tv WSJ at Large With Gerry Baker FOX Business December 2, 2018 7:30am-8:01am EST
i hope you will join us. thank you for joining us this weekend. that will do it for now. stay with foxbusiness. the premier with gerri baker begins now. ♪ >> hello. welcome to the debut of wall street journal at-large. i am the editor at large. doing something a little different from the current fair of television news and talk. not be looking for the quick soundbite of the easy sound line digging deep into the big issues of the day that are shaping our world. technology, markets, government, government, entertainment and more.
i will be talking one-on-one with some of the leading figures in the world. the opportunities and challenges we all face in the second decade, the 21st century. i am delighted you will be joining me and i really hope you enjoy. this weekend as a child is meeting of china and argentina. they will be getting together amidst the intensifying trade war. officials have been carefully downplaying expectations of any kind of a deal at the meeting. joining me now to discuss this and some other topics is larry summers. treasury secretary for president barack obama. larry, thank you very much indeed for being my first guest. thank you for being here. we are in the early stages of a cold war with china. >> i hope not. we might be. certainly on both sides the
rhetoric and the actions are getting more and more confrontational. there is no reason why we need to have a cold war with china. the world can accommodate our defining, our greatness in china defining its greatness. unfortunately, right now, it, it looks very confrontational in both the economic realm and the security realm. >> treasury secretary. china entered -- president trump says china does not play fair. he said just this week in an interview i just want our country to be treated fairly. he has a point. >> sure. some of china's practices, intellectual property,
problematic. stories about commercial espionage that are appalling. certainly examples where china has broken the rules with respect to subsidies. there is no nation that has an unblemished record on trade. there is no nation with unproblematic practices and usually work towards common conversion and towards in order that works for everybody. what is extraordinary is the degree of confrontation in which president trump has sought to engage on trade issues, not just with china, but with the world did you talking about national security terrace against canada. massive automobile terrace against europe. and, so, i think there is an extraordinary truculent on the
part of the united states that is really quite problematic in terms of our international relationships and object is with china. not to excuse the chinese, but their sins do not exempt us from the obligation to have a strategy. >> not just a particular set way you can argue that is dumping on world markets issues in particular sectors. china seems to be following a different economic model. >> china has grown spectacularly , as other countries in asia grew spectacularly. they have developed more sophisticated industrialization. opposing the tremendous success is a reflection, that is just not right. >> the kind of challenge that
china is posing, primarily because they somehow cheated. that is wrong. the reason china has grown more rapidly longer is primarily -- that would be wrong, too. we need to be very clear. we are entitled and we are right to reject chinese violation of the rules. rules that do not cover unfair practices. china cannot succeed. china is not allowed to succeed did it is somehow wrong for china to succeed. an and unattainable position for us economically. i see too many voices in this country who are slipping into that position.
my friend hank paulson warned about an economic iron curtain coming down. i think that was a valid warning. i would also warned about a new mccarthyism. with respect to china where we lose our objectivity accuracy. >> but it is true that when china joined in 1999, you went to congress to get congress to approve the trading relationship , we all believed at that time that china was on the quite different path. what you said to congress, when he recommended her approve of the trade deal. we can strengthen the hand of those that favor china.
more difficult for china to turn back the clock. becoming more market-based. more protective of commercial and personal freedoms. the end of history. the end of the cold war. they did not happen. if anything, going the wrong way >> much more market oriented economy then it was. america's firms have much more access than they did in 1999. there is far more flexibility and commercial freedom in china and there was in 1999. that is what i spoke about in the quote you read. there were people who believe that somehow china would become a democracy for trade. that view, in retrospect does look kind of naïve. the argument was about economic
liberalization, about great economic opportunity for the united states in china and about supporting economic reform in china. there is a ton of confusion about the wto debate. showing a good place to be clear on this. the united states had granted china most favored nation. the same rules we extended to england or australia or ghana was extended to china. threatened to take it away in the early 1990s. the clinton administration rightly backed off of that threat. whatever benefits united states gave countries, china was getting those and there was no prospect of being taken away. by admitting china, we won a
whole set of concessions that substantially improved commercial access for u.s. firms in china and that was the right thing to do. it would have been irresponsible not to do that. >> we are going to take a break and come this is stonington, maine, a town where almost half the population is self-employed. lobster fisherman is the lifeblood of this town. by 2030, half of america may take after stonington, self-employed and without employer benefits. we haven't had any sort of benefit plans and we're trying to figure that out now. if i had had a little advice back then, i'd be in a different boat today, for sure. plan your financial life with prudential. bring your challenges. is important to me so father being diagnosed with advanced non-small cell lung cancer made me think of all the things
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>> i am back with larry summers. this week the chairman of the federal reserve seem to get a revised assessment of where the fed is going in terms of interest rates by suggesting we are much closer to what economists call a neutral rate of interest for the economy. do you think the feds have gotten the message that maybe it is in danger of overdoing it and tightening the policy too far? >> i thought more right
yesterday, wednesday, when he spoke then he was a couple months ago. i think we are relatively close to the neutral way. i think there are signs that the economy is slowing. i think the fed has to be very careful. thirty-second lad between when you turn the faucet and when the water gets hot. it is really easy to scald yourself. when rates change and what happens to the economy. really easy to tighten too far and not doing it. reversing rates. abounds. shop the fiscal canyon protectionist is pressures working, rooming. i think being very careful not
to the economy over is the right posture for the fed. you can discuss the ways in which they got there. a better place now than it had been. >> growth is still pretty robust >> the economy, signs of significant weakening. normalized monetary policy. very low for a very long period of time. leaning in a little bit. >> i'm not sure what neutral is in this environment. we've had the economy stimulated very substantially by the tax cuts which probably did a lot more. that is going to go away. monetary policy operates with a
leg. financial conditions reflected in the stock market, foreign exchange market have tightened substantially. the great danger is we will tighten, not see the effects of the tightening, and we will keep tightening and over tighten. that is the thing that would worry me the most. i was glad to see chairman powell show some concern about that. we are also in in a more dangerous monetary environment. making it harder for the fed to do its job. maybe the fed is in danger.
>> i don't think any thoughtful economists would agree with that. there are more risks of over tightening then there are of under tightening right now. >> doesn't seem the fed slows down a little bit? a recession having begun by the end of 2020. >> what would cause that? >> the economy tipping over because of tighter financial conditions. a lot of complacency built into financial markets. you get a sudden change in the psychology and you can see condition start to change quite dramatically. again, your your fiscal stimulus being removed. monetary tightening feeding through. moving in an adverse direction.
populace pressures. that is a nasty, that is a nasty cocktail. i think it is a mistake to think the good times that will this year was some reflection of fundamental strength. temporary injection of steroids. >> we will be back again in a second. second. i want to talk with but some give their clients cookie cutter portfolios. fisher investments tailors portfolios to your goals and needs. some only call when they have something to sell. fisher calls regularly so you stay informed.
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oregon. how they impact the economy and the countries policy expanded by the country that you may be did not know. can you explain what you found a what lessons you learn from your trip. >> 60th birthday. a very different country out there. i spent my life, part of what i was struck by was political issues to foreign-policy issues kind of macro extractions that were preoccupations of people like you and me.
>> a great man. >> they were going about their lives. taking care of what would happen to them locally was their biggest concern. what was going to happen with the crops. what was going to happen in their town. i think there is a legitimate demand for respect. i think insubstantial parts of the country there is a feeling that the people who are heavily involved in government have not had enough respect for the local concerns and the local knowledge of people who live in the great
heartland of our country. i came away with a greater appreciation of the importance of that. i also came away with a greater appreciation of weather was transcontinental railroad a long time ago -- i saw that governments had a basic responsibility to provide the foundation for prosperity in large parts of our country. in many parts of our country, we are probably falling down a bit on the job as other concerns have seen more loftier. i think economic support for the heartland of our country is a profoundly important thing. >> and appreciation for the politics? many of those states where bread
-- red states. did you hope that there is a way in which may be democrats and republicans can be brought together? >> a lot of people with very good attitudes who care about the future of their kids. one opportunity for their kids. living life differently then maybe people on the east coast have. finding voices that are trying to bring people together rather than trying to pull people apart they see the is something that is profoundly important. ironically, the interview show and beginning of your show together, i think the challenge we face from china, not china breaking some rule, but a challenge from china's tremendous capacity and growth. a challenge that poses to
america and leadership. i we going to be to this. what england was to the 1920s. a receding power. i hope meeting that can be something that brings all americans together. >> that is a very nice way to end the show. thank you for being with us. have a good week. a bit of history was made on a bit of history was made on tuesda i'm at this wing joint telling people that geico has been offering savings for over 75 years. that's longer than the buffalo wing's been around. dozen wings. and did you know that geico... (lips smacking) offers mo... (coughing) motorcycle insurance? ho-ho... my lips are burning.
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each week we and the show with a number of the week. capturing the important trend of the news. 812 billion. the market valuation in dollars. overtaking apple briefly to the world's largest company. fifteen years is an intern in the. back in 2003, the iphone was a twinkle in the eye. mark zuckerberg was still in his dorm room. dominating the world of mobile and other technologies. microsoft return is partly the result of apple. the durability of a powerful brand and the effectiveness of
discipline management even in these disruptive times. another in-depth interview friday at 9:30 p.m. eastern. i hope to see you then. than >> with our signatures today will formally declare the attention of our three countries to replace nafta with the us m mca, a truly groundbreaking achievement. it's a modern-day agreement. we worked hard, it's been long and hard. taking a lot of barbs and a little abuse and we got there and it's great for owl are countries. paul: welcome to the journal editorial report. i'm paul gigot. i was president trump at the g20 summit