OF A PERCENT ON THE DOW AND A
HALF OF A PERCENT ON THE NASDAQ,
36 POINTS LOWER ON NASDAQ.
JOINING US IS SHEILA BARE.
BEHR.
YOUR REACTION ON ALL OF THIS?
>> WELL, WORLD MARKETS DON'T
LIKE TRADE WARS AND SO I THINK
WE'VE GOT SOME ROCKY TIMES AHEAD
OF US.
THERE'S CLEARLY A PROBLEM WITH
INTELLECTUAL PROBLEM, WHETHER
TARIFFS ARE THE BEST WAY TO DEAL
WITH THAT IS ANOTHER QUESTION.
I HOPE EVERYBODY CAN SIT DOWN
AND GET THIS RESOLVED AND GET A
PATH FORWARD FAIRLY QUICKLY.
MARKETS DON'T LIKE THE
UNCERTAINTY.
LONGER TERM CHINA'S INTEREST AND
OURS ARE ALIGNED.
CHINA WANTS TO GROW ITS MIDDLE
CLASS, WANTS TO GROW DOMESTIC
DEMAND AND WANTS TO STIMULATE
MORE DEMAND WITHIN ITS OWN
ECONOMY AND THEY WANT ACCESS TO
OUR MARKETS.
WE WANT ACCESS TO THEIR MARKETS.
THERE'S COMMON GROUND AND AREAS
OF LEVERAGE TO GET THIS WORKED
OUT.
THERE'S A PROBLEM WITH
INTELLECTUAL PROPERTY.
IT'S GOOD HE'S TACKLING THIS.
I HOPE THEY CAN RESOLVE IT
QUICKLY.
>> MARIA: DAGEN?
>> DAGEN: SHEILA, IT'S GOOD TO
HE SEE YOU.
AGAIN, IT SEEMS LIKE -- THIS IS
THE WALL STREET JOURNAL SPEAKING
AS WELL IN THE EDITORIAL PAGE --
THAT VERY HAPPEN
THAT VERY DAPPEN
THAT VERY DISPEN
THAT VERY DISORN
THAT VERY DISORGANIZED APPROACH.
WE NEED OUR ALLIES TO COME
TOGETHER AND TAKE ON CHINA AND
THE THEFT OF INTELLECTUAL
PROPERTY AND TAKING TECHNOLOGY
FROM COMPANIES THAT WANT TO DO
BUSINESS THERE.
WE NEED THOSE ALLEYS, WHETHER
IT'S JAPAN -- ALLIES, WHETHER
IT'S JAPAN, SOUTH KOREA AND
EUROPE.
INSTEAD, WE SLAP ON STEEL AND
ALUMINUM TARIFFS AND THEN HAVE
TO BACKTRACK AND, AGAIN, IT KIND
OF THROW THESE VERY TRADING
PARTNERS INTO A TIZZY, IF YOU
WILL.
WHERE'S THE LOGIC IN THIS
APPROACH?
>> WELL, I DON'T DISAGREE WITH
YOU.
I THINK TARIFFS ARE A VERY BLUNT
INSTRUMENT.
THEY'RE HAVING TO BACKTRACK NOW
WITH A LOT OF EXCEPTIONS.
THERE DOESN'T SEEM TO BE A LOT
OF CONSULTATION WITH OUR ALLIES.
INTELLECTUAL PROPERTY IS A
WORLDWIDE PROPERTY, NOT JUST THE
UNITED STATES' PROBLEM IN TERMS
OF HOW CHINA DEALS WITH
INTELLECTUAL PROPERTY.
PATIENCE WOULD BE HELPFUL.
THIS IS AN IMPATIENT PRESIDENT.
HE HE CERTAINLY GOT EVERYONE'S
ATTENTION.
LET'S HOPE PEOPLE CAN SIT DOWN
AND HAVE THOSE KIND OF
DISCUSSIONS AND REACH SOME KIND
OF AGREEMENT TO GET US ON AN
ORDERLY PATH.
>> CHINA CAME BACK WITH ONLY
$3 BILLION IN TARIFFS.
THEY DID NOT LOAD THE GUNS AND
FIRE HERE.
THIS WAS A SMALL RESPONSE
RELATIVE TO WHAT WE EXPECTED.
DO THEY JUST WANT TO CUT A DEAL?
DO THEY WANT TO GET IT DONE
QUICKLY AND THEY'S THAT'S
QUICKLY AND THAY'S THAT'S
QUICKLY AND THAT'S THAT'S
QUICKLY AND THAT'S WHAT'S
QUICKLY AND THAT'S WHYT'S
QUICKLY AND THAT'S WHY TS
QUICKLY AND THAT'S WHY THEY'RE
SIGNALING THIS WAY?
>> IT COULD BE.
I'VE SEEN RECKLESS RHETORIC FROM
SOME OF THE ADMINISTRATION ABOUT
WE'RE GOING TO END OUR ECONOMIC
RELATIONSHIP CHINA.
LONGER TERM, I THINK OUR
ECONOMIES CAN BENEFIT FROM EACH
OTHER.
I THINK CHINA RECOGNIZES THAT.
I HOPE WE DO IN THE U.S. TOO.
WE'VE GOT TO DEAL WITH THE I
INTELLECTUAL PROPERTY PROBLEM.
>> DAGEN: I WANT TO POINT OUT
SOMETHING, A FEW BILLION DOLLARS
FROM CHINA IN TARIFFS, THEY'RE
TARGETED.
IF YOU TARGET PORK, THEY
TARGETED THE VERY AREAS THAT
VOTED FOR PRESIDENT TRUMP.
THEY TARGETED FARMERS.
AGAIN, SOYBEANS, PORK, HOGS, AND
FRUIT.
THOSE ARE THE VERY AREAS.
THEY'RE TRYING TO MAKE IT HURT
POLITICALLY.
>> THAT'S VERY TRUE.
THAT'S A CORE CONSTITUENCY FOR
THE PRESIDENT.
IT'S A CALCULATED MOVE BUT
QUANTITATIVE TERMS IT'S NOT
OVERLY PROVOCATIVE WHICH I VIEW
AS A GOOD SIGN.
>> THIS IS GARY SMITH IN NEW
YORK.
I WANT TO ASK YOU A MORE MACRO
QUESTION.
IT GETS TO THE WHOLE TARIFFS
THING AND YOUR FORMER JOB AS
CHAIRMAN OF THE FDIC.
WE THINK -- I'M A FREE MARKET
GUY.
THAT'S MY PERSPECTIVE.
WE SEEM TO THINK THAT WE GET A
BUNCH OF SMART PEOPLE IN D.C.
AND THEY CAN CONTROL SOME HOW
LIKE THE WHICH
LIKE THE WIZCH
LIKE THE WIZARD OF OZ, MAJOR
ECONOMIC POLICIES, THE BANKING
REGULATION, THE TARGETED TRADE
TARIFFS.
WOULDN'T WE BE BETTER OFF, DO
YOU THINK IN THE LONG TERM, JUST
LETTING THE FREE MARKET WORK
THIS OUT INSTEAD OF RELYING ON
ARGUABLY SMART PEOPLE LIKE YOU
TO TRY TO MANEUVER THE ECONOMY?
>> WELL, I LIKE MARKETS.
I LIKE MARKETS ALLOCATING
RESOURCES.
I THINK THIS IS ONE OF THE
REASONS WHY I'VE BEEN SUCH A
PASSIONATE OPPONENT OF TOO BIG
TO FAIL.
I THINK THAT DEFINITELY SKEWED
MARKETS TOWARDS VERY LARGE
INEFFICIENT FINANCIAL
INSTITUTIONS.
SO I DO THINK THAT WE NEED TO
LET MARKETS WORK BUT IT ALSO
MEANS WE SHOULDN'T SUBSIDIZE
CERTAIN TYPES OF ACTIVITY.
>> AGREED.
>> INDUSTRY DOESN'T ALWAYS LIKE
THAT.
THERE'S A DIFFERENCE BETWEEN
BEING PRO INDUSTRY AND PRO
MARKETS.
REPUBLICANS AND DEMOCRATS IN
D.C., YOU SAW IT IN THE TAX
BILL, NOT MUCH LOOPHOLE CLOSING,
A LOT OF BENEFITS TO SPECIAL
INDUSTRIES THAT ALSO SKEW
RESOURCES TOWARDS THOSE FAVORED