CLOSE AT THE TOP OF THE NEXT
HOUR ON CHRISTMAS EVE.
LOT OF UNCERTAINTY WHETHER IT'S
THE FED CHAIRMAN JEROME POWELL
PROVIDING SOME OF THAT
UNCERTAINTY, OR MAYBE THE
PRESIDENT ADDING TO THAT WITH
HIS CRITICISM OF POWELL.
THERE'S SOME BLOWBACK CERTAINLY
FROM THE DEPARTURE OF JAMES
MATTIS AT THE PENTAGON AND HOW
THAT KIND OF PLAYS INTO
DECISION-MAKING IN THE WHITE
HOUSE.
LET'S BRING IN FORMER ASSISTANT
PRESS SECRETARY TO PRESIDENT
REAGAN, MOVIE NIGHTS WITH REAGAN
AUTHOR MARK WINEBERG, WHO IS
HERE IN STUDIO.
GOOD TO SEE YOU.
THANK YOU FOR COMING IN TODAY.
WE APPRECIATE IT.
KIND OF THE BIG PICTURE I THINK
FOR WALL STREET INVESTORS AS
THEY TRY TO LOOK AT POLITICS
ISN'T NECESSARILY WELL, THE
PRESIDENT GETS RID OF MATTIS,
LET'S SELL STOCKS.
IT'S WAIT, WHAT HAPPENED HERE IN
DECISION MAKING?
WHY WASN'T MATTIS CONSULTED ON
SYRIA.
NOW, WILL THE PRESIDENT NOT
CONSULT SO AND SO ON TRADE.
IT'S JUST WORRYING TO PEOPLE,
THE UNPREDICTABILITY.
YOU BUY INTO THAT?
WHAT'S GOING ON?
>> YES, I DO.
PREDICTABILITY IS A VERY
VALUABLE COMMODITY FOR
PRESIDENTS.
YOU DON'T WANT, IF YOU ARE IN A
WAR OBVIOUSLY YOU WANT TO BE A
LITTLE UNPREDICTABLE BUT PEOPLE
NEED TO BELIEVE THE PRESIDENT
WILL SAY THE SAME THING ON
TUESDAY THAT HE SAID ON MONDAY.
IF HE DOESN'T, THEN HOW DO YOU
KNOW WHAT TO INVEST IN?
IT'S A DIFFERENCE BETWEEN BEING
A LITTLE UNPREDICTABLE AND BEING
ERRATIC.
THAT'S WHAT SCARES INVESTORS.
CONNELL: SO THIS PRESIDENT RIGHT
NOW WOULD BE FAIR TO SAY, IS
BEING ERRATIC OR HAS BEEN HIS
ENTIRE TERM?
YOU THINK SOMETHING'S CHANGED IN
THE LAST FEW WEEKS?
>> WELL, IT'S EASY TO PLAY
ARMCHAIR PSYCHOLOGIST.
CLEARLY THERE ARE A LOT OF
PROBLEMS MOUNTING FOR HIM.
HE'S ALWAYS BEEN A LITTLE BIT
ERRATIC OF SORTS.
SOME PEOPLE ARE ATTRACTED TO
THAT.
I THINK FROM AN ECONOMIC
STANDPOINT, IF YOU ASK A CEO
WHAT THEY WANT, IT'S CONSISTENT,
SUSTAINABLE EARNINGS GROWTH.
AND THE TRUMP POLICIES ARE
NEITHER CONSISTENT NOR
SUSTAINABLE.
SO THAT WOULD GIVE PAUSE TO
INVESTORS.
CONNELL: ESPECIALLY THE
POLICIES, WHAT WE HAVE BEEN
HEARING FROM INVESTORS AND TO
YOUR POINT, CEOs ON TRADE.
EARLY IN THE ADMINISTRATION, THE
TRUMP ADMINISTRATION GENERALLY
SPEAKING AND THE PRESIDENT IN
PARTICULAR WERE SEEN AS QUOTE
UNQUOTE, BUSINESS FRIENDLY, CUT
TAXES, CUT REGULATIONS, BUT WITH
THE SHIFT TO TRADE, THAT'S
REALLY HANGING OVER EVERYTHING
NOW.
I KNOW THE PRESIDENT WANTS TO
BLAME THE FED FOR EVERYTHING,
BUT I KNOW THE CEOs WOULD LOVE
TO SEE SOME SORT OF DEAL CUT
WITH CHINA.
THINK WE'LL GET ONE?
>> I HOPE SO.
I DON'T KNOW.
NORMALLY, YOU WOULD SEE A PATH
THERE, BUT IN THIS CASE,
ANYTHING CAN HAPPEN.
EVEN IF IT'S AGREED TO, DOESN'T
MEAN IT WILL HOLD.
THEY WANT TO KNOW WHAT THEY CAN
COUNT ON.
THEY WANT SOME PREDICTABILITY
AND RELIABILITY AND STABILITY,
AND BY THE WAY, I KNOW HIS STYLE
OF GOVERNING IS CHAOTIC BUT CALM
HAS A PLACE IN GOVERNMENT, TOO.
CONNELL: IT WOULD BE NICE,
RIGHT?
WE HAVE ALL BEEN JOKING
SOMETIMES, BY THE WAY, THE DOW
NOW DOWN 500 POINTS, WE HAVE ALL
BEEN JOKING THROUGHOUT THIS
PERIOD, SOMETIMES IN THE SUMMER,
OTHER TIMES IN HOLIDAYS WHERE
YOU WOULD COME IN AND WORK IN
NEWS AND YOU SAY TODAY WILL BE A
QUIET DAY.
THAT LITERALLY NEVER HAPPENS
ANYMORE.
SOME PEOPLE SAY IT MUST BE FUN.
OBVIOUSLY, IT IS INTERESTING,
BUT AT THE SAME TIME, MAYBE TO
YOUR POINT, INVESTORS AND OTHERS
WOULD SAY LET'S JUST TAKE A DAY
AND TAKE A DEEP BREATH HERE.
IT ALMOST SEEMS TO NEVER HAPPEN.
I DON'T KNOW IF THAT'S THE
PRESIDENT'S FAULT BUT HE
DEFINITELY PLAYS A PART IN IT.
>> HE CERTAINLY HAS A MAJOR
RESPONSIBILITY.
IF EVERYTHING WERE GOING GREAT
HE WOULD GET CREDIT SO IT'S ONLY
FAIR TO LAY THE BLAME.
I THINK HIM ATTACKING THE FED AS
HE'S DONE, WHICH IS REALLY
UNPRECEDENTED, ADDS ONLY TO THE
INSTABILITY --
CONNELL: PEOPLE WILL SAY OTHER
PRESIDENTS HAVE HAD
DISAGREEMENTS WITH FED CHAIRMEN
IN THE PAST, NIXON HAD ISSUES
AND OTHER PRESIDENTS HAVE
ATTACKED THE FED, SOME HAVE DONE
IT BEHIND CLOSED DOORS, OTHERS
HAVE DONE IT PUBLICLY.
YOU THINK THERE'S SOMETHING
DIFFERENT THIS TIME, LIKE FOR
EXAMPLE THIS MORNING SAYING THE
ONLY PROBLEM OUR ECONOMY HAS IS
THE FED?
>> IT'S NOT THE ONLY PROBLEM OUR
ECONOMY HAS.
AND THE THREAT TO FIRE THE HEAD
OF THE FED EVEN THOUGH HE
REALIZES NOW HE CAN'T, CERTAINLY
DOES NOT ADD TO AN ATMOSPHERE OF
STABILITY HERE OR GLOBALLY.
CONNELL: PROBABLY ADDS TO
UNCERTAINTY AS WE JUST HIT
SESSION LOWS IN THE MARKET,
BECAUSE I WAS TRYING TO MAKE
THIS POINT EARLIER, IF YOU ARE
AAT THE FEDERAL RESERVE AND YOU
KIND OF RECOGNIZE THE ECONOMY IS
SLOWING DOWN AND THE NEW YORK
FED PRESIDENT LAST WEEK STARTED
TO SAY YOU KNOW, WE ARE FLEXIBLE
ON THIS, SO YEAH, WE HAVE TWO
RATE HIKES PLANNED FOR NEXT YEAR
BUT MIGHT NOT DO IT.
YOU SEE THE PRESIDENT HAMMERING
THE FED AND IT ALMOST SEEMS TO
ME PUTS PRESSURE ON THE FED TO
STAY AGGRESSIVE EVEN IF THEY
SHOULDN'T BE.
I KNOW THEY ARE SUPPOSED TO BE
APOLITICAL BUT IT'S TOUGH,
RIGHT?
>> IT'S A HUMAN REACTION AS A
NORMAL HUMAN BEING.
THE REASON THE FED IS
INDEPENDENT IS A GOOD ONE.
THE PRESIDENT CAN JAWBONE IF HE
WANTS BUT AT SOME POINT, HE HAS
TO UNDERSTAND HIS MESSAGING HAS
A VERY NEGATIVE EFFECT ON THE
MARKET.
CONNELL: NOW, THE TREASURY
SECRETARY ALSO MADE THESE CALLS
TO THE BANK CEOs OVER THE
WEEKEND, CONVENING THE
PRESIDENT'S WORKING GROUP ON THE
MARKETS TODAY TO TALK ABOUT
MARKET INSTABILITY.
WE JUST HAD A HEAD LINE OFF THE
WIRES FROM I BELIEVE REUTERS
SAYING FINANCIAL REGULATORS HAVE
TOLD THE TREASURY DEPARTMENT
THEY SEE NOTHING OUT OF THE
ORDINARY IN MARKETS.
WHICH IN A NORMAL ENVIRONMENT
WOULD BE GOOD NEWS.
BUT WHAT'S INTERESTING ABOUT ALL
OF THIS IS THAT NOT NECESSARILY
MAYBE THAT HEADLINE, BUT CALLS
OVER THE WEEKEND AS WELL, WE ARE
SEEING THINGS WE MAY HAVE SEEN
SAY IN 2008 WHEN THINGS WERE
DISASTROUS AND THERE WAS A LOT
OF INSTABILITY OUT THERE AND
CREDIT MARKETS AND ELSEWHERE,
AND YOU'RE SAYING BOY, ARE THERE
PROBLEMS HERE WE DIDN'T KNOW
ABOUT, DO THEY KNOW SOMETHING WE
DON'T KNOW.
THEY KEEP ASSURING US THEY
DON'T, BUT DO YOU THINK THAT
ADDS TO THE VOLATILITY JUST
SAYING IT OR MAKING THESE THINGS
PUBLIC?
>> I DON'T KNOW IF IT'S GOOD OR
BAD THAT THEY SAY THEY KNOW
THINGS WE DON'T OR DON'T KNOW
THINGS WE DO, BUT THE PHONE
CALLS ARE INTERESTING.
CLEARLY THEY HAVE ADDED TO AN
ATMOSPHERE OF NERVOUSNESS.
THE MARKET IS NOT DOWN 500
POINTS TODAY BECAUSE PEOPLE HAVE
CONFIDENCE.
THE MARKET IS DOWN 500 POINTS
TODAY BECAUSE PEOPLE ARE
NERVOUS.
CONNELL: THEY DON'T HAVE A
REASON TO BUY STOCKS.
WHY WOULD YOU BUY AN EQUITY, A
SHARE IN A COMPANY TODAY, WHEN
YOU HAVE NO IDEA WHAT'S GOING TO
HAPPEN SAY A FEW DAYS FROM NOW
AND YOU ARE HEADING IN A HOLIDAY
WEEK.
>> IF THE PRESIDENT ATTACKS THAT
PARTICULAR INDUSTRY IN TWO OR
THREE DAYS, THAT COULD TURN OUT
TO BE A VERY UNWISE INVESTMENT.
CONNELL: RIGHT.
SO THE OTHER HEADLINE COMING
FROM REUTERS IS THE CALL BETWEEN
THE REGULATORS AND THE TREASURY
WAS ABOUT AGENCY PLANS DURING
THE PARTIAL GOVERNMENT SHUTDOWN.
THAT'S WHAT REUTERS IS REPORTING
THROUGH A SOURCE.
SO THIS ALL WORKS INTO IT BUT
WHEN YOU START TO SEE HEADLINES
THAT HEY, EVERYTHING'S OKAY, YOU
START TO ASK YOURSELF, YOU KNOW,
DID WE HAVE A REASON TO THINK
THEY WEREN'T OKAY AND THE FED'S