# AI Momentum Drives Stocks, US Trade Representative Jamieson Greer

An episode of [Bloomberg Daybreak: Asia Edition](https://invisiblenetwork.ai/podcast/1663863437), 15 May 2026, 27 min.

Audio: https://podtrac.com/pts/redirect.mp3/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/58e85be7-dbb5-4043-afed-af80014dc0b3/c4b8bc57-1efb-47ce-b2c3-b44b001bf427/audio.mp3?utm_source=Podcast&in_playlist=27143354-63aa-4ac5-965d-af80014dc0d3

AI optimism, strong corporate earnings and a resilient economy have powered stocks to successive record highs, driven by bets that spending on artificial intelligence will continue to fuel growth. The rally has also overshadowed mounting concerns that crude oil above $100 a barrel could reignite inflation and cloud the outlook for central banks and the global economy. We speak to Mark Cudmore, Global Leader of the Markets Live Team at Bloomberg News. Plus - Jamieson Greer, Trade Representative of the United States, signaled cautious optimism that US-China trade relations are stabilizing, with progress on agriculture purchases and rare earth supplies, though tariffs and supply chain issues remain. He speaks exclusively to Bloomberg's Annmarie Hordern, on the sidelines of the US-China summit in Beijing on "Bloomberg: The Asia Trade". See omnystudio.com/listener for privacy information.

## Transcript

[0:00] Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
[0:10] Speaker 2: Welcome to the Daybreak Asia podcast. I'm Doug Krisner. The
[0:14] Speaker 2: US equity market rose to fresh record highs on Thursday,
[0:17] Speaker 2: given a revival in the AI trade. We had both
[0:21] Speaker 2: the S ANDP and NAS dot Com closing at all
[0:23] Speaker 2: time highs. A lot of this momentum seems to be
[0:26] Speaker 2: powered by retail buyers. In fact, research from goldmund Sachs
[0:30] Speaker 2: estimates that retail trading volumes are up by twenty eight
[0:33] Speaker 2: percent since mid April and this morning, it's kind of
[0:37] Speaker 2: a mixed picture for equities in the Asia Pacific. For
[0:40] Speaker 2: a closer look at the price action, let's bring in
[0:42] Speaker 2: Bloomberg strategist Mark Cudmore. Mark is the global leader of
[0:47] Speaker 2: the market's Live team and it joints from our studios
[0:49] Speaker 2: in Singapore. Thank you for being here. I think we've
[0:52] Speaker 2: got to start with the impact of the Trump Sheen meeting.
[0:56] Speaker 2: Maybe this is more about keeping relations stable rather than
[0:59] Speaker 2: try to create change. But give me your take on
[1:02] Speaker 2: what you think it means for markets.
[1:05] Speaker 3: Yeah.
[1:05] Speaker 4: I think that the key thing is to avoid the
[1:07] Speaker 4: tail risks. So we're most the way through that, and
[1:10] Speaker 4: we seem to have avoided any scary headlines. The expectations
[1:12] Speaker 4: weren't particularly high. That the base case expectation was that
[1:15] Speaker 4: we get a bunch of platitudes. Trump would say, hey,
[1:18] Speaker 4: they have such a beautiful relationship, all as beautiful, all
[1:20] Speaker 4: as wonderful. We'd get a few promising headlines potentially on
[1:23] Speaker 4: you know, buying soybeans or something to do with agriculture
[1:27] Speaker 4: or farm. We've seen some beef headlines already and the
[1:29] Speaker 4: soy ones have disappointed. We've got you know, the chips potential,
[1:34] Speaker 4: but again not for a particularly ambitious deal, but just
[1:37] Speaker 4: like something positive there. So I think we're expecting positive platitudes,
[1:41] Speaker 4: some good headlines, but nothing groundbreaking, and the most important
[1:45] Speaker 4: thing for investors was to avoid any of the tail
[1:47] Speaker 4: risks that could happen, like there are banana skins there,
[1:51] Speaker 4: like the Taiwan issue or even that just you know,
[1:54] Speaker 4: the trade war flares up again. So it seems like
[1:56] Speaker 4: we're going through that and it seems like it's positive dynamic,
[1:58] Speaker 4: but not like major.
[2:00] Speaker 2: So I mentioned the fact that we had a lot
[2:02] Speaker 2: of positivity in the Ai trade in the US session.
[2:06] Speaker 2: I'm wondering what the outlook for tech in Asia is
[2:09] Speaker 2: like right now, particularly the China story really good.
[2:13] Speaker 4: I think a couple of different timespans here. I think
[2:16] Speaker 4: the first picture is what's the overall kind of AI perspective,
[2:20] Speaker 4: And my one there is that, you know, the AI
[2:22] Speaker 4: capex bubble is still very much in the inflation stage.
[2:26] Speaker 4: It's late on in the inflation stage, but I think
[2:28] Speaker 4: we've got at least another quarter to go of this
[2:30] Speaker 4: immense money pointing system. I am so many thinks that
[2:32] Speaker 4: this bubble will collapse horrendously because it's very circular. A
[2:36] Speaker 4: lot of the gains and these stock prices are based
[2:38] Speaker 4: on the increased valuation of the other stocks in this cycle,
[2:42] Speaker 4: and they're ultimately going to be competing for earnings and
[2:45] Speaker 4: they ultimately can't keep on having their earnings projections basically implied.
[2:48] Speaker 4: They're going to make way more earnings than the end
[2:51] Speaker 4: companies that they supposedly supply a AI services too. So like,
[2:54] Speaker 4: the whole thing is definitely not sustainable long term. But
[2:57] Speaker 4: the point is is that we're absolutely in the inflation
[3:00] Speaker 4: stage at the moment. The economy is still strong. It's
[3:02] Speaker 4: a case shaped economy in the US, but at the
[3:05] Speaker 4: high end consumption, at the high income level is kind
[3:08] Speaker 4: of basically driving the economy. And that's because there's the
[3:10] Speaker 4: positive wealth effect. You've got massive private sector spending because
[3:13] Speaker 4: of this capex boom from AI, and you've also got
[3:16] Speaker 4: massive fiscal injections from governments around the world. So the
[3:19] Speaker 4: bubble is still on. Guys. That's the bigger picture backdrop.
[3:21] Speaker 4: Specifically for Asia, it's actually a much better story. It's
[3:23] Speaker 4: much more sustainable in terms of that. You know, as
[3:27] Speaker 4: I said, the big core AI names, a lot of
[3:31] Speaker 4: them are ultimately competing against each other for these earnings.
[3:33] Speaker 4: They can't all make extraordinary earnings. That's less of a
[3:36] Speaker 4: problem in a lot of the dynamics in Asia. So
[3:39] Speaker 4: I think ultimately Asia will be will be the kind
[3:42] Speaker 4: of sustainable outperformer on this. I think maybe not in
[3:46] Speaker 4: the next couple of months, but longer term, I think
[3:48] Speaker 4: they they'll probably the biggest, bigger winners. So I think
[3:51] Speaker 4: that's kind of the backdrop here. They don't have such
[3:52] Speaker 4: extreme valuations shorter term. Look, I basically my argument for
[3:57] Speaker 4: the last couple of weeks is that you know, we're
[3:59] Speaker 4: going to continue to kind of trade positively for now
[4:03] Speaker 4: going through the Trump she Summit, as long as we
[4:05] Speaker 4: gonna get any tail risk. It looks like we'll get
[4:07] Speaker 4: another kind of relief rally into that. I think that
[4:09] Speaker 4: as soon as we get through the Trump She Summit.
[4:11] Speaker 4: And my reason for why we be positive Toto the
[4:13] Speaker 4: Trump She Summit was the idea that the Strait would
[4:16] Speaker 4: be kept quiet until then because that that meeting could
[4:19] Speaker 4: not go ahead while the Strait was flaring up. But
[4:22] Speaker 4: as soon as we get through the summit, attention returns
[4:24] Speaker 4: to the Strait and the US administration you know, has
[4:27] Speaker 4: to try solving that or like admitting they have no solution.
[4:30] Speaker 4: Either way, that's really bad for markets in the short term.
[4:32] Speaker 4: So I think we're due for about of tactical risk
[4:35] Speaker 4: a version next week. Given the extraordinary gains, I think
[4:38] Speaker 4: that'll be quite dramatic. But this is not the end
[4:41] Speaker 4: of the bubble. This is ultimately another dip that we bought.
[4:43] Speaker 4: You've got to remember, like there's various size and scopes
[4:45] Speaker 4: you can do in markets. But you could see like
[4:47] Speaker 4: really dramatic pullbacks over a week or two and we'll
[4:50] Speaker 4: still be immensely higher than a few months ago. So
[4:53] Speaker 4: you know, we'll have people saying this is the end
[4:55] Speaker 4: of the bubble.
[4:55] Speaker 3: This is it.
[4:56] Speaker 4: It won't be the end of the bubble yet, So
[4:58] Speaker 4: I think that's kind of the short term outlook.
[5:00] Speaker 2: So to the point that you're making about oil and
[5:02] Speaker 2: obviously the inflationary implications that are a part of that.
[5:06] Speaker 2: Do we have to get comfortable with a US ten
[5:08] Speaker 2: year or around four fifty right now? And how destabilizing
[5:12] Speaker 2: might that be if it becomes something that remains in
[5:15] Speaker 2: place for a while longer.
[5:17] Speaker 4: I think we have to get comfortable with the idea
[5:18] Speaker 4: of US yield's going a lot higher, global yield's going
[5:20] Speaker 4: a lot higher. I think, you know, not not necessarily
[5:23] Speaker 4: much in short term, but it's not just an energy problem.
[5:26] Speaker 4: It's a supply chain disruption problem. Look, we're getting the
[5:29] Speaker 4: frogs and boiling water situation that we had back at
[5:31] Speaker 4: twenty twenty one, where you know, people are just in
[5:33] Speaker 4: denial what's happening on the inflation side. I think we
[5:36] Speaker 4: were all overly transfixed on what was happening in oil
[5:39] Speaker 4: prices and not realizing that. You know, obviously we had
[5:43] Speaker 4: the big glut, which everyone is aware of. China had
[5:45] Speaker 4: a lot of storage, We kind of unsanctioned oil from
[5:48] Speaker 4: Russia and Iran. You know, so various news sources got
[5:52] Speaker 4: back on me at Venezuela looking out and US released
[5:56] Speaker 4: a lot from a strategic petroleum reserve AF did other
[5:58] Speaker 4: countries as well particular. So I think that the the
[6:01] Speaker 4: oil impact, the energy price impact was less dramatic than
[6:04] Speaker 4: many of us expected, but as a result of overly
[6:07] Speaker 4: folks and that many people are missing that that that
[6:09] Speaker 4: the broader supply chain disruption farther down the petrochemicals kind
[6:13] Speaker 4: of chain, and I think that's where it's really really
[6:15] Speaker 4: problematic and really kind of insidious, because it's a bit
[6:17] Speaker 4: more subtle. So yeah, I think I think we're going
[6:20] Speaker 4: to get much higher yields. I think we're going to
[6:21] Speaker 4: get higher yields right along the curve and I think
[6:23] Speaker 4: we're but we're going to go through you know, bouts
[6:25] Speaker 4: of it kind of be Essentially, we'll see some bear flattening,
[6:28] Speaker 4: which is what we see in the short term, will
[6:29] Speaker 4: also see some you know, steepening later on. So I
[6:32] Speaker 4: think it's will vary between inflation concern and occasionally we'll
[6:37] Speaker 4: have these kind of more stagflationary growth concern where we
[6:40] Speaker 4: might see a little bit of kind of more bare flightening.
[6:42] Speaker 4: We see the front end up. In fact, actually the
[6:44] Speaker 4: back end might come down a little bit.
[6:46] Speaker 3: Overall.
[6:46] Speaker 4: Yeah, tenure yields probably going higher, two yields going how
[6:48] Speaker 4: the whole curve is going higher.
[6:50] Speaker 2: I mentioned that in the States, a lot of the
[6:52] Speaker 2: enthusiasm that we're seeing for AI stocks in particular is
[6:55] Speaker 2: being driven by retail. When you look at what's happening
[6:58] Speaker 2: in the Apec region, retail versus the institutional kind of
[7:03] Speaker 2: client base, how does that come down? I mean, what
[7:05] Speaker 2: do you conclude when you kind of try to compare
[7:08] Speaker 2: and contrast.
[7:09] Speaker 4: You know what, I don't have the data to hand,
[7:12] Speaker 4: particularly about what the difference in the ratio is in Asia.
[7:14] Speaker 4: I would say generally as a theme at the moment,
[7:16] Speaker 4: absolutely retail are so important, and I think many in
[7:22] Speaker 4: markets were kind of slow to maybe register the full
[7:26] Speaker 4: power of how much retail drives a lot of the moves.
[7:30] Speaker 4: You know, that's been the case for the last few
[7:33] Speaker 4: years in growing in power and growing in that wealth impact,
[7:36] Speaker 4: wealth fact and impact. And I think, you know, we
[7:38] Speaker 4: continue to kind of, you know, from a Boomberg News
[7:40] Speaker 4: point of view, we continued, you know, default to the
[7:42] Speaker 4: idea here's what you know, hedge funds are doing, and
[7:45] Speaker 4: this is what the smart money is doing and stuff.
[7:46] Speaker 4: You know what, they're not driving the market moves. The
[7:48] Speaker 4: retail drives the market moves. And this is a real problem,
[7:51] Speaker 4: particularly in AI world, because a lot of these people
[7:53] Speaker 4: are getting their same views and information off AI like
[7:56] Speaker 4: that kind of like what do you do when you
[7:58] Speaker 4: have a you know, disruption mid least and all the
[8:01] Speaker 4: AI l ms tell them the exact answer that, you know,
[8:04] Speaker 4: geopolitical risk should be faded and ultimately this is a
[8:07] Speaker 4: buy And so basically, you know, they're they're learning on
[8:10] Speaker 4: the same herding on by the dip fade stuff, which
[8:13] Speaker 4: is why when this financial bubble collapses, it's going to
[8:17] Speaker 4: be one of the most nasty collapses in decades. And
[8:22] Speaker 4: you know, I'm someone who's that leman into the GFC,
[8:25] Speaker 4: so I don't say that lightly. But the thing is
[8:27] Speaker 4: is it's not soon. I think I think people mistake
[8:30] Speaker 4: the fact that when the crash comes, it's going to
[8:32] Speaker 4: be really bad because that herding, they kind of are
[8:34] Speaker 4: constantly looking for that collapse. That's that's not right, I said.
[8:37] Speaker 4: I think we've got a lot more gains to come
[8:39] Speaker 4: first for the bubble collapses because these these retailer resilient
[8:42] Speaker 4: at the moment, they're just dying to put more cash
[8:44] Speaker 4: to work whenever there's a pullback. And this is this
[8:45] Speaker 4: is like another factor kind of driving the economy. And
[8:48] Speaker 4: it's actually funny. It's the positive wealth effect on consumers
[8:52] Speaker 4: is partially why when that the market collapse comes, it's
[8:55] Speaker 4: going to be so horrendous because it's going to suddenly
[8:57] Speaker 4: make the economy much worse as well. It's going to
[8:59] Speaker 4: be that GFC dynamic where the financial market collapse leads
[9:03] Speaker 4: into the economic collaps as well.
[9:04] Speaker 2: So when that collapse occurs, would you say that the
[9:06] Speaker 2: South Korean market is perhaps the most vulnerable.
[9:10] Speaker 4: It's a good question. Like in terms of just pure
[9:13] Speaker 4: scale again gains, like you know, we're up from the
[9:16] Speaker 4: last April lows. I think we're up like about two
[9:18] Speaker 4: hundred and forty percent. It's it's absolu ridiculous. But just
[9:21] Speaker 4: to put that in condents, like so let's just say
[9:22] Speaker 4: we see a fifty percent drop, you know, it's still
[9:24] Speaker 4: it's still gonna be up fifty percent from where's the.
[9:27] Speaker 3: Start of last year.
[9:28] Speaker 4: So it started last year even after fifty percent drop,
[9:31] Speaker 4: So yeah, we could see some horrendous gains, but I
[9:33] Speaker 4: want to put in contests accident, the Korean market is
[9:36] Speaker 4: is much more sustainable story. One of the things weird
[9:39] Speaker 4: things about Korea is, you know, this is a whatever
[9:41] Speaker 4: four point seven trillion dollar market or something around that
[9:44] Speaker 4: four point six trillion, four point seven trillion dollar market,
[9:46] Speaker 4: which sounds massive, but essentially it's a two stock market,
[9:50] Speaker 4: and you've got to realize you're just trading two stocks.
[9:52] Speaker 4: You have the volatility of trading two stocks. It's the
[9:54] Speaker 4: same as if you you know, all you do in
[9:56] Speaker 4: your whole portfolio is you trade like Google and Meta
[9:59] Speaker 4: for example, obviously have crazy volatility and crazy return. So
[10:02] Speaker 4: I actually think that the career story, likes some of
[10:04] Speaker 4: those megacap ones, is actually a good sustainable, long term story,
[10:09] Speaker 4: and so therefore I don't consider it the most vulnerable
[10:12] Speaker 4: terms that it's the most mispriced. I actually think, you know,
[10:14] Speaker 4: it's actually one of the most constructive fundamentally. But to
[10:18] Speaker 4: your point, when you see you know, two hundred and
[10:20] Speaker 4: fifty gains or two and forty percent gains whatever it
[10:23] Speaker 4: is in a thirteen month period, of course, you could
[10:26] Speaker 4: see extraordinary pullback, you know, so yes, in the short term,
[10:30] Speaker 4: but not because it's fundamentally the most misvalued.
[10:32] Speaker 2: So final trading day of the week in Asia, what
[10:34] Speaker 2: are you looking at next week? That could be kind
[10:36] Speaker 2: of market driving.
[10:39] Speaker 4: To me, I said, like in my narrative for the
[10:41] Speaker 4: last couple of weeks, as I said, I you know,
[10:43] Speaker 4: I'm repeating myself a little bit, but I think it's
[10:44] Speaker 4: really important is that you know, straight will stay quiet
[10:47] Speaker 4: and unsolved remos until this Trump sheet summit. Now it
[10:52] Speaker 4: looks like we're getting through that. When we get through that,
[10:53] Speaker 4: that comes back in focus and I think suddenly we're
[10:56] Speaker 4: going to have about of risk version, which is going
[10:58] Speaker 4: to only look really dramatically bad and which is why
[11:01] Speaker 4: we're going to get We're going to get carried away
[11:03] Speaker 4: in negativity only because the extraordinary gains recently and the
[11:07] Speaker 4: herding and some of the vulnerability of that positions. And
[11:09] Speaker 4: I think in top that, I think one of the
[11:10] Speaker 4: new dynamics is FX has been quiet and arrange for
[11:13] Speaker 4: the past past forever, but particularly in the last five weeks.
[11:17] Speaker 4: I think dollar is going to break out. I think
[11:18] Speaker 4: people are suddenly waking up to the US yield story,
[11:21] Speaker 4: like there's no chance for cuttingnytime soon you've got to
[11:23] Speaker 4: You've got a massive demand side inflation, and into that
[11:26] Speaker 4: you're getting a big supply side shock either way. Like
[11:30] Speaker 4: the US economy is currently being held up by this
[11:33] Speaker 4: AI capex boom in the labor market's holding up, consumers
[11:35] Speaker 4: holding up, and inflation is just running way too hot.
[11:39] Speaker 4: And I think people are going to wake up to
[11:40] Speaker 4: that new Yearl's narrative. Dollars is going to break higher
[11:42] Speaker 4: and that's going to be the extra interesting bit.
[11:43] Speaker 2: Good stuff. Mark, Thank you so very much, Bloomberg Strategist
[11:46] Speaker 2: Mark Cudmore, the global leader for the Market's Live team,
[11:50] Speaker 2: Joining from a studio in Singapore here on the Daybreak
[11:52] Speaker 2: Asia podcast. Welcome back to the Daybreak Asia Podcast time
[12:02] Speaker 2: Doug Krisner. As you well know, President Trump is in Beijing,
[12:06] Speaker 2: where he met Thursday with Chinese leader Shi chen Ping.
[12:09] Speaker 2: Among the many items discussed was the issue of trade.
[12:13] Speaker 2: We had a chance to take a closer look with
[12:15] Speaker 2: US Trade Rep. Jamison Greer, who is on the trip
[12:18] Speaker 2: with President Trump. He spoke with Bloomberg's and Marie hor
[12:21] Speaker 2: Dern in Beijing.
[12:22] Speaker 3: So let's start with.
[12:23] Speaker 1: Some of the trade agreements, potentially the purchasing agreements we
[12:25] Speaker 1: could see come out of this. The President was talking
[12:27] Speaker 1: earlier to some of the press about Boeing jets about
[12:30] Speaker 1: two hundred of them. A lot of reporting going into
[12:33] Speaker 1: this is maybe they'd get as high as five hundred.
[12:34] Speaker 1: We saw last night. Maybe the sign of goodwill China
[12:37] Speaker 1: renew licenses for beef imports are there, soybeans are their energy?
[12:41] Speaker 1: Can you walk us through some of the deliverables.
[12:43] Speaker 3: Yeah, I'm happy to do that.
[12:44] Speaker 5: So remember, we're in a situation where we're trying to
[12:47] Speaker 5: rebalance our trade with China.
[12:49] Speaker 3: We've had a lot of success in that.
[12:51] Speaker 5: Our trade deathsit with China went down by a third
[12:53] Speaker 5: last year in one year, and so we're trying to
[12:56] Speaker 5: manage the trade around the kinds of things we want
[12:58] Speaker 5: to be selling to China, whether it's Boeings or soybeans
[13:01] Speaker 5: or other ag or energy or medical devices. And so
[13:04] Speaker 5: you can see us bit by bit building up this
[13:06] Speaker 5: strategy coming out of this week. You heard the President
[13:10] Speaker 5: today talk about the Boeings and hundreds of Boeings being
[13:14] Speaker 5: purchased by China. We already have a soybean deal with
[13:17] Speaker 5: them from our prior meetings of twenty five million metric
[13:19] Speaker 5: tons a year over the next three years. And we
[13:21] Speaker 5: expect to also see an agreement for double digit billion purchases.
[13:26] Speaker 3: Of ags over the next three years per year coming
[13:28] Speaker 3: out of this visit.
[13:29] Speaker 5: And that's more general, that's aggregate, that's not just soybeans,
[13:31] Speaker 5: that's everything else.
[13:33] Speaker 1: Are they keeping up with those agreements.
[13:35] Speaker 3: They have been so on the soybeans.
[13:37] Speaker 5: You last year they needed to fill up twelve million
[13:40] Speaker 5: metric tons at the end of last year.
[13:42] Speaker 3: They did that.
[13:43] Speaker 5: They've now, you know, we expect most of the soybean
[13:45] Speaker 5: sales to go on in the later part of the year,
[13:48] Speaker 5: but we've seen some there already. We saw, as you noted,
[13:52] Speaker 5: things related to beef ex sports registrations re upped last night,
[13:56] Speaker 5: So we're already seeing them start to fulfill some of
[13:58] Speaker 5: their promises.
[13:59] Speaker 1: When it comes to the day, tant we have this
[14:01] Speaker 1: trade agreement TRUS till October. Will that be extended on
[14:04] Speaker 1: this trip.
[14:05] Speaker 3: So we'll see about that. We have, of course, the
[14:10] Speaker 3: agreement that goes until this fall.
[14:12] Speaker 5: That's all. That's all solid, that's all well and good.
[14:15] Speaker 5: There's certainly a willingness on both sides that if this
[14:18] Speaker 5: continues to work out well for each country to continue
[14:21] Speaker 5: that and to extend this ability to make sure we're
[14:24] Speaker 5: getting rare earths, that we're selling the types of things
[14:26] Speaker 5: we should be selling to China, and we're trying to
[14:29] Speaker 5: manage differences rather than escalate them.
[14:31] Speaker 1: We hear that some firms China is dragging their feet
[14:34] Speaker 1: when it comes to licenses on rare earths.
[14:37] Speaker 3: Was this discussed? We do discuss this. We discussed this
[14:41] Speaker 3: at all levels.
[14:42] Speaker 1: Do you think they are dragging their feet?
[14:44] Speaker 5: So with a couple of things, Sometimes they do. I
[14:46] Speaker 5: would I would give I would give them a passing
[14:50] Speaker 5: grade on this. We've certainly seen the rare earths come
[14:54] Speaker 5: back up to better levels. Sometimes it's slow. There are
[14:58] Speaker 5: times when we have to go and our point. You
[15:00] Speaker 5: may have seen a couple of weeks ago there were
[15:02] Speaker 5: some big shipments of vietrium that came across. That was
[15:05] Speaker 5: after advocacy from the US government. So whenever we see
[15:09] Speaker 5: an issue or we hear from specific companies, we engage
[15:12] Speaker 5: with our Chinese counterparts and we find them to be constructive.
[15:14] Speaker 1: Where does this leave the three oh one tariffs? Does
[15:16] Speaker 1: well China view this as retaliatory given the fact that
[15:19] Speaker 1: it seems like the relationship right now is stable and
[15:21] Speaker 1: you're in the middle of the state.
[15:22] Speaker 5: Tunt So, I haven't yet met a country where we've
[15:26] Speaker 5: been posted tariffs and said thank you, we love these tariffs.
[15:28] Speaker 5: So no one really likes that other than our workers
[15:32] Speaker 5: in our industries. What the Chinese know and what we've
[15:36] Speaker 5: agreed that there's going to be a certain level of
[15:38] Speaker 5: tariff on the Chinese. So I think as we're rolling
[15:40] Speaker 5: out and concluding different investigations under Section three oh one,
[15:43] Speaker 5: which again don't just target China, they cover other countries
[15:46] Speaker 5: as well, I think the Chinese are going to be
[15:49] Speaker 5: looking at what we're doing there compared to agreements we've
[15:52] Speaker 5: had in the past on certain tariff levels, and we'll
[15:55] Speaker 5: just have to try to manage that.
[15:57] Speaker 1: Will you get to the rate that the United States
[15:59] Speaker 1: was on China before the Supreme Court struck down APA
[16:03] Speaker 1: and the funtional ten percent?
[16:05] Speaker 5: Well, I can't prejudge the outcome of these investigations. They
[16:08] Speaker 5: are legal process. They're ongoing right now. We've received comment,
[16:11] Speaker 5: we've had hearings. We'll release the findings of these investigations
[16:15] Speaker 5: within the next several weeks, and we'll propose action if
[16:18] Speaker 5: we think we need to take action, and so if
[16:21] Speaker 5: tariffs are part of that action, you know the world
[16:23] Speaker 5: will see them, will be very transparent and public, and
[16:26] Speaker 5: people will be able to comment on that as well.
[16:29] Speaker 5: So I can't really commit to a given rate or not.
[16:32] Speaker 5: At this point, we have to go through the investigation.
[16:34] Speaker 4: Gave did a.
[16:34] Speaker 1: Discussion on the Board of Trade.
[16:36] Speaker 3: When does that begin. There's a lot of reporting.
[16:38] Speaker 1: It's about thirty billion dollars of goods on both sides.
[16:41] Speaker 1: Is this all accurate?
[16:42] Speaker 3: That's right?
[16:43] Speaker 5: And so at the end of this meeting, we'll go
[16:46] Speaker 5: back to the US and the Chinese will be here.
[16:48] Speaker 5: What we intend to do on the US side is
[16:51] Speaker 5: it's put out a call for public comment first and
[16:53] Speaker 5: foremost and saying, hey, we're trying to manage this trade
[16:56] Speaker 5: with China. We want to focus on nonsensitive goods we
[16:59] Speaker 5: think we should be selling them, things we think we
[17:01] Speaker 5: should be buying from them, trying to facilitate trade in
[17:04] Speaker 5: that area, and then we'll from there we'll be able
[17:08] Speaker 5: to interact with our Chinese colleagues and negotiate with them
[17:11] Speaker 5: over where we think we have the strongest mutually beneficial
[17:13] Speaker 5: trade with our countries.
[17:14] Speaker 1: Is there a chance though, that with this Board of
[17:17] Speaker 1: Trade there'll be some goods coming from China that are
[17:20] Speaker 1: a lower tariff rate than maybe an ally of the
[17:23] Speaker 1: United States.
[17:24] Speaker 5: I mean, I don't think we're comparing it necessarily to allies.
[17:27] Speaker 5: And if you look at the present's of tariff program
[17:29] Speaker 5: over the past year or there's certain things that never
[17:31] Speaker 5: have really been subject to tariff.
[17:32] Speaker 3: You know, energy, energy goods.
[17:34] Speaker 5: You know, certain foods, you know, fertilizers, things like that
[17:36] Speaker 5: have never been subject to tariffs. There are certain things
[17:39] Speaker 5: that we should be buying from China, I think, just
[17:42] Speaker 5: like there are other countries or we should be buying things.
[17:44] Speaker 5: You saw the President a week ago he told the
[17:47] Speaker 5: UK We're not going to have a tariff on whiskey
[17:49] Speaker 5: from the UK. So it's not out of the norm
[17:51] Speaker 5: of what this administration is doing to have nuance and
[17:54] Speaker 5: how we're approaching it, kind of picking and choosing how
[17:56] Speaker 5: we want to trade with countries.
[17:58] Speaker 1: When it comes to Nvidia and Chips. I bring this
[18:01] Speaker 1: up because a lot of talk about Jensen Wong. You
[18:04] Speaker 1: were on Air Force one, I mean, were you surprised
[18:06] Speaker 1: to see him in Alaska at the Refield stop and
[18:09] Speaker 1: getting on board, and there's a lot of speculation that
[18:11] Speaker 1: something would be done here with chips. When it comes
[18:13] Speaker 1: to the H two hundreds in January of the United
[18:16] Speaker 1: States greenlit Chinese firms to be able to buy them.
[18:19] Speaker 1: Will China allow their companies to buy them.
[18:22] Speaker 5: Well, obviously that's going to be a software decision for China.
[18:25] Speaker 5: With export controls, they're fluid, right, they change over time.
[18:29] Speaker 5: It depends on what threats you see, what's commercially available worldwide,
[18:32] Speaker 5: what the Chinese can already do, and so you want
[18:35] Speaker 5: to make sure you strike a balance between national security,
[18:37] Speaker 5: protecting high tech, but also making sure that we're benefiting
[18:40] Speaker 5: from overseas markets. And so those are the kinds of
[18:42] Speaker 5: things that went into the H two hundred decision as
[18:45] Speaker 5: to whether the Chinese are going to buy or not. Again,
[18:47] Speaker 5: they're making their own determinations. They're very committed to domestic production.
[18:51] Speaker 5: They often see US high tech as it sometimes as
[18:54] Speaker 5: a threat to them because if we're if we're ahead
[18:56] Speaker 5: of the game like we are on AI chips, sometimes
[18:59] Speaker 5: they feel that can stop their own growth. Obviously, we
[19:02] Speaker 5: think it can be helpful to them in the long run,
[19:05] Speaker 5: but they'll just have to make their decision on them.
[19:06] Speaker 1: But there's a lot of speculation that this would be
[19:08] Speaker 1: a tangible talking point at the table because of the
[19:12] Speaker 1: presence of the Nvidia boss. Did this come up Semiconductors?
[19:16] Speaker 5: Well, so we have fifteen to seventeen American business leaders here,
[19:22] Speaker 5: and they had actually the opportunity yesterday in a meeting
[19:25] Speaker 5: with President Trump and President Sheet to come in talk
[19:27] Speaker 5: a little bit about their company. So Jensen was there,
[19:30] Speaker 5: he spoke about Nvidia. We also had a variety of
[19:32] Speaker 5: other folks there, you know, Cargil, Brian Sykes, and a
[19:37] Speaker 5: variety of other companies.
[19:38] Speaker 3: So all these things come up. This was not a.
[19:42] Speaker 5: Major topic of discussion at the bilateral meeting. We did
[19:45] Speaker 5: not talk about chipexpor controls at the meeting.
[19:47] Speaker 1: When it comes to the Bussan deal, you're really building
[19:50] Speaker 1: on that. But since then, what we've seen China do
[19:53] Speaker 1: is they've put in a lot of regulations and laws
[19:56] Speaker 1: that actually make it difficult for American companies to get
[19:58] Speaker 1: a foothold here. Some of them are even contradictory to
[20:02] Speaker 1: some US laws, which would mean that doing business here
[20:04] Speaker 1: in China they'd be against US law.
[20:07] Speaker 3: Did this come up?
[20:08] Speaker 1: Do you find it harder or easier for American businesses
[20:11] Speaker 1: to gain access to this market.
[20:13] Speaker 3: Well, we have raised this with our counterparts.
[20:16] Speaker 5: The Chinese in the past couple of weeks put into
[20:18] Speaker 5: place supply chain rules that when I read them, it
[20:23] Speaker 5: looks to me like they're saying if you're trying to
[20:25] Speaker 5: reshuffle your supply chain or get closer to the United
[20:27] Speaker 5: States or something like that, they might.
[20:29] Speaker 3: Punish you, which a lot of firms are doing. So
[20:32] Speaker 3: that's a strong concern for me.
[20:35] Speaker 5: The thing to remember is with the Boosan Agreement what
[20:37] Speaker 5: we're doing now. They build on each other, but they're
[20:40] Speaker 5: not comprehensive. They don't solve every problem in the relationship.
[20:43] Speaker 5: That's why something like the Board of Trade were focused
[20:45] Speaker 5: on nonsensitive trade because we know we're going to have
[20:47] Speaker 5: differences in these other areas, whether it's export controls or
[20:50] Speaker 5: high tech or critical infrastructure or things like that. So
[20:54] Speaker 5: those are issues that we raise and we talk about,
[20:57] Speaker 5: but we also try to be constructive.
[20:58] Speaker 1: But I do wonder you, as a critical individual on
[21:02] Speaker 1: China in the past, their rules, their regulations, the subsidies
[21:04] Speaker 1: they give to their companies, do you actually welcome that
[21:07] Speaker 1: in a sense that you can say to us businesses,
[21:09] Speaker 1: this is what I've been telling you, this is why
[21:11] Speaker 1: it is hard to do business in China, and these
[21:13] Speaker 1: are some of the traps that are set in place.
[21:15] Speaker 5: Yeah, I guess what I would say is I am
[21:19] Speaker 5: clear out on these things, and I think it's helpful
[21:21] Speaker 5: for our companies to be clear eyed as well. And
[21:23] Speaker 5: I think they are a lot more realistic about their
[21:25] Speaker 5: expectations about operating in China's market and selling into this
[21:28] Speaker 5: market than they were three years ago, certainly more than
[21:30] Speaker 5: they were five years ago. So when these things happen,
[21:34] Speaker 5: it's good for our companies to realize the objectives of
[21:38] Speaker 5: the Chinese government the Chinese economy, they're just different than
[21:40] Speaker 5: the objectives we have. We're trying to make money and
[21:43] Speaker 5: be capitalists and flow that money down to workers and families.
[21:46] Speaker 5: In China, there's just a political element to their economy
[21:49] Speaker 5: that doesn't exist in the US.
[21:50] Speaker 1: The other political element to all of us, of course,
[21:52] Speaker 1: is while you were in this bilateral meeting with the
[21:54] Speaker 1: President in Shihiping, we had the Chinese readout come out
[21:58] Speaker 1: where they need it clear that Taiwan is the biggest
[22:00] Speaker 1: issue for them. At the same time, the White House
[22:03] Speaker 1: readout didn't mention Taiwan at all. How much is this
[22:06] Speaker 1: going to be the biggest hurdle between this relationship and
[22:09] Speaker 1: setting up potentially some of the broader discussions like Board
[22:13] Speaker 1: of Trade.
[22:13] Speaker 5: Well again, well, I don't expect the Taiwan issue to
[22:16] Speaker 5: bleed into Board of Trade.
[22:17] Speaker 3: I just don't.
[22:18] Speaker 5: We've known for a long time that the Taiwan issue
[22:21] Speaker 5: is of key importance to the Chinese. The Chinese know
[22:23] Speaker 5: that for us, we're interested in US companies and US
[22:27] Speaker 5: workers and being successful and leveling the playing field. So
[22:31] Speaker 5: it's normal for different countries to have different key objectives,
[22:34] Speaker 5: and so it's normal for them to raise that. It's
[22:36] Speaker 5: normal for us to talk about want to have access
[22:38] Speaker 5: to their market.
[22:38] Speaker 1: But in twenty seventeen, you were actually here. I think
[22:40] Speaker 1: you might be the only individual part of the President's
[22:42] Speaker 1: cabinet now that was here in twenty seventeen. You were
[22:44] Speaker 1: then the chiefest staff of Ambassador Litthheiser.
[22:48] Speaker 3: Do you think she's.
[22:48] Speaker 1: Warning was the sharpest you've heard on Taiwan?
[22:51] Speaker 5: So I would say no, Right, there's a difference between
[22:55] Speaker 5: the way we talk and a bilateral meeting and the
[22:58] Speaker 5: statements that go out from the Chinese minus your foreign affairs,
[23:01] Speaker 5: which is famously it takes a wolf warrior approach.
[23:03] Speaker 3: I would say that the meetings here.
[23:05] Speaker 5: Between President Trump and President She they were quite candid.
[23:09] Speaker 5: You know, with the Chinese, when you meet with them,
[23:11] Speaker 5: they always have a script and typewritten points, and they're
[23:14] Speaker 5: certainly with some of that. But there was a lot
[23:16] Speaker 5: of candid discussion, a lot of offscript discussion, which I
[23:18] Speaker 5: think is really helpful where you're talking about the two
[23:20] Speaker 5: leaders of the world's biggest economies.
[23:22] Speaker 1: Well, she opened the bilateral talking about the Ciddy's trap,
[23:24] Speaker 1: basically saying America is the established, more existing power, we
[23:28] Speaker 1: are the rising one, and the conflicts could emerge and
[23:31] Speaker 1: brew from this sort of tension. And the President called
[23:34] Speaker 1: the relationship fantastic. The two gave a toast to each
[23:36] Speaker 1: other yesterday. It does feel like there is a warmness here.
[23:39] Speaker 1: Do you feel like the relationship has changed from twenty seventeen.
[23:42] Speaker 3: Well, certainly it's developed more.
[23:45] Speaker 5: I mean it's been nine years, and during those nine years,
[23:48] Speaker 5: you know, obviously when President Trump was in office, they
[23:50] Speaker 5: didn't have communication, but they have met regularly during that time,
[23:55] Speaker 5: maybe more so than some of the other leaders that
[23:57] Speaker 5: President Trump is interacted with. President Trump is the most
[24:01] Speaker 5: powerful leader in the world, and President She is right
[24:04] Speaker 5: up there with them, So I think it's natural for
[24:05] Speaker 5: them to have a relationship. It doesn't mean there are
[24:08] Speaker 5: no problems. It doesn't mean that there are serious challenges
[24:10] Speaker 5: we have to face. It doesn't mean there are things
[24:12] Speaker 5: we're trying to deal with to protect our workers and
[24:14] Speaker 5: protect our industries. But it does mean that we have
[24:17] Speaker 5: to have a constructive relationship.
[24:18] Speaker 1: It just felt like the images in the rhetoric coming
[24:21] Speaker 1: out of yesterday potentially what we're going to see today
[24:23] Speaker 1: another bilateral meeting didn't match the trade war that we
[24:28] Speaker 1: were in a year ago. Are you happy with the
[24:30] Speaker 1: direction of travel with this relationship.
[24:32] Speaker 5: Well, for me, as the trade representative, I'm looking at outcomes,
[24:37] Speaker 5: and one year in our trade deficit with China has
[24:40] Speaker 5: dropped by thirty three percent. That's incredible when down by
[24:43] Speaker 5: one hundred and thirty billion dollars last year.
[24:45] Speaker 3: That's what we want to see.
[24:46] Speaker 5: That means we're diversifying from China, We're making more stuff here.
[24:50] Speaker 5: We're seeing the manufacturing indicators and manufacturing labor indicators increase
[24:54] Speaker 5: in the United States.
[24:55] Speaker 3: That's what we're locking at.
[24:57] Speaker 5: It's less, you know, it's not this issue of China
[24:59] Speaker 5: VERSUS America as much as it is.
[25:00] Speaker 3: We're pro America.
[25:01] Speaker 5: We want our domestic economy to do really well, and
[25:04] Speaker 5: we have to kind of manage and control our economic
[25:07] Speaker 5: relationship with China to make sure we can achieve our
[25:08] Speaker 5: domestic economicals.
[25:10] Speaker 1: And just finally, on Iran, this was the major talking
[25:13] Speaker 1: point on the White House readout. Do you believe Shijinping
[25:17] Speaker 1: is going to help the United States and potentially reopening
[25:19] Speaker 1: the strait up for mus putting the pressure on the
[25:20] Speaker 1: RUnni regime and also at home telling their firms they
[25:24] Speaker 1: need to abide by US sanctions.
[25:25] Speaker 5: So, first of all, it's really important for China to
[25:29] Speaker 5: have the Straits of Horror moves open, no tolling, no
[25:31] Speaker 5: military control. That was clear from the meeting, so we
[25:35] Speaker 5: welcome that. With respect to Chinese involvement with Iran, our
[25:40] Speaker 5: view is that Chinese are being very pragmatic. They don't
[25:42] Speaker 5: want to be on the wrong side of this. They
[25:44] Speaker 5: want to see peace in that area. President Trump wants
[25:46] Speaker 5: to see peace in that area. So we have a
[25:48] Speaker 5: lot of confidence that they will do what they can
[25:50] Speaker 5: to limit any kind of material support for Iran.
[25:53] Speaker 2: That was US Trade Rep. Jamison Grier speaking with Bloomberg's
[25:56] Speaker 2: and Marie hor Dern and Beijing, bringing you their conversation
[26:00] Speaker 2: here on the Daybreak Asia Podcast. Thanks for listening to
[26:04] Speaker 2: today's episode of the Bloomberg Daybreak Asia Edition podcast. Each weekday,
[26:09] Speaker 2: we look at the story shaping markets, finance, and geopolitics
[26:13] Speaker 2: in the Asia Pacific. You can find us on Apple, Spotify,
[26:17] Speaker 2: the Bloomberg Podcast YouTube channel, or anywhere else you listen.
[26:21] Speaker 2: Join us again tomorrow for insight on the market moves
[26:23] Speaker 2: from Hong Kong to Singapore and Australia. I'm Doug Prisoner
[26:28] Speaker 2: and this is Bloomberg

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