What are those issues that you think we won't be able to escape. Well the number one economic issue is when interest rates go up
as the day they inevitably will. Will asset prices come down and will it be more difficult to sustain all the values that people
have had over the last year and a half. I say the biggest geopolitical issue is the U.S. China relationship. It's
obviously not as pleasant as we thought it would be after Biden was elected. In fact it's probably no better than it was under
President Trump maybe even worse in some cases. So as a result I think people have to worry about investing in China or doing
business with China. That's an issue. And also what is what are the ramifications if the relationship gets worse. For example
suppose or something happens with Taiwan. How is that going to affect the chip business for example so much of which is
produced in Taiwan. So those are the two big issues I think geopolitical U.S. China and economic interest rates when they do
go up and the bond buying stops. What's the impact on private equity and the stock market. Let's dig into China a bit because
I know last year when you spoke to us you talked about the U.S. being the best place to invest but China wasn't too far behind
on your list given the changes which you laid out which have happened over the past year which have accelerated. Is China
still an attractive place to be investing. China is attractive but it's not as attractive as it once was. I think in part
because the regulatory environment there has got to be much more complicated. More American companies are afraid of doing
business there. And China has obviously made some steps to kind of thwart some of the efforts of some of the Chinese business
leaders to be more visible as a result. It's not quite as welcoming as I seem to be two years ago. But China does still
have one point four billion people gigantic consumer base and they can do very very well for people that invest there. But you
have to really know what you're doing. People on the ground and be very careful. Yeah this is something that we hear all the
time that you kind of can't ignore China. Right. It's so huge. But considering some of the geopolitical tensions as well how in
general should we really view China and their place in the global community. What. China was the biggest economy in the
world for most of organized history. And then the seventeen hundreds Europe came along in the United States. Also they came
along. China thinks it's regaining its rightful position. And think about this. China was roughly 1 percent of the world's GDP
when Richard Nixon went there. Now it's roughly 17 percent of the world's GDP. So it's grown dramatically and probably going
to continue to grow at the pace that's been growing. The United States is not going to grow at the pace of China's growing. So
at some point in your lifetime. In my lifetime trying to we'll be the biggest economy in the world as measured by GDP as
measured measure by purchase price parity. It already is the biggest economy in the world. Let's bring in a little bit closer
to your home and Carlisle's home in Washington D.C. The house on Friday passing the infrastructure bill. How important is this
that this gets to fruition that this is finally put into action in order to have the U.S. be competitive with places like China.
It's a very good bill that have been passed. But I want to make sure nobody recognizes what it is. It's a five year bill more or
less and over five years above what we'd otherwise would appropriate. It's basically one hundred billion dollars a year
which is not nothing but it's not going to dramatically change things overnight. And it's over a five year period of time. So
it's very important that it pass. It shows the president has leadership ability to get something through Congress. Now the
trick is can he get these soft infrastructure bill through which is much more politically difficult. Right. And part of that
difficulty also has been taxes. Some of the proposals higher corporate tax the cap on salts lifting that as well. How do you
see that discussion evolving. Is it going in the right direction. I don't think that they can pass the soft
infrastructure bill or the build back better bill with taxes increased increases in there. I think it's very
unlikely you'll have anything except marginal tax increases. I just don't see that being able to get the support in the Senate.
So because Senator Cinema and Senator Manchin are not really in favor of these big tax increases I suspect it'll have to be paid
for in other ways. And so what are those ways that you can pay for it and still have a constructive business environment. Well
what people like to do when they want to pay for something in Washington but don't want to raise taxes is they say we'll have
higher economic growth. So you'll probably get projections of higher economic growth rate maybe some greater IRS enforcement
and then trying to find money in places that it was not spent before. So for example Covid has some money that was not spent.
They'll take some of the Covid money and apply to them. So there are some games that people play. And remember one of the things
you're talking about with these kind of bills is this is a 10 year spending. And one of the easiest things in the world to do
is to say we're going to spend money in the year 1 2 and 3. We'll make it up. We're getting tax taxes back in years eight
nine in 10. But that never shows up never actually happened. So the 10 year budgeting system we have allows us to get really big
deficits and big debt when the Budget Act of 74 was passed. The debt of the United States was under a trillion dollars. Now
since we've had this budget act the debt is now roughly 29 trillion. So the system we have isn't really working to keep the
debt and deficit low. Right. You mentioned the hope and often the political hope for economic growth. David we have just about
a minute left. Are you confident about the growth trajectory of the US. I think. We have a pretty good situation coming out of
the recession or not the severe recession we had before. I would say I'd say the Covid situation was helped by the
enormous spending by the Congress and the Fed's easing up of interest rates and bond buying.
As we get out of that program I suspect you'll see some asset prices go down a bit. The US economy is in reasonably good shape
and I don't worry about a recession in the near term.