Economy "Very Shaky", Unemployment Likely To Surge | Anna Wong, Bloomberg

**Anna Wong** (0:00)
I think that Wall Street has been distracted by the US election in the last two months. In fact, they have been dismissing signs of cracks in the economy. People like to describe the economy as strong, that Trump inherited a strong economy. But I actually think that Trump inherited a very shaky economy, and the labor market is still cooling.

**Adam Taggart** (0:31)
Welcome to Thoughtful Money. I'm its founder and your host, Adam Taggart. The last time today's expert was on the program back in July, she was concerned about rising unemployment. Is she still as worried about it as we prepare to enter a new year with a new administration taking over? Well, to find out, we've got the good fortune to talk today with Dr. Anna Wong, Chief US. Economist for Bloomberg Economics. Prior to her current role, Anna also worked at the Federal Reserve Board, the White House Council of Economic Advisers, and the US. Treasury. Anna, thanks so much for joining us today.

**Anna Wong** (1:04)
Thanks for having me again, Adam.

**Adam Taggart** (1:07)
Such a pleasure. I really appreciate you joining us here on Thanksgiving week. I'll try to use your time very respectfully, so let's just jump right in. Got a number of questions for you, but if we can just start with a general one, I'd like to kick these off with. What's your current assessment of the global economy and financial markets?

**Anna Wong** (1:24)
I think in the past two months, most of the markets' moves have been driven and focused on the US election. And by that, I mean, it's actually, there are both pluses and minuses. So on the plus side, in the past two months, everybody at the markets have been pricing in what a Trump administration would look like. And a lot of that pricing has been manifested in higher inflation compensations and before looking, for example, one year, one year CPI fixings. So people were thinking that the Trump would be inflationary, and that seems to be almost like a consensus trade. And also as a result, the dollar also has been appreciating very briskly in the last two months in anticipation of tariffs and also the long-term yields have been, you know, from September when the Fed cut Fed funds rate by 50 basis point. Ten-year yields has risen by 80 bips since then, from then to November until this weekend, where Scott Besant was announced to be the Treasury nominee. Now we have seen finally starting to see the ten-year yields just coming down on the back of this personnel announcement.
So I think that as of now, the current stance is, I think, the current stance is that the markets is now refocusing on what the plausible policies would look like under the Trump administration, given that now we have newer information based on the economic personnel that is going to be part of the administration. So far, we have been very light on economic announcements under Trump and I think we're beginning to see the trickling of who is going to play a role, and Scott Besant is clearly the first of these people. We still don't know what role Lighthizer, the trade hardliner, will play in this administration. We also don't know who the NEC, National Economic Council Director, would be, and those are all very, very important personnel that could determine how Wall Street would react, would pair back this Trump trade that we have seen in the last two months, and that would be a key driver of how market would look like two months from now.

**Adam Taggart** (4:05)
Well, look, as you said, the election had been in the driver's seat. Now that uncertainty is resolved, right? We know that Trump's the president-elect. Now, I did want to ask you about some of his cabinet picks. And so in a moment, I'm just going to ask you for your reaction to Basant as a pick whether you think it's good, bad, and different. And also if you can, if that gives you any sense of what we're more likely to see from Treasury with him running it, that would all be great. But before there, we know the main like tent poles of what Trump ran on from an economic standpoint, tariffs, at least the threat of tariffs.
His tax policy definitely seems to be, let's get rid of as many taxes as we can. On the campaign trail, we talked about we're not going to tax tips, we're not going to tax overtime. And then near the end, we heard, okay, we're going to do away with the income tax maybe at some point. Obviously, he ran on the platform of, we want to gut the size of government bureaucracy. We have the whole DOGE, Department of Government Efficiency Department, that now Musk and Ramaswamy are going to run. And then, big things like deportations, right? Potentially millions of undocumented people, many of whom are working in the economy, just under the table. But, you know, so all of those things will have an economic impact. I'm just curious, you know, if you and your team at Bloomberg have given some thought to this and, you know, when you look at those key tent poles, what do you think that means for the economy going forward?