Lots More on JD Vance and the Future of the US Dollar

SPEAKER_1 (0:03)

Bloomberg Audio Studios, podcasts, radio, news.

Joe Weisenthal (0:10)

Did you watch JD Vance's speech last night at the RNC?

Tracy Alloway (0:14)

I saw some clips. Did you watch the whole thing?

Joe Weisenthal (0:17)

No, no, but I saw some clips as well.

Tracy Alloway (0:20)

Do you think he has read Trade Wars or Class Wars?

Joe Weisenthal (0:25)

Matt, as far as you know, has JD Vance read the book you co-authored with Michael Pettis?

Matthew C. Klein (0:31)

As far as I know, definitely people on his staff have, and I would not be surprised if he has himself.

Joe Weisenthal (0:36)

Oh, there you go.

I did a deadlift. One, two, three.

Tracy Alloway (0:42)

Hegemony.

Hegemony. Barges.

Joe Weisenthal (0:47)

This is an after school special, except.

Tracy Alloway (0:49)

I've decided I'm going to base my entire personality going forward on campaigning for a strategic pork reserve in the US.

Joe Weisenthal (0:55)

Where's the best squid ink pasta?

Tracy Alloway (0:57)

These are the important questions. Is it robots taking over the world?

Joe Weisenthal (1:00)

No, I think that like in a couple of years, the AI will do a really good job of making the Odd Lots podcast.

And people will think, I don't really need to listen to Joe and Tracy anymore. We do have.

Tracy Alloway (1:12)

Cha-ching. You're listening to Lots More, where we catch up with friends about what's going on right now.

Joe Weisenthal (1:19)

Because even when the Odd Lots is over, there's always Lots More.

Tracy Alloway (1:23)

And we really do have the perfect guest.

Joe Weisenthal (1:28)

We're here with our friend, multi-time guest, Matt Klein. Everyone is reading from your hymnal, must be pretty wild. Also, listeners, in addition to reading the book, go check out his newsletter, The Overshoot, which is, you know, it's sort of like, you know how people used to subscribe to The Economist, but then never read them and they're famously piled up?

That's how I am with substacks, except Matt's is one of the ones that I regularly open.

Tracy Alloway (1:51)

I thought you were going to say, like, Matt's is one of those newsletters that I don't read, just like The Economist. No, his was really good.

Matthew C. Klein (1:58)

Hey, as long as you subscribe. No, I appreciate that.

Joe Weisenthal (2:02)

So, yeah, one of the things that is extremely trade wars are class wars coded, so to speak. And this is one of these ideas you don't hear discussed popularly, particularly among politicians or really anyone. But it's like, oh, you're really in the know if you make this point.

Is this notion that maybe the central role of the US dollar, the reserve currency status is not so great for the US.? And he has made that point in interviews and I think even in some testimonies that, like, he's not crazy about the dominance of the US dollar.

Matthew C. Klein (2:36)

Yeah, that's right. I mean, I think he asked Fed Chairman Jerome Powell about this a year ago.

So, yes, that's right.

Tracy Alloway (2:42)

Wait, are you surprised at all that the dollar's reserve currency status has been picked up as, like, a populist talking point? I mean, seriously.

Matthew C. Klein (2:50)

So, I mean, I'm going to say no, because he's not the first one, right? So Josh Hawley is also was, you know, pettis-pilled, as it were. And I remember when the book came out, like having conversations with people on his staff.

I didn't even think before the book was officially released. I mean, they somehow got some, you know, early preprint or something. So it's definitely percolating the ideas in that segment of the Republican right. It's obviously also, I mean, you probably saw the article that Robinson Mayer wrote and he did. There's a lot of people in the Biden administration who've also read the book and I think gotten some good takeaways from it. So this is, you know, it's interesting to see that having a really cross-partisan appeal, even if the types of people who've liked to have been very different from each other are very different in their priorities for other things, but they seem to appreciate the analysis we put together.

Tracy Alloway (3:32)

I mean, one thing that is true is it seems like there's been a slight evolution or at least a clarification in Trump's approach to the dollar. So do you remember, like, in the early days of his administration or when he was running, he used to talk about, like, oh, a lower dollar would be better for US trade, but then he would also talk about how, you know, how great the dollar was in the sense of its position in the international financial system. And so it always felt like there was a little bit of tension there, but I guess as time has gone on, he's sort of migrated towards clearly, like, this idea that actually the reserve currency status isn't that great for the American economy.