try to shift supply chains, and they also by
and large illustrated a lot of sensitivity because they understand
this is not like in the pandemic when we had
inflation for the first time and they could just simply
pass it all through. This time around, consumers are highly
tired of price increases and it's going to be very selective,
if at all, and you've seen that creep through in
(04:38):
the economic numbers, where on the producer side is where
some of that's absorbed. But hopefully company by company they
can find some offsets for some of that. In terms
of deployment of artificial intelligence, deployment of technology, slow walking hires.
You know, there's a lot of things that companies are
trying to do behind the scenes to minimize that margin
(05:00):
pressure because they understand that they're going to have to
eat more of this than they did last time.
Speaker 4 (05:04):
Around.
Speaker 1 (05:05):
One of the conversations on the street, and I know
that you're well aware of this is the gap between
what the hard data is indicating and what some of
the softer, more sentiment driven data is kind of indicating.
And I'm wondering how you make sense of that.
Speaker 3 (05:19):
Well, I think a piece of it is is, you know,
because even share Paul and several of the different press
conferences from recent FOMC meetings will tell you that sentiment
data has a very loose correlation typically through to the
hard data. And we saw some hints last week that
you might have seen that start to shift in both
(05:40):
the Yumish survey and the conference board, where you saw
some snap back and consumer confidence that came after the
thawing in relationship or in the thawing in the trade
war between the US and China. And I think the
hard part is in the last two weeks, in particularly
We've had so many flip flops on tariffs that it
(06:00):
feels like consumers and definitely investors want to move on
to some other topic, So the sooner we can get
the narrative focused on growth in the economy or the
more pro business friendly pieces of the administration's tax policy,
as long as they keep it to a reasonable price
tag and don't upset the bond markets, which is a
(06:21):
whole other issue. But right now we're watching it very
closely to see if it translates through to economic activity.
It hasn't translated through yet, but we're watching it very,
very carefully.
Speaker 1 (06:34):
I'm glad you mentioned the bond market will get there
in a moment, but we were talking about margin pressure
companies trying to contain cost. We get the employment data
this week, which is significant, I guess, probably the most
important piece on a monthly basis what are your expectations here?
What are we going to learn about the labor market
that we don't already know?
Speaker 3 (06:56):
Well, I think the one thing I want to see
is I've heard some inclin from some hinting from economists
that for the first time since well before the pandemic,
we may get to a point where job openings are
below job seekers because as you recall some of the
tightness we've had in the labor market off and on
(07:17):
for the last five years, it's been we were at
a point at one point where there are two openings
for every seeker, and so a better balanced job market
means people have it's tougher asking for raises. They're more
likely to hunker down and stay put and not change jobs,
which is more helpful for employers. And I think watching
(07:39):
employers too, because selectively you're seeing some cutbacks, although they're
being very quiet and not not necessarily announcing them with
big media headlines because they don't want to overly concern
the workers they do have because of the understanding how
hard it was to get those workers in place. But
(08:00):
you know, some of the different manufacturing seminars and gatherings
I've been going to since the first of the year,
that has been a theme all years at the there
that employers are able to hang on to employees, and
so there's the job market has been less of an issue.
Speaker 4 (08:19):
But we'll definitely want to watch.
Speaker 3 (08:21):
If the wages are going up or if they're staying
in line, because they've been moderating quite a bit in
the last couple of quarters.
Speaker 1 (08:29):
So the Senate returns to Washington this week and lawmakers
are going to be taking up the spending build it
recently passed the House. You know well that during that
process there were some ructions in the bond market. Now,
we heard recently from Jamie Dimond, the head of JP
Morgan Chase, and he was saying that a crack in
the bond market is going to happen, and I'm wondering
(08:51):
what he knows that maybe we need to know.
Speaker 4 (08:55):
I'm not certain he knows anything.
Speaker 3 (08:57):
I mean, keep in mind the heads of banks for
called for serious recessions a couple of years ago.
Speaker 4 (09:02):
That never emerged either.
Speaker 3 (09:03):
But I do think and I wrote about this a
couple of weeks ago because I wrote up the issue
coming out of the House, and I noted then that
you'd had the twenty year bond auction had been very squishy,
and that it was I don't want to say cute
or amusing, but it's interesting that Congress thinks they have
(09:25):
a big vote in this, because I think ultimately the
bond market's going to have the biggest vote in what
the size of the potential deficit is because the thing
that will be interesting is one of the things I'll
be talking to our field about this week too. To
watch is that now that the Senate's back this week,
they've on paper allowed themselves a bigger potential deficit than
(09:45):
the House had, and that the market.
Speaker 4 (09:48):
Won't The bond market will not take kindly to that.
Speaker 3 (09:50):
And we saw what happened last week in Japan with
the longer yields. They're having very poor auctions. Our bond
markets were little reassured this week because we had shorter
auctions and they all went off well and yields drifted
back down a little bit, but they're still with the
tenuere at four and a half percent and the thirty
(10:12):
year having flirted with five. Investors will be watching that
very carefully, and I sincerely hope the Senate does too.
Speaker 1 (10:21):
Are you wary of the bond market right now? Maybe
you would be disinclined to take a position even if
it were let's say at the shore to medium part
of the curve.
Speaker 3 (10:30):
Now, I think, I think that bond market will help
keep them on line. And I think the fact that
Secretary Vescent is so plugged in, and I mean because
he started coaching President Trump very early on, even before
he was had secured Senate approval, he was getting President
Trump to focus on that tenure.
Speaker 4 (10:51):
In the yields there.
Speaker 3 (10:52):
So I would assume that if you start to see
serious things come out of the bond market that you're
going to you're going to get Congress to toe the
line on that.
Speaker 4 (11:03):
So I'm less concerned there.
Speaker 3 (11:04):
And I think you know our estimate of fear value
on the ten years four and a quarter, four and
three quarter in the near term, So you're right in
the middle of that range right now. And we've been
short recommending staying shorter on the curve for a very
long time. But I wouldn't mind stepping out a little
bit because we are not in the camp where we
(11:26):
think yields are going to blow out marketly to the
top side.
Speaker 1 (11:29):
Okay, we'll leave it there. Carol, always a pleasure. Thank
you so much. Thank you for joining us. Carol schlive
from Minneapolis. She is the chief market strategist at Demo
Private Wealth. Joining us here on the Daybreak Asia podcast.
Welcome back to the Daybreak Asia Podcast. I'm Doug Chrisner.
(11:51):
Recently US Commerce Secretary Howard Lutnik said a new US
visa program backed by President Trump was nearing launch. Lutnik
told Axios that a government website for the gold Card
visa would be live within days. Well, that was more
than a week ago, and so far it hasn't. The
five million dollar Trump Gold Card visa would give wealthy
(12:13):
investors US residency and an expedited path to citizenship. Well,
Forbes magazine said it's still just a concept of a
marketing plan without nearly enough potential buyers. But that's not
to say golden visa programs aren't working. In New Zealand,
for example, the country has streamlined its program and it's
(12:34):
been able to attract more wealthy investors. For a closer
look at golden visas, I'm joined now by Stuart Nash.
He is former Minister of Economic Development in New Zealand.
He's also a co founder of Nash Kelly Global. Stuart,
thank you so much for making time to chat with me.
Why do you think there is this interest in golden
(12:55):
visa programs these days?
Speaker 5 (12:58):
Well, certainly I can speak about New Zealand. Is there's
a lot of global uncertainty at the moment. You've got
obviously a war going on, in Europe, you've got the
tinder box which is the Middle East. You've got a
change in the US administration, which again in itself was
causing a lot of uncertainty. And in a country like
New Zealand, we're sort of seen as an oasis at
the bottom of the world where by and large the
(13:20):
ultra high networth they tend to seek out tax havens
for their wealth. But at the moment there's a number
who were seeking out safe havens as opposed to tax havens.
Speaker 1 (13:28):
You also have a background in law enforcement, so I'm
going to ask you about the vetting process in the
situation like this. Described to me what it looks like.
Speaker 5 (13:40):
Yeah, well, I was the Minister of Police and what
we're very clear about with regard to our Golden Visa
is that it has to have integrity. So there is
a process you've got to go through. You've got to invest.
There are two schemes. One of them is five million
New Zealand, which is about two point eight million US dollars,
and you've got to prove that the money was through
(14:00):
legitimate means, and that's a reasonably robust process. And there's
another scheme where you can invest ten million dollars again,
that's about just under six million US. Again, you've got
to prove the money was was going through legitimate processes.
You've also got to go through health checks and your
stock standard checks to prove that you are a suitable person.
(14:21):
So you know, we don't want rogues and vagabonds into
the country. We want people who are legitimate investors, who
play into the New Zealand brand and who bring not
only their wealth, but for me, one of the really
important things is they bring their experience, their competencies, their capabilities,
their networks and their connections.
Speaker 1 (14:39):
What about the requirement to speak English.
Speaker 5 (14:42):
That was in the old visa. The visa has now
changed and there is now no English language requirement. The
other thing about New Zealand's Golden Visa as well, and
this is important for a number of our clients at
Nashcally Global because as mentioned we bring in the ultra
high networth into New Zealand through Nashale Globe, is that
once you have the visa, you do not have to
(15:03):
reapply for it, and that is reasonably unique in terms
of Golden visas globally. So once you've got your permanent residency,
you've got it for life.
Speaker 1 (15:11):
So are there requirements or at least guidelines in terms
of the people who would apply for these visas the
expectation that they would put money to work in the
economy to invest. Is there a kind of a structure
to that part of the process.
Speaker 5 (15:26):
Yeah, there is. So there's two categories. There's the growth
category that's the five million kiwi and then there's the
balance category and that's ten million kiwi. As mentioned about
two point eight million UIs about just under six million
US and the others category. And the businesses that people
can invest in they must be vetted by our New
Zealand Train Enterprise, which is like an Economic development of
(15:48):
the government. So there are a number of companies that
have been vetted by the government to prove that they
are of majority of New Zealand citizenship. People can also
put their money into bonds or manage funds, and again
the managed funds have to be approved by the Ministry
for Economic Development. Now there are two reasons for this.
First and foremost, we need to make sure that when
(16:09):
people are investing in New Zealand companies that the companies
themselves have integrity. You know, we don't want investors coming
over here from the other side of the world and
feelings if they've been ripped off it all. And it's
one of the services that we offer at Nationally Global actually.
But the other thing is that it's got to be
companies or funds that are predominantly New Zealand owned, because
you know, why would you seek money to invest in
(16:33):
a company or a fund in New Zealand when it's
not helping the New Zealand economy.
Speaker 1 (16:37):
So Nash Kelly Global helps to facilitate this process. But
when I think of the economy in New Zealand, I
think of the rising property market, how expensive the cost
of living is, particularly on the housing front, and I'm
wondering whether or not the local community has been supportive
of this program or whether there has been a pushback.
Speaker 5 (16:59):
It's a really good point, Doug. We're not dealing with
hundreds of thousands of people here. And you know, there
was a point in time when when I was in
cabinet where we put a foreign buyer ban on because
what we were seeing is literally planeloads of people coming
over and buying houses in New Zealand because we have
no capital gains tax, and so we put a stop
(17:22):
on that. But you know what we're now seeing is
ultrah networth people coming in and if you're spending you know,
five million kiwi or ten million kiwi, you're not competing
with first home buyers in New Zealand. You know, I say,
you're competing with the lotto winners.
Speaker 4 (17:36):
Right.
Speaker 5 (17:37):
So the people who are coming and they're settling here,
they are buying houses, you know, five million plus and
so buy and large the business community and the vast
majority in our communities get the fact that the people
coming over under the Golden Visas scheme are bringing actually
wealth and connections and money that will actually create economic
(17:58):
development and jobs. So look, there's a little bit of
pushback on the fringe that by and large the vast
majority you're very supportive of this.
Speaker 1 (18:06):
That's said, does the government need to or is it
in the process of creating restrictions around this program?
Speaker 5 (18:14):
Not at all. In fact, we've opened it up a
little bit more. Whilst other countries are putting restrictions. New
Zealand has taken off the English language test. We've reduced
the amount of time that you have to spend in
the country. So in the growth category you've only got
to spend three weeks over three years in order to
get your permanent residency. In the balance category, it's forty
(18:36):
nine days over five years. So we've reduced some of
the barriers. But we also acknowledge, as back to the
earlier point Doug, that we want people with integrity. Hence
the reason why the process you've got to go through
to be to get your visa is robust.
Speaker 1 (18:56):
I'm curious as to whether or not there has been
any economic analysis as to the extent to which this
may contribute to overall growth in the economy.
Speaker 5 (19:07):
Yeah, we have seen a lot. That the new visa
was only launched in the first of April, there was
quite a lot of analysis done under the old visa
scheme and it showed I can't remember the exact amount,
but it was certainly billions into the economy. One thing
we have tightened up on though I launched this visa
(19:31):
in twenty twenty two, what we did tighten up on
is the money has got to be invested in stay
in New Zealand as opposed to repatriating it out of
the country. So our immigration ministry will check that people
are actually investing in a way that they said they
would to ensure that the money is staying here and
helping the New Zealand economy and the number of our
(19:51):
companies go global. If that's what they want to.
Speaker 1 (19:52):
Do, Stuart will leave it there. Thank you so much
for joining us. A great conversation with Stuart Nash of
Nash Kelley Global. He is a former Minister of Economic
Development in New Zealand. As we talk about golden visas
here on the Daybreak Asia Podcast. Thanks for listening to
today's episode of the Bloomberg Daybreak Asia Edition podcast. Each weekday,
(20:15):
we look at the story shaping markets, finance, and geopolitics
in the Asia Pacific. You can find us on Apple, Spotify,
the Bloomberg Podcast YouTube channel, or anywhere else you listen.
Join us again tomorrow for insight on the market moves
from Hong Kong to Singapore and Australia. I'm Doug Prisner
and this is Bloomberg
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