Wall Street Legend Calls Out Scott Bessent (w/ Bob Elliott)

Hey, everyone. I'm Catherine Rampell. I am the economics editor at The Bulwark and the author of The Receipts newsletter. And I'm delighted to be joined today by my old friend, Bob Elliott. Bob, I have known for a while. And when I first met him, Bob, I think you were at Bridgewater, which is the world's largest hedge fund. And I think you were in research or maybe in one of the senior positions on the investment committee. But in any event, very senior job there, helping make decisions about things like investments in fixed income bonds and the like. Bob is now the CIO, Chief Investment Officer at Unlimited, which is a company that uses machine learning to create index replications of alternative investments like hedge funds, venture capital, private equity. Basically, if you want to have an investment, that's what you're going to do. And I think you're going to be a part of that. Thank you. That performs similarly to hedge fund investments. You can buy Bob's ETF. But Bob is here today to talk a little bit about what is going on with Treasury Secretary Scott Besson's bond market interventions, how well they are working, and why Besson's former mentor seems to be trashing the whole endeavor in the pages of The Wall Street Journal. Bob, why don't we start just like with the basics? What is Scott Besson trying to do? What was the thing that he announced last week with the bond market intervention? Yeah, if you think about the Treasury, typically what the Treasury is doing is they're issuing bonds. So there's a government budget deficit. It needs to get financed. They make a choice of whether they want to issue long-term bonds or short-term T-bills in order to finance them. And in general, they're pretty boring when it comes to that. They've basically issued the same amount of long-term bonds for a long time. It's not that interesting, to be honest, other than for the real nerds of the Treasury market. The thing that they introduced relatively recently was this process of buying back bonds. So going to the market, not just issuing, but identifying certain bonds in the market that they wanted to purchase. And initially, it started off as basically an irrelevant size, a few billion dollars. And then they started to buy back bonds every once in a while against a market that's tens of trillions of dollars in size, and mostly just to improve liquidity of sort of old, stale bonds that people weren't trading very much. But what happened last week was an announcement of a desire to pick up the amount of those purchases, and in particular, pick them up on the long end of the yield curve, where the Treasury has been a little concerned about the fact that we've seen long-term interest rates rising. And so they've been doing that. And so they've like any market, if you come in and you buy into that curve, you should drive the prices up or the yields down. And so those buyback purchases should be supportive to the bond market and depress yields and all else being equal, be beneficial to risky assets across the economy. So just to put that in layman's terms, basically, the Treasury Secretary was trying to lower interest rates for long-term bonds. Which might, in turn, reduce interest rates for the 30-year mortgages or other kinds of financial products that are pegged to these treasuries, right? Like the idea was to get interest rates down. Exactly. It's a marginal effort to try and get interest rates down for real economy borrowers. And did it work? No. If anything, it did the opposite. It had the opposite effect. I think it's interesting. This is sort of, I'd say, the story of the whole administration when you talk about the rhetoric around policy is it's all too little. It all is inconsequential. And so it comes out with a big splash that basically says, I'm going to go out there and increase buybacks. And instead of $2 billion, I'm going to do $4 billion. And instead of every once in a while, I'll do twice every once in a while. And the issue is issuing more than a trillion dollars of paper on an ongoing basis, on a net basis. Going out and saying you're going to buy $4 billion, it's just irrelevant to the market. I think the thing that it did highlight is that the Treasury Secretary is a bit, and the Treasury in general, is a bit out of control in terms of their ability to control the long end of the bond market. And what was interesting about the whole movement was it no effect on the Treasury market. But what it did do is it did juice gold returns and it did juice crypto returns, which suggested that markets were interpreting it as the efforts by the administration to basically run monetary policy and long-term interest rates too low relative to the strength of the economy. And so people looked to hard assets or alternative assets in response. So basically, the Treasury Secretary looked kind of feckless. Is what I'm hearing you say. Looked kind of feckless and people were like, okay, they don't seem to know what they're doing. Therefore, maybe we should be investing in these alternatives, things like gold, which is usually what people flee to if they're worried about inflation, for example, or are they're otherwise worried about the dollar holding its value, right? Exactly. I mean, it just kind of, I don't know whether you're talking feckless, nonsense, like, you know, it's, I think in many ways, another indication of administration that thinks through rhetoric that you can meaningfully adjust real economy dynamics. And the reality is that you can't. And so I think while the flows into things like crypto and gold, you know, and the grand scheme of things are relatively modest, I think what they identify, what they highlight is investors losing faith in the credibility of the policymakers that are sitting there making the decisions and communicate. So people are losing faith if they had faith. I mean, there might be a number of other reasons why there would be a little bit of skeptic, healthy skepticism, shall we say, about the competence of some of our economic policymakers, among others right now. But this presumably did not help in that effort. Now, as I understand it, Scott Besant was, a protege of Stan Druckenmiller, who is like one of the legendary living investors. Scott, excuse me, Stan Druckenmiller had a signed piece in the Wall Street Journal. There's this whole rigmarole about whether it was written by AI, which apparently it was, as he admits. But at the very least, it was very critical of Besant. And whether it was authored by AI or by Druckenmiller's own brain, either way, he signed his name to it. He agreed with the sentiment. And suggested that what Besant was doing was wrongheaded. Can you talk us through what Druckenmiller's critique was? Yeah, I think his basic critique and sort of amongst macro investors, like what you see in a series of policies over time is that governments often try and intervene in capital markets to change the price of assets, whether it be in the bond market, et cetera. And what you see over time is that policymakers, by and large, fail at those efforts. Meaning if there's strong pressure for a currency to fall, it will likely fall despite the best efforts of policymakers to hold it up. Or similarly, on the flip side, if interest rates are intended to rise on the long end, there's very little that a policymaker can do to stop that if there's an underlying private sector supply-demand pressure on those markets. And so one of the things that makes macro, that there are opportunities for macro investors is when you see policymakers come in and say that they're going to do something which is not credible, and then you fade that, you bet against it and make money, you know, similarly to the sort of Bank of England, breaking the pound, which is a famous story in the world of macro. And so I think that was his basic critique was, look, Scott, you're not going to move the treasury market. You're certainly not going to move the treasury market with buyback for ants, let alone probably move, you know, multi, you know, tens of trillions of dollars in this market with any of the efforts you're going to do. And I think it speaks more generally to when you look at what Besson's doing, like he's, he's like, uh, cosplaying a macro manager sitting in the treasury, you know, trading the yen, trading the long bond, trading oil, like all of these things. And it's honestly just like a waste of time. Like they'd be much better off, you know, cutting fiscal deficits. If they want to bring bond yields down, they'd be much better off, like actually resolving the straight of her moves. If they want to get oil, oil flowing, you know, they'd be much better off. I don't know why they're trading again. I think it's just, you know, some random obsession, like, you know, who cares why they're trading the end? Like these are all, you know, there's, just wasting their time and in terms of influencing any of the markets. And so I think that's sort of the underlying, a bit of the unsaid sentiment is like, you know, get back to what the Treasury is supposed to be doing, which is, you know, competently issuing bonds and, you know, making sure that policy and deficit policy is not unreasonable the way it is today. So you say it's wasteful. Wasteful to me implies like it's not a net positive or a net negative. My impression of what's going on here is that it is like actively harmful, in fact, for Treasury to be doing these kinds of interventions because it sort of pisses away the credibility of the Treasury secretary and the interventions that that department would be making in the case of a crisis. This is not a crisis and they seem to be taking some pretty unusual steps. So I'm curious to hear your thoughts on that. Like when Besant does something like this, this takes this unusual step of intervening in bond markets to try to get interest rates down, fails somewhat spectacularly, at least in the near term. Doesn't that have some longer term costs? Doesn't that make markets a little bit less trusting of Besant who was put in this job in part because he was supposed to be the guy that markets trusted? Yeah, I think the basic, I think there's sort of a, a basic underlying fundamental credibility that exists with policymakers, which is that, you know, are they pursuing policies that are in the best interest of the markets, the economy? And are they pursuing policies in a way that is where the rhetoric is largely matching what they're, the quantity and impact of what they're actually doing, right? Or are they essentially trying to mislead markets on a day-to-day basis? And so I think, I mentioned the sort of flow into golden crypto in part because I think what it highlights is that, is that people are investors and not just U.S. investors, but globally investors are increasingly putting a, what we call risk premium, meaning they're, they're saying they have to get paid more to hold U.S. assets in general, and particularly U.S. bonds, because of the deteriorating credibility, of the policymakers that are in place. And that's not just in the treasury. It's also the passivity that we're seeing out of Warsh in, in the Fed. And you, you sort of add this all up together. And what you say is, look, it looks like there is, you know, we're, we're sort of in the, the era of policymaker incompetence here. And if that's the case, I'm going to need to get paid a little bit more to hold these assets, meaning interest rates are going to have to be higher than they otherwise would be. Or I'm going to move money to other assets, which, you know, don't have those concerns. And, and I think that's sort of generally what we're seeing is that erosion of, of credibility. And it's the sort of thing, it's not like any one day it all erodes and it falls, you know, it falls apart. It's like each one of these efforts, each one of these, these bungled efforts or these, or the misleading rhetoric about what's actually going on in the world, each one removes the credibility and each one causes the next incremental person to say, Hey, maybe I don't want to be invested in us bonds, given what I'm seeing. Yeah. You obviously worked a gigantic hedge fund before you track hedge funds and other alternative investments very closely. Now, how do you think market participants are feeling about everything that's happened in the past week? Well, I, first of all, I'd say that most most hedge funds are actually short the bond market. So basically betting against Besson's efforts. And that shouldn't be surprising because that is what hedge funds do in response to policymakers trying to do things that are inconsistent with the underlying supply and demand pressures. And the reason why there is pressure on bonds is not just because of the credibility of the U S but we also continue to have an inflationary problem on the long end driven by high oil prices. The thing that you see is all of these things intersect with each other, right? Like lying about how many ships are coming out of or moves. Is the thing is one of the many things that's weighing on the bond market, right? Um, just like lying that says you're going to, uh, you know, meaningfully bring the, the, you know, bring yields down is also weighing on the credibility of the policy maker. So all of these things are adding up. And so, I mean, hedge funds, but they're, they're hedge funds are always sort of tactical and they're sort of move in and out of positions all the time. Although it is interesting that they're generally quite short. Um, the other thing that's interesting is what we're seeing out of the foreign, uh, the foreign reserve holders. Like one of the things, if you look at, um, if you look at foreign reserve holders, like timely information about foreign reserve holders, they've drawn down their holdings of U S treasuries by hundreds of billions of dollars over the last year. So just for a sense of the order of magnitude, that is like five to 10 times more impactful than what Besson is saying about his buybacks. And so if he was really going to go out and really try and deal with the treasury market, he should be getting the various global central banks, like the Chinese, the Japanese, et cetera, on the phone and asking them why the heck are they selling U S treasuries rather than trying to manipulate the market with his rhetoric. And so I think that if you think about sort of what's going on, how, how does, how does the universe of investors, the biggest investors in the treasury market are global central banks. They are making it clear they're getting out of the market, uh, pretty, you know, uh, uh, you know, in a, in a pretty quick way, these are not fast moving investors and they're selling down these treasuries because of the, essentially the concern about the credibility of the U S in all sorts of, you know, explicit and implicit ways. That's interesting. So why is it that we have seen central banks around the world dump treasuries to date? It's it's because, is it because of distrust in this administration's leadership? Is it about our underlying, um, debt and deficit issues that we clearly have no interest in dealing with in the near or medium term? Like, is there a particular force you can point to that explains the, the underlying reason why, uh, a lot of our foreign, the foreign holders of U S debt are dumping it thereby inspiring Scott Besant to make this intervention that seems sort of hopeless. Yeah. You know, it's always, it's always very hard to get into the minds of, you know, there's lots of different people making that decision, but what you can do is you can look at when you see more acute sales, meaning when these, when these, um, central bankers sell a lot more, uh, treasuries. And it's actually very interesting. You saw it happen in, uh, back in November of 2024, right after the election, you saw it in April of 2025 when we had liberation day. And you saw it again in March, April, May, and a little, and more recently, but really started right after the Iran war. And so the thing that's super interesting about this is it ties very, very directly the administration's, uh, antagonistic global efforts, right. To central banks responding to those antagonistic efforts by saying on the margin, we're getting out. Uh, and I think that that's fascinating. You rarely see such a, uh, obvious connection to how, you know, essentially like, uh, geopolitical policy, uh, and efforts connect directly to how we're seeing flows in asset markets. Um, but that connection is very, very explicit. If you look at what's going on and very tied to those moments of the, the most heightened geopolitical conflict, uh, globally. This message is sponsored by Zbiotics. So I have to tell you all about this game-changing product to add to your routine before a night out with drinks. It's called pre-alcohol by Zbiotics. Zbiotics pre-alcohol probiotic drink is the world's first genetically engineered probiotic. It was invented by PhD scientists to break down acetaldehyde, a by-product of drinking alcohol. Now pre-alcohol produces an enzyme that is designed to break down this by-product. Drink pre-alcohol as your first drink of the night, drink responsibly and enjoy your next day activities. Zbiotics has sold more than 1,000, including us here at the Bulwark. Try it for yourself today. And if you're unsatisfied, they'll refund your entire order. No questions asked. Head to zbiotics.com slash bulwark takes and use code bulwark takes for 15% off your first order. So what does all of this mean for the dollar as it's, as it continues status as global reserve currency? Well, I, part of the, part of the challenge in terms of the global reserve currency is, you know, there's not many alternatives, uh, that are out there. Um, but, you know, and, and these things don't change overnight. And so it'll probably be somewhere between years and decades, uh, before the US, you know, completely fails as the global reserve currency. I think the thing that it does highlight is that all of these investors are looking for assets outside of the US and in particular looking for hard assets. So things like gold, um, uh, and some, some smaller extent crypto, but really gold from these sort of large institutional investors. Um, and I think that's very interesting because you can kind of get a feel. If you look at that gold price, you kind of get a feel of how these global investors are feeling about the US and feeling about the dollar and, you know, sort of all too often. often we sort of look at the dollar like as it relates to the euro or the yen or this or that look at other currencies but the the real value of the dollar can be seen in gold and you know gold is up two and a half times over the course of the last couple of years um and you know the reason why that is is because the dollar and all currencies but the dollar in particular is losing credibility uh for institutional investors and so i think the thing that's interesting about it from sort of the everyday investors perspective is you know most people don't hold gold in their portfolio most people you know in the west you know investors hold a lot of bonds um in a typical 60 40 portfolio they basically hold no gold um and so it highlights the the value of maybe adding gold as a as an asset to your portfolio um so just to go back a second to the stan dreck and miller op-ed did you think it was a big deal that he put out that piece you know being critical of treasury policy i don't know do you know him at all have you met him before i i don't know him personally um okay i i'm the reason i ask is i don't think of him as as someone who's like particularly um uh public as a as a figure and like particularly engaged in discourse in the press and so i was sort of surprised that he came out with that piece that seemed to be criticized deeply criticizing his former protege so i was just curious what you read into it if anything yeah i i think i think it's a good point i mean he he's like on bloomberg talking you know narrowly about markets with some regularity but this was this is a very different vibe when you're talking about essentially naming a person and their policy decisions um and you know i think uh in in some ways i'd say in some ways look when there was a question a few years ago about who was going to sit in the treasury seat there was an expectation um that a besant was going to bring at least some sense of normalcy to that seat certainly relative to the other candidates that were out there those folks who have been shunned aside to go pick on the canadians about speaking french in quebec right thank god those people aren't in the treasury but you know there was basically i guess you know it was basically this idea that that he was going to bring a sense of normalcy now um we've gotten a lot of things uh we've certainly gotten more physical altercations in the white house as a result of his uh being in the treasury secretary position um but uh but you know the question is is he holding up his end of the bargain and every time that he behaves in a way that is so obviously inconsistent with his training with his understanding of how the world works um with statements that he's made before with norms in the financial community i think um those folks who are in the sort of financial elite look at and say hey look we we essentially endorsed you amongst a field of pretty awful alternatives we endorsed you and supported you to be in the seat we expect you to act reasonably and when you do this sort of nonsense this is you know this isn't the deal that we made when we supported your uh your move to be in in the treasury right and not only is he not holding up his end of the bargain and in whatever narrow sense you're referring to it does seem like it's doing quite a bit of damage institutional damage to the treasury to uh the attractiveness of u.s assets assets including u.s debt instruments and things like that so yeah like it seems like it's it's not just about people feeling perhaps personally disillusioned but disappointed i would imagine with the actual governance and policies that have been in place i think when you look at like asset managers in general like part of the reason there's sort of uh an underlying like value that that people who are in the finance industry have about making sure that u.s capital markets are the most efficient attractive you know well run um in the world because there are a lot of second and third order benefits that exist for the u.s from that being the case and so the erosion essentially of efforts by policymakers underlying advantage of the U.S. I think, you know, offend the, as I say, the sort of small V values that a lot of these a lot of folks who sort of grew up in the finance world have about how things should be done. It's not it's not necessarily a disagreement about the narrowness of the policy. It's more like what are you doing to undermine the credibility of the U.S. capital markets, which is the thing that makes which is one of the many one of the few important things that distinguishes the U.S. from the rest of the world. Yeah. And as I'm hearing you talk, what I'm hearing is that there's so little self-awareness potentially within this administration of why there is degrading trust in U.S. governance and U.S. assets, why there is potentially less interest in holding U.S. debt that they don't even realize that the things that they are doing to try to counteract that are actually worsening them. Right. It's like if to the extent that central banks around the world are dumping U.S. treasuries has to do with declining trust in U.S. governance, then doing something that even further erodes trust in U.S. governance is like going to backfire, which seems to be potentially what we saw in this past. And I think the challenge, I guess, is this goes to like, why would Druckenmiller and others go directly to Besson is like. Besson is no fool. He knows exactly what he's doing. And I can I I remember a particular time when I was at Bloomberg and he was interviewed right ahead of me, actually, and he had his whole cadre of people or like 20 different people who are there. This is Besson you're talking about. This is Besson. Yeah. And you could you could see the torture on his face trying to explain administration policies. And policy, he gets out and everyone's like, oh, my gosh, that was amazing. And he just kind of shakes his head and you could just tell he was exhausted at the effort to try and rationalize the irrational that was going on. And so I think that that, you know, when you when you think about the disappointment, like I believe that there are certain people in the administration who actually have no idea what they're doing, like who are who are fumbling around, particularly when it comes to macro dynamics like Lutnick. No idea. That guy is a salesperson. He knows nothing of the macro economy. So, you know, you see him say silly things and you go, that guy is a silly guy who doesn't know anything, doesn't know better. Besson knows better. And Besson knows that what he's doing is undermining the credibility of the Treasury. And that is disappointing. Yeah. Well, you know, I was I was reading some of the coverage, the sort of the secondary and tertiary coverage of the Druckenmiller, commentary on Besson and the FT had a nice headline, Besson gets drugged. And they referred to a quote that Besson gave, I guess, about a year ago. Besson told the FT last year that, quote, in macro, there's Stan Druckenmiller and then there's everybody else. And that Druckenmiller stood apart from the pack, quote, in terms of performance, in terms of reverence and in terms of analysis. So I have to think if Besson genuinely knows better than what he is doing, and if he does really respect Druckenmiller's opinion, which he appears to, it seems like it's got to be pretty hurtful slash humiliating, I guess, to see this very public criticism of him. And yet, I don't know that it's really going to move the needle. Do you have faith that the reaction from markets rebuked from his former mentor, any of that, is likely to lead Besson and or Treasury to change course? Like, if anything, it seems like they're doubling down and threatening to use the Treasury General Account, which means a much bigger pot of money that they could throw at this problem, again, fecklessly. Yeah, yeah. The Treasury General Account point is particularly silly because the level of the Treasury General Account is defined by policy, as being five days of cash reserves. And so they can't use the Treasury General Account. It's not a thing. It's such a good example. That is idiotic rhetoric, right? That is meaningless rhetoric. He can say, I'm going to use the Treasury General Account. And anyone who knows what's going on, it's like, what are you talking about? The Treasury has five days of cash reserves to ensure if there's a 9-11 type moment, that they have enough cash in the bank to be able to pay the ongoing liabilities. So there's no using the Treasury General Account. That's not a thing, right? And so when he says that, you're like, what are you doing, man? You certainly know better that you're not going to use the Treasury General Account. It's not a thing. Anyway, I think that's a little bit of a rant, but it's such a good example of. And I think the problem is there's not that many people, whether it be in the financial media or other places, that can say, I'm going to use the Treasury General Account. I'm going to use the Treasury General Account. I'm going to use the Treasury going to do buyback. So we're going to use this and we're going to do that and kind of sounds good in the moment. And then like all the all the markets nerds like look at it. You know, if you follow Twitter, you'd see all the markets nerds make their comment and they're like, well, hold on, wait a minute, you know, and then it has no impact on the bond market because other than, you know, marginally losing his credibility, is he going to change? You know, certainly there doesn't seem to be a lot of indication that there is, you know, an agility in terms of of changing behavior. I mean, the only moments of agility that seems to have happened have been around, you know, stock prices falling in a way that is unacceptable to the president, falling enough that it's unacceptable to the president. That's been kind of the only reaction function. out of the administration that seems to have been effective so far. So so maybe that's a that's a constraining element of what his policies will be or what the administration's policies will be. But, you know, I think, you know, part of the deal also was that the best that was going to listen to the markets and see the response. And so far, interestingly, whether you look at what Besson's doing or whether you look at what Warsh is doing, which, you know, we should not divorce. Those two folks too much. I mean, they're having breakfast with each other like, you know, once a week. They are also both they're both Druckenmiller protégés. They both work for Druckenmiller under Soros. Right. So it's like, yeah, yeah. They've known each other a long time. They've worked together. Yeah. Yeah. I mean, certainly. Yeah, they they certainly are in the orbit of Druckenmiller. And so and so I think, you know, the. You know, Warsh, as an example, didn't hike when people expected it. And the long end of the bond, you know, the long end of the curve or yields rose a lot in response to that, which was about the worst Fed outcome that you've seen in a long time, just like in terms of if the Fed is trying to establish its credibility, like long term interest rates surging when Warsh, you know, spends says five words at a press conference, like it's a good indication that he's also losing credibility. So you can't look at these things. You can't look at them in isolation. They're all sort of from the same policymaking group, and they all are undermining their, you know, undermining the policymaking credibility both at the Treasury and the Fed. And the question is, are they going to react or are they going to just kind of let it go? And I just don't see a lot of indication that they're going to stand up and implement the types of policies that would restore credibility. Well, I also wonder if to some extent the things, this is a little bit in the weeds, but the things that Warsh is doing and the things that Besson is doing are kind of at odds, right? Because like Warsh wants to shrink the Fed balance sheet, which would mean getting rid of some of, you know, some of the long dated treasuries, for example, that the Fed holds. And now Besson is saying he's going to buy long dated treasuries, like which neutralize each other. Like you would think that they would be working more in concert than they are. Or maybe this is how Besson, like, I don't know. I don't know what's going through Besson's head, but I wonder if this is how he enables Warsh to do the thing that he wants to do. It's like that. Yeah, I think this is one of the challenges in navigating what are the likely policy outcomes from this administration. Like does, is Warsh an inflation hawk? Is he going to shrink the balance sheet or is he not? Like, and I look at, you know, so far he's done nothing. Like, let's just, let's just like, he's literally done nothing. He's made a few committees to discuss things. That's what he's done. Task forces. Task forces, some committees of committees to discuss things at some point. I think the question is, is there, is there anything, you know, the question is like, where's the beef? He talks about, you know, wanting to shrink the balance sheet. It's like, okay, go shrink the balance sheet. Like, go get that done. Is that happening? No. Right. He talks about being an inflation hawk, but then, you know, inflation by, you know, the Fed's measure is been above it for 65 months and, and, you know, is at three and a half percent. And he sits on his hands at the recent policy meeting. Like, like what part of the question is, again, it's this disconnect between the rhetoric, the reality, and the actual impact of that reality. And so, so far I've seen nothing, but, you know, pretty hollow words and not a lot of actions that are consistent with it. And it sort of goes to this question, like, you look at this and you say, like, a thinking person would look at this and say, is there some sort of, you know, chess that's being played here? And I think your intuition, like, is what is going to happen is that Worsh is going to reduce the balance sheet and then, you know, Besson's going to buy it, buy bonds, and that's going to, you know, neutralize it. And that would make sense as a way to, like, reduce the Fed balance sheet and, you know, not have too much pressure on long-term interest rates. Like, I think you're almost, I think folks are almost being fooled by the rationalism that that series of thoughts brings when you're looking at a series of irrational decision-making. I will share with our audience that one of your recent Substack posts on your Substack non-consensus was titled The Era of Policy Inequality. The Era of Policy Inequality. In which you use some colorful language referring to some of the examples of policy ineptitude, only some of which we have actually gone through just now. But, Bob, before we leave, I would be remiss if I did not ask you about the trade war with Canada that you alluded to earlier, because if I recall correctly, you grew up in or around Detroit. Yeah, I'm from Detroit, so I'm like one-third Canadian by constitution. Well, I was going to say you may have some thoughts on whether it is wise to start tariffing Canadian autos and auto parts as part of whatever negotiation we are trying to engage in to bring the Canadians to heel. Yeah, I mean, you know, what's happened in the sort of Detroit metro area for the past, you know. For decades or something like that created this relatively remarkable integrated production system for automobiles, which basically involved at various points shipping parts across the Detroit River back and forth in a seamless way that, you know, wasn't tariffed. And it seems as though this administration has a desire, and that was very efficient for all sorts of different reasons. The automakers were able to take advantage of, you know, currency mismatches. And pricing and different skill sets and all sorts of things. And so you can kind of think about it. It was just like its own, you know, block, basically, auto block that extended into Canada. And so the imposition of tariffs on Canadian content essentially breaks that whole cycle and all the advantages that it had that have been built up over 40 years. And so the effects are far, I think, far bigger. I mean, there's a lot more to this than just the literal tariff dollars. And I think it's on both sides, meaning both for the U.S. and for the Canadian manufacturers. You know, it just it in the scope of silly things to do, like enforcing tariffs on Canada, just it just is such a waste of time. Like it not only doesn't really matter macroeconomically, like at an economy-wide level, but it also means that you're. You know, if you're in Canada, you're not really distancing your, you know, your closest geographic neighbor. And so, you know, like, why? Why do that? And then over, over in the ranting side of things and then doing it over the fact that the Canadians want French language labeling on consumer products, like, is nuts. Like French is a language of Canada, is one of the two languages of Canada. Like, you know, I think Carney should come back and he should say, We'll do a trade deal, but you have to kick Texas out of the out of the union. That's that's the deal. I'm sure that'll go great. You just gotta kick Texas out of the union. How will that go? Yeah. And I think actually. I'm sure that'll be very successful. You know, Carney, for those of us who have been in this sort of macro markets for a long time, Carney is very familiar to us because he was at the Bank of England and the Bank of Canada. So we know him pretty well in terms of his his policymaking efforts. You know, in a world where basically every other country, you know, we're in a world where basically every other country has taken the path to basically submit to the administration's demands. He is certainly taking a different path. And I think that that he will, you know, the administration is basically running into this, you know, the series of instances where the parties on the other side of the table are much tougher than the administration. And I think he's, the current administration is likely to to learn the fact that the Canadians are a lot tougher than the U.S. when it comes to to dealing with these sorts of issues. Yeah. Well, maybe we'll have you back to. to talk about the next phase of that, uh, that trade war, which hopefully doesn't become a hot war with the Canadians. Um, but anyway, we shall see Bob Elliott. Thanks so much for joining me today. Thanks everyone for watching. Remember to please like, and subscribe to the bulwark for more wonderful conversations like this one.