Key Takeaways from Day 2: Bloomberg Invest Global

Day Two of Bloomberg Invest Global, Bloomberg’s flagship financial conference, got underway in Asia today with Bloomberg TV anchor Haslinda Amin interviewing the highly respected Indonesian finance minister, Sri Mulyani Indrawati, on how the government is funding its fiscal response to the Covid-19 pandemic.

Top Asian investor Cheah Cheng Hye, Co-Chairman & Co-Chief Investment Officer of Value Partners Group, offered a bracing assessment of Hong Kong’s problems, starting with profound and “vast inequalities.” He also assessed that U.S.-China tensions are “the worst crisis we’ve seen in something like 30 years.”

From Asia, we moved to the Middle East. Bloomberg TV anchor Manus Cranny spoke with Wamkele Mene, the Secretary General of the African Continental Free Trade Agreement. Cranny asked him why Nigeria and Tanzania have yet to sign onto the agreement. Mene also vowed to press ahead with the agreement even if a second wave of Covid-19 hits the region.

And speaking of bracing, Stephanie Flanders, Bloomberg’s Senior Executive Editor for Economics, interviewed economist Nouriel Roubini who lived up to his well-deserved “Dr. Doom” moniker with a sobering assessment of where the global economy stands. “There is going to be a painful process of deleveraging both in the corporate sector and housing sector,” he said. “There are imbalances that will be ongoing for a decade.”

Flanders also spoke to Nobel Prize-winning economist Joseph Stiglitz who was no less bleak about the current situation but offered a different way forward: an urgent rethink of capitalism. “American-style capitalism is going to take a beating if financial markets continue to behave in the way they’ve been behaving,” he said. “There is a responsible capitalism.”

That set the stage for the day’s final discussions out of the United States. Bloomberg Editor-in-Chief John Micklethwait spoke with PIMCO CEO Emmanuel Roman in a wide-ranging conversation:

  • The U.S. Federal Reserve’s response to the crisis: “You can make a very decent argument that the signaling is more important than the actual amount they buy,” Roman said. “But, I don’t want to understate the amount of restructuring that will need to happen in various industries.”
  • The differences between the responses of Eastern vs. Western countries: “There are very different rights in terms of what you think the state should give you, versus what your own private liberties are.”
  • The increasingly tense relationship between the United States and China: “I think there is an issue with China in the next 6 months. We’re going to have an election where I think globalization will be a big debate. China will be a big point of contention.”

Next, Bloomberg TV anchor Alix Steel spoke with Kewsong Lee, the C0-CEO of The Carlyle Group, who predicted that the recovery for the United States would be tougher than for China. If the recovery for China is more V-shaped, then for the U.S., it will resemble a check mark with some squiggles. He also addressed the importance of racial and gender diversity in corporate leadership.

Lee also said:

  • On the U.S.-China trade deal, phase one of which is still being negotiated: “I think it’s really important for both sides to make phase one work. It’s almost symbolic at this point.”
  • On where Carlyle is putting its money: “We’re active, but it’s being selective. There is a difference between investing aggressively and investing wisely.”

World Bank chief economist Carmen Reinhart addressed the extraordinary burdens facing emerging markets as they deal with the ongoing pandemic. They have less ability to absorb shocks than developed economies. This reality, she said, underlines the importance of China’s participation in the Group of 20’s debt suspension for poor countries.

In a special Leadership Live with David Rubenstein, U.S. Treasury Secretary Steven Mnuchin said that the administration might consider extending the tax due date beyond the current date of July 15. He also said that another stimulus package could pass the U.S. Congress in July. Mnuchin said he expects the U.S. to emerge from recession by the end of the year. He also pushed back against the claim by former National Security Advisor John Bolton that he’s afraid of imposing economic sanctions on adversaries. He called that “ridiculous” and also said he had not yet read Bolton’s controversial memoir.

The third and final day of Bloomberg Invest Global resumes on June 24 at 1 p.m. local time in Hong Kong, when Bloomberg Executive Editor Tracy Alloway interviews Jessica Tan, the Group Co-CEO of giant Ping An Insurance Group.

View our highlights recap from Day Two below, and click here to view all content on demand.

 Click here to register for Day 3 Bloomberg Invest Global

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