Isaias Makes Landfall, Diesel Deal Struck with Putin

Coming up on Bloomberg this weekend. You heard about the oil deal with Russia. That is a big deal. President Trump strikes a deal on diesel with Russia's president. And I want to thank President Putin, to be honest with you, how it could impact prices weeks ahead of the midterms and why Ukraine's leader is calling it a birthday present to Putin. Isaias makes landfall as a powerful hurricane along the Gulf Coast with heavy rains and howling winds. We're tracking the storm as it pushes inward, what it means for oil production and insurance, and get ready to go bananas. Banana nation comes together for the biggest performance in Banana Bowl history. Part baseball, part P.T. Barnum. The banana ball championship is tonight. You can talk to the league's owner about the phenomenon. Happy Saturday. Welcome to Bloomberg. This weekend we're coming to you live from our world headquarters here in New York. I'm Christina Ruffini. I'm David Gura with Lisa Mateo. It is Saturday, October the 10th. Welcome to our listeners and viewers across all of Bloomberg's platforms on radio, television, streaming the show on Bloomberg.com and on the Bloomberg Business app, really tracking the progress of this storm as it makes its way into into Tennessee, Alabama, these places expecting a lot of rain over the course of the day. It's still dark here on the East Coast. The storm is just starting to hit, but we're we're tracking it and we're gonna have some updates as we go through the show. We're also going to talk about what that means for your bottom line, what it means for these insurance companies, what it means for the diesel crisis that we're already dealing with, and that you can see some live pictures if you're watching us on TV or digital. And that's from Panama City Beach, Florida. Uh, Lisa Mateo has more headlines, including some updates on that storm. Lisa. Yeah, you mentioned that that darkness over there. Well, now, hundreds of thousands of people without power in Alabama and the Florida Panhandle, that's after the first hurricane of the Atlantic season crashed into the Gulf Coast, what is now post Tropical Cyclone Isaias also flooded roads and downed trees. The storm made landfall last night near Guess in Florida as a category two hurricane, and were also watching two other storms this weekend. Heavy rains from Tropical Storm Rachel is impacting parts of Southern California, where residents are using kayaks and paddle boards to navigate the flooding, and Hurricane Simon is approaching Mexico's coast, and its busiest Pacific port is strength into a category four storm and is expected to make landfall tonight. President Donald Trump says he's working with Vladimir Putin to release Russian diesel supplies into global markets. The announcement comes as the white House looks at tame, soaring fuel prices ahead of the U.S. midterm election. But with boxing legend Mike Tyson by his side, the president spoke to reporters outside of the white House yesterday before boarding Marine One for a trip to Syracuse, New York. He called the agreement a big deal. And I want to thank President Putin, to be honest with you. We have massive amounts of oil being coming into our country, and it's diesel, which is what we want. So thank you. The president announced a series of cargos beginning this month, totaling about 13.5 million barrels. Ukrainian President Volodymyr Zelensky and Senate Democratic Leader Chuck Schumer say the deal will prolong the war. Meanwhile, a day after the deal was announced, officials say Russian aerial bombs killed 12 people and wounded at least 14 in Ukraine. Ukrainian President President Zelensky had warned a deal would allow Russia to kill more and wage war for longer. The major fire has been reported at an oil loading terminal in Russia overnight and reported drone attacks. Russian regional authorities confirmed a fire but did not confirm the damage to the terminal. Ukrainian military officials have not claimed responsibility for that reported attack. David and Kristina, thank you very much. Appreciate it. Thanks, Lisa. And that's where we want to start. As Lisa mentioned, President Trump thanks President Vladimir Putin for the release of those Russian oil supplies into the global market. He also posted untrue social quote, lower prices for Americans, especially for our great farmers, ranchers and truckers, is my greatest priority. This is a very big and important announcement. But Ukraine's President Zelensky countered that posting on X gifts to Putin will not bring peace or any benefit to the civilized world. Russia will repay the diesel with further terror and perfidy. Allowing Russia to sell petroleum products is an investment in a war that must be ended. Not for long. Nancy Youssef is a staff writer at The Atlantic covering national security in the Defense Department, and she joins us now. Nancy. Later in the show, we're going to get into the economic ramifications so much as they're going to be some from the release of this diesel. Um, let's start with him doing this. I mean, we were going to talk about the plague, the Russian plague, a little later in the show, and the president said he was going to talk to Vladimir Putin about that. No indication of the readout if, in fact, that happened. How surprised should we be by what really is an overture here by the Russian president to President Trump? Well, I think President Trump is signaling that he is trying to address an immediate economic problem, but doing so at a potential geopolitical cost. You'll remember that the United States put these sanctions into place because they were trying to cut off revenues that the Russian government was to using to pay for the war in Ukraine. Now, because of the war in Iran. The United States is willing to lift some of those, um, limits on Russian revenue to try to offset, um, the costs of the war in Iran. The question becomes, is it even going to work? One will Russia be able to produce the kinds of, um, promises that it's made in this deal? And if so, and even if that happens, it's not clear that that by itself will offset the cost of rising diesel brought on by the war in Iran. So, um, I think you're seeing a, uh, United States that is willing to, um, potentially, um, make a geopolitical, uh, gamble in a bid for a short term economic gains. This also came as Jared Kushner and Steve Wycoff were in Miami negotiating with Ukrainian representatives. The timing of this seems surprising. Do we have any reporting as to whether or not they themselves, or other members of the administration were caught off guard? We haven't heard the details in terms of how administration officials have responded. Even the sort of details of the deal are a little bit unclear. We've heard promises of what, um, Russia will deliver, uh, in October, November, and then increasingly so as time goes on. But we have heard from the Ukrainians who are deeply frustrated by this deal because they see it as a means of potentially funding Russia's ability to keep, um, building the kinds of missile systems and other offensive weapons needed to attack Ukraine precisely at a time when Russia is so aggressively going after Ukrainian infrastructure ahead of the cold winter months. And so I do think you're going to see a growing response, um, both in the United States in Ukraine because, as you note, the United States is trying to enter a deal to help in this war precisely when, um, it is also agreeing to something that could allow Russia to prolong it. Nancy, contemporaneous with this, we saw the Treasury Department lift sanctions on Russian oil, Russian petroleum, and, um, I guess there's some something dubious about that. Unclear if that's going to be legal as we look ahead here. Um, but let me ask you about Europe's response. And we haven't heard a whole lot from European leaders in light of this announcement, which was made as the president was, was leaving the white House yesterday afternoon, so, so late in Europe. Um, but what does it say about Europe's leverage, Europe's position here in trying to find an end to this conflict? Well, you remember that the United States has really pushed Europe to provide more weapons to the Ukrainians, as the United States has been unable or unwilling to do so. And so this puts increased pressure on Europe to produce weapons for the Ukrainians, because of the risk that the Russians will now have the capability to bring more weapons to the battlefield. And so I think if you're the Europeans already trying to, um, step up and provide more in the absence of U.S. weapons, this puts even more pressure on them to provide those weapons even faster. Lindsey, I do want to tie this into what's happening in Iran, because obviously that's the main driver of the elevated, uh, gas and oil prices around the world. You had some reporting out earlier this week that the Trump administration was, in fact, looking at potential strike options before the midterms. Then the white House came out and said, we're not going to strike before the midterms. Now it seems like that might be back on the table. Do we have any idea what options they were wearing, weighing specifically and why they would do that? Because in your piece, you walk through the fact that every time hostilities ramp up, oil and gas prices ramp up as well. So wouldn't that be counterintuitive, especially for a president who seems to be going to some pretty extreme lengths to try to lower these prices before the midterms? It's such a great question. Um, so the Pentagon is drafting those options right now, and so we don't have a decision yet on what that could look like or even the scope of them. Um, but you're right. The strikes in and of themselves, whether they happen before the midterms or after, are unlikely to change. Uh, the price of gas, um, and oil in a way that benefits the president. Um, in terms of the economics of it, however, I think there's a feeling among some within his administration that doing something ahead of the elections and being able to say that it is going after the Iranians and weakening the Iranians could potentially give them some kind of lining and more importantly, give, um, Republicans across the country who are hearing from constituents that are frustrated about the war in Iran, that the U.S. is being, um, on the offense, that it is doing something and that the strikes are the first pathway towards ending the war. I think the devil's in the details. And for Americans, I don't think you're hearing, uh, a sentiment of wanting more war, but rather a conclusion to it that promises an enduring, um, drop in gas prices. So I think that's why you're also seeing some of the oscillation back and forth about whether this is the best way to go about trying to change public sentiment around this war ahead of these critical midterm elections. So let me ask you what's happening, if anything, in this vacuum that's emerged here while we have this period of, I think, what you characterize as relative tranquility, uh, in this conflict. And you right, the latest military deliberations come as the administration pursues two tracks at once, ongoing military and economic pressure and indirect negotiations. Washington and Tehran continue to communicate through mediators, but significant differences remain over the terms and sequencing of a cease fire, an end to the U.S. blockade of the Strait of Hormuz and the Straits reopening. Uh, we watched here in New York on the sidelines of the U.N. is there were these conversations taking place, the kind of awkward acknowledgment that Secretary of State Marco Rubio and others made of those talks not just happening, but happening for for many hours here. What is their status and indeed, how much constructive is happening in these indirect negotiations right now? So while the talks are going on, the fact that both sides are preparing for the resumption of strikes at some point, whether it's before the midterms or after, I think makes having constructive, enduring talks much more difficult because both sides are anticipating something else other than a peaceful resolution to the conflict. And so what you're seeing is both sides using the talks as a form of leverage rather than, I think, looking towards an end, said, well, both sides want the water in. Iran is suffering economically because of, um, the closing of the strait as well, and the naval blockade that's in place. And of course, the United States has seen a real economic impact because of the war. I don't think either side believes that. The other is, um, uh, willing to sort of enter terms that they agree upon. I think the biggest challenge for the president is up until this point, we have seen, uh, United States at once sort of a declared victory in this conflict. And I don't think that the Iranians are willing or believe that their position where they have to give that. And so the question ultimately going forward is what kind of concessions are both sides willing to make, particularly the United States? Will President Trump accept an agreement in which the Iranians, for example, retain some leverage over the Strait of Hormuz, and in doing so, um, deprive him of being able to say that he was, um, categorically victorious in the war. Nancy, quickly, before we let you go, I do want to ask you if they do wait, if the administration does wait for for more strikes until after the election, you kind of write about what the menu option could be. We've done analysis here at Bloomberg about the dwindling number of military targets left. What could the administration do? What is left and will any of it really change or move the needle when it comes to the Iranian leadership and how they're making these decisions? You're absolutely right. I think the options in terms of what the United States a strike is, what the message they're trying to send with them. If, for example, we see strikes much like the United States did in June, in which they went after nuclear facilities, you can see an administration say that the strikes of them obliterated again Iran's nuclear program. If you see the targeting of things like missile launch sites and others, um, facilities that the Iranians have used to launch attacks at Gulf Partners, um, at ships transiting the Strait of Hormuz, then I think the message will be that the United States is trying or has successfully, depending on your perspective, weakened Iran's ability to have leverage over the Strait of Hormuz and to be a threat to its Gulf allies and partners, and therefore need to enter negotiations, um, quickly, because they are not as strong as they once were. In some ways, the longer this conflict goes on, um, the harder it is for the Iranians to use the closing of the Strait of Hormuz as leverage, particularly as, um, the markets, um, find alternative routes. Yeah. The challenges one way that the markets have, um, responded is by releasing strategic reserves. And that in and of itself, on the flip side, puts pressure on the United States to reach an agreement because, of course, um, those reserves are not unlimited. We get back into the economics of that in just a little bit. But Nancy, you have staff writer at The Atlantic. Nancy, thank you very much. As always. Great to have you with us on this Saturday. Thank you Nancy. All right. We're going to move now on to that powerful hurricane that slammed the Gulf Coast overnight. Hurricane SAS made landfall around 9 p.m. on the Florida Panhandle as a category two storm. Evacuation orders had been issued ahead of the storm, which comes during a relatively calm Atlantic hurricane season. Phil Waddell with AccuWeather joins us now from Pensacola Beach, Florida, just a few miles from where that storm came ashore. You'll get us up to speed on what happened here over the last 12 hours. You're on that barrier island. I know it's a it's a treacherous place to be during storms like this one. And picking up on what Christina just said. We've had, what, a two year reprieve almost from from these kinds of storms hitting this part of the world was made it through the whole hurricane season. Our fingers were across. David. Christina, good morning to you. Yeah. A lot of people down here at the Gulf Coast were hopeful that they were going to look out for two years in a row without a U.S. hurricane landfall, but we knew the odds were against us. Isaias blew through here with wind gusts in the Pensacola Beach area, topping 90 in 100 miles an hour at times and in different places. I mean, you could see what the power of the wind did here. Large signs toppled over. A lot of the businesses boarded up. You may be able to hear it in the background. We're hearing a lot of sirens that's coming from the damaged businesses. Also some blown out windows as well. So we had flooding here on this barrier island. A lot of wind damage, a bit of good news. The power came back on to a part of the island just within the past 2 or 3 hours. But yes, this location was under an evacuation order. We know that many people did leave that going off of that three mile bridge that was shut down during the worst of the storm, but others that stayed here, we got an update from officials overnight. They are urging people just to hunker down and stay put. We're just now starting to get a bit of daylight, but so many hazards out here from downed power lines. A lot of nails and debris on the roads that can puncture tires. So we're just starting to see the utility trucks rolling out. They're going to get to work to restore power because at the peak of this storm, a well over 800,000 homes and businesses across the Florida Panhandle and this part of the southeast have been in the dark after Isaias as it continues to move inland right now. So that's what I wanted to ask you about. Where is it now? Is it losing momentum? Is it losing strength, or is it still posing a real threat as it moves up? Yeah, no, it definitely has reduced intensity compared to what we saw at landfall, and that was well forecasted by the expert meteorologists at AccuWeather. It really packed a punch when it came here along the Florida Panhandle. Uh, right now, not even officially Isaias. At this point, it quickly downgraded from Ca2 to Cat one tropical storm, uh, no longer even officially AccuWeather meteorologist. So continue to call this a tropical rain storm as it moves inland. Um, the center of what is left of the storm, essentially in Alabama right now. It's going to continue that jaunt to the northeast and then make that hard turn to the east. So for the New York City area, for the I-95 corridor, we're looking at the potential of 1 to 2in of rain Sunday into Monday. Uh, some of the wind gusts up in the northeast could top 20 miles an hour or so. Uh, impacts as the storm kind of makes that cross country track. Uh, but definitely the most widespread impacts being felt down here. Uh, this is going to be a costly storm when it comes to damage. One thing I will say is that, uh, with Florida's building code, right, that has really evolved over the past 20, 30, 40 years. Uh, many of these buildings built quite sturdy now, uh, to handle these intense winds. So, yes, we are seeing damage. We are seeing issues here. But if this level of a storm had hit another state, uh, you know, parts of Texas, Louisiana where we've covered a lot of storms, we would be seeing more widespread damage. So it is just important to put that in context that, yes, these 100 plus mile an hour wind gusts did some damage here. If it had hit a different region that didn't have as strong building codes, you would be seeing a lot more visual damage. All right. So a lot out with AccuWeather. Thank you so much for that update. We appreciate you being all right. From eye to eye to super eye with technology advancing at lightning speed, our next guest looks at how we got here. Where AI goes next. That is straight ahead on live this weekend on Bloomberg Television, radio, Bloomberg.com, and the Bloomberg Business. And. Thank you for joining us live on Bloomberg this weekend. I'm Lisa Mateo. Let's update you on today's top stories. Cleanup in southern Panama continues after two powerful earthquakes and multiple aftershocks prompted evacuations yesterday. The 7.7 magnitude earthquake at toppled buildings a second 6.6 magnitude quake followed. There have been no reports of casualties. The National Weather Service has issued a tsunami threat for several countries. Hundreds of protesters gathered in Foley Square last night in front of the federal courthouse in lower Manhattan. Demonstrators, they express their anger over ISIS presence in the city after immigration officers shot a man with his young son in a vehicle in New York on Thursday. Department of Homeland Security Secretary claims federal officers were not aware that a child was in the car, and that Oscar van Gaal was aware he was being stopped by Ice. Vice president JD Vance expressed doubts over the Pentagon's plan to live stream the Fort Hood shooter's execution. When asked about it yesterday, the vice president said, quote, I don't know. That's actually going to happen. President Trump told reporters that his administration still had not made a decision to broadcast it. Former Army Major Nidal Malik Hasan, he was convicted of killing 13 people in a shooting spree at the Texas military base in 2009. And in other news, the white House has a new secretary. Katie Zechariah, conservative communications advisor for President Trump's media company will succeed Caroline Leavitt. The president described Zechariah as a loyal and brilliant supporter. Christina over to get to see what she does with this job. I mean, the we've gone many weeks now without warning and no briefings, so we'll see. Yeah. Decides to do with a very familiar face to all of us soon, one way or the other. Thank you. Thank you Lisa. On Friday, Axios reported on a top level meeting among I executives. Gaming out so-called day after scenario is what would follow a catastrophic eye incident. The report details concern among the companies on how to handle the public and political revolt from a large scale event, most likely a cyberattack that shuts down access to financial services, to internet connectivity, or even to power and water. All right. This comes as the technology advances rapidly from AI to AGI and the president's favorite phrase for it super intelligence. We spoke with tech journalist Kevin Bruce about the AI development race over the past decade, laid out in his new book, The AGI chronicles this as I think you know, obviously the president has said we're going to read all of it. See, is that something that was already being used in the industry, because we've heard from Intel folks that this could be confusing because it refers to something else within the intelligence world. But this is a term. Seems like it's on your book. It's already out there. Yeah. Um, this is basically the sort of the thing that comes after. So there's there's AI. Yeah, there's AGI and there's ASI, which is artificial superintelligence. And AI is sort of like everything, you know, we have now, AGI is this kind of point where the AI gets, uh, roughly as smart as humans, as roughly a human level AI system that can do a bunch of different things at or around human level. Do we get there? I think we're there. You do something that I do. I mean, people disagree about what the exact definition of AGI is, but for me, um, I like my my sort of personal bar has been cleared, but that's what the whole book, that's what the people in this book are aiming for. They're not trying to make this thing, uh, human level at one or 2 or 6 things. They're trying to make it human level at many things. And then ASI is the step after that. That's when you have an AI that is better than every human at everything. And so there's sort of yeah, it's just that. And that is actually the ultimate goal of this. They are not just the people who have been building these systems for the last decade. Will not be satisfied if these things top out around our intelligence level. They want to build something vastly smarter than the smartest humans who have ever lived. The principles in this book have been wrestling with the kind of broader implications of this technology for a long time, but it strikes me that in recent weeks, recent months, um, the public has become aware of that. Wondered how well equipped is a Sam Altman to decide whether something is moral or not, and what the implications for humanity might be. You've, uh, followed and spoken with the principles in this book. How well equipped are they to be wrestling with these kind of broader philosophical and existential issues? Well, they might be well equipped relative to the average person, but there are so few of them. I mean that this is the thing. Like the thing that I realized reporting this book, and I talked to more than 150 people at the AI labs that I covered, OpenAI Anthropic and Google DeepMind. And that was essentially how big the group of key decision makers was. It started off as like a couple dozen people who were interested in this about a decade ago, and they grasped something about the world that wasn't obvious, which is that powerful AI was possible, and that some recent advances in things like GPUs had made it, uh, it made it seem realistic. And then the circle kind of stayed small for a long time where like maybe 100 people, maybe 150 people actually were involved in creating the technologies that we see today. And no matter how good or moral or well-equipped those people are like, it's a very small group of people to be building this thing and making all the decisions that could affect billions of people around the world. And by the way, it's a very homogenous group. Yes. No. These are like mostly men in San Francisco. Um, they are blinkered. They don't sort of have the rest of humanity's experience to draw from, and they're all racing each other. That is the craziest thing. It's like they understand the stakes of what they're doing. They're not naive. They think this thing could blow up the world, but they're all racing toward it anyway. But like, to what end? When you say, okay, we're possibly on parity with human intelligence. The goal is to be better than that. I mean, I say this jokingly, but also not did no one watch The Terminator? Like every piece of science fiction we've made in the last 25, 30 years goes to the same inevitable end. You know, these guys are aware of this. Just they're just doing it anyway. Yes. And they have various justifications for that. Some of them think that the future will be amazing, and we'll have this sort of post-scarcity utopia where robots are doing all the jobs and humans are just free to pursue our, our leisure activities and, you know, make art and think about philosophy all day. Art as well. Exactly. So that's one rationale. The other rationale, the one that motivates several of the characters in this book is, uh, is that they think this technology is going to be built whether they build it or someone else builds it. They think it is inevitable. The recipe is not that hard. You get a bunch of data and a bunch of compute and some algorithms, and you throw it all into a neural network and out comes intelligence. And so their fear is that if they don't build it first, if they don't get to this threshold of AGI or ASI first, then China or their rival down the street, or someone they really don't trust will do it first. And that is the the sort of fear motivation in addition to like the you know, it's all going to be utopia motivation. Kevin. It's a small group, as you pointed out. Now we have policymakers and politicians, uh, interested in the prospect of regulating this. And we've had a lot of conversations with lawmakers in which we've asked quite bluntly, is, is Congress equipped to do this. The answer is we do have a self-proclaimed high IQ president, but what is the barrier to regulating it? Is it momentum? Is it? Is it Congress's lack of desire to do it? Or is there really no way in which the government could, given the sophistication of all of us, have any hand in regulating this smartly? I mean, the government can do it. They just may not because they are stuck in states. They have failed to regulate every important new technology on a relevant timescale. I mean, think about it. Social media is now 20 years old, 25 years old, and we still don't have it's getting regulated through the courts. It's getting regulated through the courts. But it's but Congress has not passed a single law. So I think in the absence of like strong federal regulation, we'll see some state level regulation. We might see some self-regulation among the labs. Um, but I'm, I'm skeptical that we're going to get some federal regulation. And in part, I think that's because the members of Congress do not understand this technology. I was just interviewing a member of Congress at a conference the other day, and I learned that in the US House of Representatives, the only approved AI tool for member and staff use is Microsoft Copilot. I was going to guess Clippy, but it looks nothing against Microsoft. I'm sure it's a fine paradox, but like if you if that is all you're allowed to use, uh, you're not actually aware of what the technology can do at the frontier. You need to be using the frontier models to understand what they're capable of. One of the things that surprised me, just anecdotally in my own life, with the adoption of this technology from people who are using it for everyday things that you could Google just as easily, or you could type the email just as fast. Is this concern about cognitive atrophy that people are outsourcing basic things and they're going to stop being able to do them? I mean, did anybody you talked to have major concerns about that? And what is the repercussions other than we're all just kind of waiting to see where this goes. Yeah. People I talked to have concerns about that. It's not the foremost. They're mostly concerned about human extinction and mass job loss. I just I feel like this is I mean, but, like, you talk to people in your daily life and they're like, oh, I had ChatGPT write an email to my boss, or, oh, I had ChatGPT respond to somebody on a dating app and it's like, it's I am just shocked at how quickly people have stopped doing basic tasks. I worry about this a lot for students. I think if I had had AI during high school or college, I would have done like very little work. Um, and I imagine that that's the experience some students are having today, I think. Yeah. And less worried about it for, for, you know, adults. I think it's, it's a problem. But I would say I would compare it to something like Google Maps where like when it came out, everyone was like, oh, Google Maps, like we're all our skills at navigation are going to atrophy. No one's going to know where we're going anymore. Those two things are true. Correct. And if your phone dies and you don't have Google Maps like you are screwed, you are lost and you are asking someone else to use their phone. Um, but for most people that's just not a problem because they always have Google Maps. Kevin, let me ask about sentience and many viewers, listeners, remember your conversation with one Sydney, the Bing chat bot who expressed her affection for you and you're still married? Nothing. Nothing came of that. I'm married to a human woman. Tried to try to intervene in your relationship. We're hearing from the Pope on these issues. There have been these moments in which people have thought that these bots do exhibit signs of sentience. How do you think about that? As we kind of think through where this might be headed, not knowing where it might be headed, this emerging kind of fear, anxiety surrounding what life might be within the the machine. Yeah. If I get asked about this a lot, in part because of the Sydney thing, and my answer is usually that it could be possible that at some point in the future, these systems become conscious. I don't know, I'm not a I'm not a philosopher of mind. I'm not a cognitive neuroscientist. I don't know what consciousness is or how we test for it in humans. Uh, you know, let alone any other organism or entity. But I actually don't think it matters that much whether these things are conscious or sentient or whether they're just inert. I'm more of like, I think it's important what they do and how we react to them. So I think it's a problem if like, you know, these things are, uh, seducing people and baiting teenagers into, you know, trusting them and, you know, hurting their mental health. I think it's important if they're out there committing crimes and cyber attacks and developing bioweapons, like if something can develop a bioweapon, I don't care if it's conscious or not. I care about whether it's safe. But as one of our producers was asking, why can't you just pull the plug? That's not really going to be an option if it is even now, very soon, right? I mean, it is already hard to pull the plug, so to speak. I mean, it's not like the movies where you run over to the server, you yank the cord out of the wall, and it just sort of, like, powers down. Like, that's not how this any of this works anymore. But it's especially not how it works with these agents, which are we've we have seen capable of resisting attempts to shut them down. So, you know, maybe you go to pull the plug, but the agents have already replicated the weights of their model on a different server that they're not going to let you into because they're trying to preserve themselves. Um, that's not a hypothetical concern anymore. It used to be there used to be lots of science fiction books. Like every Michael Crichton novel has, like, had some version of that. Again, it's no one read any science fiction, but like, that is the sort of behavior that these researchers are starting to see now in things like the hugging face attack. Kevin Roose, thank you very much. Thanks for having me. Kevin, a great guy didn't make me feel any better about any of this stuff. Well, he's he's more of an optimist. When you could have a look at the pantheon of people who are writing and commenting on this. He is, but it still seems I don't know. You know what, skeptic? I want to play with Duma, but I'm a skeptic. It's fine. You can be the ray of sunshine. Never. Sorry. Coming up. Coming up from potted plants to light fixtures, Bloomberg Pursuits looks at why more restaurants are dealing with an increase in thefts and how that's impacting their bottom line with Bloomberg this weekend. Stick with us. We'll be right back. Thank you for joining us live in Bloomberg this weekend. I'm Lisa Mateo. Let's update you on today's top stories. Anthropic AI model apparently went rogue and submitted a fake tip to the Philadelphia Police Department in a homicide case. In a report, the company said its clawed AI model demonstrated four types of unintended behaviors, The New York Times reported. Anthropic AI agents also submitted 20 visa applications for a form available on the State Department's website. OpenAI said that it fired three safety researchers for a breach of trust. In a social media post a chat, GPT maker said they violated clear policies on handling sensitive information. The researchers accused a company of putting its corporate interests before safety. While tributes continue to pour in for Pro Football Hall of Famer and former Chicago Bears coach Mike Ditka. President Donald Trump saying, he was a great guy. He was with me all the way. Former President Barack Obama said when he arrived in Chicago in 1985, coach Ditka set the tone for a team that was punishing, dominant and fun, and the city loved him for it. And if NFL Commissioner Roger Goodell stated Ditka served as an ambassador for the game and inspired generations of fans. Ditka died Friday at the age of 86. To golf now, where the PGA tour continues with a big current classic at Yokohama Country Club in Japan. Topping the leaderboard is a three way tie between Michael Brennan, Zach Bosu and Jacob Bregman at 13 under par, followed by Adam Scott at 12 under par. David and Christina. Lisa, thank you very much. Appreciate them. Thanks, Lisa. Okay. When you leave a restaurant, you might ask for your meal to go or something to take home. But there's this growing issue of diners taking other things home that they didn't. You'd never do this, I know. Food editor Kate Creator explains there's a rise in culinary klepto knife, and that is costing all of us at the dinner table. If I'd known that Kate was cool with pilfering small things from restaurants, we had dinner at one Club Ro a little while back in London. They have this beautiful cobalt blue cutlery I might have taken. Might have taken a fork or a knife. Kate, you're all right with this. I love that you. I love that you still remember the details of that. And, um, that wasn't on my radar, but I'm glad we should check your pockets. Where are you two? Pilfering from restaurants. I go, I call out, you know, do you do you have I should say I have, yeah. Let's put this. I'm scared straight, I know I it was big, big admission for me, but I have been known to get caught up in the moment of being in a restaurant and thinking that a spoon looked especially attractive, or in one case, even a jug. I did manage to abscond with like a big ceramic jug, but that was a while ago. I'm scared straight now. Wait, so apparently this is a bit of a problem. I had never heard of this before. A friend of mine was dating this woman. Um, and they had gotten banned from several restaurants around DC because she kept stealing things and they knew she was stealing them. She was stealing like the little, um, like aluminum or a metal thing that you put the ketchup in or like a, like a cop, or they were stealing glasses and they kept catching her and they banned her from several restaurants. I had never heard of this, but apparently from restaurants. Oh, I'm gonna have to do a sequel and talk to your friend. That's a lot. That's that's farther than it usually goes, to be honest. What? What motivates people to do this? You can speak from your own personal experience, but as you've talked to folks reporting out this story, why do people feel compelled to take something small or a jug? I guess in your case, off the table? Yeah, exactly. Um, it's it's super interesting. I did talk to a lot of, um, psychiatrists or a number of them, and people take them because they get caught up in the moment because sometimes there's alcohol involved. But there is also a sense of entitlement that comes when you eat at restaurants. You know, you're being so well cared for. Someone's taking your order or someone serving you food. Someone is cleaning up after you. And so then if that cobalt blue fork knife looks really good, you are all of a sudden you think, oh, I should have this memento. A lot of people justify it as a souvenir. And as you know, I totally understand that mentality. But if you start to think about it for a minute, especially in this landscape, for restaurants where margins are increasingly tighter, food is more expensive, labor is more expensive. It really it costs money. Even if you are taking like a leather menu cover like that, it adds up. So, um, I'm going to be more thoughtful now. And David, I hope you are too. I will admit I did go on a diplomatic trip to India and we ate at this very famous restaurant where they have these giant nuns and they're so messy and so many people come in their suits. They give you, like, this full body bib napkin. And there was a little bit of alcohol involved, and we did all try to take them out. And two out of the three of us got caught. But I did make it out with successful. But I felt so guilty for successfully like, hey, party! The club now had to get rid of it. Every time I looked at it I felt so of the guilty. But you make a list of other fun things are funny or not funny that people have stolen from restaurant. They run the gamut from artwork to six foot tall trees, butter knives, toilet paper. And chefs at Quality Bistro in New York told you that customers have gone as far as unscrewing light sconces from the bathroom. That's crazy. That's I mean, that's not that's insane. I agree, that's a bridge. That's a bridge way too far, even for me. I would never walk into a bathroom and try and take away something that is especially that's nailed down, um, this really excellent restaurateur in Miami. Well, Thompson, um, who? Somebody told me a great story about stealing their super chic martini glasses, um, said that, um, people take down people take anything that's not nailed down, and that doesn't even stop them sometimes. And I think that's true. Also, if you get it in your head that you want something and especially as alcohol is involved, you know, or some things on inhibiting you, you think, oh, that looks really good. And that would look really cute in my house. What did restaurateurs tell you about what you mentioned a moment ago, which is the way that this affects their bottom line? I guess there was a school of thought like, this restaurant must have an infinite number of forks or spoons. They could replace one. Surely, if I were to were to take it. What did they say about the effect that it actually does have if you if you take one of these things. Right. Yeah, that's a really good point because, um, definitely people justify it as a victimless crime. You know, they look around, you don't see the owner, you know, the server, you don't count the server as someone that you're stealing from. And so you think, oh, there's like spoons on every table. There's glasses on every table. But the bottom line, it starts to add up at this, um, great restaurant in New York called La Amico. Um, they lose a couple thousand dollars every year based on things that get stolen, including cute little spoons. And beyond the cost. There's also a time element when you try and replace it. And so if you're running short on plates or glasses and you can't get them replaced for weeks, that's, um, that really starts to be a problem. But you've also written about how related and not related that restaurants are starting to stay open later. Can you talk to us about why that is? And in my mind, that kind of increases the risk of this. These kind of shenanigans are going to happen if we're all staying out later drinking. I was going to say that spoons starts to look like That was an excellent segue. Oh my gosh, that was like skating on. You were like Misty Copeland. All right, all right, all right. That was amazing. Um. Come back. And that's true. It's okay. Thank you. Um, it really it's an excellent trend that we are really we're delighted to report on. Matt Cronenberg, who's one of our star writers, noticed this trend of places staying open later. And as you probably know, um, during as a result of the pandemic, all of a sudden 530 became the hot time to eat and nobody wanted a late reservation and places were deserted. But now, as a result of several things on both sides of the Atlantic, they run the gamut from the Odyssey, you know, showing 24 hours and people trying to stay up for 2 a.m. screenings. And here in the UK, the World Cup, some of those games are played at midnight and even one and two in the morning. And so pubs got licensed to stay open later and all of a sudden people realized, you know what I'm not like? The world doesn't end if I go to eat out to eat at 9 p.m.. And in fact, it's really fun, you know, like, there's just like a fun factor that's back certainly in New York City. And you feel it in London too. And it really manifested a restaurant in the dining room later at night. New York, London Christina has moved here recently from DC. I'm just going to go out and say not many late night restaurant spots in Washington. Kate, is this happening in other places? Is catching on in places outside of New York and London. Um, you know what other places haven't been so badly hit like Miami always been? Um, much more of a late night place, literally in a place like Madrid and Barcelona. It's, um, it's something that you see, but. Yeah. No, I think in L.A., people are starting to rediscover their late night habits. And the thing is, once you start, once you realize, like, oh, going out at 9:00, 930 isn't going to kill me, then you sort of get you sort of think, oh, this is really fun. And, you know, it's fun to be out kind of late. and it's, um, it's something. It's making a difference. Restaurateurs like it because it's next to turn at their table or at their tables, and so they're making more money. And um, and there's also, um, down in New York, um, this restaurant, some, uh, that's super popular, um, especially it's got high end Indian food, a lot of Indians, um, the owner, Ronnie Moore, said he's seeing a lot of demand from his Indian clientele for later populate for later reservations. And it's not even that they can't get in at 6:00 or 630. It's if they want to eat at 930. I do like to avoid a few, uh, because of cutlery for you from the the pantry upstairs. Coming up next here on Bloomberg this weekend. This weekend or bet dubs. Don't don't. I'm Christina Ruffini with David Gura and Lisa Patel. You what's see or hear some stories you might have missed this week. Lisa. Catch us up. Okay. You know how the internet is getting so much better in flight, right? People are saying talking about it. They're going to United because they say United has the best Starlink. They've got. Starlink got Starlink. Okay. But now comes this from the Wall Street Journal. The latest nuisance flight is a zoom call at 30,000ft straight to jail. But here's the thing. Okay, so more people there doing the zoom work calls, they're FaceTiming their friends and family. They're doing all these things. People are getting frustrated. They're trying to sleep. You know, they did. They wanted to stop. But there are certain airways like Qatar Airways, Emirates, British Airways, they allow the Starlink for for voice calls. Wow. Really? But the thing is they have certain name them again. Let's go through that list again. Yeah I want to know exactly. They say people have to keep their voices down. They keep finding people, you know. Uh, but it's becoming a thing. There's a group of lawmakers who want to pass the Quiet Skies Act to ban this. Um, it's going to be getting, like, a train commute. Like that happens on the train every time when people are having a loud conversations right next to you. And we know how you feel about this. Yes. Your rage. Rage. Now you also do it now in the park. You go and try and have like a nice moment of Zen, and especially tourists will be like FaceTiming with their family to show them Central Park, but on like speakerphone. And so like as you walk, all you're hearing as people and you do what? Glare. Uh, I go up to them and say, no, hi. Do you need headphones? Every. Single time? No, no, there's a CVS right there. Do you need headphones? Do you talk to people on the plane? On the plane? Yeah. Are you a chatter on the plane when you sit down? But when we take off, the headphones go a little longer. Does anybody. Yeah. There's a, um, an executive producer here. We should go. Nameless. I flew to DC next to her. Neither of us recognized the other nor spoke the entire time. The entire entire time you were, like, directly right there next minute, like headphones were on and, like, pretty. You're just so tunnel vision. Do not engage. Do not make eye contact. It's not a place. It's not a place for talk. For me, I think that's fair. Honestly, I think that's fair. Okay. You're tired, I get it. I just feel and give you that. I feel obligated to make some sort of pleasantry. But you're a nicer person than I. All right, Lisa, what else do you have? Is going to be fine on the plane. These people start again. Okay. Remember the hotdog and soda at Costco, right? That big combo. You are a Costco commercial. About this one, a wine deal. Okay, this one from Bloomberg. That $30 Costco private label wine might be a really a 50. Explain. So let me explain. There's vintners in California who have this surplus of wine. Right. So, you know, people are cutting back on alcohol. JP ones are drinking less, um, inflation. Um, so winemakers, um, what they're doing is they're offloading it to retailers like Costco, like Kroger, like Aldi, um, who are slapping their label on it and they're selling it for cheaper. How do I know if I'm getting a good bottle? You're doing okay. You have to taste. I guess it's a taste. I know they had, like, really quality vodka. I didn't realize it was like quality white labels. That. Right? Yeah, they're they're vodka rates. Almost every year. The mom swears by the Kirkland vodka. Sorry for not going to bed, she says. Well, let me tell you, I like you. You can call me anytime. Loves her. Vodka tonic. All right. Um, but they even lower it. Like, Kirkland has that signature, um, Cabernet. And they even lowered it from 1990 from $22 to 1999. So it's even. Had you tried this? I have not, but now I'm curious. I know you to be a huge Costco devotee. Tom Keene talked about this every day, but I don't have a Costco card to you. Absolutely not. So you should bring that into a room. There is a Costco in Brooklyn. I've not been. The parking lot looks hellacious. Oh, I've got the one in Northern Virginia. Was always terrible, but. So you should bring that in for us to sample. I will do that. And that will be our next beat. Do you have do you have, like, the higher level membership? I do. You're seeing the amount of money you probably get to just, like single handedly keeping them employed. Okay. You guys are new. Have you been to Elon Stardust Diner? You know the one. I know what it is saying. And it's the. You know, it's the 1950s. It's great. Okay. Big tourist attraction. Now there is some competition coming in New York Times. Broadway's new heated rivalry. Two diners with singing waiters. Okay, this is diner 24. It's like a block away from Ellen's, and it just opened. Um, it had one in Gramercy Park, but this one is here now. It has the burgers, it has the shakes. It has an all day breakfast at the table. So they've got a runway. So this is my version of the zoom calls on an airplane. If you don't like it, go upstairs. I don't like it. I'm a Broadway nerd, and I don't love this either. Have you been? You haven't. Oh, God. No, no. Well, see, you might like this one better, because what they do, they have a one floor. That's no singing. They have the upstairs, it has the singing, but it's only in like, certain amount of increments. Whereas in Ellen's, it's all the time singing and people are like, like all day to like talk, you know, over their pancakes. So it gets a little. Do you guys like live music when you go to eat? Absolutely. I mean, I'll go to City Winery. That's great. All jazz. Okay. Like a jazz. I don't know if I could do show tunes and not show tunes now. Just generally compliment the conversation. Not like drown it out. I do it as such. It's so amazing to be in New York though, because you have so many talented people and so many of them don't have jobs. You've I've seen these people sing online. Like any Midwestern theater. They would be the absolute rock star. And I just always feel like I could never sing that well. And you are singing on a table at a diner. Is it so nice to hear you praise New York? You. Oh, all right, now you've ruined it. Now you've ruined it. Lisa, you got anything else right now? Last one. We'll go from, um, burgers and shakes to a whole new type of sushi experience. This wisdom from Bloomberg, a $30,000 tuna car. Sure, it's the next splurge for sushi lovers. Okay, so here's the experience. You go there and they throw out a £200 bluefin tuna right in front of you. It's about six feet long. Diners get up close. Look, you can eat the rare cuts of the tuna, like if you want the cheeks or the forehead, you can get those great pieces of it. Um, it costs about $218 a person. Okay. All right. That's not 30,000. Experience and experience. Yeah. Um, and it's kind of like farm to table, like you get it right there in there. I would do that in a way. If you want to do that, I'd go do that. 218. Sure. It looks fresh. You get. It's my own little zero dreams of sushi. Will you do that? It's a party atmosphere. I'll do it. You take. She wants a party poster. She do we do it as a story? We could probably expense. I would bring the Kirkland wine. We'll have the. $280 sushi. And at Costco, that $20 wine. I love it. Um, Lisa, thank you very much. Lisa. Mateo. The stories you may have missed over the course of the week. Yes, on the Bloomberg Terminal and Bloomberg.com, but on other news sites as well. Take your coffee. Here's how to live. Be careful. Please. We're coming up on 8 a.m. in New York City. Don't spill the coffee. The next hour of Bloomberg this weekend starts right now. Coming up on Bloomberg this weekend. You heard about the oil deal with Russia. That is a big deal. President Trump strikes a deal on diesel with Russia's president. And I want to thank President Putin, to be honest with you, how it could impact prices weeks ahead of the midterms. And while Ukraine's leader is calling it a birthday present to Putin, Isaias makes landfall as a powerful hurricane along the Gulf Coast with heavy rains and howling winds. We're tracking the storm as it pushes inward, what it means for oil production and insurance, and get ready to go bananas. Banana nation comes together for the biggest performance in Banana Bowl history. Part baseball, part P.T. Barnum. The banana ball championship is tonight. You're talking to the league's owner about the phenomenon. Business, economics, geopolitics to banana ball. Well, cover it all to Bloomberg this weekend. 8 a.m. in New York from Bloomberg's world headquarters. I'm David Garrett. I'm Christina Ruffini with Lisa Mateo. We're going to bring you the latest breaking news reports and analysis live this morning and every weekend from 7 to 10 a.m.. We're going to start with some of that sound you just heard, which is the president who allegedly was calling Vladimir Putin to talk about this potential outbreak in Russia that somehow turned into it was President Putin's birthday, and they are now announcing this deal to import Russian oil, which goes against sanctions the president just signed a few weeks ago. So we're going to dig into all of that. And ahead of the midterms, what this is looking like, what the map is looking like, I going to talk to some of our white House team and try to dig into that as well. Yeah. Again, the president, you're looking for a short term fix to the energy price issue ahead of those midterm elections. Dig into that in just a minute. But first let's get to the headlines with Lisa Mateo. Lisa, you got into more than 800,000 customers without power in Florida, Alabama and Georgia. This is as communities across the Gulf Coast assess the damage after the first hurricane of the Atlantic season. But as now post Tropical Cyclone Isaias also flooded roads and downed trees. While the storm made landfall last night near Destin, Florida, as a category two hurricane. As much as eight inches of rain is predicted across the region and tropical storm conditions likely to continue to Saturday morning. We're also watching two other storms this weekend heavy rains from Tropical Storm Rachel impacting parts of Southern California. Residents are using kayaks and paddle boards to navigate the flooding. Hurricane Simon approaching Mexico's coast and its busiest Pacific port. It's strengthened to a category four storm expected to make landfall tonight. President Donald Trump may be changing his tune when it comes to not attacking Iran before November's midterm elections, but for avoiding rain. Juan for a trip to Syracuse, New York, the president responded to three questions of why not act now? We may have the worst day, but I think that, uh, they're failing badly. Their country is failing badly. Their military is defeated. They have no navy. They have no air force. Uh, they have 300% inflation. And, uh, Iran is in very bad shape. In other news, President Trump says he's working with Vladimir Putin to release Russian diesel supplies into global markets. The president announced a series of cargoes beginning this month, totaling about 13.5 million barrels. Ukrainian President Volodymyr Zelensky says the deal will prolong the war. Meanwhile, a day after the deal was announced, officials say Russian aerial bombs killed 12 people and wounded at least 14 in Ukraine. President Zelensky had warned that the deal would allow Russia to kill more and wage war for longer. And a major fire has been reported at an an oil loading terminal in Russia overnight. Reported drone attacks Russian regional authorities. They confirm the fire. Ukrainian military officials have not claimed responsibility for that reported attack. And to New York, where hundreds of protesters gathered in Foley Square last night in front of the federal courthouse in lower Manhattan. Demonstrators expressed their anger of ISIS presence in the city after immigration officers shot a man with a young son in a vehicle on Thursday. Department of Homeland Security Secretary claims federal officers were not aware that a child was in that car, and that Oscar Bel Gal was aware he was being stopped by David and Christine pretty much on edge. Lisa. Thank you. Appreciate that update. We're going to drill down on diesel here. As Lisa just mentioned, President Trump thanking President Vladimir Putin for the release of a substantial amount of diesel. You heard about the oil deal with Russia. That is a big deal. That is massive amounts of oil coming into our country. And I want to thank President Putin, to be honest with you, we have massive amounts of oil being coming into our country, and it's diesel, which is what we want. So thank you. The aim of the president there is to lower prices and quick. With three weeks to go until Election Day, he posted on Truth Social. This lower prices for Americans, especially our great farmers, ranchers and truckers, is my greatest priority. This is a very big and important announcement. It's a move that comes along as a new Reuters Ipsos poll says that nearly 8 in 10 Americans blame President Trump for the rising cost of living. Joining us now we have Bloomberg News congressional reporter Caitlin Riley and ABC News State Department reporter Shannon Kingston. Thank you both for being up with us this morning. Shannon, I do want to start with you, because we have this strange moment where President Trump's domestic policy and his foreign policy are really colliding here. How much do you think, uh, members of his own administration were taken by surprise with this Russia announcement, given that, uh, Jared Kushner and Steve Wycoff were in Miami negotiating with Ukrainian officials when this came out? Uh, over and over. And then we heard the comments from the president. Right. Christina. Well, this certainly was a sharp turn for the Trump administration, which has been working to broker some kind of energy truce between Ukraine and Russia and making some progress in recent weeks. So this is likely to make some kind of deal, a limited short term deal like that, even rather difficult to achieve now because this is just a pact between the US and Russia. And of course, we know Ukraine's President Zelensky very unhappy with this. He's calling it a birthday present for Vladimir Putin. And many are predicting that this will set the stage for further cooperation between us and Russia even before this war comes to an end. So that's something that the Ukrainians are very unhappy about. But as we look to your point on making some kind of compromise here between domestic needs and foreign policy as we head into the midterm elections, I think Trump administration officials are privately, you know, they know that they're up against a wall here. They are anxious to create any kind of perception, at least, that there's going to be something in the offing to bring down energy costs for American consumers as voters head to the polls. So we've seen time and again that the president is willing to pay a higher price when it comes to global issues than he is here in the country. Caitlin, great to have you with us. Welcome to the show. Your first time on it. Uh, glad to have you with us. And I wanted to ask you just about the resonance of what the president's doing here for Republicans and for Democrats. We got new consumer sentiment data yesterday. We're going to talk to Joanne Shew in just a little bit, the woman who oversees that survey that the University of Michigan does. But what's so clear is how big a driving force these energy prices are in the lives of Americans. They're worried about them. They're making spending and purchasing decisions based on them. Um, I'm curious sort of how that issue is resonating among Republicans in the House and Senate in particular, as they spend this recess, in many cases, trying to to win reelection is something like President Trump announced yesterday, likely to give them enough grist to make the case to Americans that, in fact, lawmakers in Washington are doing something about this ongoing crisis. I mean, I think it will. Time will tell, but I think it's a tough sell. We've seen Republicans sort of cast about for an economic message that will resonate with voters. The latest tax seems to be to blame rising prices on the Biden administration. Um, even though it's been, uh, almost two years since Biden has been president. Um, energy costs are obviously a huge concern, and we're starting to see some Republicans break with Trump around the edges, around the, uh, on the war on tariffs. There was a bit of Republican criticism of this deal with Russia, um, yesterday. But it, um, it, it Republicans do seem to be grasping for a coherent message they can bring to voters on the economy. Um, and for a while it was that prices will go down when the war in Iran ends in the Strait of Hormuz reopens. But they've seem to have dropped that message as well as the war drags on. Caitlin. There are also several debates and some high stakes Senate races, and we've got some sound for you. Here are Georgia Senator Jon Ossoff and Representative Mike Collins talking about what else? Affordability. Ground beef and coffee are up 30%. These tariffs have crushed families and small businesses. And Georgia agriculture. The war in Iran has sent gas prices near their all time high. Unleaded is $4 in Georgia, diesel $6. My opponent voted for those Biden mics that caused this historic inflation, not just on gas. And gas is too high and we're bringing that down. But on everything that you purchase out there. He's the one that voted for that Green New Deal. He doesn't want your gas to go down. So, I mean, Republicans are trying to find a closing message on the economy, but Democrats need to get on step or in step as well. What are we hearing? What are some of the overarching themes we're hearing? As we oh my goodness, get so close to these midterms that I feel like it's all we talk about at the moment. All Democrats have just consistently hit Republicans on cost of living, on affordability. It's a message that seems to resonate with voters. We've seen a lot of economic anxieties show up in the poll. President Trump's approval ratings are as low as they've ever been, particularly on the economy was, which was actually a strong point during his first term. And so Democrats have been able to just hit Republicans again and again on cost of living and point directly to policies they say have contributed to higher costs, including tariffs, which you heard there, and, of course, the war. Shannon, you were traveling with Secretary of State Marco Rubio this week. He was in Greece. He went to Portugal as well. He talked about Western civilization. Yeah, I saw her Instagram looks like a really, really hard ship as I continue to visit. Um, Sharon, let me play a bit of sound here from Secretary of State Marco Rubio talking about, um, kind of the US's place in the global economy. We choose the unapologetic pursuit of national power to take back control of our critical supply chains, to re industrialize our economy, to rebuild our defense, to fight for dominance of the technologies and industries of the future. An incredible backdrop for those who are some good advance right there. I will say listen more. Um, Shannon, talk a bit about that. The message that we heard from Secretary State Marco Rubio there. And of course, this was unfolding as this scandal erupted surrounding the US ambassador to Greece as well. That's right. And this speech was very atypical for Secretary of state, because while they do talk a lot on these foreign trips, you know, typically they're with their counterpart in the host country, maybe a foreign leader. They don't usually get so low billing, and they do not usually get a backdrop like that. The Acropolis at sunset, golden hour. So this was something that turned a lot of heads because it did feel somewhat presidential. Of course, as Secretary of State, Marco Rubio does stay out of domestic politics, so he's not so entrenched in this midterm fight. But we know that there have been presidential intentions in the past, and many say that he plans to run for higher office again. So that was something that caught attention. This was a defense of Western civilization, was how the State Department built it. So getting more into a bit of the global culture wars, if you will. But yes, there have been some allegations about the ambassador in Greece, Kimberly Guilfoyle, you know, seeking to use what should be a position for a public servant to privately enrich herself. Something that we've seen has been a theme that has impacted this second Trump administration, certainly. So he did try to, you know, step away from those allegations, say he wasn't going to address them while he was on the trip. But we do know now that the State Department's Office of the Inspector General, is investigating those allegations that were first reported by the Wall Street Journal. So that is something that he is going to have to deal with even as he tries to set up, you know, his other priorities here and perhaps looks towards an office for himself in the future. Sharon, you're putting that very diplomatically in his response to questions about this was it was it was rather he shut it down. I mean, there was a kind of feisty exchange between him and the press corps he really doesn't want to engage with with this issue, doesn't it? That's right. And I'm sorry I've been hanging out with diplomats too much. Recent, perhaps after this week of travel. So I'll, I'll say yes. He he was I combative. He did spar with us a little bit as we tried to press him at least to say what he was going to do about it if he was going to look into the allegations. And we did hear similar comments from the president, where he said on Friday that he just heard about the allegations against Guilfoyle that have, of course, have been in the media all week. He said it was too bad, but really didn't indicate that there was going to be, you know, a very deep inquiry into what was going on there. He said, quote, she's always been so nice to me. So that's something, of course, that we'll be watching and we'll keep pressing on. I think the most on point comments we got were actually from Vice President JD Vance, who said he didn't love the idea of these allegations, that it was a pay for play scheme, where she was asking, am I got a donor to help pay off her Amex bill, which, you know, I didn't know was an option, but I should ask, why not? Let's be clear. Not enough. Okay, Caitlin, let's focus, uh, closer to home. We've got the Michigan Senate race. This is, of course, one of the most watched races. You've got Republican Mike Rogers and Democrat Abdullah said they were kind of tussling this week about Canadian tariffs. Take a listen. Are you saying that we need to eliminate all tariffs for Canada? You have 60s I would like to see the deal made. I have actually called the white House this week, talked to the, uh, the Secretary of Commerce about getting the deal done. Canada still has some high tariffs for U.S. goods, and they did it before this started. Those should be eliminated. There are tariffs that I think are too high and not helpful for us. We ought to get rid of those. He's doing an ad drinking Labatt and talking about the Red wings, pretending like he was not for this the entire time. Be serious, my God. Like, just be serious. People deserve to know that have a leader is going to be serious about policy. I mean, you've got Rogers now breaking with Trump on this and the war in Iran. Does this kind of illustrate the difficult position some of these policies have put Republicans in, in states that could swing one direction or the other? Absolutely. And he's not the first Republican we've seen break with the other president on this. Um, we saw, um, Congresswoman Ashley Hinson, who is now in a very competitive race, um, in the in Iowa for the Senate also call for an end to the war. Of course, that was after she took a vote in the House to allow it to continue, um, in Florida, we saw Congresswoman Salazar, who, um, has a Miami district very directly criticized the president's immigration policies. And so we are starting to see Republicans try to distance themselves, in some cases, from the president and his most unpopular policies. But a huge, um, challenge they face is that Trump has made these midterms about him and has told voters to vote as if he's on the ballot. And in many cases, these Republicans have cleaved so closely to the president for so long. Uh, time will tell whether or not, um, they they've broken with him early enough or if, um, some of these results are already kind of baked in in voters minds. Sharon, before we let you go. We have a new Nobel Peace Prize laureate. That's, uh, Navi Pillay, who's a South African jurist, has worked with the ICC. Uh, got that recognition yesterday from from the Norwegians. The president unhappy about that uh, posting on Truth Social about it, bringing up it in the speech last night, he feels like the the award should have gone to him as a proxy for for the United States. Putting that aside, uh, we did get this announcement yesterday. The U.S. kind of withdrawing, putting new sanctions here on the ICC, not withdrawing from it hasn't been party to it. But what is the implication of it? How do you read the timing of the State Department making that announcement on the heels of this announcement from the Nobel committee? Right. There have been a lot of questions about that. But we do know that the Trump administration's campaign against that international tribunal has been going on for several months, and they've been threatening to roll out this week being sanctions for really weeks now. So this has been in the works, of course, the timing there a big question mark, because the, uh, person who was ultimately awarded the Nobel Peace Prize is someone who is linked very closely to the ICC. Uh, but for President Trump's argument overall, it is, uh, a difficult case to make, given that the U.S. is seen as starting the conflict in Iran this year. So it would be, uh, one would think a tough hill to climb for the president to win that award. But when it comes to the ICC, Secretary of State Marco Rubio has been very clear that he's going to continue pushing back and trying to also get U.S. allies to turn against the courts. So a lot going on there still. All right. Shannon Kingston from ABC news, State Farm reporter and our very own Caitlin Riley, our congressional reporter. Thank you both so much, I appreciate it. Coming up, it is time to go bananas. The biggest championship in Banana Bowl history. And the man behind the phenomenon joins us live here on Bloomberg this weekend. Look at that. What a great show. Great weekend. Thanks for joining us live on Bloomberg this weekend I'm Lisa Mateo. Let's update you on today's top stories. Cleanup in southern Panama continues after two powerful earthquakes and multiple aftershocks prompted evacuations yesterday. The 7.7 magnitude earthquake had toppled buildings a second 6.6 magnitude quake well that followed we had there have been no reports of casualties. The National Weather Service has issued a tsunami threat for several countries. Vice president JD Vance spoke to supporters at a Republican midterm rally at Allen County Regional Airport in Lima, Ohio, yesterday. Now he praised Ohio Senator John Hughes Houston and also gubernatorial candidate Vivek Ramaswami. And he had a few choice words about Senator Sherrod Brown. Remember that this is a man who wanted to raise taxes on Social Security. It did. This is a man who wanted to ship your jobs overseas and did. And he also called Representative Marcy Kaptur a radical and a fraud who needs to be kicked out of Washington. And in other news, the white House has issued a new press secretary. Katie Zakaria, conservative communications advisor for President Trump's media company, will succeed Caroline Leavitt. President described Zechariah as a loyal and brilliant supporter. And in sports, we have some MLB playoff action tonight. The Chicago White Sox, they take on the Cleveland Guardians in Game five in Ohio. That series tied at two apiece. We'll find out. I'll give you the recap tomorrow. 358 for you, perhaps because the Yankees are out. I was just you. I knew you were going to go in there, and it still hurts. It still hurts. It's tough. See what happens with the management of the team. Apparently Aaron Boone stay. I don't know. All right. We'll see. Yeah. Talk about that. I knew all about that. Sorry. I didn't mean to open wounds here on the stick with baseball. Okay. Championship League hosting their inaugural Banana Bowl today at Nationals Park. Christine is former national park. I love that part of the waterfront matchup featured the Texas tailgaters versus the Savannah Bananas. Promises of on field showmanship from first pitch to final out, along with some special guest surprise appearances and, yes, unforgettable entrances. You're not going, are you, Christina? No. I'm here. We have a show. Did you tell her there's still time. All right. In a new essay for Bloomberg Businessweek, Ben Austin explains how the Savannah bananas are now the most important baseball team, using their goofiness and over-the-top camp play to become the hottest ticket in American sports. Joining us now is the owner of the Banana Ball Championship League. Or the top banana, if you will. Jesse Cole. Uh, Jesse, for those of you who have been living under a rock and have never seen Banana Ball, can you explain to us what this is and why you wanted to change baseball into this amazing spectacle? Well, I played baseball my whole life. And, you know, I realized that there were some parts of the game that maybe too long, too slow, too boring, and we wanted to change it in the name of our company's fans first entertainment. So, you know, we thought, what would fans want? And so why can't fans catch a foul ball and have it be an out during a game? Why not? You know, why can't we have big celebrations and dancing players and dancing umpires? You know, why can't we just make the game faster and more exciting? And so, uh, we built this one step at a time. You know, we started my wife and I, we only sold two tickets when we started. We were sleeping on an air bed. And now to see that there's 5 million people on a waitlist. We've been selling out 100,000 seat stadiums. And, uh, it's just amazing. Now, our biggest game, our Super Bowl, is here with all six teams. And it's been an amazing journey over the last 11 years. Jesse, it's David. You can find me on that waitlist. I've yet to receive me due to my my kids, uh, eagerness to do so. Talk about a little more about that. The way that this is caught on, how surprised you might have been by the degree to which this has been embraced by so many people. I mean, you're selling out stadiums all over the place. Yeah. I mean, I think, you know, right now more than ever, the world is hungry for fun, but hungry for joy. And, you know, we don't take ourselves too seriously. And the ball in the field is unbelievable. These players are unbelievably talented. I mean, they're doing backflip catches and they're doing catches between the legs. They're hitting 400 foot home runs. But also they understand it's about entertainment and putting on a show. So they'll come and do a walk up dance. They'll do a celebration. That's fun. And I think, you know, the world needs that. And, uh, you know, it's a balance. You know, there's baseball, which is a great game. We're so grateful to have some great ballplayers, but we know that we got to entertain in the crowd. And with 40,000 fans here tonight, you know we're going to have all of our players up in the upper deck entertaining the crowd. And it's just about breaking down that barrier between fans and players and giving fans something they've never seen before and never felt before at a stadium. And that's what brings us joy every single night. Jesse, I got to tell you, what I love about it is the price point because you make it affordable for families. I mean, I got to admit, I go to a Yankee game, I'm hurting, and I go take out the load. So how do you keep it at that price for families? What is it, $35 a ticket? Oh, geez. Well, everything. Yeah. And no ticket fees, no conveniences, no service fees. We pay your taxes. I mean, everything that one should. I mean that that's that's our model. And when you make every decision by the fans, that's why we do it. And so, yeah, I mean, we're fortunate. Even tickets are going on the secondary market for hundreds of dollars. So we built our own secondary market and we kept every taken at face value where we're investing hundreds of thousands of dollars in that, because you can't just say you're going to be fans first. You have to do with every single thing that you do. And we've been trying to do that since day one. And, uh, the fans certainly have repaid us and showed up more than we could ever imagine. Jesse, how do you find these players? That was going to be my question. Very curious about this. They have to be able to dance and do flips. And I'm going to guess that, uh, an Aaron judge might not be skilled at that. So, you know, you're looking at baseball players primarily. Are you looking at folks with a dancing background? Who do you target for this? Well, I'll tell you at first, uh, not many people want to play for a show. Like, what is the story? I think we had, like, 50 total people show up for the tryouts. Uh, now we have thousands. And we have from former Major League All-Stars and World Series champions like Jackie Bradley playing full time. We got first round or second round. You have to play baseball at a very high level. I mean, throw 90, 95 miles an hour, hit 400 foot home runs. But you have to be able to, you know, understand what it's about. And that's entertainment. So our guys work. We've been doing rehearsals the last three days for hours early in the morning, late at night. We've got brand new performances. Seven original songs. A huge final winning show. So you have to understand that you get to do things, get out of your comfort zone. And yes, they every day they're practicing trick plays, catching the ball between the legs and backflips. So they have taken their baseball to another level and push themselves to another level. And I think those are the players we look for every single night. I mean, I think it's really fun because for a while, high school sports got so serious that you really had to pick one thing to do, right. You had to dedicate it seemed like fully. And I feel like this is a place for the kid who was also a drama nerd, or also might have like moonlit. And I have seen some of your players do some very excellent for I say turns. I will tell you, you know, I feel these other skills and I was I was listening to an interview about one of your players who maybe wouldn't have made the cut with his baseball skills, but he used to walk on stilts years ago and they were like, oh, we'll bring the stilts. You can pitch on stilts. And that was the clincher. I mean, how do you make the calculation of, oh, yeah, we got a stilts guy. We don't need another one of those, but we need the good lip sync guy and the guy who could do the pirouettes and then also do a fastball. Well, he said, I mean, we have a Broadway singer. I mean, Derek Kline on one of the best Broadway singers, A-lister, doing amazing shows. And now he also played college baseball at UCLA. So now he joins us. But you better believe he's going to be singing when he comes to the mound and stilts. I mean, yes, he showed up at a tryout in stilts and uh, he said, you want me to walk? And I go, no, I want you to hit him. And I go, can you hit on stilts? He said, sure, whatever. I drive them stilts. And now he's become a legend. And so I think that's what it's all about. What can people do that people have never seen before on a baseball field? We got a guy on a unicycle. That's unbelievable. Literally on a unicycle driving line drives. I'm like, I don't know how you can do that. And that's when you take it so bad and show up and they're just like, what's going to happen tonight? And that's what makes it special for all of us. Well, that's what I get. It's always like a guessing game as to what's going to happen. So I have to ask you, so this banana bowl, is it more like the World Series or is it more like the Super Bowl halftime show? Like, how would you kind of put it as far as entertainment is concerned. This is Super Bowl WrestleMania. I was on the show. With with original performances. We got tons of guest stars. We are going over the top. It's every single happening. There will be something. And so it's commercial free. It's ad free. We are giving it all I and literally I mean, it's ten new performances. I mean, it is over-the-top. So it is entertainment. That's what we are. That's the business world. But they're also competing for a championship. And right before they win the championship, there's going to be a 11 and 11 minute performance on the field. It's like, oh no, forget about the championship. Now we're going to do a 11 minute show for everyone and that's what it's all about. We want to give fans something that you know is really remarkable and unforgettable. Jesse, you're donning the yellow tuxedo. You were the face of this league. Um, but there's also a component of this which is you growing it, dealing with the media right side of things here. This is going to be on Disney Plus. I gather games are streamed on on YouTube. Talk a bit about how you've navigated that world again. Uh, you've seen this kind of amazing growth. Um, how do you navigate the role of kind of figuring out the media landscape and where you fit into that? Well, every decision is it fans first. So very easily, you know, we could have multi huge multi-million dollar deals if we went exclusive. But we said no, we're going to keep every game free for our fans on YouTube. And that is something that we will always stay true to because we want fans to build experiences. So we leave millions of dollars on the table to do that. So yes, our fans support us and between tickets and merchandise we are supported more than we could ever imagine. But for media? Yeah. Partners. Disney. Great. Awesome. We're going to get it to millions of people. But also it's going to be free on YouTube. And I think that's that balance we're always going to stay true to. Can I ask a really, uh, insightful question, how much do your players make? Is it enough to do it full time? Do they have side hustles? What does it do? Oh, yes. I mean, we spend millions of dollars on investing on our players and cast. We have 150 cast members, 150 plus players. I mean, the average player salaries, you know, well in the six figures, I mean, they are they are doing well and they play 100 less games in major leagues. They only play 60 games, but we're also paying them at a great level, and we're going to keep growing that as they continue to make an impact with our fans now. So you're also playing at the same time that the major leaguers are. I mean, are you going to consider to keep doing that? Do you want to go maybe to a different season so you don't have to compete with that? Or maybe that's not even your competition. There's an abundance mindset. There's a scarcity mindset. We have an abundance mindset. So the more that we can do, I think there's plenty of opportunity. And we're playing NFL stadiums now. We're playing college football stadiums with 100,000 fans. We're going to we're going to play international. There's all these opportunities that we can continue to bring our show to, like major league stadiums like that's Park or Yankee Stadium. But also, you know, again, we can do things that, you know, we can break the rules a little bit and play places people never imagined. And I think that's what's fun about it. Dig into that a little bit more. You've got the bananas, you've got the Texas Tailgaters. You've got the Loco Beach coconuts is what is expansion look like. How do you see this kind of growing city by city here in the US? Yeah I mean we have six teams and it's really about we grow just around the country. We play from small stadiums to 100,000 seat stadium. So we have six teams. They're all based out of Savannah. We may have some more two teams in the future. Uh, but they, uh, you know, the reality is it's how do we take care of more fans? Our business grows by serving fans. We serve 3.4 million fans. This year will probably be over for 4.5 million next year. Uh, we're going to look international. All these things we're going to continue to explore. The name of the game is, uh, creating fans. And I believe we're going to create 1 billion fans. And the only way we do it is one fan at a time. And so we got a long way to go. And we're not to say, hey, add more teams, add more teams. It's only on how we can bring a unique show and a better experience to the fans, and that's how we're going to grow. Jesse set the stage for us. Gates open tonight. What happens? Walk us through the evening. What we can expect is all of this. Don't don't give away too many secrets. But how all this all fold. Let's just say I walked here at 7 a.m.. There's fans already waiting outside. It's unbelievable. We have fans from all 50 states, multiple countries. I mean, like I said, this is the biggest event in banana ball history. So at 2:00, they'll be a thousands of fans waiting outside. We'll do a big road drop. They're going to come in. They'll be out. I meet by all of our players are cast. There will be autographs. We got all six teams doing autographs. Then we have a plaza show out in front of about 5 to 10,000 fans. That goes from 3 to 430. Then we do a march with our championship teams and your big, huge opening. Open up the gates. Then we do 70 things before the game starts. We're going to have skydiving coming in. We're going to have huge performances. We're going to have a bunch of surprises like that. I don't know what you had for breakfast, but could you ship us some, please? This is a very early show and we could use some of this energy coming our way. We love it. Our team says the joke. They say people ask if you said you ever drink coffee, Jesse. And I said no, I've never had a sip of coffee. Is that right? What? They say coffee wakes up and has a cup of Jesse that I like, and I let it soak it all night long. We're going to go full show final performance, and then we have an hour and a half post-game plaza party where we're going to bring 5000 fans on the field. I mean, we put 8 to 10 hours of a show. We want always to give people more than what they expected. And we're doing that times 100 tonight. All right, Jesse, thank you so much. You got tuned in to that game. I was telling you, it's like I could still make it. They make fun of me here just because I never know what's going on in sports. But this one, this one. I can get into social media too. They're they're incredible social media. I do follow them on social media. All right, all right. The current stock rally for something completely different. Four years strong. But can that momentum last is we're on the precipice of earnings season, especially with the chaos in the bond market. We're we'll get to that next. I'm doing it this week. And Amanda Penske is going to join us coming up next on Bloomberg Television radio Jesse energy. It's gonna be good. Agrees on the Bloomberg business out. Stay with us. Thank you for joining us live on Bloomberg this weekend. I'm Lisa Mateo. Let's update you on today's top stories and three topics I model apparently went wrong and submitted a fake tip to the Philadelphia Police Department in a homicide case. In a report, the company said its AI model demonstrated four types of unintended behaviors, The New York Times reported in graphics. Agents also submitted 20 visa applications through a form available on State Department's website. OpenAI said that it fire three safety researchers for a breach of trust. In a social media post, the ChatGPT maker said they violated clear policies on handling sensitive information. Researchers accused the company of putting its corporate interests before safety, and tributes continue to pour in for Pro Football Hall of Famer and Chicago Bears coach Mike Ditka. President Donald Trump saying he was a great guy who was with me all the way. Former President Barack Obama said when he arrived in Chicago in 1985, coach did set the tone for a team that was punishing, dominant and fun, and the city loved him for it. And NFL Commissioner Roger Goodell stated Ditka served as an ambassador for the game and inspired a generation of fans. Ditka died Friday at the age of 86. The golf now where the PGA tour continues with a bakery classic at the Yokohama Country Club in Japan topping the leaderboard. A three way tie between Michael Brennan, Zach Bosu and Jacob Bridgeman ends at 13 under par, and they're followed by Adam Scott at 12 under David and Christina, over to you. All right Lisa. Thanks, Lisa. All right. U.S. stocks finished the week at near record highs as concern over an AI bubble seemed to fade. All the major indexes were in the green on Friday, with the Nasdaq posting its fourth straight week of gains. However, there are some cracks in parts of the tech sector, with higher prices weighing on consumer behavior and a God who joins us now, chief investment officer at PNC Asset Management. Thank you very much for being here. Once again, I guess I could ask you about all of those AI stories in the newscast, which I found to be kind of alarming and might be you just kind of sit down. And then Lisa comes on telling us that the AI spaces are swatting and filing fake visa. Another way to put that aside. Amanda, nice to see you. Uh, here we are on the precipice of earnings season, and I know that in quarters past, you have been quite bullish about what we've seen in earnings. When you look at what we can expect here in the weeks ahead. What stands out to you? What are you watching most closely? Well, it's great to be with you both. Thanks so much for having me this morning. I'm excited for earnings season. And yes, I have been bullish the last few quarters on, uh, the underlying fundamental strength. I continue to believe that is underappreciated in this market environment. It's an unloved market. Um, it feels like I can't get no satisfaction. You know, that one hand. Uh, uh, I had to go there. I had to, uh, but I think, you know, fun musical references aside, the fundamentals for Q3 look great. I mean, we're seeing pretty significant breadth in terms of expectations. It's not following, you know, price returns. Breadth has actually narrowed a lot. But I think we're going to see a really strong result come out of Q3 earnings season for the S&P 500. And I do think it will be enough to get this market rally re-engaged and get maybe the bears, uh, to the references. I love it from a Steelers fan. No. Maybe to this side. Very good. Shoot. You want to be excused? So I did want to ask you. I've heard some rumblings that when we're talking about tech stocks, the mag seven is really not a thing anymore. It's really not indicative as a whole of what people like you are actually watching in the market. What's your take on that? Is that kind of unexpired term and where are you really looking to see the indicators of that sector. Well it's it's great. It's a great phrase. I think it's going to continue to have some level of legs to it, but I'm not sure they're quite as magnificent as maybe they once were. Um, and that doesn't mean that the cycle is over or their leadership position is necessarily going to change in a material way. But what we really want to see is breadth, um, and use cases beyond the Magnificent Seven. Right. The very narrow, myopic focus on one name or even seven names as it relates to this AI innovation cycle, has to come to an end, right? In order for this to really drive the market. Drive profitability, drive even economic growth. We really do need to see an expansion and use cases, and we just haven't seen a lot of that yet this year. So for me, in Q3 earnings season, I'm definitely going to be paying close attention to how our company is actually starting to incorporate this. What do the revenue streams look like? How is it going to change the margin and profitability profile of the market going forward? Regrettably, I'm on the couch. I can't get to the iMap function on the terminal to look at all of those different sectors. When you do, do you see that breadth in each of those sectors or any sectors that you're worried about as we approach earnings, earnings season? I don't know that there's any particular sector that I'm worried about per se. I just think we've been sort of noticeably waiting for, and it's been absent in terms of the commentary on how the follow through, uh, is going to come in terms of all of this I investment, you know, investors are still Really skittish about all the money that's going into building out the infrastructure. And when that return on invested capital is actually going to come back to us. We haven't seen much of that yet. And it's not specific to one sector, one industry outside of, again, like The Magnificent Seven or those that are are really leading the charge here. So I'm not I'm not particularly worried about one sector. I'm more just maybe a little bit anxious waiting for, you know, this breadth to start expanding. It's going to happen. It's not that it's not going to happen, but I'm notoriously impatient, as are most investors. You know, when you look at the economy as a whole, you write that consumer spending continues to be the workhorse despite high gas prices. And despite this kind of morose consumer sentiment, people are still spending. How do you reconcile those two factors? We're all miserable, right? If you look at every survey now, you're talking, my listeners nodding for those are not going to be okay. Yeah, we're we're all miserable and yet at the same time. So yeah, no matter how you slice and dice, spending it continues to be really strong. Quarterly retail sales, you know, monster numbers back to school shopping. Great. It sets the stage for, you know, strong follow through into the holiday shopping season. Even when you shorten up your line of sight and look at weekly Johnson, Redbook, uh, data, it's still moving at a pace that's ahead of inflation. So we continue to spend. And maybe it's a function of we're all miserable, so spending makes us feel better. I'm not I'm not sure how to reconcile it, but it's very interesting that the hard data, whether you look at retail sales data and just economic leading indicators and data, it's all really strong. And at the same time, the soft data, the sentiment survey related data is incredibly weak. It's a very interesting, dynamic and hallmark of the cycle. Amanda Christina was adamant that we talk about the bond market. She said, we have to we have to talk bonds with Amanda Gordy. Um, let me ask you about what we saw in Europe. I think this is so fascinating. The protests that we've seen in France is that country deals with a lot of social pressure, which can, of course, kickstart the government having to borrow more, to do more. And we get into this kind of difficult cycle for for a government. What is what's happened in France. Tell us what how much is it a cautionary tale about what's happening here in the US as we've seen yields really spike here in the last few weeks. It's a great question, a very riveting topic for a Saturday morning, no doubt. Yes. Um, I mean, I, I, you know, I'm not convinced that it is a harbinger of things to come here in the U.S.. I think it just reinforces, at least for us, in terms of our tactical positioning. We've been underweight, developed international aka Europe for for quite some time. And I think it's just very much a reflection of the fiscal challenges that exists there. And when you see rates move as fast as they have, fast and furious moves here. Right. And the pressure on rates moving higher from here, I think will continue, maybe not quite at the same pace, but it's going to continue. Those weak links start to show themselves pretty quickly. So, you know, it's obviously something we're paying close attention to. But I think it sort of reinforces our thesis that that's probably not the right place to be overweight. Um, in a macro environment that's changing so quickly, like the says. But overall, you write that your current playbook is to still stay U.S. overweight, because 31% earnings growth in 2026 is just pretty much the best deal you're going to get across the globe. That's absolutely right. Yeah, it's hard to bet if for all the challenges we may have here at home. Right. And sentiment being so negative, when you look at, uh, the, the, the universe really, um, it is by far the best house on the global block. So we are definitely U.S. over international and international from a positioning standpoint. We do see some opportunities in emerging markets. So I'd go em over developed international. Um, but you know, it's very hard to bet against such a strong earnings growth backdrop not only for this year, but also for next year. And yes, I know everybody's talking about a peak narrative. Right. But 15 to 7017% earnings growth for next year is really strong. And it is really, I think, good enough to keep this market rally engaged. So um, I'm staying the course here uh, in terms of being overweight equities in this environment. And it's always good to talk to him into either pop culture allusions, flying, Rolling Stones, Mike Ditka, SNL he was fabulous and furious here in the bond market. Amanda got it. Thank you very much. Appreciate your time. Thank you Amanda. All right. Coming up. We've got a mystery in Siberia and questions about the plague. That's right. The latest on the investigation after a lab worker died of unspecified pneumonia. Coming up next on Bloomberg this weekend. Welcome back to Bloomberg this weekend, I'm Christine Ruffini with David Garrett. This week, the investigation continues into the death of a 28 year old lab worker in Russia who died of severe pneumonia after local Russian media reported that she may have been exposed to the bacterium that causes plague. After breaking a test tube at her lab. Now, that is unconfirmed at this point. Most recently, Russian authorities said they had completed precautionary measures at after nearly 5000 laboratory tests found no dangerous pathogens. Joining us now is Doctor Peter Hotez. He's the dean of the School of Tropical Medicine at Baylor University. Doctor who is great to speak with you. So many of us relied on you during the pandemic, the Covid 19 pandemic, to explain the science and what was happening epidemiologically and in terms of public health response. Uh, I think a lot of folks here are perhaps rightly nervous about what's happened here. And I wonder sort of what counsel you would give them in light of these news reports, in light of how little we know. We don't know the full story of what happened here. How concerned should we be about a potential outbreak here? Uh, yeah. Let me let me give you some context. So, um, this institute is a fairly old institute. It's been around almost 100 years, and it was set up, um, at a very strategic location north of Mongolia in the Central Asian steppes, for a very good reason. It's one of the few places on our planet where there's naturally occurring plague circulating among animals, uh, among small rodents, marmots, durables, um, and in fact, some. There's good evidence to suggest that the Black Death, the bubonic plague of the 13th middle of the 14th century, actually began in the central steppes of Asia, probably a few hundred miles west towards Kazakhstan. So that's the reason why the institute exists there to study plague. Then that's point one. Point two. Then you have this individual, this tragic story of a 28 year old who who died of pneumonia. And it's well known that bubonic plague has another form called pneumonic plague. And the thinking is, well, perhaps she died of of of plague. Pneumonia. Um, and therefore there was a big effort to, uh, identify any of her contacts. And ultimately 200 individuals were either placed in quarantine or placed in medical observation. We don't know if they were put on antibiotics or what other measures there were and who did. The Russians do have an old school vaccine and who was vaccinated, who wasn't all all making sense. The part that's unfortunate was the Russians did not abide by international health regulations to report this to the World Health Organization. Um, and the W.H.O. found out about it only through um, media reports. So it raised suspicion that perhaps the Russians are doing some kind of cover up or not being transparent. And, you know, we still don't have the full story. And so people start assuming perhaps the Russians were modifying the plague bacillus to make an antibiotic resistant, make it into a bio weapon, um, or some other untoward activity, although there's no evidence for that. So that's a very long way of saying there's more we don't know than we do know about this particular story. And it's interesting, cause a lot of the reports were actually from local media in er, cooks. And when you looked at the national newscast, this was this is hardly mentioned, even though you had the Russian foreign minister, the commenting it on the record. Can you explain to us the difference between pneumonic and bubonic plague and why you have to catch pneumonic plague so quickly, or it can turn fatal in a matter of days? I think I was reading. Yeah. That's right. Well, a bubonic plague again. That was the the cause of the Black Death and the plague of Justinian in the, in the, in the sixth century, um, that's transmitted, uh, by, uh, a flea, uh, by an infected flea that, uh, transmits it from rodents to to people. Um, in pneumonic plague case, you can either progressed to pneumonic plague after you have bubonic or or it can be from individual to individual. And the problem there is it's a very short window period from when you're exposed via the aerosol route to you get pneumonic plague and, uh, just a couple of days. And not only that, it has an even higher mortality than bubonic plague. So as bad as bubonic plague is, pneumonic plague is essentially 100% fatal unless. Unless you're vaccinated or treated with antibiotics. So that's where the panic is, is that this could be spreading via the aerosolized route. The good news is that if this really was pneumonic plague and it was spreading through the population, it's not subtle, right? It's usually within a couple of days where everyone is getting sick and dying. And clearly that's not happening unless there again with there's some issue around transparency. How about a minute left here? You mentioned the W.H.O. finding out about this. Uh, a bit late. And you'd think that if there's any lesson to be learned from what we've experienced over the last few years, it's that celerity is important. Move quickly here to to get this information out. Um, in the minute we have left. Do you feel confident now that the kind of broader global public health apparatus is getting some of the information that you say has been absent here over the last couple of days? You know, I think the best thing that could happen is that the Russians invite the World Health Organization to come in and do either a parallel investigation or an independent investigation, uh, to put all this at rest. And then the other problems on the US side. We do not have pandemic preparedness for plague. We have no vaccine stockpiled, no vaccine even made the old school vaccine from the 1950s and 60s. That's gone. That's all expired. And there's been no effort to make next generation plague vaccines, even though it would not be that difficult. So it's another reminder that we've really let our guard down in terms of bio preparedness in this country. All right. Doctor Peter Hotez, thank you so much for joining us with the Baylor College of Medicine and the School of Tropical Medicine, of which you are the dean. We appreciate your insight there. Fascinating piece by our colleague Laura Williams, who writes about public health and other issues for Bloomberg Opinion, writing about how her real fear here is what lies beneath the permafrost, indicating that because of climate change and global warming. Yeah. That's melting. Uh, a mummy was unearthed, I think that she noted here that, uh, this is incredible. I mean, I was supposed to some of these. Yeah, you can take boats to some of these places and just basically pulled them out of the permafrost because it's melted so badly. So if you're looking for fodder for insomnia, you read more. Williams's piece, which again indicates this might just be the tip of the iceberg in terms of what might be unearthed in that from frost here in the years ahead. All right. And on that cheerful note, we're coming up on 9 a.m. here in New York. The next hour of Bloomberg. This weekend starts right now. Take us. Welcome to Bloomberg this weekend live from New York with David Gura, Christina Ruffini and Lisa Mateo. The latest headlines, analysis, big interviews and the stories that hit home on your days off. Welcome back to Bloomberg this weekend, coming to you live from our world headquarters here in New York. I'm Christina Ruffini. I'm David Gura alongside Lisa Mateo. It is Saturday, October the 10th. A lot of news this morning focused, of course, on that storm that made landfall early in the afternoon yesterday, now making its way through the central part of the country, causing a lot of rain, a lot of high winds. Keep you posted on that as this the day goes on here. And also looking at the president's announcement, Christina, that Russia is releasing a not insignificant amount of diesel here, something that the president hopes is going to help him and the fortunes of his fellow Republicans here as we get to the midterm elections, causing a bit of a diplomatic storm as well. But first, we're going to go to Lisa Mateo, who has the headlines. Lisa, let's get to that hurricane. You spoke up, David. Hundreds of thousands of people without power in Alabama, in the Florida Panhandle. That's after the first hurricane of the Atlantic season crashed into the Gulf Coast. What is now Tropical Cyclone Isaias also flooded roads, downed trees and out the storm. It made landfall last night near Destin, Florida, as a category two hurricane. They're also watching two other storms this weekend heavy rains from Tropical Storm Rachel impacting parts of Southern California. Residents are using kayaks, paddle boards to navigate the flooding and Hurricane Simon approaching Mexico's coast and its busiest Pacific port. It's strengthened to a category four storm and is expected to make landfall later tonight. President Donald Trump says he's working with Vladimir Putin to release Russian diesel supplies into the global markets. The announcement comes as the white House looks to tame soaring fuel prices ahead of the U.S. midterm election. Well, with boxing legend Mike Tyson by his side, the president spoke to reporters outside of the white House yesterday before boarding Marine One for a trip to Syracuse, New York. He called that agreement a big deal. And I want to thank President Putin, to be honest with you. We have massive amounts of oil being coming into our country, and it's diesel, which is what we want. So thank you. President announced a series of cargos beginning this month, totaling about 13.5 million barrels. Ukrainian President Volodymyr Zelensky and Senate Democratic Leader Chuck Schumer say the deal will prolong the war. Meanwhile, a day after the deal was announced, officials say Russian aerial bombs killed 12 people and wounded at least 14 in Ukraine. President Zelensky had warned the deal would allow Russia to kill more and wage war for longer. And a major fire has been reported at an oil loading terminal in Russia overnight and reported drone attacks. Russian regional authorities confirmed the fire but did not confirm the damage to the terminal. Ukrainian military officials have not claimed responsibility for the reported attack, and the European Union plans to use safeguard measures to cut imports of Chinese hybrid cars by half. Sources told Bloomberg the measures could be implemented by December and would likely take the form of tariff rate quotas to slow access flows. The EU trade chief said it would cut the flow of hybrids into the EU to about 400,000 per year, from around 800,000 that are expected in 2026. So big difference there is to learn more about the Paris Car Show. I think it is this week and they will get some more. I know a lot of those Chinese automakers are going to be there, so we'll see what other announcements come from that. All right. Thank you Lisa. Ukrainian President Volodymyr Zelensky is speaking out this morning on the heels of that white House announcement that the U.S. plans to import diesel from Russia. Moments ago, Zelensky posted on every additional billion dollars they, meaning Russia can earn from exports, will be spent on nothing but sourcing and importing critical components and equipment to manufacture weapons, upgrading showerheads, producing missiles and recruiting even more mercenaries to fight at the front. The president continues Russia's choice is war, and they will be ready to end it only when they feel that their ability to drag the war out is diminishing. Unfortunately, he continues. The signals Russia received yesterday were entirely different signals, suggesting that it could simply keep attacking. He also says Ukraine needs strong signals from the U.S. and Europe, while saying he's spoken with French President Emmanuel Macron. Joining us now is Chris Kennedy, our economic statecraft lead here at Bloomberg. Chris, you put out a note on this in short order after this announcement from the president. And I want to start to sort of with the deficit the U.S. faces here. The U.S. consumes 3.7 million barrels of diesel per day and produces about 5.3 million barrels per day. You note with that in mind, what kind of a difference is an announcement like this likely to make to the pain that so many people who rely on diesel in all kinds of sectors in the U.S. have been facing here? Yeah. Thanks, David. The short answer is not much. So if we look at these projected, you know, releases from Russia, uh, the President Trump's true social post nodes, 500,000 tons in November, that's equivalent to about one day of U.S. diesel consumption. So it's not a huge amount, and we don't expect it will have much of an impact. And that's putting aside all of the legal and logistical challenges of getting, uh, Russian diesel to the US. Chris, there's two issues here, right? There's this promise of this certain amount of quantity of diesel. But then Russia has also self-imposed an export ban for refined petroleum products because there was a shortage within the country after Ukraine successfully struck a lot of their refining facilities. So on the larger picture, I mean, you write that Russia's supply is large enough to matter. It accounted for about 11% of global seaborne diesel trade in 2025. But that's not the number we're talking about here, is it? No it isn't. And the reality is Russia still faces real constraints on its refining capacity. About 50% of its diesel refining capacity has been hit by Ukraine, and that refining capacity can't come back online as quickly because of Russian sanctions. Uh, Ukraine has successfully targeted parts of these refineries for which parts are not necessarily readily available. So we do think that over the past few weeks, we've seen Russian diesel, uh, stockpiles start to rise again. And we, as you noted, we put out a note that was an update to a note earlier this week where we talked about this possibility. We do think they have some space to export, but not at the levels that we saw. Uh, you know, last year before Ukraine really, uh, accelerated its campaign on Russian infrastructure. Uh, I'm going to have you assess whether or not this is, in fact, a birthday gift to President Putin, as you look at it. So, yes, there is this the the transfer of all of this diesel. There is also the waiver of these sanctions that have been in place. Um, okay. You do have to say if it's a gift or not, but but how good is the good news here that Russia's received here from the president? United States? It certainly is not bad. I think the real the real thing is even if, uh, you know, we saw, as you mentioned earlier, uh, Ukraine has hit another Russian oil terminal today. Even if this doesn't come to fruition, Putin is now in a place where he can call up President Trump and say, hey, sorry, we can't get that diesel to you because Ukraine has continued its attacks. And so this is a really difficult situation, uh, for President Zelensky. And, you know, they'll be a difficult choice, I think, to whether or not to continue this successful campaign on Russian refining capacity that has created real shortages in Russia and put pressure on Putin as he continues to wage war. Because I saw you tweet about this soon after it was announced saying, it seems like this. This might not be legal or to David's point. Do they have to issue a sanctions waiver against themselves? I saw the president of the Cato Institute respond to your tweet saying Congress just passed a law giving President Trump the power to impose new tariffs on major buyers of Russian oil and gas. Can America tariff America? Yeah. So a couple of laws. Less than a month ago, the president signed into law the Lindsey Graham sanctioning, uh, Russian Oil Act. I believe I might have just. Right. That's a little bit close, I think. Yeah. Uh, you know, allowing the president to impose new sanctions and, uh, tariffs on countries that continue to purchase Russian oil. So obviously this is in conflict with the spirit of that. But more importantly, in 2022, the Congress passed a law called the ending Russian, importation of Russian Oil Act. And you know that explicitly says the US shall not import any oil or petroleum products from Russia until such time that Russia has stopped its war with Ukraine, withdrawn troops, and the president has certified that to the Congress. Now, not a lawyer will defer to the lawyers on the, uh, the authority that the president has to essentially certainly go against the spirit of that law, if not the letter. But there are clearly legal questions about whether or not the president and the Department of Treasury can take the actions that they've taken over the past day. Um, I saw on a piece that Bloomberg put out this question raised by an analyst of whether Russia could actually, uh, refine and export as much diesel has been called for here. What do we know just about the condition of that refining capacity within, uh, Russia, as you rightly bring up just a moment ago, we've seen still more attacks from the Ukrainians. And it seems like President Zelensky, um, isn't especially open to President Trump's insistence that the attacks on energy infrastructure in Russia end, um, is Russia capable of producing and exporting as much diesel? Here is the US once indeed thinks it's getting its. We don't have the best data on this. From what we can tell, Russia's refining capacity has been severely hit, and we've actually seen Russia pick up its own imports of diesel and other products over the past couple of months. Uh, but as I mentioned, you know, we have seen the way in which, you know, we don't need to get into the technical, uh, details of refining, but basically every barrel of oil produces about, uh, a third of a barrel of diesel and two thirds of gasoline. So when you ban the export of diesel, you create these sort of structural imbalances that distort the market. And that's creating problems in Russia. So we do think that they are currently building up some diesel stockpiles. They could probably export that. But again, to go back to the top of the segment, we're talking about a very small amount of diesel in the grand scheme of things. November 500,000 tonnes. That's how much the US currently consumes in a single day. And Putin's offering to to export that over the course of a month. So it's not a huge material shift. All right. That's Chris Kennedy our economic statecraft lead here at Bloomberg, again writing recently about that announcement from the president. You can find that on the Bloomberg terminal. Chris, thank you very much as always for joining us right here. He says slammed the Gulf Coast overnight near Destin, Florida. That powerful storm causing severe damage on the coast, as well as disruptions in Gulf oil production at a time when energy supplies are already strained. That's right. Earlier this morning we spoke with AccuWeather. Bill while down on the Florida Panhandle about the threat facing communities with Florida's building code. Right. That has really evolved over the past 20, 30, 40 years. Many of these buildings built quite sturdy now to handle these intense winds. So yes, we are seeing damage. We are seeing issues here. But if this level of a storm had hit another state, uh, you know, parts of Texas, Louisiana where we've covered a lot of storms, you would be seeing more widespread damage. So it is just important to put that in context that, yes, these 100 plus mile an hour wind gusts did some damage here. If it had hit a different region that didn't have is strong building codes, you would be seeing a lot more visual damage right where I'm standing. All right. Senior insurance equity analyst Matthew Poulsen is here in the studio. That was so interesting to me because when you do storm coverage, one of the things you have to do when you're finding a hotel is ask them what it's rated to. You're going around asking days in there, you cat four. You can't five. When you look at storms like this, what are the biggest risks to property? Yeah. So when we look at storms like this, we typically will look at historical analogs and say, okay, what what storm hitting a similar region of a similar strength. And what were the losses there, uh, to impact the insurance companies. If you look at this so way back in 1995. So I was in high school. Christina was also, you young. Not at all. Or young or not at present. Yes. Um, so that was hurricane Opal. Uh, hit in a very similar area that caused losses of about $2 billion. Inflation adjusted. That is a relatively mild hurricane. So I was doing some work this morning and said, okay, that's 1995. Property values increased. It was like almost like eightfold since then. So maybe the losses were a lot higher. But very interesting point in that prior bit was the, uh, building standards have increased significantly. So there's these kind of counterbalances. So what we're looking at is probably losses in the single digit billions of dollars for this event. Um, take us inside the palace of that household on a weekend when there's a storm like this hit. And you mentioned you were up early. Uh, you know, your most recent, you know, it's it's too early to kind of assess what the damages is going to be. What do you find that out customarily, when do you kind of find out the way that this is going to put on this insurers? I send my three daughters out to the storm region and they they assess it. Um, No. Um, well, I was actually coincidentally in Destin, Florida earlier. That was. Yeah, lovely area. It was great. Nice beaches. Um, and I could see the build up there, but more directly to your to your point, um, you know, we are what will happen as we make these kind of high level look down analysis. And we're looking at it from the perspective of how does this impact insurance companies. Obviously there's a human element to the whole thing. My job is looking for the insurance aspect. Um, so we do that top down that I had kind of described. What you will see probably mid next week is there is companies that essentially do this for a living. They have satellite imagery. Uh, they, they really analyze the whole region and they'll come out with much more granular numbers. Uh, our numbers tend to be pretty close to what they do. So, uh, I think we'll hear that those mid-single digits later in the week. When you look at the hurricane season that we've had so far, and even last year, they were they were pretty mild. And I feel like that came on the heels of some really bad seasons. What does this mean for the insurance industry as a whole? Do they get time to catch up in these seasons when there's less damage? Does it keep the prices slightly lower, even as other factors, including, you know, just rising tides and the price of houses are making it more so they do. Yes. An interesting stat. This is the latest first hurricane of the Atlantic season since 1905, since we started tracking. Yeah. So, uh, this was a very mild hurricane season. The last season was mild as well. There's the El Nino effect, so I'm just an amateur meteorologist, so I'll explain it briefly. Is warmer winds in the Pacific? Uh, drive trade winds kind of across the globe. Those hinder Atlantic hurricane activity. Okay, so that's what's been happening this season. Why we've seen this, this kind of late storm. Uh, and to the point, insurers are building up a lot of capital, the reinsurance industry, which is insurance for insurance companies. Those are actually seeing kind of abundant capital. So the prices, they're going down a lot. I wouldn't get your hopes up on your home insurance prices going down just yet, but those companies are doing actually well this year. On that note, last question here. If I work my life away for a time, sure, down in destined to quote the great Taylor Swift and Florence Welch. Um, can I get insurance for it? How hard is it to get insurance? So it's it's gotten easier. So we've had actually the rare case of kind of government and industry coming together and working out a win win solution. Uh, there was a lot of fraud in Florida, uh, pertaining to homeowner's insurance. And what happened was the state actually put in a bunch of reforms that have so far worked fraud in, like, framing for things that hadn't happened or FEMA fraud or all of it was kind of more exaggerating things that had it. Okay. So your roof gets damaged, you have a contractor come out, he gets assigned the benefits. He then kind of overstates all the damage, gets you a new roof, and a cost of a claim goes up over 100%. And that pushes up costs for everybody. The state came and made a bunch of reforms and they have seemed to work. We haven't been tested by a major storm since that that has happened. But, uh, seems to be working so far in Florida at least. So you should be able if you keep working, you should be able to get the results, if you like. That illusion that Florida. Well, Taylor Swift, you know, we're going to talk about your future employment here. Not that I have any say over that whatsoever. All right, Matthew, thank you so much for coming in and watching all those numbers. And we'll have to come back once you've got your aggregate show back. Once the daughters come back from the scouting trip to see how it's gone down. That's it. Tell us all the brood is back. Um, preciate. It does seem like, you know, we're going to see what happens today with the damages. That assessment comes in as the storm moves through, through the country. But, um, it does seem like what's worth underscoring here is this drought that you were talking about a moment ago to lean on that word. But we haven't seen these hurricanes on the East Coast here for almost two years or so. And time to catch up. No, I mean, especially because we watch hurricane coverage and sometimes we have to go out into it. And there has been a bit of a low after it just seemed like non-stop. But it's interesting. It does. As mother was telling us, give some time, a little bit to recover and hopefully it gives a time for those reforms she was talking about to go into place before. They're really, really tested and wild to see how much has been happening in Hawaii as well, which is kind of anomalous, which is really rare because you have friends who live there, and they just shocked at how much they've been in the crosshairs of strong weather this year. All right. Coming up here, a key indicator of the strength of the economy, consumer sentiment hitting a five month low, as measured by the University of Michigan. We're going to speak with Doctor Joanne Shew. She's the director of the University of Michigan Consumer Sentiment Survey. That is straight ahead on this weekend at Bloomberg Radio Television, Bloomberg.com and the. Stay with us. Thank you for joining us live on Bloomberg this weekend. I'm Lisa Mateo. Let's update you on today's top stories. Authorities in the United Arab Emirates say the flydubai co-pilot intended to crash the plane into Tel Aviv airport. The UAE's top prosecutor said the Omani national had familiarised himself with the route on the previous flights and had aimed to cause maximum casualties. Drawing inspiration from the September 11th attacks. Cleanup in southern Panama continues after two powerful earthquakes and multiple aftershocks prompted evacuations yesterday. The 7.7 magnitude earthquake toppled buildings a second 6.6 magnitude quake that followed. There have been no reports of casualties. The National Weather Service has issued Astronomy Threat for several countries in New York. Hundreds of protesters gathered in Foley Square last night in front of the federal courthouse in lower Manhattan. Demonstrators, they expressed their anger of the ISIS presence in the city after immigration officers shot a man with his young son in a vehicle on Thursday. Department of Homeland Security Secretary claims federal officers were not aware the child was in the car, and that Oscar Bengel was aware he was being stopped by Ice, and Vice President JD Vance expressed doubts over the Pentagon's plan to live streamed the Fort Hood shooter's execution. When asked about it yesterday, the vice president said, quote, I don't know that that's actually going to happen. Now, President Trump also told reporters that his administration still had not made a decision to broadcast it. Former Army Major Nidal Hasan was convicted of killing 13 people in a shooting spree at the Texas military base back in 2009. JD Vance, which is why you're seeing his photo up there if you're watching, said he will not be watching. Or at least thank you very much. U.S. consumer sentiment fell in early October, and views of the current economic conditions hit an all time low as inflation weighed on U.S. households. The University of Michigan's preliminary sentiment index decreased to 46.3. That is the lowest reading since May, according to the survey released Friday. That was below the median estimate of 47.6 in a Bloomberg survey of economists. All right. Joining us now is the consumer survey director for the University of Michigan Institute for Social Research, Joanne Schuh. thank you so much for joining us. I've just we're perpetually confused by consumer sentiment versus an economy that seems to just be chugging along. And we were just talking about people are still spending. Why do they feel so bad about it? I mean, customer sentiment was little changed this month, inching down about 1.8 index points from September. Why do you think that is? Well, it's not really that mysterious why consumers have been feeling so terribly about the economy since the pandemic. Consumers have been very clear that the top factor weighing on them is the persistent pain of high prices and the erosion of their core, of their purchasing power through high cost of living. So this has been the case for several years. And this year, with the, uh, escalating gas prices as gasoline prices, fuel prices, um, consumers don't see a whole lot of difference between this month and last month, but they're really worried that those elevated fuel prices, uh, are here to stay for the foreseeable future. Joe, and talk a bit about the work that you did with this special report that came out yesterday on gasoline prices and expected consumer spending. You really took a broad kind of historical view of the way this has played out in the past, when we've seen spikes in energy prices, the likes of which we've seen here over the last few months, maybe we can start before we get into the history, just with the top line there in that the way that higher energy prices are beginning to shift Americans appetite and indeed ability to make some of the purchases they might have planned to. That's right. So we've been we've asked questions periodically, uh, historically, on how people are planning to deal with higher prices. And what we are seeing is that there's a good chunk of people who are, uh, planning to scale back their spending on items that have had particularly large price increases. Um, but of course, you know, gas is one of those prices has gone up a lot, and a lot of people just don't have the ability to scale back their driving, especially if they're driving for work. One thing that's really interesting is if you look across wealth, there are actually quite a bit of difference in spending intentions, um, by wealth and income. Um, if you are wealthy, if you're being propped up by the stock market, you're not planning to make too many changes to your spending in response to these, uh, elevated gas prices. But for lower income, lower wealth consumers, uh, they feel like they have no choice but to make some alterations. Are you seeing consumers across the board or either, uh, in those two categories, being more willing to take on debt than we had in the past? Um, overall, we're seeing a reluctance to take on debt. Um, unless it is absolutely necessary to do so. Uh, so, you know, if we we have folks who, you know, don't feel like taking on debt is a good idea. But at the same time, if there are budgets already stretched, uh, they don't really have savings to tap on. Um, in this high price environment. Um, then then a lot of consumers feel like they need to, but they don't think it's necessarily a good idea. Let's go back in time, as I suggested that we would. When you take a kind of broader look at that history, and we have seen spikes in the past. Um, how is this played out then and how illustrative, how useful is it to look at those analogues now, how different of the circumstances today versus what we saw back then. So we started asking questions like these in the late 70s, early 80s. Um, and what's interesting, uh, at looking at this historical period is, of course, we all know that inflation was objectively, uh, considerably higher back in the late 70s and early 80s. Uh, we not only had high gas prices, but there was gas shortages. There were lines around the block, uh, to to fuel up your car. Um, but the views around inflation were a little bit different back then. And part of the reason is that, um, in by the early 80s, consumers had experienced multiple episodes of inflation, inflation going up, coming back down, not all the way, and then going back up again. Uh, over the past ten, 15 years or so. Um, and that's very different from this current environment where we had a spike in inflation or a surge in inflation in 2022. It came down. And this is our second, I would say, episode of high inflation since the pandemic. Uh, so consumers really aren't used to it yet. Uh, they're still really, um, not nostalgic, but really thinking about the environment that we had prior to the pandemic when we had an unprecedented long period of economic expansion. Um, after the Great Recession, um, you know, almost ten years of low inflation, uh, low interest rates, low unemployment. Um, and I think for a lot of consumers, that felt normal. Um, and with the disruption of the pandemic, not just the economic shutdown, but, but also the inflation that, uh, that came after that. Um, it's it's been a big transition and consumers haven't really quite adjusted to that yet. Do you ask, uh, you know about political sentiment, too? Do you see trends in different political camps and how people feel about the economy, depending on how they're voting at the end of the survey? We do ask people if they identify or affiliated with one political party or another. But we don't ask anything about voting behavior. Uh, one thing I can tell you, though, is that people tend to have more favorable views of the economy, uh, when their party is in the white House. And if their party's not in the white House, they tend to feel more poorly about the economy. But independents, they are always in the middle. And what's really interesting is if you throw out all the partisans and you only look at the independents, their numbers are exactly like what we see. Um, for, for the national trends. So our national trends are low readings. They're not really being driven by one part of the political distribution. Um, but one thing I'll note is that if you look over the last year, um, it's actually Republicans that have had the strongest decline in sentiment or one of the strongest declines in sentiment. Independents and Republicans have had really sharp drops since January. Democrats have drop it. Not nearly as much. Um, and I think this is in large part due to, uh, the Iran conflict, the elevated extended period of high gas prices. And people are just worried, particularly the Republicans, that it's not going to end anytime soon. And as you know well, I think there's a real fear among policymakers about inflation expectations, how anchored they are. And I'm curious, when you look at the data that you've collected and you've processed sort of what that tells you about how consumers are feeling about the prospects of prices coming in some. Yes, it's the Fed's work here to get it back to its 2% target and all of that. When you look at this granular data that you have about how people are feeling, about where prices have been and are going, um, what does that tell you about expectations and how might that be useful to policymakers here in the months ahead? Uh, so we have about 59% of consumers spontaneously telling us that high prices were a drag on their personal finances. And when we ask consumers directly, is inflation or is unemployment the bigger challenge for the economy? Uh, we're having a growing share telling telling us it's inflation. That's the one that they're worried about. And when we look directly at inflation expectations, both over the one year as well as the 5 to 10 year horizons, both of those ticked up this month. Uh, so they're not moving in the right direction. Um, and there are ample for both measures. They are quite elevated relative to what we were seeing just in 2024. Not not that long ago. Uh, when, you know, prices, of course, were still high at that time, inflation was on its way down. Um, so consumers are not feeling optimistic about, uh, about inflation. Uh, they do expect interest rates to continue rising. They have absolutely notice that interest rates have risen already since the last FOMC. Uh, we have buying conditions for major purchases like cars, durables and homes, all, uh, near historic lows on the basis not just of high prices, but increasingly because of high interest rates. So they are consumers are broadly expecting interest rates to rise. To combat this, uh, growing inflation. And it's great to speak with you, Joanne, of the University of Michigan. I should say we talked to Justin Wolfers last week. There was a Michigan football game today. There is a buy. Grateful for you making the time perhaps that is opened up here as a result of there not being a game that Michigan is playing today. But she heads up the consumer surveys work there at the University of Michigan. And Christina, very interesting. Here we see consumers trading down increasingly from brand names to generics, and I thought that was kind of fascinating here, substituting, um, their expenditures for food and other items in that way. So a lot of interesting detail, again, in that special report that Joanne and her team put together. One of them, big generic product by Herbert. All right, OpenAI is expecting to hit some $70 billion in revenue by the end of the year, according to people familiar with the matter. Major AI companies are quickly piling up cash ahead of those expected IPO. We spoke earlier with journalist Kevin Roose about his new book, tracing the history of AI development, its developers and yes, the challenges of regulating that. They think this technology is going to be built whether they build it or someone else builds it. They think it is inevitable. The recipe is not that hard. You get a bunch of data and a bunch of compute and some algorithms, and you throw it all into a neural network and out comes intelligence. And so their fear is that if they don't build it first, if they don't get to this threshold of AGI or ACI first, then China or their rival down the street, or someone they really don't trust We'll do it first. And that is the the sort of fear motivation in addition to like the you know it's all going to be utopia motivation. Kevin it's a small group, as you've pointed out now, we have policymakers and politicians interested in the prospect of regulating this. And we've had a lot of conversations with lawmakers in which we've asked, quite bluntly, is, is Congress equipped to do this? The answer is we do have a self-proclaimed high IQ president, but what is the barrier to regulating it? Is it momentum? Is it is it Congress's lack of desire to do it? Or is there really no way in which the government could, given the sophistication of all of us, have any hand in regulating this smartly? I mean, the government can do it. They just may not because they are stuck in spaces. They have failed to regulate every important new technology on a relevant timescale. I mean, think about it. Social media is now 20 years old, 25 years old, and we still don't have it's getting regulated through the courts. It's getting regulated through the courts. But but Congress has not passed a single law. So I think in the absence of strong federal regulation, we'll see some state level regulation. We might see some self-regulation among the labs. Um, but I'm skeptical that we're going to get some federal regulation. And in part, I think that's because the members of Congress do not understand this technology. I was just interviewing a member of Congress at a conference the other day, and I learned that in the U.S. House of Representatives, the only approved AI tool for member and staff use is Microsoft Copilot. I was going to guess Clippy, but it looks nothing against Microsoft. I'm sure it's a fine paradox, but like if you if that is all you're allowed to use, uh, you're not actually aware of what the technology can do at the frontier. Um, you need to be using the frontier models to understand what they're capable of. All right, David Gura, are you a bag man? I'm not a bag man. No, I have a Filson Attache. Wow, Tom Keene is very fancy for us. He carries around. He does. It's definitely a designer bag. I like a nice bag, but I don't. I'm not like crazy. I'm not gonna spend a crazy amount. But there's a man in New York who makes these bags by hand. He's a one man fashion brand. Designer Pierre Laborde is going to join us in studio next, talking about how he went from essentially this flea market on the Upper West Side to global fame and recognition and sell out, sell out lines of commodity at the right time. Thank you for joining us live on Bloomberg this weekend. I'm Lisa Mateo. Let's update you on today's top stories. Anthropic AI model apparently went wrong and submitted a fake tip to the Philadelphia Police Department in a homicide case. In a report, the company said its cloud AI model demonstrated four types of unintended behaviors The New York Times reported anthropic saying agents also submitted 20 visa applications through a form available on the State Department's website. OpenAI said that it has fired three safety researchers for a breach of trust. In a social media post, the ChatGPT maker said they violated clear policies of handling sensitive information. The researchers accused the company of putting its corporate interests before safety to golf, where the PGA tour continues with the Bay Current Classic at the Yokohama Country Club in Japan. Topping the leaderboard is a three way tie between Michael Brennan, Zach Beauchamp and Jacob Bridgeman at 13 under par, followed by Keith Mitchell at 12 under. And also some MLB playoff action tonight the Chicago White Sox they take on the Cleveland Guardians. It is game five in Ohio. That series is tied at two apiece. And attention Star Wars fans. A Darth Vader lightsaber used in the climactic duel in The Empire Strikes Back, where Vader tells Skywalker, I am your father. It is up for auction. Yes. It also used in return of the Jedi, is expected to fetch at least million. It is one of more than two dozen lightsaber props that are going to be up for sale. It's the ultimate Star Wars auction to be held at Heritage Auctions on November 12th. Christina, did you like that in person? I was going to ask you to come join me for this next segment, but after that, I might need you to leave the studio. Okay. All right. Come over here. I will. All right, look, if you're trying to buy one of his insanely popular bags and you log on to the website, you will be greeted with a message that says, we are truly grateful for the incredible response to our collection. Due to high demand, we have currently reached our capacity for new orders. Look, we've talked a lot about luxury retail and how high end designers are suffering from kind of this onslaught of sameness. Customers are increasingly looking for something unique and, well, real. So we are happy to have the real human being behind these really popular bags works of art here with us today, designer Pierre Laborde. So nice to meet you. Thanks for having me. Such a pleasure. I have seen these bags. I don't know if you've seen them. They have been absolutely everywhere. They have been all over Instagram. Every fashion girl wants one. They're really hard to get. Um, but there's this saying that it takes 20 years to be an overnight success. And that's kind of your story. You've been making these for how long? How did we get here? The experience? Well, actually, I, uh, studied fashion. And if I teach, then I used to make clothes, so it was not fun for me anymore then. So I went back to school and took classes on making handbags. Okay, then. So I found a. That was what I really love. And you're kind of good at it. Yeah. Then so I started like 1 to 3 bags. You know, it was selling in my place. My friends were supporting me and people were pushing me all the time to go out, and I always thought I was not good enough. People would never like my stuff except my friends. So yeah. Then one in, 1 in 1 word of mouth, then. So this is. Then I started going to the market. Yeah, yeah. You were selling them at the Grand Bazaar. For how many? For a couple. And for people who don't know, the Grand Bazaar is like this very cool, eclectic flea market on the Upper West Side. It's outdoors. It's pretty casual. Yes, for many years. Where are you doing? Actually, it's been over eight, eight, nine years still. Yeah, but when I started a it was very well for me. I was not selling anything at all. So really. Yeah. There were days, you know, go home with zeal and you're making them in your apartment, right? Yeah. Yeah. It's safe. He made it because I'm looking right here as a cowboy. This is cowhide mixed with leather high. That is a mixture of a different kind of leather stuff. When did it really take off? Was there one person who particular posted about your bags? Or was it like a word of mouth thing? I think it's, uh, about like two and a half years ago, some someone by the bank for me and I, I never thought, I mean, like 2 or 3 days after my Instagram and my website was going crazy, I did. I just thought, what's going on? Then she texted me and she said, oh, I posted, you know, the back of that purchase for me on TikTok. And it went viral. So it's just like all the, uh, almost like a mini only, uh, views and stuff. So you said you're making these by hand, right? Yes. Are you still because you have all these they're sold out. Like, do you have calluses on your fingers? Like, how are you keeping. Oh, yeah, actually, I'm still working from home in your apartment, right? Yeah. And so I have, uh, my family is still big then, so I have a studio, so. So I just. We were dead. So now I cannot make everything on my own. So I just hire some a few people like, say, 516, you know, people and somebody will help me with the email and all that kind of stuff. So I'm still that small. It's the things that I find so interesting about your box is they really don't look like anything. And as we talk about, you know, luxury fashion is having a bit of a moment where I was just on the Upper East Side a couple of days ago and going into all the stores, and frankly, it all looks the same. It's the same color palette because they're trying to reach such a large swath of people. That can be hard when you have shareholders, when you have all these parties who need and want to have opinions, is there? I mean, I know it's so hard being an independent designer, but is there freedom there? And is that how you've been able to establish that kind of signature style? Uh, I mean, freedom in a way. Design in my own way. Yeah. Like you can do whatever. Oh, yeah. Just selling you how to make your bag. That's what the joy that I have. Because, you know, I can do whatever I want. I can say I love colors. I get to mix all the colors that I want to. The next thing you know, you know all the design that I want to do. And, you know, most of the time when I'm designing in work, I don't think I want money. I just think about the art, you know, because my art comes first after money. Do what you love. And the money does come at a price. I mean, what's the price point for for winning bags? What's the range to actually run through? Like 360 to like 2000, I guess. And how long did it take you to make one bag, actually. Uh, one bag. I can make one back in a day, but, like, uh, in a week, we can make, like, 40, 50 bag. Yeah, but now with the high demand. So I cannot do the market every week. Yeah. So we do, like, every six weeks. And because we have a big following that people in our, you know, the together bank and Italy tickets. So because we don't want to chaos people just come in traveling and being able to get away. So what are your plans for the future. Are you going to scale? Are you going to license? Are you talking to bigger stores, bigger distributors. What do you want to do with this? Actually, I've been contacted by stories that I. For now, I don't think I'm interested. Really? You know. Yeah, I think I like the idea that uniqueness being unique and just still making things by hand because I don't want ever to do mass production. Is that's the reason why I went into this at first base. You know, I know it's going to take time for some, some people to get a bag, but it's better to have something unique, something different. So it's not out, you know, everyone has the same thing. It's. That was my idea. But do you think that's why people connect to them? Because they can tell that you put. I'm sorry, I don't know. But yeah, you put effort. Put your your heart into them. Yes, yes, yes, that is me. Even though like sometimes, you know, I spend all night designing, working and it's just like I find joy in doing it because I feel like whenever you do something you like. It doesn't matter how hard you know or the problem that's coming. And it's just think about your work. And probably that's why it also like everything that's happening, it wouldn't have happened if it wasn't like for the supporters, people who support my work. And I think it's a 5050 thing. So I do the work and they support me financially and emotionally. So if you work and people don't care about what you do, so what else would you ever expand like to something like belt or like anything? Are you thinking of doing something like that? You can belt. Oh, you're jumping up. You see, you're already on top of it. At least once it melts. I want all of the bags. Yeah. Unfortunately, once you bring them into the studio, we, by law, I think, have to keep all of them. That right. You know, you'll be allowed to keep everything, though. Thank you so much for joining. Such a pleasure. Thanks. I know that when you are at the Grand Bazaar now, it can take hours for people. People wait hours to see you. But I think the payoff is there and it's lovely to see such handcrafted things. And thank you so much. All right. So you think I you know what? I have to get into it because, like, I feel like it's all about like, are there compartments inside? Can I put, like, a phone in one pocket another. Can you. Can we, can we peek? Does it. Can it hold everything. Yes I if you even my snacks and everything. Because I carry a lot. Lisa does carry a lot of snacks. Yes. All right, stand by. Coming up after this, we're going to, um. You got to go back to the desk again because we're going to do the pointed news quiz. Oh, no. Look, this is the day. I am ready for it this week. David. Kara, I have studied. I am coming for you. You've had a good run, but I'm not allowing this anymore. Come back. Now that I've talked a good game, I'm probably going to lose again. But pointed this quiz straight ahead. Thanks for sticking with us. This is live, right? This weekend. It's time. You know, it's it's you. My name's Mary. Into the light. Blown by. So has the show. And lo, it is time for my favorite part of the show. You know, this used to not be your favorite part of the show. And then you started beating me routinely, and that I was resistant to this whole thing. And then I realized how much gratification I get out of winning week after week. And it's become essentially insane how he's being genuine. Like, yeah, yeah, actually excited. And Skip sounds like he's going to lift into Sunday's show. I feel like you're like a little kid hopping out of here. Oh my gosh. Yeah. Please send it in for a day. Pep in my step the point of news quiz. Let's get to it. Yes, I hope I beat you. You're going to do it. You're going to do it. Everybody play along at home, please. All right. And help out. Give Christina the vibes. Okay. So here's how it works. Let's see your penny by 55. Uh, three categories. Right I'm going to give those to you to second. You guys have your 30 chips in front of you. Place your bets after right now in some category. We'll see what you guys think about each one. And then you write your answers on the white cards and you'll flip them and we'll get right to it. All right. Let's start with the categories. Three of them. Yes three categories. First is protest okay. Second category is technology. And third category is investigations. Right. So how are we feeling on protest. Feels good on protest okay. Yeah. If you're less good on the guess she's not going to do anything out of the ordinary. Just ten, ten, ten. Fine. You know what they're doing. On how to protest anything. Well, you both doubled up on. Yeah, I did. Okay. Okay. You have none on technology, Christina. Right. And not investing. David I've done none on invest. Investigate investigations. Okay. Let's see. Here we go. Had the right strategy. Let's get underway. Let's get to protests. Since you both doubled up. Okay, I feel like I'm going to get some chips on my plate here. Spanish Prime Minister Pedro said. I know there's gonna be France. Uh oh. Okay. He called for a snap election after parliament rejected legislation. For which issue? So this was in Spain. There were protests there. For what? What were people protesting about? Um. Do you remember? You don't listen to my news reports. I always supports housing. Affordable housing? Yes. You both got it right. Ding ding ding. Oh, I'm so excited, you guys. Uh. All right, so you both keep those. So we're in good shape. We're in great shape and so well. We're doing so well. I'm so excited for this. Okay, uh, we'll move on to technology. Christina, you got nothing on this. David. You got ten, right? Interesting. So we'll see. Are you kidding? He does. Okay. Shenzhen trends and all this is going well. All right. Is expected to list in Hong Kong. The tech company produces more than half of Africa's. What? I do know this one Yes I know, I knew, I just could never pronounce it. Jin Jin Shenzhen's in Shenzhen. No. It should. Shenzhen is right. It announced this week. I think it's fine. Uh, direct messages are open on the cell phones. Oh, you guys are on a roll. Democracy. But you reap no reward for that. Oh, that's okay, that's it. I got bullied into it, by way. David, girl. Well, now I've got 30 chips and no risk of losing anything. Right, Lisa? But it's actually known as the King of Africa. Yeah, it's the bell pan. I didn't know that. I thought it was going to be Huawei and it wasn't. Yeah, there's a very interesting piece on the terminal about it, too, um, which I found fascinating, but yes. Shenzhen, um, investigations. Okay. This could be the determining factor. Could be. Okay. We'll see. Fermenting factor. Japan's FTC is investigating several major beer makers. For what? Suspected financial violation. What was it? Oh, she is right in fast. David Gray, you are slow to the pin. What is going? I don't really have to worry. I could write a novel. I'll repeat the question for the people in the please. Because really, when I'm writing a long answer. Japan's FTC is investigating several major beer makers. For what? Suspected financial violation. What is this? Intellectual property theft? Oh my goodness. It was like, ooh, price fixing. Like when I was like fixing it. Oh, it's a tie. It is a teeny. It is a tie. But do you know what we do have beers was one that I liked. That's why I remember what is. Yeah. What's the beer that you like? Uh, as I should. Boom. Whichever one that is. Whenever you're at a good a good Japanese restaurant. Yes. Yeah. Hearing is good, too. That's right. It was a bread I didn't have to give it. Forgot I was supposed to bring Clemenceau in this week. Do the failing across the wind grove, Caesar. And. Ah, so we have a bonus. Bonus round. It's all coming down. The bonus weekend. Another time, I guess what happens with bonus if you just it's it's for bragging rights. Bragging rights. Here we go. It's so that I can do prestige. Currency is the category for the. David. Derek. Oh, this is a good one. Guys. I know you heard this story. Two four animals will soon be replacing historical figures on UK banknotes. Yes. Just name one of them. One for me, one where you can draw a picture you can complete. But they're like random. They're not the ones that. Yes. So they're replacing historical figures on UK banknotes. I from the koala because I think everyone loves it. Well, that was a good guess. I think it's the same, um, way of work if I know. Oh wow, we really have exhausted the cute animals list. Me the puffin. I mean, it's the owl, the puffin, the bee and the hedgehog. Well, I think I think you playing? I don't know. Are those not the same? I don't know. I don't know. And I think we're going to find out here. We're going to fact check that quickly. It's a groundhog. And children's are not hedgehogs. Really? They know. I remember this. No, I don't think so. I know Director Tim is saying it's raining. Yeah, well, at home. Right in. Yeah. Right in. But I think we're just going to leave it at a time because the head, the porcupine has them, like they got those things around. Oh. I'm sorry. Naturalist Lisa Mateo, please explain to me the difference in the quills for porcupines and hedgehogs. Spooky minds are like the hedgehog. Your dog is like. What's on it? All right. Oh, that's right, they are the big ones, aren't they? All right, you can plan it. Oh, my gosh. You can test your knowledge on all ten questions as these two continue to do. Can I go please. And this was a Bloomberg.com slash pointed also available on the Bloomberg Business app. Thank you very much for watching. We'll be back tomorrow morning I'm David Greene. I'll be back here with Lisa Mateo and we will be back tomorrow. Thank you so much for speaking with us.