June 18, 2025 • 28 mins
Watch Carol and Tim LIVE every day on YouTube: http://bit.ly/3vTiACF.
Federal Reserve officials left interest rates unchanged and continued to pencil in two rate cuts in 2025, saying uncertainty over the economic outlook was still high but had diminished. The Federal Open Market Committee voted unanimously on Wednesday to hold the benchmark federal funds rate in a range of 4.25%-4.5%, as they have at each of their meetings this year.
Officials also downgraded their estimates for economic growth this year while lifting their forecasts for unemployment and inflation.
Speaking to reporters following the decision, Chair Jerome Powell repeated his view that the central bank was “well positioned to wait to learn more about the likely course of the economy before considering any adjustments to our policy stance.”
While the median expectation for two rate cuts in 2025 didn’t change, a number of officials lowered their projections. Seven officials now foresee no rate cuts this year, compared with four in March. Two others pointed to one cut this year
Today's show features:
- Ross Mayfield, Investment Strategist at Baird Private Wealth Management & Ira Jersey Bloomberg Intelligence Chief US Interest Rates Strategist on FOMC Reaction
- Heather Williams, Director of Project on Nuclear Issues and Senior Fellow for Defense and Security at Center for Strategic and International Studies
- Michael Lohan, head of IDA Ireland on trade, tariffs and EU’s view of Trump.
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2 (00:08):
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 news as it happens. The Bloomberg Business Week
Daily Podcast with Carol Masser and Tim Steneveek on Bloomberg Radio.
Speaker 3 (00:32):
Let's just remind everybody, here's what happened FED officials. You
heard it from Charlie leaving interest rates unchanged, continuing to
pencil in two rate cuts in twenty twenty five, saying
uncertainty over the economic outlook was still high but had diminished,
and that effect can be kind of patient, it seems
like as it awaits more information, here's fetchirt J.
Speaker 4 (00:51):
Powell.
Speaker 5 (00:52):
We feel like the right thing to do is to
be where we are, where our policy stance is, and
just learn more. In particular, we feel like we're going
to learn a great deal more over the summer on tariffs.
We hadn't expected them to show up much by now,
and they haven't, and we will see whether the extent
to which they do or overcoming months. And I think
(01:12):
that's going to inform our thinking.
Speaker 3 (01:14):
All right, That of course was fedya Jay Powell earlier
at the FOMC press conference.
Speaker 6 (01:18):
Let's get to it.
Speaker 3 (01:19):
Let's get more on the investment landscape, also the rate landscape,
and how the FED decision and commentary may affect all
of it.
Speaker 6 (01:25):
Are we all going to kind of just wait for
the next FED meeting?
Speaker 3 (01:28):
Ross Mayfield is with us, these investment strategists at BAIRED
Private Wealth Management from Louisville, Kentucky.
Speaker 7 (01:33):
Also with us.
Speaker 3 (01:34):
Bloomberg Intelligence chief US interest rates strategist Ira Jersey out
there in New Jersey.
Speaker 6 (01:39):
Hey, Ira, I want to kick it off with you.
Some went into this meeting truly.
Speaker 3 (01:43):
I was listening to Bloomberg Television's coverage, really TV and
radios coverage of the FED decision. Some said it was
going to be boring. Some expected not much to happen.
Others said it's never.
Speaker 8 (01:53):
Bell, It's never boring for us, right.
Speaker 6 (01:56):
Well, sometimes it is.
Speaker 3 (01:57):
And then others said it was going to be historic
because all that is coming at the FED right now.
Speaker 6 (02:02):
Why was there such a gap going into this meeting?
Speaker 4 (02:06):
Yeah, I think there's some people who think that, firstly,
that the Federal Reserve does have to cut interest rates
because they see cracks in certain parts of the economy.
And then there's other people who are fearful of tariffs
and think that, you know, inflation might increase. And you
even heard that the last question, which was about how
come no one was projecting rate increases even though there
(02:26):
were a number of members who were thinking the Fed
is going to be on hold for the entire year
and then cut a bit next year.
Speaker 9 (02:32):
You know, I this was as I expected.
Speaker 4 (02:35):
And what's always interesting about this, you know, and we
have to as market professionals kind of parse every single
thing coming out of the FED Reserve.
Speaker 9 (02:45):
Is the reaction function? Right? What is the Fed's reaction function?
Speaker 4 (02:49):
So we heard a number of if van statements from
Jare Powell, and you know, those ifan statements could mean,
you know, give us at least a little bit of
an indication under what circumstances, don't make any kind of
policy adjustments.
Speaker 8 (03:02):
Hey, Ross, come on in here and just give us
your general overview of how the meeting went, your expectations,
Where they met, where they not met. What was your
big takeaway?
Speaker 9 (03:10):
Yeah?
Speaker 8 (03:10):
I think they were largely met.
Speaker 10 (03:11):
I mean, I don't know anyone who expected much action
at this meeting or a resolution of all the uncertainty
that they've been discussing at this meeting. Given that we're
still in this kind of tariff pause, you know, we
have the potential for oil prices to swing and impact
headline inflation.
Speaker 8 (03:27):
So I didn't expect much.
Speaker 10 (03:30):
I'm on the side of the camp that thinks the
FED should be a little more aggressive and cutting. I
think the cracks in the labor market are starting to
really accumulate. And to hear Finch, our pals say that
the labor market is I forget the exact language, but
on solid footing.
Speaker 8 (03:44):
Yeah, he wouldn't agree with you. I think Ross that
the cracks are starting to appear. What data are you
paying attention to that he's not And.
Speaker 3 (03:51):
Perhaps that headline Microsoft planning thousands more job cuts you.
Speaker 6 (03:54):
Know that we saw.
Speaker 10 (03:56):
Certainly, yeah, certainly, the anecdotal evidence of layoff is rising.
But if you look at something like warn notices or
initial claims and continued claims, I mean we're sitting at
multi year highs for a lot of those levels.
Speaker 9 (04:09):
If you look at some.
Speaker 10 (04:11):
Of the employment statistics about people fresh into the job
for us out of college. You know that the unemployment
rate there is at not record highs by any means,
but is significantly higher than the overall on employment rate.
So I think it's a labor market where we have
tight supply, and especially in this you know, given the
immigration policy, but it is not a robust labor market,
(04:31):
and we are well north of a neutral policy. I
think that getting to neutral should be more more of
a goal for the Fed, who doesn't seem to want
to get there until the end of twenty twenty six
if you look at the CCP.
Speaker 6 (04:43):
All right, come on in airah, yeah.
Speaker 4 (04:45):
So I just want to want to say I think
that's part of this debate, like where is neutral? And
you know, there's you know, the Fed will say that
they're still have restrictive policy, but a lot of the
other information that that's some of us, me included, have
looked at suggests that actually they're probably pretty close to neutral.
So unless there's a deceleration of the economy, the Fed
(05:08):
probably doesn't have to adjust interest rates.
Speaker 9 (05:10):
Now.
Speaker 4 (05:11):
The question is, and to Cross's point, like they can't
wait until the economy is clearly really bad before.
Speaker 9 (05:19):
They cut interest rates.
Speaker 4 (05:20):
But I do suspect that because of this overhang of
inflation and the recent past episode that we just had,
that the Fed will try to wait until almost the
last minute, and then once it cuts, it'll cut faster.
Speaker 9 (05:33):
And I go back to the statement that J.
Speaker 4 (05:35):
Powell made in May at at the press conference, where
he said, like, look, we know how to deal with
a weak economy. We could just cut more aggressively and
get down below the neutral rate to stimulate the economy.
We don't want to have to go the other way
and have to hike interest rates rate if inflation were
to remain relatively high.
Speaker 8 (05:56):
Hey, Ira, a couple more to you, and then we're
going to bring ross back in here. But I'm wondering
about a couple of things here. One specifically, is the
question of AI and the labor force. The bed chair
was asked about that, Carol, and I cannot stop talking
about this. What did you make of the way that
he answered this question about AI and the effect on
(06:18):
the labor face feels like.
Speaker 3 (06:19):
There's a pig pile of all of a sudden, people
are waking up and saying, Okay, there's going to be
a lot of jobs lost because of AI.
Speaker 9 (06:25):
Well, there's always disruptions.
Speaker 4 (06:26):
Whenever you have new technologies, there's always disruptions and you
wind up having you know, layoffs in some sectors, and
then the new economy creates other jobs and new jobs.
We've done that over centuries since, you know, even before
the Industrial Revolution, you've always seen you know, things replacing
other things. I mean, we did it thirty years ago.
Right when you think about the Internet, and you know
(06:49):
in nineteen ninety five, very few firms had websites. Yet
today everyone does, right, and this is kind of an
extension of that. So we created a whole new economy
around the Internet that now is creating more jobs. Whereas
robotics and other things like manufacturing, they're less people are
needed to do the same amount of work in labor
(07:09):
than was needed in nineteen seventies.
Speaker 6 (07:11):
H So true.
Speaker 3 (07:12):
Socho hey, Ross just got about twenty five seconds left here,
Mike McKee saying, nobody on the committee has any conviction
on these forecasts, so don't take us seriously on the
rate cuts. Things will change. That was kind of the
message that Mike took away, and he says that maybe
kind of means for the Bloomberg audience, don't invest on
this FED decision fifteen seconds.
Speaker 6 (07:29):
Do you agree?
Speaker 10 (07:31):
Yeah, I don't think you can take much away from
this FED decision in terms of actionable investment items. I
think you need to watch the long end of the curve,
and for that you need to watch things like the
budget deficit and service sector inflation. So that's what I'm watching,
and I think you go long deration here.
Speaker 3 (07:45):
All right, great duo Ross Mayfield Investment strategis ad baired
Private Wealth Management, our own IRA Jersey chiefos interest rate
Strategies at Bloomberg Intelligence.
Speaker 2 (07:53):
You are listening to the Bloomberg Business Weekdaily podcast. Catch
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Speaker 8 (08:07):
The Israeli Ron conflict, the more than three year old
war between Russia and Ukraine, the US LED tariff for
changing geopolitical relationships, Carol, These are all things that can
and do affect global investment flows.
Speaker 3 (08:19):
Yeah, it's kind of interesting at a moment in time
where where they're rethinking whether or not the US is
uninvestable and also questioning the dominance of the US dollar.
We should point out as Alex Steel mentioned in our
TV simulcast, foreign treasury holdings holding your record high in
the month of April.
Speaker 6 (08:37):
So foreign investors are.
Speaker 8 (08:39):
They're not selling well foreign investors.
Speaker 3 (08:42):
It sounds like, at least not when it comes to treasuries,
which is what we kind of keep watching so closely.
All of this tie it all up, and especially when
it comes to foreign direct investment. It is the world
of our next guest, and it's so great to have
back with us in studio, Michael Lohan, CEO of IDA Ireland.
It's the Foreign Direct Investment Agency of the Irish government.
Speaker 6 (08:59):
Hello, Hello, how are you?
Speaker 7 (09:01):
I'm good carel good to be back in tint.
Speaker 3 (09:03):
There's a lot coming at everyone, and I'm not even
quite sure to begin. Just give us a good Macro
overview as you think of the things that the G
seven leaders we're facing this week are facing this week.
The war is the conflict certainly top of mind, and
you know we're having this interview in real time and
(09:23):
things are going to continue to develop. But how do
you see the environment right now? Is it continuing to
be an uncertain one?
Speaker 1 (09:31):
I think that's the word that you'd have to you'd
have to use is uncertainty, and you know when we
last met actually just that in March of this year.
I think we've gone through a lot in those in
those intervening weeks, to be honest, probably as much as
I've seen in my career in foreign direct investment. A
lot has happened in a very short space of time.
And when you think about from from the tariffs in
(09:53):
terms of what tariffs means, where they're going to be pulled, composed,
at what level and what time frame, A lot of
those questions still remain unanswered as we sit today, and
I think from a European perspective, we are very clear
that you know, bringing negotiation, trying to get to a
point of aspos consensus around what this looks like. It's
so critically important for investment flows and indeed for the
(10:16):
economic prosperity of the world, you know, whether it's the
US or whether it's the Europe, or indeed whether it's
the Asia. So that's a that's a real area of
focus from from a European perspective and indeed the Irish
government perspective, and of course you're correct, this is all
against the backdrop then of some other conflicts across the world,
and you know, we see that increasing, so you know,
it's we're very mindful of that in the context of
(10:38):
trade flows and trade investments as well, because that brings
another level of uncertainty into the equation.
Speaker 8 (10:44):
Yeah, it's been pretty much exactly three months since we
last saw you. You were here in New York, right
before you went to Washington with the Prime Minister to
visit the White House. That'so you met with the President,
You met with his team. How did the meeting go?
Speaker 7 (10:59):
So, so you're correct the last time was here. I
left them.
Speaker 1 (11:02):
I went to d C with on t shock or
our Prime minister. The medium went very well actually, and
I think actually it was was. In reflecting on it,
you'd say that, you know, the President was actually very
gracious in terms of his engagement. Yes, there was fourth
Right discussions and you know he talked about the challenges
in terms of trade, trade deficits in particular.
Speaker 8 (11:22):
This was before all the teriffs were announced.
Speaker 7 (11:24):
Yeah, this is before.
Speaker 1 (11:25):
But remember this was all very you know, it was
all very live and active at that point because you
were this we were talking about this is the fifteenth,
sixteenth of March, so it was all becoming very transparent
or apparent as to what was what was going to
come down the tracks. So I would say that that
that that meeting and engagement very much reflect this the
relationship which is one hundred years between Ireland and the US,
(11:47):
and I think in any relationship there can be pints
of let's call this discussion, and that was the discussion
that we had, but it would think it was very
respectful on both on both sides.
Speaker 3 (11:56):
Michael, what changes have you guys seen in investment flowers?
What are you seeing from your bead point?
Speaker 1 (12:00):
Yeah, so what we're seeing today, actually, Carol, it's interesting.
So I can sit here today and actually in two
weeks time I'll be sharing with her Minister Peter Burke
are results for the first half of the year, and
when I can't disclose them to you on air, what
I could, yeah, but I won't. But what I can
say is this is that we continue to see investment flows.
In fact, it is a power with last year in
(12:23):
terms of the first half of last year, which is
maybe somewhat maybe surprising giving the level of uncertainty that
you see across the globe. But the reasons where we
see that is and we're seeing across a number of
different areas. We're seeing reinvestment in research and innovation continuing
and companies looking to double down on their investments in
Ireland in innovation. We're also seeing a lot of investment
(12:43):
as well in terms of new entrance into the Irish economy,
which is really important. And that's because they're looking for
global marketplace, stable locations where they who's just trusted and proven,
I believe, and that's what they're seeing in Ireland. In
terms of the future world.
Speaker 3 (12:57):
I know you can't reveal all, but I am curious
so on that where there's new investments coming in. Are
there conversations you're having with entities, global companies, US companies
who say we want to do more stuff with you
guys because we don't necessarily want to be in the
US or other like give me an idea if there's
anything that's a repercussion or you know, the result of
(13:19):
an action by the White House.
Speaker 1 (13:20):
Yeah, So I don't think it's it's a scenario of
we don't want to do it in location A, so
we're doing location B. I actually think companies are looking
to actually how can.
Speaker 7 (13:29):
We grow our business?
Speaker 1 (13:30):
Where can we grow that from what markets do we
want to serve and where can we get the skills.
Speaker 7 (13:36):
Or are the policies that support that.
Speaker 1 (13:38):
That's really what we're seeing and what we do in
Ireland is that, you know, we make sure we bring
is stability and certainty to those areas of policy in
terms of talent and talent availability, not just Irish talent,
but international talent. These are the pieces that are setting
I believe investors apart when they're looking at locations around
the globe, because I said previously at the very core
(13:59):
of the IE and of multinational companies, they look to
international markets. They need international markets, they need international supply chains,
they need international talent. That's what they need in order
to be successful. And that success isn't just success in
the country they're located in, It actually comes back to
their entire supply chain.
Speaker 8 (14:16):
We're speaking to you on today where we heard from
the FED chair and there are a lot of questions
about what the labor market looked like. The takeaway that
I got from him, Carol, and I think you'd agree
with this is that he really likes where the labor
market is right now. And then despite what anecdotes people
hear and what people are saying, there are not cracks
starting to appear. Things are looking pretty strong. Explain to
us the labor market in Ireland right now in the
(14:37):
context of these companies, especially tech companies battling it out
for top tech talent for AI.
Speaker 1 (14:45):
Yeah, and I think you're just to use it the
comment in terms of the Fed's comments this afternoon of
the labor market, actually, Irish labor market is somewhat mirrors.
I think what the FED has has mentioned today. It's
robust where like you know, we're almost at full employment.
So there is actually I think for economies that are
performing and have a strong underlying fundamentals that is I
(15:06):
think that's mirrored across many economies across the globe. And
the key is in this context is you're correct, there
is like talent availability and is probably this key differentiator
for success for whatever business you're in or whatever sector
you're in. And that's why I believe that multinational companies
look they see talent as global.
Speaker 7 (15:24):
They don't see it as within a geography or within
a region.
Speaker 1 (15:28):
They see it as global. And I think that's what
we have to continue and we're very we're very as
suppose attuned to the fact that not howlone do we
have to generate our own talent, but we have to
be able to track the best talent to Ireland, and
we have to create the conditions in which they can prosper,
which they can live, and which they can and enjoy
life as well.
Speaker 11 (15:46):
Well.
Speaker 3 (15:46):
I'm also curious because there is a lot of pressure
from this administration, the President specifically for US based companies,
US based multinationals to do more in the United States.
Having said that, I think about a company like Microsoft,
who has been in Ireland in for four decades or so, correct,
I'm just curious, you know, is any of that relationship
that you folks have, and especially the investments that Microsoft
(16:10):
has made and maybe continue to do, has any of
that changed?
Speaker 1 (16:13):
To be honest, it hasn't. And if you think about
your correct, Microsoft celebrated it's fiftieth birthday actually since we
last spoke, and forty of those fifty years have been
in Ireland. And when when when Actually, when we celebrated
Microsoft's fortieth birthday in Ireland, they spoke about how important
Ireland was to the Microsoft's success, not just Microsoft Ireland,
(16:34):
but Microsoft the corporation because that's what it really is
is embedded. And when we look at companies like Microsoft
and the many more companies that we have in Ireland,
there are there are multi decade investments, there are you know,
trusted long term partnerships with IDA and with the Irish,
with the Irish government, and that's what really brings that
success back. And what we have to be conscious of
(16:54):
as well is that we need to make sure that
we actually have we're meeting the future needs of industry
as well. So that means people, it means infrastructure, and
it means policy, and that's very much what we're focused on,
what Irish government or folks.
Speaker 8 (17:07):
We'll go back to my question about AI specifically. Carol
mentioned there were some layoffs at Microsoft.
Speaker 9 (17:11):
Today.
Speaker 8 (17:11):
There are hundreds of thousands of people who work at
Microsoft and we know thousands.
Speaker 3 (17:15):
Is that the latest report, Carol, Yeah, some more job
cuts in salespeople, I think they were saying.
Speaker 8 (17:20):
And it's about making sure that you have the workforce
that these tech companies need. J Powell was asked the
same question, what is going to be effect of AI
on the workforce? Yes, what is it in your view
and how do you make sure that it doesn't decimate
a workforce, like the CEO of Anthropic dom Dario Amidae
said recently.
Speaker 7 (17:40):
So I think you're correct.
Speaker 1 (17:41):
We need to be conscious of the fact that AI
is going to be a technology and is a technology
that's going to revolutionize. In fact, we see it all
in our day to day lives and their day to
day work. What we're looking at from an idea perspective
is we're trying. We have very much looked at where
is the opportunity for AI to bring efficiency and bring
productivity gains.
Speaker 7 (17:59):
But secondly, then how do we make.
Speaker 1 (18:00):
Sure that where there are risks, we are upskilling and
reskilling that workforce for future and new new technologies. And
that's our real focus is in our new strategy. Just
to say this, for the first time, we have put
a public target and upskilling and reskilling of the workforce,
so forty thousand people we are committing to to upscale
and rescale and that's actually not just to meet AI,
(18:22):
but to meet all technological changes that's coming.
Speaker 6 (18:24):
Michael just got about thirty seconds.
Speaker 3 (18:25):
I'm just curious about what's Ireland's relationship with China and
what do you think it is going forward?
Speaker 6 (18:30):
Just quickly Yeah.
Speaker 1 (18:31):
So with China, our relationship has been the same and
the same with the European Union. I suppose it's d risk,
but don't the couple We see opportunity, but we also
understand that we need we need to do that balance
between the risk and the coupling, and we will continue
to do that.
Speaker 3 (18:44):
Is China being more aggressive though and reaching out to
a country like.
Speaker 1 (18:48):
Your own, I can't say this. I think we have
offices in China, We have offices all across Asia, so
I think it's no different to dat than it was
this time six months ago.
Speaker 3 (18:58):
Trying to just get an idea right as we look
get geopolitics and new relationships being formed, whether or not
you know John has certainly there's been reporting that as
the US backs off, kind of looking to kind of
step in, but not necessarily.
Speaker 7 (19:10):
Not evident of this juncture. Yeh.
Speaker 6 (19:11):
Be well, be well. We know you travel a lot,
so stay safe.
Speaker 3 (19:14):
Michael Lowan, chief executive Officer of IDA Ireland, joining us
here in our Bloomberg Interactive Broker Studio.
Speaker 2 (19:21):
This is the Bloomberg Business Week Daily Podcast. Listen live
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Speaker 8 (19:39):
As Kate Sullivan told us earlier this hour, Bloomberg News
White House correspondent, the President's latest meeting to discuss the
conflict in the Middle East is ongoing right now. Earlier,
the President remained qui about whether the US plans to
join Israel's offensive aim at destroying Uran's nuclear enrichment program.
What exactly is that nuclear enrichment program? What exactly is
(20:00):
Iroon's strategy. Is it for weapons or is it for energy?
Is it even close to having a nuclear weapon? These
are all questions that we talked about in preparation for
this segment today. We've got a great voice on this.
Heather Williams is the director of the Project on Nuclear
Issues and a Senior Fellow in the Defense and Security
Department at these Center for Strategic and International Studies. She's
(20:21):
also an associate Fellow with the Project on Managing the
Atom in the Belfer Center for Science and International Affairs
at the Harvard Kennedy School. She joins us this afternoon
from Boston. It's good to have you with us, Heather,
thanks for taking the time. I think a place we
want to start is just getting an understanding of exactly
what the capabilities Iran has right now when it comes
(20:42):
to nuclear energy and weapons. What do they have?
Speaker 11 (20:47):
Yeah, well, thanks so much Carolyn tim for inviting me on.
So we before we talk about what they have right now,
I want to just very quickly say what they had
a week ago, because there's a big difference between then
and now. A week ago, iron had a nuclear enterprise
involving thirty different facilities spread out across the country. It
was enriching to sixty percent its uranium, which is well
(21:07):
above the amount that you need for civilian purposes.
Speaker 12 (21:10):
It also had some ballistic missile.
Speaker 11 (21:12):
Capabilities, and so this was a really concerning program. And
the day before the Israeli strikes, the International Atomic Energy
Agency actually found that Iran was in breach of its
non proliferation obligations for the first time since two thousand
and five. So there was this really expansive program. Where
that program stands now is a very different picture.
Speaker 12 (21:33):
One of the.
Speaker 11 (21:34):
Biggest enrichment facilities, Naton's, has essentially been destroyed and that
is partially because of the power being cut the targeting
of the structure itself.
Speaker 12 (21:46):
But there's one big piece.
Speaker 11 (21:47):
Of Iran's nuclear program that remains, and that is the
four Doah enrichment facility, which is buried really deep underneath
the mountain, and Israel has had a few strikes on Fourdah.
That facility still remains, but for the most part, a
lot of Iran's other nuclear facilities and capabilities have been
significantly impacted by the Israeli strikes.
Speaker 6 (22:10):
So how long does it take to kind of.
Speaker 3 (22:14):
Rebuild all of this if that is ultimately Iran's plan.
Speaker 12 (22:20):
Yeah, it's an unsatisfying answer.
Speaker 11 (22:22):
We don't know because it really depends on the extent
of the damage.
Speaker 12 (22:26):
But it also really depends on.
Speaker 11 (22:28):
What President Trump is going to decide, probably in the
next days or weeks, because that Florida facility is going
to be really crucial if Iran does want to rebuild
a race to having a nuclear weapon in the near future,
because that's where a lot of the higher enrichment was happening.
It's a place where iron stockpile could be transported to.
(22:49):
And so if that facility endures and Iran continues to
use it. In that case, some estimates had said that
Iran was just weeks away from.
Speaker 12 (22:58):
Having a nuclear weapon.
Speaker 11 (23:00):
Now if that facility is destroyed, that will probably set
Aron back by a significant amount of time. But the
answer to that question, we just don't know. But we
probably will know a lot more in the next few days,
assuming that President Trump makes a decision.
Speaker 8 (23:13):
Do you think Florida can be destroyed without using the
GBU fifty seven.
Speaker 12 (23:18):
It would be really, really difficult.
Speaker 11 (23:20):
It would require sustained Israeli strikes using their own bunker
busting bombs, which are a lot smaller than the GBU
fifty seven, and even then it's not clear that those
sustained strikes would get the job done. Another option would
be an Israeli sabotage mission such as cutting the power
to four Do Doh, or some sort of commando mission
(23:42):
on the ground, such as go and getting folks into
Fourdoh to blow it up from inside. That might be
one option for probably having the higher likelihood of success
of just throwing Florida, But for air strikes, it's really
hard for the Israelis to do this without US support.
I do think it's important to point out, though, that
the US strikes on Florida.
Speaker 12 (24:04):
If they do come to fruition, this might not be
a one and done mission.
Speaker 11 (24:08):
It would be difficult, I think for the US to
be able to take out all of Flouridah with one
of these bombs.
Speaker 12 (24:14):
And the reason for that is Florida is buried so deep.
Speaker 11 (24:17):
Also, we don't know a lot about the extent of
the Floidau facility.
Speaker 12 (24:22):
There could be additional tunnels even further underground.
Speaker 11 (24:24):
Some suspect that there are facilities buried up to half
a mile into that mountain, and so the GBU fifty
seven is probably the best bet for air strikes in
taking out that facility, but it might require multiple strikes.
Speaker 6 (24:38):
How do you feel? Forgive me?
Speaker 3 (24:41):
And this is with all due respect, but there's been
so much debate about does Iran have weapons?
Speaker 6 (24:45):
Do they not have weapons? I feel like it's gone
back and forth.
Speaker 3 (24:47):
So how do we trust the intel or how do
you determine that you can trust the intel that you've got.
Speaker 12 (24:57):
I love this question.
Speaker 11 (24:58):
It's such an important question because there is all this
confusion about the intel right now. Right Chelsea Gabbert says
one thing, the President says another thing, The CIA says
one thing, central Command says another thing. And I actually
think this confusion is really really understandable, and a big
reason for that is how you define a nuclear weapon.
And I promise I'm not going to get academic about this,
(25:20):
but it is the difference between if Iron is pursuing
weaponization technologies, so for example, triggering devices, if you want
an implosion device, what do you do with all that
highly enriched uranium.
Speaker 12 (25:32):
It's not just going to sit there. You have to
figure out how to convert it into.
Speaker 11 (25:35):
A nuclear weapon, versus a nuclear weapons program which requires
the highly enriched uranium a means of delivery along with
that weaponization technology. And so if we're talking about that
weaponization technology, I think those in the Intel community who
said they don't see evidence of that, that seems to
be pretty consistent. However, if you count a nuclear weapons
(25:57):
program as enriching uranium well beyond billion purposes, having secretive
nuclear facilities, talking about using wiping your neighbor off the
face of the earth, then that also points towards the
nuclear weapons program.
Speaker 12 (26:12):
And so I think that there's a lot less daylight.
Speaker 11 (26:14):
On the Intel then sometimes comes across it does just
require this kind of wonky more nuanced understanding of what
actually goes into making a nuclear weapon.
Speaker 3 (26:24):
Heather, I have no idea if this is in your purview,
But I mean, do you think that there is a
world where Ron says, Okay.
Speaker 6 (26:30):
I'm out, we don't need nuclear weapons just quickly?
Speaker 11 (26:35):
It's hard to envision that world under the current regime.
They have staked a lot on this nuclear program. I
don't see many face saving off ramps ahead for them,
and they can make a pretty strong case and have
international support for saying that they have the right to
a civilian enrichment program. But at the same time, I
don't know how the international community can ever trust them
again not to pursue a nuclear weapon.
Speaker 3 (26:57):
So you do wonder, you know, does the US take
the step of potentially using the GBU fifty seven, which
would be seen as a pretty pretty strong move, and
then in the long term around still continues to build
up its nuclear facilities for weapons.
Speaker 8 (27:13):
Yeah, this is the massive bunker buster bomb that we've
been referring to over the last couple of days that
can only be delivered by the B two Spirit aircraft.
Speaker 6 (27:20):
So the USN does right.
Speaker 3 (27:21):
This is probably some of the conversations the president is
currently having, perhaps Heather Williams.
Speaker 6 (27:25):
Thank you so much.
Speaker 3 (27:26):
This is what we were hoping to do for the
Bloomberg audience, and you did it so well.
Speaker 6 (27:30):
Thank you. Thank you.
Speaker 3 (27:31):
Director of the Project on Nuclear Issues and Senior Fellow
for Defense and Security at the Center for Strategic and
International Studies there in Boston.
Speaker 2 (27:40):
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(28:00):
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Speaker 1 (28:09):
Mm hmm.
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Speaker 2 (00:08):
This is Bloomberg business Week Daily reporting from the magazine
that helps global leaders stay ahead with insight on the people, companies,
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Speaker 3 (00:32):
Let's just remind everybody, here's what happened FED officials. You
heard it from Charlie leaving interest rates unchanged, continuing to
pencil in two rate cuts in twenty twenty five, saying
uncertainty over the economic outlook was still high but had diminished,
and that effect can be kind of patient, it seems
like as it awaits more information, here's fetchirt J.
Speaker 4 (00:51):
Powell.
Speaker 5 (00:52):
We feel like the right thing to do is to
be where we are, where our policy stance is, and
just learn more. In particular, we feel like we're going
to learn a great deal more over the summer on tariffs.
We hadn't expected them to show up much by now,
and they haven't, and we will see whether the extent
to which they do or overcoming months. And I think
(01:12):
that's going to inform our thinking.
Speaker 3 (01:14):
All right, That of course was fedya Jay Powell earlier
at the FOMC press conference.
Speaker 6 (01:18):
Let's get to it.
Speaker 3 (01:19):
Let's get more on the investment landscape, also the rate landscape,
and how the FED decision and commentary may affect all
of it.
Speaker 6 (01:25):
Are we all going to kind of just wait for
the next FED meeting?
Speaker 3 (01:28):
Ross Mayfield is with us, these investment strategists at BAIRED
Private Wealth Management from Louisville, Kentucky.
Speaker 7 (01:33):
Also with us.
Speaker 3 (01:34):
Bloomberg Intelligence chief US interest rates strategist Ira Jersey out
there in New Jersey.
Speaker 6 (01:39):
Hey, Ira, I want to kick it off with you.
Some went into this meeting truly.
Speaker 3 (01:43):
I was listening to Bloomberg Television's coverage, really TV and
radios coverage of the FED decision. Some said it was
going to be boring. Some expected not much to happen.
Others said it's never.
Speaker 8 (01:53):
Bell, It's never boring for us, right.
Speaker 6 (01:56):
Well, sometimes it is.
Speaker 3 (01:57):
And then others said it was going to be historic
because all that is coming at the FED right now.
Speaker 6 (02:02):
Why was there such a gap going into this meeting?
Speaker 4 (02:06):
Yeah, I think there's some people who think that, firstly,
that the Federal Reserve does have to cut interest rates
because they see cracks in certain parts of the economy.
And then there's other people who are fearful of tariffs
and think that, you know, inflation might increase. And you
even heard that the last question, which was about how
come no one was projecting rate increases even though there
(02:26):
were a number of members who were thinking the Fed
is going to be on hold for the entire year
and then cut a bit next year.
Speaker 9 (02:32):
You know, I this was as I expected.
Speaker 4 (02:35):
And what's always interesting about this, you know, and we
have to as market professionals kind of parse every single
thing coming out of the FED Reserve.
Speaker 9 (02:45):
Is the reaction function? Right? What is the Fed's reaction function?
Speaker 4 (02:49):
So we heard a number of if van statements from
Jare Powell, and you know, those ifan statements could mean,
you know, give us at least a little bit of
an indication under what circumstances, don't make any kind of
policy adjustments.
Speaker 8 (03:02):
Hey, Ross, come on in here and just give us
your general overview of how the meeting went, your expectations,
Where they met, where they not met. What was your
big takeaway?
Speaker 9 (03:10):
Yeah?
Speaker 8 (03:10):
I think they were largely met.
Speaker 10 (03:11):
I mean, I don't know anyone who expected much action
at this meeting or a resolution of all the uncertainty
that they've been discussing at this meeting. Given that we're
still in this kind of tariff pause, you know, we
have the potential for oil prices to swing and impact
headline inflation.
Speaker 8 (03:27):
So I didn't expect much.
Speaker 10 (03:30):
I'm on the side of the camp that thinks the
FED should be a little more aggressive and cutting. I
think the cracks in the labor market are starting to
really accumulate. And to hear Finch, our pals say that
the labor market is I forget the exact language, but
on solid footing.
Speaker 8 (03:44):
Yeah, he wouldn't agree with you. I think Ross that
the cracks are starting to appear. What data are you
paying attention to that he's not And.
Speaker 3 (03:51):
Perhaps that headline Microsoft planning thousands more job cuts you.
Speaker 6 (03:54):
Know that we saw.
Speaker 10 (03:56):
Certainly, yeah, certainly, the anecdotal evidence of layoff is rising.
But if you look at something like warn notices or
initial claims and continued claims, I mean we're sitting at
multi year highs for a lot of those levels.
Speaker 9 (04:09):
If you look at some.
Speaker 10 (04:11):
Of the employment statistics about people fresh into the job
for us out of college. You know that the unemployment
rate there is at not record highs by any means,
but is significantly higher than the overall on employment rate.
So I think it's a labor market where we have
tight supply, and especially in this you know, given the
immigration policy, but it is not a robust labor market,
(04:31):
and we are well north of a neutral policy. I
think that getting to neutral should be more more of
a goal for the Fed, who doesn't seem to want
to get there until the end of twenty twenty six
if you look at the CCP.
Speaker 6 (04:43):
All right, come on in airah, yeah.
Speaker 4 (04:45):
So I just want to want to say I think
that's part of this debate, like where is neutral? And
you know, there's you know, the Fed will say that
they're still have restrictive policy, but a lot of the
other information that that's some of us, me included, have
looked at suggests that actually they're probably pretty close to neutral.
So unless there's a deceleration of the economy, the Fed
(05:08):
probably doesn't have to adjust interest rates.
Speaker 9 (05:10):
Now.
Speaker 4 (05:11):
The question is, and to Cross's point, like they can't
wait until the economy is clearly really bad before.
Speaker 9 (05:19):
They cut interest rates.
Speaker 4 (05:20):
But I do suspect that because of this overhang of
inflation and the recent past episode that we just had,
that the Fed will try to wait until almost the
last minute, and then once it cuts, it'll cut faster.
Speaker 9 (05:33):
And I go back to the statement that J.
Speaker 4 (05:35):
Powell made in May at at the press conference, where
he said, like, look, we know how to deal with
a weak economy. We could just cut more aggressively and
get down below the neutral rate to stimulate the economy.
We don't want to have to go the other way
and have to hike interest rates rate if inflation were
to remain relatively high.
Speaker 8 (05:56):
Hey, Ira, a couple more to you, and then we're
going to bring ross back in here. But I'm wondering
about a couple of things here. One specifically, is the
question of AI and the labor force. The bed chair
was asked about that, Carol, and I cannot stop talking
about this. What did you make of the way that
he answered this question about AI and the effect on
(06:18):
the labor face feels like.
Speaker 3 (06:19):
There's a pig pile of all of a sudden, people
are waking up and saying, Okay, there's going to be
a lot of jobs lost because of AI.
Speaker 9 (06:25):
Well, there's always disruptions.
Speaker 4 (06:26):
Whenever you have new technologies, there's always disruptions and you
wind up having you know, layoffs in some sectors, and
then the new economy creates other jobs and new jobs.
We've done that over centuries since, you know, even before
the Industrial Revolution, you've always seen you know, things replacing
other things. I mean, we did it thirty years ago.
Right when you think about the Internet, and you know
(06:49):
in nineteen ninety five, very few firms had websites. Yet
today everyone does, right, and this is kind of an
extension of that. So we created a whole new economy
around the Internet that now is creating more jobs. Whereas
robotics and other things like manufacturing, they're less people are
needed to do the same amount of work in labor
(07:09):
than was needed in nineteen seventies.
Speaker 6 (07:11):
H So true.
Speaker 3 (07:12):
Socho hey, Ross just got about twenty five seconds left here,
Mike McKee saying, nobody on the committee has any conviction
on these forecasts, so don't take us seriously on the
rate cuts. Things will change. That was kind of the
message that Mike took away, and he says that maybe
kind of means for the Bloomberg audience, don't invest on
this FED decision fifteen seconds.
Speaker 6 (07:29):
Do you agree?
Speaker 10 (07:31):
Yeah, I don't think you can take much away from
this FED decision in terms of actionable investment items. I
think you need to watch the long end of the curve,
and for that you need to watch things like the
budget deficit and service sector inflation. So that's what I'm watching,
and I think you go long deration here.
Speaker 3 (07:45):
All right, great duo Ross Mayfield Investment strategis ad baired
Private Wealth Management, our own IRA Jersey chiefos interest rate
Strategies at Bloomberg Intelligence.
Speaker 2 (07:53):
You are listening to the Bloomberg Business Weekdaily podcast. Catch
US Live weekday afternoons from two to five pm E.
Listen on Apple CarPlay and Android Auto with the Bloomberg
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Speaker 8 (08:07):
The Israeli Ron conflict, the more than three year old
war between Russia and Ukraine, the US LED tariff for
changing geopolitical relationships, Carol, These are all things that can
and do affect global investment flows.
Speaker 3 (08:19):
Yeah, it's kind of interesting at a moment in time
where where they're rethinking whether or not the US is
uninvestable and also questioning the dominance of the US dollar.
We should point out as Alex Steel mentioned in our
TV simulcast, foreign treasury holdings holding your record high in
the month of April.
Speaker 6 (08:37):
So foreign investors are.
Speaker 8 (08:39):
They're not selling well foreign investors.
Speaker 3 (08:42):
It sounds like, at least not when it comes to treasuries,
which is what we kind of keep watching so closely.
All of this tie it all up, and especially when
it comes to foreign direct investment. It is the world
of our next guest, and it's so great to have
back with us in studio, Michael Lohan, CEO of IDA Ireland.
It's the Foreign Direct Investment Agency of the Irish government.
Speaker 6 (08:59):
Hello, Hello, how are you?
Speaker 7 (09:01):
I'm good carel good to be back in tint.
Speaker 3 (09:03):
There's a lot coming at everyone, and I'm not even
quite sure to begin. Just give us a good Macro
overview as you think of the things that the G
seven leaders we're facing this week are facing this week.
The war is the conflict certainly top of mind, and
you know we're having this interview in real time and
(09:23):
things are going to continue to develop. But how do
you see the environment right now? Is it continuing to
be an uncertain one?
Speaker 1 (09:31):
I think that's the word that you'd have to you'd
have to use is uncertainty, and you know when we
last met actually just that in March of this year.
I think we've gone through a lot in those in
those intervening weeks, to be honest, probably as much as
I've seen in my career in foreign direct investment. A
lot has happened in a very short space of time.
And when you think about from from the tariffs in
(09:53):
terms of what tariffs means, where they're going to be pulled, composed,
at what level and what time frame, A lot of
those questions still remain unanswered as we sit today, and
I think from a European perspective, we are very clear
that you know, bringing negotiation, trying to get to a
point of aspos consensus around what this looks like. It's
so critically important for investment flows and indeed for the
(10:16):
economic prosperity of the world, you know, whether it's the
US or whether it's the Europe, or indeed whether it's
the Asia. So that's a that's a real area of
focus from from a European perspective and indeed the Irish
government perspective, and of course you're correct, this is all
against the backdrop then of some other conflicts across the world,
and you know, we see that increasing, so you know,
it's we're very mindful of that in the context of
(10:38):
trade flows and trade investments as well, because that brings
another level of uncertainty into the equation.
Speaker 8 (10:44):
Yeah, it's been pretty much exactly three months since we
last saw you. You were here in New York, right
before you went to Washington with the Prime Minister to
visit the White House. That'so you met with the President,
You met with his team. How did the meeting go?
Speaker 7 (10:59):
So, so you're correct the last time was here. I
left them.
Speaker 1 (11:02):
I went to d C with on t shock or
our Prime minister. The medium went very well actually, and
I think actually it was was. In reflecting on it,
you'd say that, you know, the President was actually very
gracious in terms of his engagement. Yes, there was fourth
Right discussions and you know he talked about the challenges
in terms of trade, trade deficits in particular.
Speaker 8 (11:22):
This was before all the teriffs were announced.
Speaker 7 (11:24):
Yeah, this is before.
Speaker 1 (11:25):
But remember this was all very you know, it was
all very live and active at that point because you
were this we were talking about this is the fifteenth,
sixteenth of March, so it was all becoming very transparent
or apparent as to what was what was going to
come down the tracks. So I would say that that
that that meeting and engagement very much reflect this the
relationship which is one hundred years between Ireland and the US,
(11:47):
and I think in any relationship there can be pints
of let's call this discussion, and that was the discussion
that we had, but it would think it was very
respectful on both on both sides.
Speaker 3 (11:56):
Michael, what changes have you guys seen in investment flowers?
What are you seeing from your bead point?
Speaker 1 (12:00):
Yeah, so what we're seeing today, actually, Carol, it's interesting.
So I can sit here today and actually in two
weeks time I'll be sharing with her Minister Peter Burke
are results for the first half of the year, and
when I can't disclose them to you on air, what
I could, yeah, but I won't. But what I can
say is this is that we continue to see investment flows.
In fact, it is a power with last year in
(12:23):
terms of the first half of last year, which is
maybe somewhat maybe surprising giving the level of uncertainty that
you see across the globe. But the reasons where we
see that is and we're seeing across a number of
different areas. We're seeing reinvestment in research and innovation continuing
and companies looking to double down on their investments in
Ireland in innovation. We're also seeing a lot of investment
(12:43):
as well in terms of new entrance into the Irish economy,
which is really important. And that's because they're looking for
global marketplace, stable locations where they who's just trusted and proven,
I believe, and that's what they're seeing in Ireland. In
terms of the future world.
Speaker 3 (12:57):
I know you can't reveal all, but I am curious
so on that where there's new investments coming in. Are
there conversations you're having with entities, global companies, US companies
who say we want to do more stuff with you
guys because we don't necessarily want to be in the
US or other like give me an idea if there's
anything that's a repercussion or you know, the result of
(13:19):
an action by the White House.
Speaker 1 (13:20):
Yeah, So I don't think it's it's a scenario of
we don't want to do it in location A, so
we're doing location B. I actually think companies are looking
to actually how can.
Speaker 7 (13:29):
We grow our business?
Speaker 1 (13:30):
Where can we grow that from what markets do we
want to serve and where can we get the skills.
Speaker 7 (13:36):
Or are the policies that support that.
Speaker 1 (13:38):
That's really what we're seeing and what we do in
Ireland is that, you know, we make sure we bring
is stability and certainty to those areas of policy in
terms of talent and talent availability, not just Irish talent,
but international talent. These are the pieces that are setting
I believe investors apart when they're looking at locations around
the globe, because I said previously at the very core
(13:59):
of the IE and of multinational companies, they look to
international markets. They need international markets, they need international supply chains,
they need international talent. That's what they need in order
to be successful. And that success isn't just success in
the country they're located in, It actually comes back to
their entire supply chain.
Speaker 8 (14:16):
We're speaking to you on today where we heard from
the FED chair and there are a lot of questions
about what the labor market looked like. The takeaway that
I got from him, Carol, and I think you'd agree
with this is that he really likes where the labor
market is right now. And then despite what anecdotes people
hear and what people are saying, there are not cracks
starting to appear. Things are looking pretty strong. Explain to
us the labor market in Ireland right now in the
(14:37):
context of these companies, especially tech companies battling it out
for top tech talent for AI.
Speaker 1 (14:45):
Yeah, and I think you're just to use it the
comment in terms of the Fed's comments this afternoon of
the labor market, actually, Irish labor market is somewhat mirrors.
I think what the FED has has mentioned today. It's
robust where like you know, we're almost at full employment.
So there is actually I think for economies that are
performing and have a strong underlying fundamentals that is I
(15:06):
think that's mirrored across many economies across the globe. And
the key is in this context is you're correct, there
is like talent availability and is probably this key differentiator
for success for whatever business you're in or whatever sector
you're in. And that's why I believe that multinational companies
look they see talent as global.
Speaker 7 (15:24):
They don't see it as within a geography or within
a region.
Speaker 1 (15:28):
They see it as global. And I think that's what
we have to continue and we're very we're very as
suppose attuned to the fact that not howlone do we
have to generate our own talent, but we have to
be able to track the best talent to Ireland, and
we have to create the conditions in which they can prosper,
which they can live, and which they can and enjoy
life as well.
Speaker 11 (15:46):
Well.
Speaker 3 (15:46):
I'm also curious because there is a lot of pressure
from this administration, the President specifically for US based companies,
US based multinationals to do more in the United States.
Having said that, I think about a company like Microsoft,
who has been in Ireland in for four decades or so, correct,
I'm just curious, you know, is any of that relationship
that you folks have, and especially the investments that Microsoft
(16:10):
has made and maybe continue to do, has any of
that changed?
Speaker 1 (16:13):
To be honest, it hasn't. And if you think about
your correct, Microsoft celebrated it's fiftieth birthday actually since we
last spoke, and forty of those fifty years have been
in Ireland. And when when when Actually, when we celebrated
Microsoft's fortieth birthday in Ireland, they spoke about how important
Ireland was to the Microsoft's success, not just Microsoft Ireland,
(16:34):
but Microsoft the corporation because that's what it really is
is embedded. And when we look at companies like Microsoft
and the many more companies that we have in Ireland,
there are there are multi decade investments, there are you know,
trusted long term partnerships with IDA and with the Irish,
with the Irish government, and that's what really brings that
success back. And what we have to be conscious of
(16:54):
as well is that we need to make sure that
we actually have we're meeting the future needs of industry
as well. So that means people, it means infrastructure, and
it means policy, and that's very much what we're focused on,
what Irish government or folks.
Speaker 8 (17:07):
We'll go back to my question about AI specifically. Carol
mentioned there were some layoffs at Microsoft.
Speaker 9 (17:11):
Today.
Speaker 8 (17:11):
There are hundreds of thousands of people who work at
Microsoft and we know thousands.
Speaker 3 (17:15):
Is that the latest report, Carol, Yeah, some more job
cuts in salespeople, I think they were saying.
Speaker 8 (17:20):
And it's about making sure that you have the workforce
that these tech companies need. J Powell was asked the
same question, what is going to be effect of AI
on the workforce? Yes, what is it in your view
and how do you make sure that it doesn't decimate
a workforce, like the CEO of Anthropic dom Dario Amidae
said recently.
Speaker 7 (17:40):
So I think you're correct.
Speaker 1 (17:41):
We need to be conscious of the fact that AI
is going to be a technology and is a technology
that's going to revolutionize. In fact, we see it all
in our day to day lives and their day to
day work. What we're looking at from an idea perspective
is we're trying. We have very much looked at where
is the opportunity for AI to bring efficiency and bring
productivity gains.
Speaker 7 (17:59):
But secondly, then how do we make.
Speaker 1 (18:00):
Sure that where there are risks, we are upskilling and
reskilling that workforce for future and new new technologies. And
that's our real focus is in our new strategy. Just
to say this, for the first time, we have put
a public target and upskilling and reskilling of the workforce,
so forty thousand people we are committing to to upscale
and rescale and that's actually not just to meet AI,
(18:22):
but to meet all technological changes that's coming.
Speaker 6 (18:24):
Michael just got about thirty seconds.
Speaker 3 (18:25):
I'm just curious about what's Ireland's relationship with China and
what do you think it is going forward?
Speaker 6 (18:30):
Just quickly Yeah.
Speaker 1 (18:31):
So with China, our relationship has been the same and
the same with the European Union. I suppose it's d risk,
but don't the couple We see opportunity, but we also
understand that we need we need to do that balance
between the risk and the coupling, and we will continue
to do that.
Speaker 3 (18:44):
Is China being more aggressive though and reaching out to
a country like.
Speaker 1 (18:48):
Your own, I can't say this. I think we have
offices in China, We have offices all across Asia, so
I think it's no different to dat than it was
this time six months ago.
Speaker 3 (18:58):
Trying to just get an idea right as we look
get geopolitics and new relationships being formed, whether or not
you know John has certainly there's been reporting that as
the US backs off, kind of looking to kind of
step in, but not necessarily.
Speaker 7 (19:10):
Not evident of this juncture. Yeh.
Speaker 6 (19:11):
Be well, be well. We know you travel a lot,
so stay safe.
Speaker 3 (19:14):
Michael Lowan, chief executive Officer of IDA Ireland, joining us
here in our Bloomberg Interactive Broker Studio.
Speaker 2 (19:21):
This is the Bloomberg Business Week Daily Podcast. Listen live
each weekday starting at two pm Eastern on applecar Play
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also listen live on Amazon Alexa from our flagship New
York station Just Say Alexa played Bloomberg eleven thirty well.
Speaker 8 (19:39):
As Kate Sullivan told us earlier this hour, Bloomberg News
White House correspondent, the President's latest meeting to discuss the
conflict in the Middle East is ongoing right now. Earlier,
the President remained qui about whether the US plans to
join Israel's offensive aim at destroying Uran's nuclear enrichment program.
What exactly is that nuclear enrichment program? What exactly is
(20:00):
Iroon's strategy. Is it for weapons or is it for energy?
Is it even close to having a nuclear weapon? These
are all questions that we talked about in preparation for
this segment today. We've got a great voice on this.
Heather Williams is the director of the Project on Nuclear
Issues and a Senior Fellow in the Defense and Security
Department at these Center for Strategic and International Studies. She's
(20:21):
also an associate Fellow with the Project on Managing the
Atom in the Belfer Center for Science and International Affairs
at the Harvard Kennedy School. She joins us this afternoon
from Boston. It's good to have you with us, Heather,
thanks for taking the time. I think a place we
want to start is just getting an understanding of exactly
what the capabilities Iran has right now when it comes
(20:42):
to nuclear energy and weapons. What do they have?
Speaker 11 (20:47):
Yeah, well, thanks so much Carolyn tim for inviting me on.
So we before we talk about what they have right now,
I want to just very quickly say what they had
a week ago, because there's a big difference between then
and now. A week ago, iron had a nuclear enterprise
involving thirty different facilities spread out across the country. It
was enriching to sixty percent its uranium, which is well
(21:07):
above the amount that you need for civilian purposes.
Speaker 12 (21:10):
It also had some ballistic missile.
Speaker 11 (21:12):
Capabilities, and so this was a really concerning program. And
the day before the Israeli strikes, the International Atomic Energy
Agency actually found that Iran was in breach of its
non proliferation obligations for the first time since two thousand
and five. So there was this really expansive program. Where
that program stands now is a very different picture.
Speaker 12 (21:33):
One of the.
Speaker 11 (21:34):
Biggest enrichment facilities, Naton's, has essentially been destroyed and that
is partially because of the power being cut the targeting
of the structure itself.
Speaker 12 (21:46):
But there's one big piece.
Speaker 11 (21:47):
Of Iran's nuclear program that remains, and that is the
four Doah enrichment facility, which is buried really deep underneath
the mountain, and Israel has had a few strikes on Fourdah.
That facility still remains, but for the most part, a
lot of Iran's other nuclear facilities and capabilities have been
significantly impacted by the Israeli strikes.
Speaker 6 (22:10):
So how long does it take to kind of.
Speaker 3 (22:14):
Rebuild all of this if that is ultimately Iran's plan.
Speaker 12 (22:20):
Yeah, it's an unsatisfying answer.
Speaker 11 (22:22):
We don't know because it really depends on the extent
of the damage.
Speaker 12 (22:26):
But it also really depends on.
Speaker 11 (22:28):
What President Trump is going to decide, probably in the
next days or weeks, because that Florida facility is going
to be really crucial if Iran does want to rebuild
a race to having a nuclear weapon in the near future,
because that's where a lot of the higher enrichment was happening.
It's a place where iron stockpile could be transported to.
(22:49):
And so if that facility endures and Iran continues to
use it. In that case, some estimates had said that
Iran was just weeks away from.
Speaker 12 (22:58):
Having a nuclear weapon.
Speaker 11 (23:00):
Now if that facility is destroyed, that will probably set
Aron back by a significant amount of time. But the
answer to that question, we just don't know. But we
probably will know a lot more in the next few days,
assuming that President Trump makes a decision.
Speaker 8 (23:13):
Do you think Florida can be destroyed without using the
GBU fifty seven.
Speaker 12 (23:18):
It would be really, really difficult.
Speaker 11 (23:20):
It would require sustained Israeli strikes using their own bunker
busting bombs, which are a lot smaller than the GBU
fifty seven, and even then it's not clear that those
sustained strikes would get the job done. Another option would
be an Israeli sabotage mission such as cutting the power
to four Do Doh, or some sort of commando mission
(23:42):
on the ground, such as go and getting folks into
Fourdoh to blow it up from inside. That might be
one option for probably having the higher likelihood of success
of just throwing Florida, But for air strikes, it's really
hard for the Israelis to do this without US support.
I do think it's important to point out, though, that
the US strikes on Florida.
Speaker 12 (24:04):
If they do come to fruition, this might not be
a one and done mission.
Speaker 11 (24:08):
It would be difficult, I think for the US to
be able to take out all of Flouridah with one
of these bombs.
Speaker 12 (24:14):
And the reason for that is Florida is buried so deep.
Speaker 11 (24:17):
Also, we don't know a lot about the extent of
the Floidau facility.
Speaker 12 (24:22):
There could be additional tunnels even further underground.
Speaker 11 (24:24):
Some suspect that there are facilities buried up to half
a mile into that mountain, and so the GBU fifty
seven is probably the best bet for air strikes in
taking out that facility, but it might require multiple strikes.
Speaker 6 (24:38):
How do you feel? Forgive me?
Speaker 3 (24:41):
And this is with all due respect, but there's been
so much debate about does Iran have weapons?
Speaker 6 (24:45):
Do they not have weapons? I feel like it's gone
back and forth.
Speaker 3 (24:47):
So how do we trust the intel or how do
you determine that you can trust the intel that you've got.
Speaker 12 (24:57):
I love this question.
Speaker 11 (24:58):
It's such an important question because there is all this
confusion about the intel right now. Right Chelsea Gabbert says
one thing, the President says another thing, The CIA says
one thing, central Command says another thing. And I actually
think this confusion is really really understandable, and a big
reason for that is how you define a nuclear weapon.
And I promise I'm not going to get academic about this,
(25:20):
but it is the difference between if Iron is pursuing
weaponization technologies, so for example, triggering devices, if you want
an implosion device, what do you do with all that
highly enriched uranium.
Speaker 12 (25:32):
It's not just going to sit there. You have to
figure out how to convert it into.
Speaker 11 (25:35):
A nuclear weapon, versus a nuclear weapons program which requires
the highly enriched uranium a means of delivery along with
that weaponization technology. And so if we're talking about that
weaponization technology, I think those in the Intel community who
said they don't see evidence of that, that seems to
be pretty consistent. However, if you count a nuclear weapons
(25:57):
program as enriching uranium well beyond billion purposes, having secretive
nuclear facilities, talking about using wiping your neighbor off the
face of the earth, then that also points towards the
nuclear weapons program.
Speaker 12 (26:12):
And so I think that there's a lot less daylight.
Speaker 11 (26:14):
On the Intel then sometimes comes across it does just
require this kind of wonky more nuanced understanding of what
actually goes into making a nuclear weapon.
Speaker 3 (26:24):
Heather, I have no idea if this is in your purview,
But I mean, do you think that there is a
world where Ron says, Okay.
Speaker 6 (26:30):
I'm out, we don't need nuclear weapons just quickly?
Speaker 11 (26:35):
It's hard to envision that world under the current regime.
They have staked a lot on this nuclear program. I
don't see many face saving off ramps ahead for them,
and they can make a pretty strong case and have
international support for saying that they have the right to
a civilian enrichment program. But at the same time, I
don't know how the international community can ever trust them
again not to pursue a nuclear weapon.
Speaker 3 (26:57):
So you do wonder, you know, does the US take
the step of potentially using the GBU fifty seven, which
would be seen as a pretty pretty strong move, and
then in the long term around still continues to build
up its nuclear facilities for weapons.
Speaker 8 (27:13):
Yeah, this is the massive bunker buster bomb that we've
been referring to over the last couple of days that
can only be delivered by the B two Spirit aircraft.
Speaker 6 (27:20):
So the USN does right.
Speaker 3 (27:21):
This is probably some of the conversations the president is
currently having, perhaps Heather Williams.
Speaker 6 (27:25):
Thank you so much.
Speaker 3 (27:26):
This is what we were hoping to do for the
Bloomberg audience, and you did it so well.
Speaker 6 (27:30):
Thank you. Thank you.
Speaker 3 (27:31):
Director of the Project on Nuclear Issues and Senior Fellow
for Defense and Security at the Center for Strategic and
International Studies there in Boston.
Speaker 2 (27:40):
This is the Bloomberg Business Week Daily podcast, available on Apple, Spotify,
and anywhere else you get your podcasts. Listen live weekday
afternoons from two to five pm Eastern on Bloomberg dot com,
the iHeartRadio app, tune In, and the Bloomberg Business App.
You can also watch us live every weekday on ute
(28:00):
you and always on the Bloomberg terminal.
Speaker 1 (28:09):
Mm hmm.
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