September 17, 2025 • 39 mins
Watch Carol and Tim LIVE every day on YouTube: http://bit.ly/3vTiACF.
Federal Reserve officials lowered their benchmark interest rate by a quarter percentage point and penciled in two more reductions this year following months of intense pressure from the White House to slash borrowing costs.
Chair Jerome Powell pointed to growing signs of weakness in the labor market to explain why officials decided it was time to cut rates after holding them steady since December amid concerns over tariff-driven inflation.
The decision comes at an extraordinary moment for the Fed. President Donald Trump, who has demanded drastic rate reductions and sought to exert more control over the US central bank, continued his legal battle this week to remove one official from the Fed board and install his own top economic adviser ahead of the highly anticipated gathering.
Fed Governor Lisa Cook and newly-sworn-in Governor Stephen Miran, who is on a temporary leave from his role as chair of the White House Council of Economic Advisers, both attended the meeting.
The Federal Open Market Committee voted 11-1 on Wednesday to cut the target range for the federal funds rate to 4%-4.25%, after holding rates steady for five straight meetings this year.
Today's show features:
- Danielle DiMartino Booth, CEO and Chief Strategist at QI research, on what to watch for from the FOMC for the rest of 2025
- Ethan Penner, 2026 Candidate for Governor of California and Managing Partner and co-Founder of Mosaic Real Estate Investors, on his political platform as an independent candidate
- Bloomberg "Open Interest" Co-Host Matt Miller on Tesla working on a redesign of its door handles that have drawn safety scrutiny
- Bloomberg News Reporter Zach Mider on Treasury Secretary Scott Bessent’s contradictory mortgage pledges
See omnystudio.com/listener for privacy information.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg business
Week Daily reporting from the magazine that helps global leaders
stay ahead with insight on the people, companies, and trends
shaping today's complex economy. Plus global business, finance and tech
(00:23):
news as it happens. The Bloomberg Business Week Daily Podcast
with Carol Masser and Tim Stenebeck on Bloomberg Radio.
Speaker 2 (00:31):
We want to stay on the FED decision and the
financial market outlook.
Speaker 3 (00:34):
Back with us is Danielle Di Martine Booth.
Speaker 2 (00:38):
She's CEO and chief strategist at the research and analytics
firm QI Research. She's a former advisor at the Dallas Fed.
She is the author of Fed Up and Insider's Taken
Why the Federal Reserve Is Bad for America that was
published back in twenty seventeen when there was some momentum
around the FED.
Speaker 3 (00:54):
And so she is back here in our Bloomberg Interactive
Broker's Studio. Do you still believe the FED is bad
for America?
Speaker 4 (01:00):
I don't think the FED right now is very good
for the American economy, let's put it that way, okay,
But I do think that the FED made a genuine
stand for FED independence today.
Speaker 2 (01:11):
Hmm, okay, lot to unpacked there. So wait, do you
agree with their decision today?
Speaker 5 (01:18):
I think it should have been a fifty basis point
rate cut.
Speaker 2 (01:21):
You know, with inflationary concerns that are out there.
Speaker 4 (01:23):
Even with inflationary concerns that are out there, Christopher Waller
gave a kind of a land descent.
Speaker 5 (01:29):
He did not descent, and that could that is the
biggest news of the day. Actually, yeah, because.
Speaker 4 (01:33):
Waller directed us to what he calls core private sector
job creation. What that does is it looks at private
sector job creation and it nets out education and healthcare.
We've had, you know, you guys have had a few
really good articles on that since the latest.
Speaker 5 (01:47):
And Plumber report.
Speaker 4 (01:48):
In any event, when you net out healthcare and an
education what we call recession proof industries. The last time
we had a job created in the private sector was April,
meaning according to Waller's benchmar the FED should have been
lowering rates not just in July, but in June and
in May as well, because that's how long we've seen
this private sector deterioration. And then we get June, right,
(02:11):
which has got a negative number in front of it.
The pandemic notwithstanding we haven't seen a negative print in
front of non foreigm payrolls in real time, mind you,
fairly real time since September of twenty ten. So it's
been a very long time since we've seen the job
market weaken to the extent that it has. And Waller
would agree with that, and yet he stood firm with
(02:33):
the rest of the committee today.
Speaker 6 (02:34):
So onto your statement that the FED made a good
case for its independence today, what was that?
Speaker 5 (02:39):
It was? That it's exactly what I just described.
Speaker 4 (02:43):
Waller's own research dictates that we should have been playing
catchups because we didn't lower in May, we didn't lower
in June or July. Yet he stood with the rest
of the community. He may well have given up a
shot at being chair, and the betting markets had him
in the top position going in. Of course, you could
not be interviewed these last few days because the FED
was so blackout.
Speaker 6 (03:02):
Isn't that a good thing for markets then? Isn't that
a good thing for people who are concerned? Yes, that
there is political pressure on this entity.
Speaker 5 (03:12):
Yes, because they.
Speaker 4 (03:13):
Pushed back against the political pressure through that prism, and
through that prism alone, the right thing.
Speaker 5 (03:18):
Was done today.
Speaker 4 (03:21):
That being said, they really do need to find some
time to catch up to the economy despite what's happening
with the potential for TARF passed through.
Speaker 6 (03:31):
Okay, so let's talk about that a little bit, because
I remember last time you were in here July twenty ninth.
It was the day before the most recent FED decision
before this.
Speaker 7 (03:41):
You came on and you.
Speaker 6 (03:42):
Said, the underemployment is such a big issue in this country,
and we're not looking at it the right way. What
I took away from our conversation was your evidence that
there were all these people out there who were essentially
doing gigwork who wanted to be working full time and
the effect that that's having on the economy. Does the
FED understand that in your view, Well, the.
Speaker 4 (04:04):
FED staff certainly does understand what's happening. We've had more
than one point four million full time jobs loss since
the beginning of this year, and we had a great
big boost to the labor force because the census had
us out a couple of million people into the population. No,
I think the FED understands, or at least the FED staff.
They've all been given these presentations. They understand the magnitude
(04:24):
of what's facing the job market. It's not a lack
of understanding, it's a lack of recognition because they're under attack.
But the FED completely understands that that incomes are understrained.
That the only thing that the class of twenty twenty
four can say if college graduates is you know, at
least we're better than the class of twenty twenty five.
I talked to college aged students all the time.
Speaker 3 (04:45):
The jobs are just.
Speaker 4 (04:46):
Not there, and you know, youth unemployment is at recessionary levels.
We have seventy seven percent of state in the United States,
seven percent of the population is in states with job openings.
Speaker 2 (05:01):
I mean, you got, what can the FED do by
cutting rates that will because what if it is because
of AI, Like, what is it if there are structural
changes that are going on in the labor market that
a rate should change.
Speaker 4 (05:13):
The Federal Reserve Act to no longer have the employment mandate,
You cannot ignore a weakening job market.
Speaker 2 (05:19):
But again I would go to if it's not the Fed,
Fed's they've got to look at inflation. There's a dual mandate,
and you know inflation, it's sticky. It's been sticky for
a while, right.
Speaker 5 (05:31):
God has been sticky.
Speaker 4 (05:32):
It absolutely so, and yet we're not seeing the fact that,
according to Redfin, eighty percent of the major metropolitan areas
in this country have falling home prices.
Speaker 5 (05:41):
That's not filtering through to the CPI.
Speaker 4 (05:43):
Nor will it yet, because there's typically, according to Fanny May,
a six quarter lag between you when you actually start
to see home prices falling.
Speaker 5 (05:49):
This is also we've also seen this in case Shiller
four months in a row now.
Speaker 4 (05:53):
But once you see that, it's a very long time
before you get that deflationary impulse that's evident in the CPI.
Speaker 3 (05:59):
But it's But don't you think about Danielle.
Speaker 2 (06:01):
I think about this a lot in terms of what's
going on in the economy, especially post pandemic, that there
are people who are have great jobs or in the
market they're doing okay, and then there's a lot of
the economy that isn't. And I don't know if that
is the result of FED policy or more policy that
maybe our lawmakers in Congress need to think more broadly,
(06:22):
not about political contributions that get them back into office
and companies amen to that.
Speaker 3 (06:28):
But rather thinking about all of America.
Speaker 5 (06:31):
So, you know, I wrote a whole book about it.
Speaker 3 (06:33):
I think I'm going to get off my soapbox.
Speaker 5 (06:35):
No, no, but you're on the right.
Speaker 7 (06:37):
But I'm just saying this.
Speaker 2 (06:38):
I don't know if it's the FED responsibility here the
inflation fact.
Speaker 4 (06:41):
I mean, if you're speaking philosophically, the inflation and employment
mandates are inherently conflicting. And this was a nineteen seventy
eight tweak to the Federal Reserve Act that completely changed
how the FED operates. Should the FED go back to
being only an entity that fights inflation? Absolutely, we shouldn't
make that happen yesterday. That, however, is an Act of Congress.
Speaker 2 (07:01):
So in other words, and the Fed has done the
right thing, they're watching inflation, inflation is.
Speaker 5 (07:05):
Getting until they're let off the hook. They still have
that employment mandate.
Speaker 3 (07:09):
Yeah, I mean, I don't know. I don't know what
the answer is. I think you could even see from J.
Speaker 2 (07:14):
Powell, although I think it's pretty remarkable that the markets
kind of went back to where they were, and you
do see the Treasury trade kind of saying all right,
we had inflation. It's a problem, so you know, we're
going to do the work maybe for the central bank.
Speaker 6 (07:26):
So then if you believe that that's what the FED
should be focusing on what is the right way to
challenge the labor market right now, or the right way
to ignite the labor market to get it back to
full employment.
Speaker 4 (07:36):
Well, as I said, outside of healthcare and education, we
have not seen a single job created in the private
sector since April.
Speaker 5 (07:44):
The private sector must be re engaged.
Speaker 4 (07:46):
And that's not going to be J Powell knocking on
somebody's door and saying, re engage. Doctor, gave you another
twenty five basis point rate cut.
Speaker 6 (07:52):
But do you think that will take something on the
fiscal side of things?
Speaker 7 (07:56):
Will it take?
Speaker 2 (07:57):
I mean, look, the companies are getting tax cuts already.
Leos are there at the White House. They're making large
investments in the United States also overseas. I know, but
that's what I'm trying to understand. I mean, there's the
opportunity to have that conversation.
Speaker 7 (08:09):
Yes, there is.
Speaker 4 (08:11):
At the moment, what we're seeing is capital expenditure plans
get cut. That's what we're seeing in every single regional
FED survey. They remain in contraction. Backlogs remain in contraction.
Companies are mired in uncertainty. There are a lot of
promises for investment going forward that even companies who think
they're investing in tomorrow have now just, oh, I don't know,
pulled their plans back to not be able to start
(08:33):
contruction until twenty twenty six in South Carolina.
Speaker 6 (08:34):
Where's the uncertainty coming from is a tariff policy.
Speaker 5 (08:39):
It's coming from every policy coming out of the White House.
Speaker 4 (08:42):
And I don't make a political statement when I say
that at all, but whether you're talking about geopolitics or economics,
it is literally a moving target and it's very difficult
to make long term investment decisions in prosperity in plant
and equipment, commit to saying we're going to be the
next generation of manufacturers in this kind of an environment
(09:05):
in which you cannot plan.
Speaker 2 (09:06):
So that uncertainty that comes from the White House and
the criticism that comes from the White House. Do you
see the impact of politics in this decision?
Speaker 8 (09:14):
Oh?
Speaker 5 (09:14):
Absolutely?
Speaker 3 (09:15):
And is it because of the uncertainty coming out Is
that what you're saying?
Speaker 4 (09:18):
Or oh no, until a certain gentleman stops being the
bully on the playground and calling a certain somebody else
too late. I think that there's every single reason in
the world for the FED to be in a defensive
posture because its independence is under a full frontal attack.
Speaker 3 (09:37):
All right, we gotta leave it there. Good good, heated.
Speaker 2 (09:40):
I Love Danielle Di Martine Boost to the CEO and
chief Strategies QI Research, Joining us right here in our
Bloomberg Interactive Broker's studio.
Speaker 7 (09:48):
Stay with us.
Speaker 6 (09:49):
More from Bloomberg Business Week Daily coming up after this.
Speaker 1 (09:56):
You're listening to the Bloomberg Business Week Daily Pod. Catch
us live weekday afternoons from two to five Easter and
listen on Apple Karplay and Android Otto with the Bloomberg
Business app, or watch us live on YouTube.
Speaker 2 (10:10):
The gubernatorial raised in California definitely picking up momentum just
a little bit more than a year away. We featured
a few possible candidates on air, and our next guest
launched his own bid to become California's next governor, targeting
voters disillusioned with Democratic rule but tim not ready to
vote Republican.
Speaker 6 (10:26):
Our next guest launch his bid to become California's next governor.
He's here in the studio with us Ethan Panner. As
we mentioned, he's twenty twenty six candidate for governor of California,
also founder and managing partner of Mosaic Real Estate Investors,
Ethan Welcome.
Speaker 7 (10:38):
How are you?
Speaker 9 (10:39):
I'm I'm very busy.
Speaker 6 (10:41):
Well, you're you're going to run for governor of California,
but you're in New York.
Speaker 7 (10:45):
Why are you in New York?
Speaker 9 (10:47):
Mm? Because you're here.
Speaker 7 (10:48):
Talking to us. Well, why do you why do you
want to run?
Speaker 9 (10:52):
Well?
Speaker 10 (10:53):
I really didn't see anyone who was qualified to do
the job raising their hand, and so I decided I
would do it. I feel that we're in a desperate place.
So I think that California has been so grossly mismanaged
for so long. All the statistics bear that out. The
quality of life has deteriorated so amazingly over the last
decade and even two, and it's time for somebody with
(11:15):
the real qualifications to do this job to step up.
Speaker 9 (11:18):
And that's what I decided I would do.
Speaker 3 (11:20):
What would you do differently? What don't you like?
Speaker 2 (11:22):
What needs to be changed that you think would change
the course of California in what you would perceive as
a good way.
Speaker 10 (11:27):
There are a number of things, but the most obvious thing,
the starter, is that we've repelled people. So we've been
last in net migration for five consecutive years, which means
people in the United States have preferred to live anywhere
but California, which is shocking considering it's California.
Speaker 9 (11:45):
Right, gorgeous, And.
Speaker 10 (11:48):
I think that we need to be more welcoming and
inviting to businesses. We need to grow our economy. Our
economy is important for everyone. It's important to create opportun
unities for our young people, but it's also important so
that we have the funds to make good on the
retirement benefit promises that people are counting on. So I
(12:09):
would do The first thing I would do is change
our tax policy.
Speaker 2 (12:13):
Well, let's talk about this because our understanding is you
are releasing a tax plan this week that would turn
California from one of the least friendly tax dates to
one of the top five. So what details. That's a
big broad statement. The devil's always in the details. So
what's specific?
Speaker 10 (12:28):
So the Tax Foundation ranks all fifty states by their
tax policy. We're currently ranked forty ninth, and pro form
on my policy would move us to third according to
the Tax Foundation.
Speaker 3 (12:42):
How do you do that?
Speaker 5 (12:43):
How do you do that well?
Speaker 2 (12:44):
And what do you do specifically? Because you also talked
about needing revenues for things. So I'm just curious how
you get Yeah.
Speaker 10 (12:50):
So it would be importantly, Carol. It will be a
revenue neutral to revenue growth plan. So everyone else, everyone
that talks about changing our tax plan talks about cutting taxes,
and I understand kind of the intuitive appeal to some people,
but of course that that really doesn't the math doesn't work.
We need to actually pay for the things we need
in California.
Speaker 9 (13:11):
To support our society.
Speaker 10 (13:13):
So mine is a revenue neutral that will ultimately be
a revenue growth idea. It's about replacing income tax with
a consumption taxun mentally.
Speaker 7 (13:22):
That's the plant, so explain the details there.
Speaker 10 (13:25):
We will eliminate all state income tax, both corporate and personal.
Speaker 9 (13:30):
Wow, amazing. We will replace.
Speaker 10 (13:34):
All state sales tax, including our horrible gasoline tax, and
all of that will be replaced by a single fifteen
percent consumption tax on goods and services.
Speaker 6 (13:43):
But does California Okay, So you're coming at this from
the angle where California has been a net loss when
it comes to migration. Yes, do you want? Can California
handle more people? Because the real estate price is there
well in so many places and very desirable places to
live are out of control.
Speaker 9 (14:00):
That's a phenomenal question.
Speaker 6 (14:01):
But the challenge is on a local level because you
have all these people that say, yes, we want more
affordable housing, but do not build that multi family house
right here.
Speaker 10 (14:09):
Our problem has really nothing to do with having too
many people. It has to do with too few housing units.
So the RAND Corporation published a paper last year that
showed that it costs one hundred and ten thousand dollars
more to build an apartment unit in the state of
California than in the neighboring state of Arizona or most
(14:31):
other states.
Speaker 7 (14:32):
For regulatory raisons, it's all.
Speaker 10 (14:33):
Driven by regulatory red tape. That's the second thing I
would have to do is really streamline our regulatory approval processes.
So the tax plan is stage one. Stage two is
the streamlining of regulatory processes.
Speaker 2 (14:47):
How do you think about it against a backdrop or
climate change is certainly impacting California neighborhoods in a big way,
and so build back has also got to think about
how do you make it safer.
Speaker 10 (14:56):
So environmental greatness is really at the foundation of California.
I mean, you're from California and you know this. I
take all of my vacations hiking in the nature of California.
Speaker 9 (15:09):
It's amazing, right, and.
Speaker 6 (15:11):
So first trip to you, somebody, I'm a few months
ago for Carol Mass So it's incredible.
Speaker 5 (15:15):
Corgeous, everything in exactly right, I really, and.
Speaker 2 (15:20):
Passing a massive wind farm to get there, so it's
certainly ambrazing.
Speaker 10 (15:23):
So I think that we we have to be as
vigilant as we've ever been about protecting our natural beauty
and our resources. But but we don't need nineteen different
organizations that a developer of an apartment has to go
through an approval process for. We need one, one very
good one powered by AI with great responsiveness. Rather than
(15:47):
five years, how about five days to get your feedback,
how about fifteen minutes to get your feedback.
Speaker 9 (15:53):
There's no reason that we.
Speaker 10 (15:54):
Can't use technology intelligently, and there's no reason we can't
have both both the things. We can have environmental beauty
and environmental soundness and make it easy for people to
build the units that we actually need to drop costs
and make living more affordable.
Speaker 2 (16:10):
One of the thing you're talking about too, when it
comes to housing and tim see it. We see it
when we've been to Seattle. We live in New York City.
Go any place where it's warm, the heart warm, and
there's a high cost of living, high cost, but the
homeless populations and it's you know, I went to college
here in New York many many years ago and it
was a homeless problem. And here we are again in
twenty twenty five and we haven't figured this out. What
(16:32):
you are looking to build some communities from my understanding
in rural areas for homeless people to live in, how
would you fund that? How long do you would you
expect it to take to get that done? How do
you roll that all up?
Speaker 10 (16:44):
So it gets back to the original question of bringing
true competence, the required competence to lead the state at
this moment. We need the skills that I bring to
the table. We need an understanding of how to build things.
We need an understanding and appreciation and for how to
have transparency. It's not that we don't have the money.
We've spent twenty five billion dollars in the last state
(17:06):
money in the last four years and all that's gotten
us is nothing but twenty five percent more homeless. So
nothing's been solved. We have systems that don't work we
have a management system that's failing us. We don't know
where the money is, there's no accountability, So how.
Speaker 5 (17:21):
Do you do this?
Speaker 2 (17:22):
Then you're saying that with this consumption to actually have
the money to do this, and how do you get
how quickly can you get it built?
Speaker 10 (17:27):
Well, So it's a combination of things. One is, yes,
the money is there, although we squandered so much money ready,
the money is there for this. Second of all, we
have to use smart building. We don't have government. We
need public private partnerships and my government will lean very
heavily on private excellence to work in tandem with public
(17:49):
oversight to get things done fast.
Speaker 9 (17:51):
And I think that.
Speaker 10 (17:53):
Modular housing is definitely one of the answers. Yeah, but
we have to combine competence, a commitment to safety, and
a love for our fellow people right especially I'm proud
to be in California. We care for our most vulnerable neighbors.
That will never change, but we need to do it
the right way. These people, unfortunately, with all the money
(18:14):
we've spent, still sleep on the pavement.
Speaker 6 (18:17):
We're speaking with Ethan Penner, twenty twenty six, candidate for
Governor of California and also the founder and managing partner
of Mosaic Real Estate Investors. On the homelessness question, it
obviously has to do with housing, it has to do
with mental health. There's no easy solution, as we've learned
on the regulatory side of things. You said, for building housing,
you want to streamline regulations, get rid of red tape.
(18:39):
But how specifically do you do that? Because it's an
easy thing to say, But as we're learning in the
wake of the fires in Pacific Palisades and the waste
removal going to New Calabasas and the landfill there, people
are not happy about that, Like, how do you do
this in a way that satisfies these constituents.
Speaker 10 (18:58):
Well, I think it's top down, actually, So I think
we have to set a standard from the from the
Governor's office and Sacramento, and that standard has to be Look,
if I get elected, it will be with a mandate
for change. Right, I'm the consummate outsider. I don't belong
to either of the main parties. I've never had a
day in political office. So I'm running for a mandate
(19:20):
for change with specific policies in mind, and I believe
the people's will will be heard. Through me and that
will that will empower me to actually make change.
Speaker 3 (19:29):
But you understand, I mean, I do understand me.
Speaker 10 (19:32):
I understand bureaucracy very well, work at big companies.
Speaker 2 (19:35):
But I'm just thinking about Elon musk Doze. Even in
the federal government, and yes, USA dismantled, other offices or
other built departments dismantled, But it's not easy to kind
of you know, all these regulatory checkpoints. I mean, how
do you really do it when it gets down to it,
how do you do it?
Speaker 10 (19:54):
In you know, I'll tell you two things. One, I
am not willing to accept that it's hard or impossible
to do. And I'm going to commit myself fully to
doing that. And I know for sure, if people like
you and I don't commit ourselves to positive change, the
answer is one hundred percent bad. So I'm going to
commit myself and I'm going to do as good a
(20:16):
job as I can.
Speaker 9 (20:17):
Second, I really do.
Speaker 10 (20:19):
Believe that most people in government, in state government in
California go into their jobs wanting to do the right
thing for their people. I really do believe that. And
I think that as a non partisan and a non
career politician who's not trying to advance my career at all.
I think I'm going to be very uniquely well received
by the legislature because I won't be viewed as oppositional
(20:42):
in any way.
Speaker 6 (20:43):
We got to talk property taxes. Do you think something
has to change with property taxes in California? In the
context is that somebody like my parents, who've lived in
the same house since the nineteen nineties, pay basically nothing
in property taxes thanks to the passing of a certain
proposition many years ago. But if somebody were to buy
that house, like you know, the next family to own
that house, the property taxes would be debilitating and it
(21:06):
makes it so people stay in homes for a very
long time and contributes to the housing crisis. Some critics say,
you know what, I don't believe that's true.
Speaker 9 (21:14):
Well, I don't accept that. I think that.
Speaker 10 (21:17):
I think that we are our society, our community is
served well by continuity, and I think that having people
be forced out of their homes because of appreciation it
denigrates our community. It denigrates the continuity of our community.
So I would I would not try to change that policy.
(21:37):
I think that's a wonderful policy.
Speaker 2 (21:39):
Got to ask you about Governor Newsom his feed with
the president, the President's attention on California on many states.
Speaker 3 (21:45):
How would you posture yourself toward President chup Well, I.
Speaker 9 (21:49):
Think that.
Speaker 10 (21:51):
Both parties are busy fighting with each other about the
president pro or against the President, and I feel that
it's a gigantic distraction from the incompetence that they've brought
to the table in actually doing their job for the
citizens of California. I will not be engaged in that distraction.
For me, I'm laser focused on serving the needs of
(22:13):
the people in California who would be electing me, who
I care for.
Speaker 3 (22:17):
But what do you do, though, Ethan?
Speaker 2 (22:19):
If President Trump you do a policy and you are
a social media post at seven am in the morning
of something he doesn't like, and he says, maybe we're
going to go down to California and talk to Governor Penner, Well,
what do you do?
Speaker 10 (22:35):
I think that every leader Carol has to approach their
job with humility, and I don't see that as often
as I would like. So Governor Penner would remember that
Governor Penner is a servant for the people, and Governor
Penner would understand that whatever he says or does he
has to take in mind. Is this in the best
(22:56):
interests of the people who he's serving and fighting with?
The President the United States? It's not in the best
interests of the people. Okay, this is definitely not. So
I would try to have a workable relationship with both
the legislatives, the legislature that I would need to work with,
but also the federal government, because, as you point out,
that's a very important relationship. Whether it's this president or
(23:19):
another president. It's not about my personality and the personality
of another, which I think, unfortunately we see today becoming
the story. I don't need to be the story. My
personality is not that important to me. My job as
serving the needs of the people who elected me is
the only thing I care about.
Speaker 2 (23:38):
Well, stay in touch as this year progresses.
Speaker 3 (23:41):
I'd love to see how things are going. Ethan. Thank
you so much.
Speaker 9 (23:43):
Thanks for having me.
Speaker 3 (23:44):
Yeah, I really appreciate.
Speaker 2 (23:45):
Ethan Penner twenty twenty six, candidate for Governor of California,
Founder and Managing director of Mosaic Real Estate Investors.
Speaker 3 (23:51):
We did not get to talk about the CNBS markets.
Maybe next time around. Next time, Ethan, thank.
Speaker 7 (23:56):
You stay with us.
Speaker 6 (23:58):
More from Bloomberg Business Week Daily coming out up after this.
Speaker 1 (24:05):
This is the Bloomberg Business Week Daily Podcast. Listen live
each weekday starting at two pm Eastern on Applecarflay and
Android Auto with the Bloomberg Business App. You can also
listen live on Amazon Alexa from our flagship New York station.
Just say Alexa play Bloomberg eleven thirty.
Speaker 6 (24:24):
Hey, I want to get to some breaking news. Redhead
crossing the Bloomberg terminal just in the last hour. Tesla
working on a redesign of its vehicle door handles, which
have drawn scrutiny over safety issues. We've got Matt Miller
with us. He's the co host of Open Interest on
Bloomberg TV and the Hot Pursuit podcast with Hannah Miller. Matt,
this news coming thanks to an interview that you and
Hannah did with somebody at Tesla. It's longtime design chief.
Speaker 7 (24:49):
What can you tell us?
Speaker 3 (24:50):
Yeah, Hannah Elliott.
Speaker 7 (24:51):
First of all, Oh, Hana Elliott? Did I say, Hannah Miller?
Speaker 11 (24:54):
She hooked up this interview with Franz von Holdtausen. She
ran into him at the Tesla Diner in Los Angeles
and she said, Hey, come on our podcast. It's called
Hot Pursuit. You can find it on Spotify, Apple Podcasts,
or wherever you listen. And yeah, we asked him about
the door handles because you know, Bloomberg BusinessWeek wrote this
(25:17):
story about people having difficulties getting out or first responders,
even more concerningly, having difficulties opening doors from the outside
after accidents. And what he told us, and of course
he designed everything from the models to the cyber truck,
is that their response is a new door opening mechanism where,
(25:40):
for example, you push a button, the lighter press opens
it electronically, but if the battery is dead and you panic,
you push harder and that activates a mechanism that opens
it just like a normal door would. Lucid kind of
has this in the opposite direction. You pull a little
bit and it opens electronically, but if you're panicking, pull harder,
(26:00):
it opens mechanically.
Speaker 7 (26:01):
So it's pretty cool.
Speaker 2 (26:02):
We actually have some of that interview with Tesla's longtime
design chief that you and Hannah did.
Speaker 3 (26:06):
Let's listen.
Speaker 5 (26:06):
In Everybody, we.
Speaker 12 (26:07):
Actually have a mechanical release that's you know, basically right
at the electronic one two, and we're combining the two,
so you know in the moment that you're in a
panic situation, the muscle memory to go to you know
what you know is right there, so you just pull
a little bit further on the lever and you have
the mechanical release. So that's something that we're working on. Yeah,
(26:30):
and it's in the.
Speaker 7 (26:31):
Cars now, all right.
Speaker 11 (26:33):
So if there is, if there is then a China ban.
Speaker 7 (26:38):
You're ready to roll that out so that we're working well.
Speaker 11 (26:42):
Actually the ban the ban, I guess the Chinese issue
is the flat uh outer door handle. So would you
would you do something? Would you make a change, like
you know, Ferrari's have that little crease you can reach into.
Is there is there some idea about that on the outside.
Speaker 12 (26:58):
Yeah, we're working on it right now and just looking
at the you know, the details of the regulation if
and when that happens, and we'll have a really good
solution for that. I'm not I'm not worried about that.
Speaker 8 (27:11):
It makes sense, you know, I know, like it's one
thing for us adults to know that, but for kids,
you know, it's a little bit different to expect a
kid to know how to go for a manual release.
Speaker 12 (27:23):
Yeah, So the idea of combining the Electronic one and
the Manu one together into one button. I think, you know,
it makes a lot of sense. It really helps, you know,
the muscle memory of reaching for something every day is there,
and so you intuitively just crab the same thing and
you're free.
Speaker 5 (27:40):
All right.
Speaker 2 (27:41):
So that's Franz von Holdshausen, Tesla's longtime design chief, catching
up with Hannah Elliott and you anything that surprised you
in the conversation. I love that they're kind of moved
pretty quickly. I mean understanding this is a pretty serious situation. Yeah,
it's a serious situation.
Speaker 11 (27:55):
And not only has Beijing acted with potentially new regulation
at least a look into it, but the National Highway
Transportation Safety Administration NITSA is also looking into it. I
thought it was quite cool that rather than reacting defensively
as you might, I thought the same thing best, he
(28:17):
was like, you know what, let's just find a sensible solution.
He's really focused on sustainability. He's really focused on a
better way to travel for more people, for lower income people.
And don't forget that was the initial idea of this
car company. Obviously, they make these luxury vehicles now and
we think of them for you know, one hundred thousand dollars
(28:39):
cyber trucks. But the goal is, or always has been,
to fight climate change, and they've always been trying to
make a lower priced vehicle. They kind of achieve that
in a model why, but they think they can get
the price lower. And Frans has been there from the start,
so he's really focused on those goals.
Speaker 3 (28:58):
All right, great stuff, and everybody.
Speaker 11 (28:59):
Can not German. That was what surprised me the most.
What Franz von Holtzausen.
Speaker 5 (29:04):
What is he is?
Speaker 7 (29:05):
Not German? He's from Connecticut, from.
Speaker 3 (29:08):
Greenwich, the Melting Podcatrol. We love the Melting Pot. Matthew Miller,
thank you so much.
Speaker 2 (29:14):
Be sure to check out the full conversation that Matt
and Hannah had with him. You can find it on
his podcast, It's the Hot Pursuit Podcast. Catch it on
Bloomberg Radio and of course wherever you find your own
podcasts and you download them.
Speaker 6 (29:27):
Frans joining Matt and Franz joining Matt. And that's how
you say it in Connecticut, Matt, Franz and Hannah from
the Tesla robo van. I was, he was, yeah, you
can see it. I've never seen an interior that looks
like this. It's a it's this is a planned futuristic
mass trend, not massive diner.
Speaker 8 (29:47):
No.
Speaker 6 (29:47):
I don't know if it was at the diner, but
that thing looked like something out of the future. I
was like, what is that thing? Yeah, it is pretty
Check out the podcast the video portion too. Yeah, it's
also on the Bloomberg and at Bloomberg dot Com.
Speaker 3 (29:59):
Check the story.
Speaker 6 (30:01):
Stay with us more from Bloomberg Business Week Daily coming
up after this.
Speaker 1 (30:09):
You're listening to the Bloomberg Business Week Daily Podcast. Catch
us live weekday afternoons from two to five eas during
Listen on Applecarplay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.
Speaker 2 (30:23):
All right, let's get to the most read story in
the Bloomberg today. It's been there all day. It's about how,
like Fed Governor Lisa Cook, US Treasury Secretary Scott bessint
has made tim some contradictory mortgage pledges, ser.
Speaker 6 (30:35):
Gerry Bessen once agreeing to talking by two different houses
as his quote principal residents at the same time. The
story by Anthony Cormier and Zach Meier. Zach joins us
with more on their reporting. Zach is Bloomberg News reporter
Pullitzer Prize winning Bloomberg reporter. He joins us here in
our Bloomberg Interactive Brokers studios.
Speaker 3 (30:50):
It's an amazing reporter.
Speaker 5 (30:51):
I like to play it after.
Speaker 6 (30:52):
Well, I look, this story is getting picked up far
and wide. Everyone's picking up this story. Tell us about
your reporting.
Speaker 7 (30:58):
What did you find?
Speaker 9 (30:59):
Sure?
Speaker 13 (30:59):
So when you you saw the president try to fire
Lisa Cook, he said, you signed You signed one piece
of paper saying you're going to live in Michigan and
another promising you're going to live in Georgia, two different
houses at the same time as a condition of getting
your mortgage.
Speaker 3 (31:14):
It's your primary resident.
Speaker 13 (31:16):
Yes, and he's saying, maybe that's fraud. We don't know,
but it's enough to fire you. And so we and
I think a lot of other people in the Prescott
curious about, well, is she the only person that this
has ever happened to? And by the way, I should
mention that she said she's done nothing wrong and she subsequently,
you know, documents have come to light to say, at
least in at one case, the bank was understanding this
(31:38):
was going to be a vacation home. So we looked
in it turned out that the Treasury Secretary himself had
also signed agreed to two different to live in two
different places at the same time.
Speaker 6 (31:51):
Then there's the important context in your story and what
you learned too from the reporting. As far as who
represented the Treasury sect Terry in the signing of these documents,
talk a little bit about that.
Speaker 13 (32:03):
So, first of all, he didn't sign them himself. He
gave power of attorney to a lawyer who signed on
his behalf. But the bigger difference is there's really no
chance that what Besson did could possibly have been mortgage
fraunt because both of the mortgages were from the same bank.
It was all part of one big deal. It was
it was one lender, So it wasn't like he was
(32:24):
tricking one lender into thinking it was his primary residence
and then going to a different lender and getting a loan.
Speaker 6 (32:30):
So how is that different than the allegations against Lisa
so Cook.
Speaker 13 (32:33):
She refinanced her longtime home in Michigan, and then she
bought a condo in Georgia from a different bank a
couple of weeks later, and in that mortgage signed a
clause saying she would live there for the next year.
And which she had also done in her Michigan one. Now, subsequently,
a document came to Lights saying showing that in the
(32:55):
in the in the Atlanta case, it looks like the
bank was had the understanding that this was actually going
to be a vacation home. So the question is, well,
why did it get papered this way? And you can
ask a similar question about Beson. Clearly the bank didn't
expect him to split himself in half and live in
both places, and yet the paperwork got filed that way.
Speaker 2 (33:14):
Yeah, he said it right that he said that both
would be his principal residence.
Speaker 13 (33:20):
It's he agreed to both of those mortgages, which both
of them obligated him to live in those two different places.
Speaker 3 (33:28):
I mean, I don't know. I'm assuming, Zach, you and
the team are like looking at this.
Speaker 2 (33:31):
As you said, look, I mean, we've been talking about
this in the newsroom that we're thinking, gosh, you know,
didn't the government when they thought about kind of going
after Lisa Cook think about, Hey, anybody else had this situation?
What are you finding out as you reported out this story?
But just in general, is this common?
Speaker 13 (33:48):
I don't know what common, but you know, there's another
cabinet secretary, the Secretary of Labor, who has kind of
a fairly similar you know, two mortgages two months apart
in two different states where he's pledging to live there
for the next year. So it's not super uncommon, because
we've found a few just in looking at the top
(34:09):
officials in the government. It's probably not all that rare
for people to actually do it because of fraud. But
in all of these cases, the people involved or documents
we've obtained, show that they have at least a pretty
good argument that this wasn't fraud at all, and that
maybe it was just a matter of not filing the
(34:29):
paperwork in the right order. Typically, these things are everyone
signs basically the same mortgage agreement, and then if you
have a second home, you sign another thing called the
second home rider, which waives that documency clause. So if
somebody forgets to put that in front of you and
to file it, then maybe it just kind of slips
through the cracks and no one cares unless you happen
to be on.
Speaker 7 (34:49):
The FED board as you and the team.
Speaker 6 (34:51):
Right, Charles Rich had power of attorney to sign Secretary
Scott best Sin's documents on behalf of him. Rich who
signed the documents, wrote that of America was fully aware
that the Provincetown property was not a principal residence and
waved any requirement that it be used as a principal resident.
There was absolutely nothing improper about mister Besson's loan applications
with which he was minimally involved, as he had delegated
(35:14):
delegated authority to me.
Speaker 7 (35:16):
So is it the end of the story.
Speaker 13 (35:18):
So, just to be clear, our story isn't saying that
Besson did anything wrong. Rather, it's saying that maybe just
because these two pieces of paper are filed saying you're
going to live in two different places, it doesn't mean
that you've necessarily committed mortgage front. Clearly Investment's case, he didn't.
And in a lot of the other cases that we've seen,
there's often an innocent explanation that really means that it's
(35:43):
more of like a paperwork error.
Speaker 2 (35:45):
Yeah, I do think about that, right, just you know,
getting it wrong, as you said, either not signing something
or something not getting done.
Speaker 13 (35:52):
If you guys have ever been to a closing for
a house, you're asked to sign about ten thousand pieces
of paper. It's like you get your hand gets tired
from right now. I don't think there's that many people
who've read every single word on every page. I certainly haven't.
Speaker 2 (36:04):
I mean when I think of mortgage, I don't know
when you think of mortgage fraud, I think of something.
Speaker 3 (36:09):
Yeah, I kind of do, like intent, Yeah, like a
plan to kind of deceive either a lender or so.
Speaker 7 (36:15):
I don't think it's that.
Speaker 13 (36:16):
Unusual, though, for somebody to buy a vacation home and
when they get the mortgage, tell the tell the lender
they're going to live there, even if they really won't.
That would technically be fraud, if they really intended to
deceive the lender and get a more favorable interest rate. Right,
But we haven't seen that investments case.
Speaker 6 (36:33):
And is there anything we have to understand about the
difference between the words principle and primary.
Speaker 13 (36:39):
The word in the in the in the papers is
always principle.
Speaker 7 (36:43):
It's always principal, Yeah, okay.
Speaker 13 (36:44):
Yeah, And I think it's just it basically means, you know,
this is your real house, right and no other.
Speaker 2 (36:52):
Yeah, you know, I also think it's different. You know,
you guys say that how the situations are an identical.
And we've touched on this a little bit Sack, But
like Beson's mortgages two decades ago, signed by his lawyer,
he obviously was wealthy. There was no concern about his
ability probably to manage any kind of loans. Cook signed
hers personally, and much more recently, there are distinctions.
Speaker 13 (37:18):
Oh, there absolutely are. I think the common theme though,
is that if the Trump administration's view is that anyone
who signs document these documents that conflict with each other
right needs to be removed from office, then there are
actually other people in Washington who are in that same situation,
even if and let me be clear, they didn't do
(37:38):
anything wrong and are not only didn't commit mortgage fraud,
but didn't do anything wrong in Besson's case, probably wasn't
even aware of it until we ask questions.
Speaker 3 (37:47):
We can't help but feel that like there are lots
of officials.
Speaker 2 (37:50):
Potentially right now looking at things right and looking at
their documentation right, wait, going back and looking well that
everybody's looking at it, and you're right, and it doesn't
mean that anybody had intent to do something wrong?
Speaker 3 (38:01):
Is there?
Speaker 2 (38:03):
Does the investigation continue or not even an investigation?
Speaker 3 (38:06):
But you guys, continuing to look.
Speaker 13 (38:07):
The court case is proceeding with Lisa Cooks. She's she's
contesting her the Trump's attempt to fire her. She's for
for the moment, she's participating with the Fed today, right,
and so it's going to be up to the courts
to decide it. Could it could come down to whether
she actually did defraud Alenda or not. But it may
(38:30):
it may not.
Speaker 6 (38:31):
And as we heard from j Powell today, he will
not comment on a court case that's ongoing.
Speaker 2 (38:35):
Yeah, he made it very very clear. Interesting stories. We said,
it's the most red story on the Bloomberg.
Speaker 3 (38:40):
Zach, thank you so much.
Speaker 2 (38:41):
Thanks always appreciate, Zach Miider, Bloomberg News Reporter here and
of course you can read the entire story just head
to the Bloomberg or Bloomberg dot com.
Speaker 11 (38:49):
This is the Bloomberg Business Week Daily podcast, available on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 10 (38:57):
Listen live weekday afternoons from two to five pm Eastern
on Bloomberg dot com, the iHeartRadio app, tune In, and
the Bloomberg Business App.
Speaker 11 (39:06):
You can also watch us live every weekday on YouTube
and always on the Bloomberg terminal
Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg business
Week Daily reporting from the magazine that helps global leaders
stay ahead with insight on the people, companies, and trends
shaping today's complex economy. Plus global business, finance and tech
(00:23):
news as it happens. The Bloomberg Business Week Daily Podcast
with Carol Masser and Tim Stenebeck on Bloomberg Radio.
Speaker 2 (00:31):
We want to stay on the FED decision and the
financial market outlook.
Speaker 3 (00:34):
Back with us is Danielle Di Martine Booth.
Speaker 2 (00:38):
She's CEO and chief strategist at the research and analytics
firm QI Research. She's a former advisor at the Dallas Fed.
She is the author of Fed Up and Insider's Taken
Why the Federal Reserve Is Bad for America that was
published back in twenty seventeen when there was some momentum
around the FED.
Speaker 3 (00:54):
And so she is back here in our Bloomberg Interactive
Broker's Studio. Do you still believe the FED is bad
for America?
Speaker 4 (01:00):
I don't think the FED right now is very good
for the American economy, let's put it that way, okay,
But I do think that the FED made a genuine
stand for FED independence today.
Speaker 2 (01:11):
Hmm, okay, lot to unpacked there. So wait, do you
agree with their decision today?
Speaker 5 (01:18):
I think it should have been a fifty basis point
rate cut.
Speaker 2 (01:21):
You know, with inflationary concerns that are out there.
Speaker 4 (01:23):
Even with inflationary concerns that are out there, Christopher Waller
gave a kind of a land descent.
Speaker 5 (01:29):
He did not descent, and that could that is the
biggest news of the day. Actually, yeah, because.
Speaker 4 (01:33):
Waller directed us to what he calls core private sector
job creation. What that does is it looks at private
sector job creation and it nets out education and healthcare.
We've had, you know, you guys have had a few
really good articles on that since the latest.
Speaker 5 (01:47):
And Plumber report.
Speaker 4 (01:48):
In any event, when you net out healthcare and an
education what we call recession proof industries. The last time
we had a job created in the private sector was April,
meaning according to Waller's benchmar the FED should have been
lowering rates not just in July, but in June and
in May as well, because that's how long we've seen
this private sector deterioration. And then we get June, right,
(02:11):
which has got a negative number in front of it.
The pandemic notwithstanding we haven't seen a negative print in
front of non foreigm payrolls in real time, mind you,
fairly real time since September of twenty ten. So it's
been a very long time since we've seen the job
market weaken to the extent that it has. And Waller
would agree with that, and yet he stood firm with
(02:33):
the rest of the committee today.
Speaker 6 (02:34):
So onto your statement that the FED made a good
case for its independence today, what was that?
Speaker 5 (02:39):
It was? That it's exactly what I just described.
Speaker 4 (02:43):
Waller's own research dictates that we should have been playing
catchups because we didn't lower in May, we didn't lower
in June or July. Yet he stood with the rest
of the community. He may well have given up a
shot at being chair, and the betting markets had him
in the top position going in. Of course, you could
not be interviewed these last few days because the FED
was so blackout.
Speaker 6 (03:02):
Isn't that a good thing for markets then? Isn't that
a good thing for people who are concerned? Yes, that
there is political pressure on this entity.
Speaker 5 (03:12):
Yes, because they.
Speaker 4 (03:13):
Pushed back against the political pressure through that prism, and
through that prism alone, the right thing.
Speaker 5 (03:18):
Was done today.
Speaker 4 (03:21):
That being said, they really do need to find some
time to catch up to the economy despite what's happening
with the potential for TARF passed through.
Speaker 6 (03:31):
Okay, so let's talk about that a little bit, because
I remember last time you were in here July twenty ninth.
It was the day before the most recent FED decision
before this.
Speaker 7 (03:41):
You came on and you.
Speaker 6 (03:42):
Said, the underemployment is such a big issue in this country,
and we're not looking at it the right way. What
I took away from our conversation was your evidence that
there were all these people out there who were essentially
doing gigwork who wanted to be working full time and
the effect that that's having on the economy. Does the
FED understand that in your view, Well, the.
Speaker 4 (04:04):
FED staff certainly does understand what's happening. We've had more
than one point four million full time jobs loss since
the beginning of this year, and we had a great
big boost to the labor force because the census had
us out a couple of million people into the population. No,
I think the FED understands, or at least the FED staff.
They've all been given these presentations. They understand the magnitude
(04:24):
of what's facing the job market. It's not a lack
of understanding, it's a lack of recognition because they're under attack.
But the FED completely understands that that incomes are understrained.
That the only thing that the class of twenty twenty
four can say if college graduates is you know, at
least we're better than the class of twenty twenty five.
I talked to college aged students all the time.
Speaker 3 (04:45):
The jobs are just.
Speaker 4 (04:46):
Not there, and you know, youth unemployment is at recessionary levels.
We have seventy seven percent of state in the United States,
seven percent of the population is in states with job openings.
Speaker 2 (05:01):
I mean, you got, what can the FED do by
cutting rates that will because what if it is because
of AI, Like, what is it if there are structural
changes that are going on in the labor market that
a rate should change.
Speaker 4 (05:13):
The Federal Reserve Act to no longer have the employment mandate,
You cannot ignore a weakening job market.
Speaker 2 (05:19):
But again I would go to if it's not the Fed,
Fed's they've got to look at inflation. There's a dual mandate,
and you know inflation, it's sticky. It's been sticky for
a while, right.
Speaker 5 (05:31):
God has been sticky.
Speaker 4 (05:32):
It absolutely so, and yet we're not seeing the fact that,
according to Redfin, eighty percent of the major metropolitan areas
in this country have falling home prices.
Speaker 5 (05:41):
That's not filtering through to the CPI.
Speaker 4 (05:43):
Nor will it yet, because there's typically, according to Fanny May,
a six quarter lag between you when you actually start
to see home prices falling.
Speaker 5 (05:49):
This is also we've also seen this in case Shiller
four months in a row now.
Speaker 4 (05:53):
But once you see that, it's a very long time
before you get that deflationary impulse that's evident in the CPI.
Speaker 3 (05:59):
But it's But don't you think about Danielle.
Speaker 2 (06:01):
I think about this a lot in terms of what's
going on in the economy, especially post pandemic, that there
are people who are have great jobs or in the
market they're doing okay, and then there's a lot of
the economy that isn't. And I don't know if that
is the result of FED policy or more policy that
maybe our lawmakers in Congress need to think more broadly,
(06:22):
not about political contributions that get them back into office
and companies amen to that.
Speaker 3 (06:28):
But rather thinking about all of America.
Speaker 5 (06:31):
So, you know, I wrote a whole book about it.
Speaker 3 (06:33):
I think I'm going to get off my soapbox.
Speaker 5 (06:35):
No, no, but you're on the right.
Speaker 7 (06:37):
But I'm just saying this.
Speaker 2 (06:38):
I don't know if it's the FED responsibility here the
inflation fact.
Speaker 4 (06:41):
I mean, if you're speaking philosophically, the inflation and employment
mandates are inherently conflicting. And this was a nineteen seventy
eight tweak to the Federal Reserve Act that completely changed
how the FED operates. Should the FED go back to
being only an entity that fights inflation? Absolutely, we shouldn't
make that happen yesterday. That, however, is an Act of Congress.
Speaker 2 (07:01):
So in other words, and the Fed has done the
right thing, they're watching inflation, inflation is.
Speaker 5 (07:05):
Getting until they're let off the hook. They still have
that employment mandate.
Speaker 3 (07:09):
Yeah, I mean, I don't know. I don't know what
the answer is. I think you could even see from J.
Speaker 2 (07:14):
Powell, although I think it's pretty remarkable that the markets
kind of went back to where they were, and you
do see the Treasury trade kind of saying all right,
we had inflation. It's a problem, so you know, we're
going to do the work maybe for the central bank.
Speaker 6 (07:26):
So then if you believe that that's what the FED
should be focusing on what is the right way to
challenge the labor market right now, or the right way
to ignite the labor market to get it back to
full employment.
Speaker 4 (07:36):
Well, as I said, outside of healthcare and education, we
have not seen a single job created in the private
sector since April.
Speaker 5 (07:44):
The private sector must be re engaged.
Speaker 4 (07:46):
And that's not going to be J Powell knocking on
somebody's door and saying, re engage. Doctor, gave you another
twenty five basis point rate cut.
Speaker 6 (07:52):
But do you think that will take something on the
fiscal side of things?
Speaker 7 (07:56):
Will it take?
Speaker 2 (07:57):
I mean, look, the companies are getting tax cuts already.
Leos are there at the White House. They're making large
investments in the United States also overseas. I know, but
that's what I'm trying to understand. I mean, there's the
opportunity to have that conversation.
Speaker 7 (08:09):
Yes, there is.
Speaker 4 (08:11):
At the moment, what we're seeing is capital expenditure plans
get cut. That's what we're seeing in every single regional
FED survey. They remain in contraction. Backlogs remain in contraction.
Companies are mired in uncertainty. There are a lot of
promises for investment going forward that even companies who think
they're investing in tomorrow have now just, oh, I don't know,
pulled their plans back to not be able to start
(08:33):
contruction until twenty twenty six in South Carolina.
Speaker 6 (08:34):
Where's the uncertainty coming from is a tariff policy.
Speaker 5 (08:39):
It's coming from every policy coming out of the White House.
Speaker 4 (08:42):
And I don't make a political statement when I say
that at all, but whether you're talking about geopolitics or economics,
it is literally a moving target and it's very difficult
to make long term investment decisions in prosperity in plant
and equipment, commit to saying we're going to be the
next generation of manufacturers in this kind of an environment
(09:05):
in which you cannot plan.
Speaker 2 (09:06):
So that uncertainty that comes from the White House and
the criticism that comes from the White House. Do you
see the impact of politics in this decision?
Speaker 8 (09:14):
Oh?
Speaker 5 (09:14):
Absolutely?
Speaker 3 (09:15):
And is it because of the uncertainty coming out Is
that what you're saying?
Speaker 4 (09:18):
Or oh no, until a certain gentleman stops being the
bully on the playground and calling a certain somebody else
too late. I think that there's every single reason in
the world for the FED to be in a defensive
posture because its independence is under a full frontal attack.
Speaker 3 (09:37):
All right, we gotta leave it there. Good good, heated.
Speaker 2 (09:40):
I Love Danielle Di Martine Boost to the CEO and
chief Strategies QI Research, Joining us right here in our
Bloomberg Interactive Broker's studio.
Speaker 7 (09:48):
Stay with us.
Speaker 6 (09:49):
More from Bloomberg Business Week Daily coming up after this.
Speaker 1 (09:56):
You're listening to the Bloomberg Business Week Daily Pod. Catch
us live weekday afternoons from two to five Easter and
listen on Apple Karplay and Android Otto with the Bloomberg
Business app, or watch us live on YouTube.
Speaker 2 (10:10):
The gubernatorial raised in California definitely picking up momentum just
a little bit more than a year away. We featured
a few possible candidates on air, and our next guest
launched his own bid to become California's next governor, targeting
voters disillusioned with Democratic rule but tim not ready to
vote Republican.
Speaker 6 (10:26):
Our next guest launch his bid to become California's next governor.
He's here in the studio with us Ethan Panner. As
we mentioned, he's twenty twenty six candidate for governor of California,
also founder and managing partner of Mosaic Real Estate Investors,
Ethan Welcome.
Speaker 7 (10:38):
How are you?
Speaker 9 (10:39):
I'm I'm very busy.
Speaker 6 (10:41):
Well, you're you're going to run for governor of California,
but you're in New York.
Speaker 7 (10:45):
Why are you in New York?
Speaker 9 (10:47):
Mm? Because you're here.
Speaker 7 (10:48):
Talking to us. Well, why do you why do you
want to run?
Speaker 9 (10:52):
Well?
Speaker 10 (10:53):
I really didn't see anyone who was qualified to do
the job raising their hand, and so I decided I
would do it. I feel that we're in a desperate place.
So I think that California has been so grossly mismanaged
for so long. All the statistics bear that out. The
quality of life has deteriorated so amazingly over the last
decade and even two, and it's time for somebody with
(11:15):
the real qualifications to do this job to step up.
Speaker 9 (11:18):
And that's what I decided I would do.
Speaker 3 (11:20):
What would you do differently? What don't you like?
Speaker 2 (11:22):
What needs to be changed that you think would change
the course of California in what you would perceive as
a good way.
Speaker 10 (11:27):
There are a number of things, but the most obvious thing,
the starter, is that we've repelled people. So we've been
last in net migration for five consecutive years, which means
people in the United States have preferred to live anywhere
but California, which is shocking considering it's California.
Speaker 9 (11:45):
Right, gorgeous, And.
Speaker 10 (11:48):
I think that we need to be more welcoming and
inviting to businesses. We need to grow our economy. Our
economy is important for everyone. It's important to create opportun
unities for our young people, but it's also important so
that we have the funds to make good on the
retirement benefit promises that people are counting on. So I
(12:09):
would do The first thing I would do is change
our tax policy.
Speaker 2 (12:13):
Well, let's talk about this because our understanding is you
are releasing a tax plan this week that would turn
California from one of the least friendly tax dates to
one of the top five. So what details. That's a
big broad statement. The devil's always in the details. So
what's specific?
Speaker 10 (12:28):
So the Tax Foundation ranks all fifty states by their
tax policy. We're currently ranked forty ninth, and pro form
on my policy would move us to third according to
the Tax Foundation.
Speaker 3 (12:42):
How do you do that?
Speaker 5 (12:43):
How do you do that well?
Speaker 2 (12:44):
And what do you do specifically? Because you also talked
about needing revenues for things. So I'm just curious how
you get Yeah.
Speaker 10 (12:50):
So it would be importantly, Carol. It will be a
revenue neutral to revenue growth plan. So everyone else, everyone
that talks about changing our tax plan talks about cutting taxes,
and I understand kind of the intuitive appeal to some people,
but of course that that really doesn't the math doesn't work.
We need to actually pay for the things we need
in California.
Speaker 9 (13:11):
To support our society.
Speaker 10 (13:13):
So mine is a revenue neutral that will ultimately be
a revenue growth idea. It's about replacing income tax with
a consumption taxun mentally.
Speaker 7 (13:22):
That's the plant, so explain the details there.
Speaker 10 (13:25):
We will eliminate all state income tax, both corporate and personal.
Speaker 9 (13:30):
Wow, amazing. We will replace.
Speaker 10 (13:34):
All state sales tax, including our horrible gasoline tax, and
all of that will be replaced by a single fifteen
percent consumption tax on goods and services.
Speaker 6 (13:43):
But does California Okay, So you're coming at this from
the angle where California has been a net loss when
it comes to migration. Yes, do you want? Can California
handle more people? Because the real estate price is there
well in so many places and very desirable places to
live are out of control.
Speaker 9 (14:00):
That's a phenomenal question.
Speaker 6 (14:01):
But the challenge is on a local level because you
have all these people that say, yes, we want more
affordable housing, but do not build that multi family house
right here.
Speaker 10 (14:09):
Our problem has really nothing to do with having too
many people. It has to do with too few housing units.
So the RAND Corporation published a paper last year that
showed that it costs one hundred and ten thousand dollars
more to build an apartment unit in the state of
California than in the neighboring state of Arizona or most
(14:31):
other states.
Speaker 7 (14:32):
For regulatory raisons, it's all.
Speaker 10 (14:33):
Driven by regulatory red tape. That's the second thing I
would have to do is really streamline our regulatory approval processes.
So the tax plan is stage one. Stage two is
the streamlining of regulatory processes.
Speaker 2 (14:47):
How do you think about it against a backdrop or
climate change is certainly impacting California neighborhoods in a big way,
and so build back has also got to think about
how do you make it safer.
Speaker 10 (14:56):
So environmental greatness is really at the foundation of California.
I mean, you're from California and you know this. I
take all of my vacations hiking in the nature of California.
Speaker 9 (15:09):
It's amazing, right, and.
Speaker 6 (15:11):
So first trip to you, somebody, I'm a few months
ago for Carol Mass So it's incredible.
Speaker 5 (15:15):
Corgeous, everything in exactly right, I really, and.
Speaker 2 (15:20):
Passing a massive wind farm to get there, so it's
certainly ambrazing.
Speaker 10 (15:23):
So I think that we we have to be as
vigilant as we've ever been about protecting our natural beauty
and our resources. But but we don't need nineteen different
organizations that a developer of an apartment has to go
through an approval process for. We need one, one very
good one powered by AI with great responsiveness. Rather than
(15:47):
five years, how about five days to get your feedback,
how about fifteen minutes to get your feedback.
Speaker 9 (15:53):
There's no reason that we.
Speaker 10 (15:54):
Can't use technology intelligently, and there's no reason we can't
have both both the things. We can have environmental beauty
and environmental soundness and make it easy for people to
build the units that we actually need to drop costs
and make living more affordable.
Speaker 2 (16:10):
One of the thing you're talking about too, when it
comes to housing and tim see it. We see it
when we've been to Seattle. We live in New York City.
Go any place where it's warm, the heart warm, and
there's a high cost of living, high cost, but the
homeless populations and it's you know, I went to college
here in New York many many years ago and it
was a homeless problem. And here we are again in
twenty twenty five and we haven't figured this out. What
(16:32):
you are looking to build some communities from my understanding
in rural areas for homeless people to live in, how
would you fund that? How long do you would you
expect it to take to get that done? How do
you roll that all up?
Speaker 10 (16:44):
So it gets back to the original question of bringing
true competence, the required competence to lead the state at
this moment. We need the skills that I bring to
the table. We need an understanding of how to build things.
We need an understanding and appreciation and for how to
have transparency. It's not that we don't have the money.
We've spent twenty five billion dollars in the last state
(17:06):
money in the last four years and all that's gotten
us is nothing but twenty five percent more homeless. So
nothing's been solved. We have systems that don't work we
have a management system that's failing us. We don't know
where the money is, there's no accountability, So how.
Speaker 5 (17:21):
Do you do this?
Speaker 2 (17:22):
Then you're saying that with this consumption to actually have
the money to do this, and how do you get
how quickly can you get it built?
Speaker 10 (17:27):
Well, So it's a combination of things. One is, yes,
the money is there, although we squandered so much money ready,
the money is there for this. Second of all, we
have to use smart building. We don't have government. We
need public private partnerships and my government will lean very
heavily on private excellence to work in tandem with public
(17:49):
oversight to get things done fast.
Speaker 9 (17:51):
And I think that.
Speaker 10 (17:53):
Modular housing is definitely one of the answers. Yeah, but
we have to combine competence, a commitment to safety, and
a love for our fellow people right especially I'm proud
to be in California. We care for our most vulnerable neighbors.
That will never change, but we need to do it
the right way. These people, unfortunately, with all the money
(18:14):
we've spent, still sleep on the pavement.
Speaker 6 (18:17):
We're speaking with Ethan Penner, twenty twenty six, candidate for
Governor of California and also the founder and managing partner
of Mosaic Real Estate Investors. On the homelessness question, it
obviously has to do with housing, it has to do
with mental health. There's no easy solution, as we've learned
on the regulatory side of things. You said, for building housing,
you want to streamline regulations, get rid of red tape.
(18:39):
But how specifically do you do that? Because it's an
easy thing to say, But as we're learning in the
wake of the fires in Pacific Palisades and the waste
removal going to New Calabasas and the landfill there, people
are not happy about that, Like, how do you do
this in a way that satisfies these constituents.
Speaker 10 (18:58):
Well, I think it's top down, actually, So I think
we have to set a standard from the from the
Governor's office and Sacramento, and that standard has to be Look,
if I get elected, it will be with a mandate
for change. Right, I'm the consummate outsider. I don't belong
to either of the main parties. I've never had a
day in political office. So I'm running for a mandate
(19:20):
for change with specific policies in mind, and I believe
the people's will will be heard. Through me and that
will that will empower me to actually make change.
Speaker 3 (19:29):
But you understand, I mean, I do understand me.
Speaker 10 (19:32):
I understand bureaucracy very well, work at big companies.
Speaker 2 (19:35):
But I'm just thinking about Elon musk Doze. Even in
the federal government, and yes, USA dismantled, other offices or
other built departments dismantled, But it's not easy to kind
of you know, all these regulatory checkpoints. I mean, how
do you really do it when it gets down to it,
how do you do it?
Speaker 10 (19:54):
In you know, I'll tell you two things. One, I
am not willing to accept that it's hard or impossible
to do. And I'm going to commit myself fully to
doing that. And I know for sure, if people like
you and I don't commit ourselves to positive change, the
answer is one hundred percent bad. So I'm going to
commit myself and I'm going to do as good a
(20:16):
job as I can.
Speaker 9 (20:17):
Second, I really do.
Speaker 10 (20:19):
Believe that most people in government, in state government in
California go into their jobs wanting to do the right
thing for their people. I really do believe that. And
I think that as a non partisan and a non
career politician who's not trying to advance my career at all.
I think I'm going to be very uniquely well received
by the legislature because I won't be viewed as oppositional
(20:42):
in any way.
Speaker 6 (20:43):
We got to talk property taxes. Do you think something
has to change with property taxes in California? In the
context is that somebody like my parents, who've lived in
the same house since the nineteen nineties, pay basically nothing
in property taxes thanks to the passing of a certain
proposition many years ago. But if somebody were to buy
that house, like you know, the next family to own
that house, the property taxes would be debilitating and it
(21:06):
makes it so people stay in homes for a very
long time and contributes to the housing crisis. Some critics say,
you know what, I don't believe that's true.
Speaker 9 (21:14):
Well, I don't accept that. I think that.
Speaker 10 (21:17):
I think that we are our society, our community is
served well by continuity, and I think that having people
be forced out of their homes because of appreciation it
denigrates our community. It denigrates the continuity of our community.
So I would I would not try to change that policy.
(21:37):
I think that's a wonderful policy.
Speaker 2 (21:39):
Got to ask you about Governor Newsom his feed with
the president, the President's attention on California on many states.
Speaker 3 (21:45):
How would you posture yourself toward President chup Well, I.
Speaker 9 (21:49):
Think that.
Speaker 10 (21:51):
Both parties are busy fighting with each other about the
president pro or against the President, and I feel that
it's a gigantic distraction from the incompetence that they've brought
to the table in actually doing their job for the
citizens of California. I will not be engaged in that distraction.
For me, I'm laser focused on serving the needs of
(22:13):
the people in California who would be electing me, who
I care for.
Speaker 3 (22:17):
But what do you do, though, Ethan?
Speaker 2 (22:19):
If President Trump you do a policy and you are
a social media post at seven am in the morning
of something he doesn't like, and he says, maybe we're
going to go down to California and talk to Governor Penner, Well,
what do you do?
Speaker 10 (22:35):
I think that every leader Carol has to approach their
job with humility, and I don't see that as often
as I would like. So Governor Penner would remember that
Governor Penner is a servant for the people, and Governor
Penner would understand that whatever he says or does he
has to take in mind. Is this in the best
(22:56):
interests of the people who he's serving and fighting with?
The President the United States? It's not in the best
interests of the people. Okay, this is definitely not. So
I would try to have a workable relationship with both
the legislatives, the legislature that I would need to work with,
but also the federal government, because, as you point out,
that's a very important relationship. Whether it's this president or
(23:19):
another president. It's not about my personality and the personality
of another, which I think, unfortunately we see today becoming
the story. I don't need to be the story. My
personality is not that important to me. My job as
serving the needs of the people who elected me is
the only thing I care about.
Speaker 2 (23:38):
Well, stay in touch as this year progresses.
Speaker 3 (23:41):
I'd love to see how things are going. Ethan. Thank
you so much.
Speaker 9 (23:43):
Thanks for having me.
Speaker 3 (23:44):
Yeah, I really appreciate.
Speaker 2 (23:45):
Ethan Penner twenty twenty six, candidate for Governor of California,
Founder and Managing director of Mosaic Real Estate Investors.
Speaker 3 (23:51):
We did not get to talk about the CNBS markets.
Maybe next time around. Next time, Ethan, thank.
Speaker 7 (23:56):
You stay with us.
Speaker 6 (23:58):
More from Bloomberg Business Week Daily coming out up after this.
Speaker 1 (24:05):
This is the Bloomberg Business Week Daily Podcast. Listen live
each weekday starting at two pm Eastern on Applecarflay and
Android Auto with the Bloomberg Business App. You can also
listen live on Amazon Alexa from our flagship New York station.
Just say Alexa play Bloomberg eleven thirty.
Speaker 6 (24:24):
Hey, I want to get to some breaking news. Redhead
crossing the Bloomberg terminal just in the last hour. Tesla
working on a redesign of its vehicle door handles, which
have drawn scrutiny over safety issues. We've got Matt Miller
with us. He's the co host of Open Interest on
Bloomberg TV and the Hot Pursuit podcast with Hannah Miller. Matt,
this news coming thanks to an interview that you and
Hannah did with somebody at Tesla. It's longtime design chief.
Speaker 7 (24:49):
What can you tell us?
Speaker 3 (24:50):
Yeah, Hannah Elliott.
Speaker 7 (24:51):
First of all, Oh, Hana Elliott? Did I say, Hannah Miller?
Speaker 11 (24:54):
She hooked up this interview with Franz von Holdtausen. She
ran into him at the Tesla Diner in Los Angeles
and she said, Hey, come on our podcast. It's called
Hot Pursuit. You can find it on Spotify, Apple Podcasts,
or wherever you listen. And yeah, we asked him about
the door handles because you know, Bloomberg BusinessWeek wrote this
(25:17):
story about people having difficulties getting out or first responders,
even more concerningly, having difficulties opening doors from the outside
after accidents. And what he told us, and of course
he designed everything from the models to the cyber truck,
is that their response is a new door opening mechanism where,
(25:40):
for example, you push a button, the lighter press opens
it electronically, but if the battery is dead and you panic,
you push harder and that activates a mechanism that opens
it just like a normal door would. Lucid kind of
has this in the opposite direction. You pull a little
bit and it opens electronically, but if you're panicking, pull harder,
(26:00):
it opens mechanically.
Speaker 7 (26:01):
So it's pretty cool.
Speaker 2 (26:02):
We actually have some of that interview with Tesla's longtime
design chief that you and Hannah did.
Speaker 3 (26:06):
Let's listen.
Speaker 5 (26:06):
In Everybody, we.
Speaker 12 (26:07):
Actually have a mechanical release that's you know, basically right
at the electronic one two, and we're combining the two,
so you know in the moment that you're in a
panic situation, the muscle memory to go to you know
what you know is right there, so you just pull
a little bit further on the lever and you have
the mechanical release. So that's something that we're working on. Yeah,
(26:30):
and it's in the.
Speaker 7 (26:31):
Cars now, all right.
Speaker 11 (26:33):
So if there is, if there is then a China ban.
Speaker 7 (26:38):
You're ready to roll that out so that we're working well.
Speaker 11 (26:42):
Actually the ban the ban, I guess the Chinese issue
is the flat uh outer door handle. So would you
would you do something? Would you make a change, like
you know, Ferrari's have that little crease you can reach into.
Is there is there some idea about that on the outside.
Speaker 12 (26:58):
Yeah, we're working on it right now and just looking
at the you know, the details of the regulation if
and when that happens, and we'll have a really good
solution for that. I'm not I'm not worried about that.
Speaker 8 (27:11):
It makes sense, you know, I know, like it's one
thing for us adults to know that, but for kids,
you know, it's a little bit different to expect a
kid to know how to go for a manual release.
Speaker 12 (27:23):
Yeah, So the idea of combining the Electronic one and
the Manu one together into one button. I think, you know,
it makes a lot of sense. It really helps, you know,
the muscle memory of reaching for something every day is there,
and so you intuitively just crab the same thing and
you're free.
Speaker 5 (27:40):
All right.
Speaker 2 (27:41):
So that's Franz von Holdshausen, Tesla's longtime design chief, catching
up with Hannah Elliott and you anything that surprised you
in the conversation. I love that they're kind of moved
pretty quickly. I mean understanding this is a pretty serious situation. Yeah,
it's a serious situation.
Speaker 11 (27:55):
And not only has Beijing acted with potentially new regulation
at least a look into it, but the National Highway
Transportation Safety Administration NITSA is also looking into it. I
thought it was quite cool that rather than reacting defensively
as you might, I thought the same thing best, he
(28:17):
was like, you know what, let's just find a sensible solution.
He's really focused on sustainability. He's really focused on a
better way to travel for more people, for lower income people.
And don't forget that was the initial idea of this
car company. Obviously, they make these luxury vehicles now and
we think of them for you know, one hundred thousand dollars
(28:39):
cyber trucks. But the goal is, or always has been,
to fight climate change, and they've always been trying to
make a lower priced vehicle. They kind of achieve that
in a model why, but they think they can get
the price lower. And Frans has been there from the start,
so he's really focused on those goals.
Speaker 3 (28:58):
All right, great stuff, and everybody.
Speaker 11 (28:59):
Can not German. That was what surprised me the most.
What Franz von Holtzausen.
Speaker 5 (29:04):
What is he is?
Speaker 7 (29:05):
Not German? He's from Connecticut, from.
Speaker 3 (29:08):
Greenwich, the Melting Podcatrol. We love the Melting Pot. Matthew Miller,
thank you so much.
Speaker 2 (29:14):
Be sure to check out the full conversation that Matt
and Hannah had with him. You can find it on
his podcast, It's the Hot Pursuit Podcast. Catch it on
Bloomberg Radio and of course wherever you find your own
podcasts and you download them.
Speaker 6 (29:27):
Frans joining Matt and Franz joining Matt. And that's how
you say it in Connecticut, Matt, Franz and Hannah from
the Tesla robo van. I was, he was, yeah, you
can see it. I've never seen an interior that looks
like this. It's a it's this is a planned futuristic
mass trend, not massive diner.
Speaker 8 (29:47):
No.
Speaker 6 (29:47):
I don't know if it was at the diner, but
that thing looked like something out of the future. I
was like, what is that thing? Yeah, it is pretty
Check out the podcast the video portion too. Yeah, it's
also on the Bloomberg and at Bloomberg dot Com.
Speaker 3 (29:59):
Check the story.
Speaker 6 (30:01):
Stay with us more from Bloomberg Business Week Daily coming
up after this.
Speaker 1 (30:09):
You're listening to the Bloomberg Business Week Daily Podcast. Catch
us live weekday afternoons from two to five eas during
Listen on Applecarplay and Android Auto with the Bloomberg Business app,
or watch us live on YouTube.
Speaker 2 (30:23):
All right, let's get to the most read story in
the Bloomberg today. It's been there all day. It's about how,
like Fed Governor Lisa Cook, US Treasury Secretary Scott bessint
has made tim some contradictory mortgage pledges, ser.
Speaker 6 (30:35):
Gerry Bessen once agreeing to talking by two different houses
as his quote principal residents at the same time. The
story by Anthony Cormier and Zach Meier. Zach joins us
with more on their reporting. Zach is Bloomberg News reporter
Pullitzer Prize winning Bloomberg reporter. He joins us here in
our Bloomberg Interactive Brokers studios.
Speaker 3 (30:50):
It's an amazing reporter.
Speaker 5 (30:51):
I like to play it after.
Speaker 6 (30:52):
Well, I look, this story is getting picked up far
and wide. Everyone's picking up this story. Tell us about
your reporting.
Speaker 7 (30:58):
What did you find?
Speaker 9 (30:59):
Sure?
Speaker 13 (30:59):
So when you you saw the president try to fire
Lisa Cook, he said, you signed You signed one piece
of paper saying you're going to live in Michigan and
another promising you're going to live in Georgia, two different
houses at the same time as a condition of getting
your mortgage.
Speaker 3 (31:14):
It's your primary resident.
Speaker 13 (31:16):
Yes, and he's saying, maybe that's fraud. We don't know,
but it's enough to fire you. And so we and
I think a lot of other people in the Prescott
curious about, well, is she the only person that this
has ever happened to? And by the way, I should
mention that she said she's done nothing wrong and she subsequently,
you know, documents have come to light to say, at
least in at one case, the bank was understanding this
(31:38):
was going to be a vacation home. So we looked
in it turned out that the Treasury Secretary himself had
also signed agreed to two different to live in two
different places at the same time.
Speaker 6 (31:51):
Then there's the important context in your story and what
you learned too from the reporting. As far as who
represented the Treasury sect Terry in the signing of these documents,
talk a little bit about that.
Speaker 13 (32:03):
So, first of all, he didn't sign them himself. He
gave power of attorney to a lawyer who signed on
his behalf. But the bigger difference is there's really no
chance that what Besson did could possibly have been mortgage
fraunt because both of the mortgages were from the same bank.
It was all part of one big deal. It was
it was one lender, So it wasn't like he was
(32:24):
tricking one lender into thinking it was his primary residence
and then going to a different lender and getting a loan.
Speaker 6 (32:30):
So how is that different than the allegations against Lisa
so Cook.
Speaker 13 (32:33):
She refinanced her longtime home in Michigan, and then she
bought a condo in Georgia from a different bank a
couple of weeks later, and in that mortgage signed a
clause saying she would live there for the next year.
And which she had also done in her Michigan one. Now, subsequently,
a document came to Lights saying showing that in the
(32:55):
in the in the Atlanta case, it looks like the
bank was had the understanding that this was actually going
to be a vacation home. So the question is, well,
why did it get papered this way? And you can
ask a similar question about Beson. Clearly the bank didn't
expect him to split himself in half and live in
both places, and yet the paperwork got filed that way.
Speaker 2 (33:14):
Yeah, he said it right that he said that both
would be his principal residence.
Speaker 13 (33:20):
It's he agreed to both of those mortgages, which both
of them obligated him to live in those two different places.
Speaker 3 (33:28):
I mean, I don't know. I'm assuming, Zach, you and
the team are like looking at this.
Speaker 2 (33:31):
As you said, look, I mean, we've been talking about
this in the newsroom that we're thinking, gosh, you know,
didn't the government when they thought about kind of going
after Lisa Cook think about, Hey, anybody else had this situation?
What are you finding out as you reported out this story?
But just in general, is this common?
Speaker 13 (33:48):
I don't know what common, but you know, there's another
cabinet secretary, the Secretary of Labor, who has kind of
a fairly similar you know, two mortgages two months apart
in two different states where he's pledging to live there
for the next year. So it's not super uncommon, because
we've found a few just in looking at the top
(34:09):
officials in the government. It's probably not all that rare
for people to actually do it because of fraud. But
in all of these cases, the people involved or documents
we've obtained, show that they have at least a pretty
good argument that this wasn't fraud at all, and that
maybe it was just a matter of not filing the
(34:29):
paperwork in the right order. Typically, these things are everyone
signs basically the same mortgage agreement, and then if you
have a second home, you sign another thing called the
second home rider, which waives that documency clause. So if
somebody forgets to put that in front of you and
to file it, then maybe it just kind of slips
through the cracks and no one cares unless you happen
to be on.
Speaker 7 (34:49):
The FED board as you and the team.
Speaker 6 (34:51):
Right, Charles Rich had power of attorney to sign Secretary
Scott best Sin's documents on behalf of him. Rich who
signed the documents, wrote that of America was fully aware
that the Provincetown property was not a principal residence and
waved any requirement that it be used as a principal resident.
There was absolutely nothing improper about mister Besson's loan applications
with which he was minimally involved, as he had delegated
(35:14):
delegated authority to me.
Speaker 7 (35:16):
So is it the end of the story.
Speaker 13 (35:18):
So, just to be clear, our story isn't saying that
Besson did anything wrong. Rather, it's saying that maybe just
because these two pieces of paper are filed saying you're
going to live in two different places, it doesn't mean
that you've necessarily committed mortgage front. Clearly Investment's case, he didn't.
And in a lot of the other cases that we've seen,
there's often an innocent explanation that really means that it's
(35:43):
more of like a paperwork error.
Speaker 2 (35:45):
Yeah, I do think about that, right, just you know,
getting it wrong, as you said, either not signing something
or something not getting done.
Speaker 13 (35:52):
If you guys have ever been to a closing for
a house, you're asked to sign about ten thousand pieces
of paper. It's like you get your hand gets tired
from right now. I don't think there's that many people
who've read every single word on every page. I certainly haven't.
Speaker 2 (36:04):
I mean when I think of mortgage, I don't know
when you think of mortgage fraud, I think of something.
Speaker 3 (36:09):
Yeah, I kind of do, like intent, Yeah, like a
plan to kind of deceive either a lender or so.
Speaker 7 (36:15):
I don't think it's that.
Speaker 13 (36:16):
Unusual, though, for somebody to buy a vacation home and
when they get the mortgage, tell the tell the lender
they're going to live there, even if they really won't.
That would technically be fraud, if they really intended to
deceive the lender and get a more favorable interest rate. Right,
But we haven't seen that investments case.
Speaker 6 (36:33):
And is there anything we have to understand about the
difference between the words principle and primary.
Speaker 13 (36:39):
The word in the in the in the papers is
always principle.
Speaker 7 (36:43):
It's always principal, Yeah, okay.
Speaker 13 (36:44):
Yeah, And I think it's just it basically means, you know,
this is your real house, right and no other.
Speaker 2 (36:52):
Yeah, you know, I also think it's different. You know,
you guys say that how the situations are an identical.
And we've touched on this a little bit Sack, But
like Beson's mortgages two decades ago, signed by his lawyer,
he obviously was wealthy. There was no concern about his
ability probably to manage any kind of loans. Cook signed
hers personally, and much more recently, there are distinctions.
Speaker 13 (37:18):
Oh, there absolutely are. I think the common theme though,
is that if the Trump administration's view is that anyone
who signs document these documents that conflict with each other
right needs to be removed from office, then there are
actually other people in Washington who are in that same situation,
even if and let me be clear, they didn't do
(37:38):
anything wrong and are not only didn't commit mortgage fraud,
but didn't do anything wrong in Besson's case, probably wasn't
even aware of it until we ask questions.
Speaker 3 (37:47):
We can't help but feel that like there are lots
of officials.
Speaker 2 (37:50):
Potentially right now looking at things right and looking at
their documentation right, wait, going back and looking well that
everybody's looking at it, and you're right, and it doesn't
mean that anybody had intent to do something wrong?
Speaker 3 (38:01):
Is there?
Speaker 2 (38:03):
Does the investigation continue or not even an investigation?
Speaker 3 (38:06):
But you guys, continuing to look.
Speaker 13 (38:07):
The court case is proceeding with Lisa Cooks. She's she's
contesting her the Trump's attempt to fire her. She's for
for the moment, she's participating with the Fed today, right,
and so it's going to be up to the courts
to decide it. Could it could come down to whether
she actually did defraud Alenda or not. But it may
(38:30):
it may not.
Speaker 6 (38:31):
And as we heard from j Powell today, he will
not comment on a court case that's ongoing.
Speaker 2 (38:35):
Yeah, he made it very very clear. Interesting stories. We said,
it's the most red story on the Bloomberg.
Speaker 3 (38:40):
Zach, thank you so much.
Speaker 2 (38:41):
Thanks always appreciate, Zach Miider, Bloomberg News Reporter here and
of course you can read the entire story just head
to the Bloomberg or Bloomberg dot com.
Speaker 11 (38:49):
This is the Bloomberg Business Week Daily podcast, available on Apple, Spotify,
and anywhere else you get your podcasts.
Speaker 10 (38:57):
Listen live weekday afternoons from two to five pm Eastern
on Bloomberg dot com, the iHeartRadio app, tune In, and
the Bloomberg Business App.
Speaker 11 (39:06):
You can also watch us live every weekday on YouTube
and always on the Bloomberg terminal
Hosts And Creators
Tim Stenovec
Carol Massar
Popular Podcasts
On Purpose with Jay Shetty
I’m Jay Shetty host of On Purpose the worlds #1 Mental Health podcast and I’m so grateful you found us. I started this podcast 5 years ago to invite you into conversations and workshops that are designed to help make you happier, healthier and more healed. I believe that when you (yes you) feel seen, heard and understood you’re able to deal with relationship struggles, work challenges and life’s ups and downs with more ease and grace. I interview experts, celebrities, thought leaders and athletes so that we can grow our mindset, build better habits and uncover a side of them we’ve never seen before. New episodes every Monday and Friday. Your support means the world to me and I don’t take it for granted — click the follow button and leave a review to help us spread the love with On Purpose. I can’t wait for you to listen to your first or 500th episode!
Stuff You Should Know
If you've ever wanted to know about champagne, satanism, the Stonewall Uprising, chaos theory, LSD, El Nino, true crime and Rosa Parks, then look no further. Josh and Chuck have you covered.
The Joe Rogan Experience
The official podcast of comedian Joe Rogan.