Speaker 1: And Hi, how are you welcome to the Big Podcast.
It is Monday. Today's the eleventh day of August, year
of Our Lord twenty twenty five. My name is Tom Sullivan.
And have we got a boatload of information for you today?
And we've got the President came out today held a
news conference in the Briefing room at the White House
about basically taking over Washington, DC. And he's going to
be activating eight hundred National Guard and also taking over
the Metropolitan Police Department in Washington, d C. So there's
a lot of the President wants to clamp down on crime,
and he says it's a filthy city, it's a dirty city,
and he goes on and on about what a terrible
city it is. And I have to I know, like
I told you last week, I know enough about Washington,
d C to be dangerous. I've been there a number
of times. There are parts of DC that are very
crime ridden, and you don't want to go into those
parts of d C. It's called the Northeast Section and
the Southeast Section, and those are primarily low income, high
crime neighborhoods. And so if you're going to take the
crime out of those neighborhoods. It's a big social economic
effort that goes way beyond just adding some national guard
because it's a poor neighborhood and there's a lot of crime.
And that's true in most cities, is that you have
in low income neighborhoods high crime. Not all, but most.
And that's the other thing about big cities is what
big cities have done there. And yes, most of the
big cities out there, I'd have a hard time finding
one that was not run by a Democrat. They don't.
They raise taxes on the rich, and the rich move
and their tax base leaves, and then they're stuck with
people who need services that don't pay taxes. But back
to the whole port part about crime, there are other
areas of Washington, DC that are no more crime ridden
than any place. And I'm talking about around the government
buildings and out in Georgetown and Watergate area, all of
that lovely city. It's very nice. So what is going
to happen by adding these police. The other problem with
all of this is the law. Well, the law does
allow the president to do this. There are major restrictions
on the federal government using any sort of police or
Army or National Guard, posse commatatis, laws, all kinds of
things going into any other city. But Washington, d C.
Is federal. It's a federal area, and so the president
does have the authority to do all of that. The
question then becomes how long does he have that authority?
And it basically the law was clarified in nineteen seventy
three says the president is allowed to take control of
the DC Police for forty eight hours if he determines
that special conditions of an emergency nature exist. Then the
forty eight hour period can be extended if he notifies
relevant congressional committees, and then taking control for over thirty
days must be passed into law by Congress. So there's
a lot to go on this Washington, d C experiment.
I don't think they're going to change the crime rate
in forty eight hours, nor in thirty days, so it's
it's a little bit of a puzzler to me. I
also just I'm a small government guy. The more the
federal government expands it's reached, the more tentacles it puts
out there under the name of the federal government, the
more I don't like it. So, yes, there are problems
in Washington, d C. The other problem about Washington he
c And this was at the news conference the day.
So there's the president, there's the head of the DOJ,
she's there, the Attorney General, dam Bondi, the head of
the FBI, Cash Battel is there, Pete Hegseith, the head
of the Defense Department is there. But listen to what
cash Battel said. And I'm going, did he not get
the memo? Here's cash Battel, FBI director, and the murder
rates are plummeting.
Speaker 2: We are now able to report that the murder rate
is on track to be the lowest in US history,
in modern recorded US history, thanks to this team behind
me in President Trump's priorities.
Speaker 1: So that's kind of an oopsie's because the whole idea
what the President kept saying, Oh my gosh, the crime
is out of control, the city's out of control. We
got to think that we're going to run in. It's
an emergency. We're bringing in federal troops. We're bringing in.
And cash Battel gets up and says, actually, the crime
rate is down to the lowest and recorded history. The
crime rate has dropped everywhere in this country. It's not
unique to Washington, but Washington has seen all the major
category of crime actually be reduced. So I don't know
what the endgame of this is, but it just seems
too much to me. Then there's the question of the
job of a soldier National guardsman in this case versus
the job of a police officer, And well, I've done both.
I was in the army and I was in law enforcement,
and I got to tell you something, they're not the same.
They're not even close to the same. Chief Charles Ramsey,
former police chief in Washington, DC, at these observations.
Speaker 3: Well, I mean, I don't know what's going to wind
up happening in terms of who's going to be in
charge of what. They are two totally different pictures that
were painted today and by the President which was pretty bleak,
pretty dark, and then of course by the mayor, And
personally my experience with Washington, d C. And what I
know about it, I think the mayor's version is closer
to the truth. Now they're going to have to work
out some details, and I'm sure they will. She mentioned
that she's going to sit down with the Attorney General
to kind of hammer out a few details, but as
far as the Mayor's concern, what I took from that
is that the Chief of Police, Pamsmith, will remain the
chief of police. Now that doesn't mean that higher ups
in the dj and certainly this interim quote unquote commissioner
that was referred to earlier will have a role.
Speaker 4: So there's there's a lack of clarity on just how
this is going to shape up. You know, one thing
I can say, you know, working in the mayor mentioned it.
Working in the National Capital Region, we worked with federal
agencies on a daily basis, surrounding jurisdictions on a daily basis.
And I'm sure that d c's not saying they don't
need help. Everyone could use some help, but that help
needs to be coordinated. Everyone needs to be on the
same page because you have a lot of issues here.
You have training issues. I mean, federal officers are trained
on federal law, on that DC, municipal government law, even
patrol techniques and so forth. Officers where body one cameras
and MPD will be fit where body warre cameras I
kind of doubt it.
Speaker 3: I mean, there has to be some things that have
to be made very clear and get straight and again,
you need to They can't just deploy where they want
to deploy. The Department has to be in a position
to be able to tell them, you know, we're here
are hotspots, here's where we need you, Here's what we
need you to do here. Uh And if that doesn't happen,
then you're going to have a chaotic situation.
Speaker 1: So there is a lot to do and a lot
of coordination to work out between the military, the National Guard,
the FBI, other federal law enforce, horseman in the DC
Metro Police. I don't know how they're that's going to
take some time, and the president only has forty eight
hours and eventually up to thirty days. That's it. I
don't know if Congress will say, yeah, you can go
ahead and continue to do that or not. But this
is a very short time frame. Again, I don't think
they're going to change anything regarding crime in Washington, DC
in thirty days. Now, Can the Feds do a lot
of not out driving around patrol cars, but a lot
of intelligence and that sort of thing that would help
out the DC police. That's probably where their best efforts
will be played. Then the question comes up, if there
is an armed confrontation and there are bullets flying. If
a US Army National Guard soldier shoots a civilian, now
you've got real problems.
Speaker 3: I would hope nothing like that happens. Of course, the
potential for something like that would be there, but I
would hope that that is not going to be the
case at all. They should serve in a backup role.
In my opinion, there is a need for some help,
some assistance. I mean, crime is down in the district,
but you never get it really low enough because you're
not just dealing with numbers and with the reality of crime.
From that perspective, you know, people don't feel safe, and
if people don't feel safe, then they aren't safe, and
so you have to deal with that as well. So
that added presence I think will give people a sense
of safety insecurity, but it has to be very well
coordinated with clear roles and responsibilities. And if they're going
to arm soldiers, they had to understand they're not in Iraq,
they're not in Afghanistan. The rules of engagement are a
lot different, and they need to have the proper training
on use of force and all those kinds of things.
Should they be armed. Hopefully they do not become armed.
Speaker 1: Yeah, the whole idea about national Guard coming in to
help the police is usually because of an emergency or
riot things like that. But so we'll watch to see
how this turns out. Let's talk about China for a moment,
because I want to give you just I'll just as
a reminder. And Vidia, which is the darling of the
tech world right now, they make a super duper chip
that is being used by the people in the AI
race to get ahead of everybody else by using and
Vidia's chips. So and Vidia comes up with this new
super duper chip and the government says to them, don't
you sell that to China. We are not going to
allow you to sell it to China because China will
have use it to their advantage. And so that was
where it started off, was that the chips were banned
from being sold to China. Then and Vidia gets the okay,
what was it a week, ten days ago something like
that from the US to yeah, go ahead, yeah, you
can go ahead and sell those to China. And everybody
raised their eyebrows. What happened to the big national security thing? Well,
now it's all turned around and China is now worried
about the fact that the Nvidia chips could have a
back door to them where the US could spy on China.
We were worried about them spying on us with TikTok
and and Huawei phones and things like that, and now
they apparently are very worried about Hey, what do you
mean they can sell the Nvidia chips to China? Are
they trying to spy on us? So Eunice Yun with
CNBC and Beijing has has kind of the report on that.
Speaker 5: Oh well, it looks as though the relationship between China
and Nvidia's Age twenty chip is very complicated. The messaging
out of China recently has been that the Age twenty,
which is a chip that the Chinese want to have,
could be bad for the country. So, in several posts
by a social media account that's linked to Chinese state TV,
the Chinese we're suggesting that the Chinese don't actually have
to buy this particular chip. Yuyuan Tantan called the Age
twenty far from safe for China. It says that Nvidia
needs to substantiate its claims that it has no so
called back doors in those chips. It alleges that installing
back doors as a condition by the US government to
easing its export curves and allowing Nvidia to sell into China,
and Nvidia issued a statement saying in Nvidia does not
have back doors in our chips that would give anyone
a remote way to access or control them. Now, the
Chinese tech companies here count as some of the biggest
clients for in video. The H twenty is the industry
standard here in China. It's not the best for training,
so in that way, President Trump is right that this
is one that doesn't have as much processing power, but
at the same time, it is really good at inferencing.
So this means that the chip is able to recall information.
And it just so happens that the Chinese industry depends
very heavily on inference, especially when it comes to deep Seak.
Those orders for a twenties rows very quickly, along with
the boom of deep Seek's AI models. Twenty is very suitable,
people say for this particular industry. Now, one other thing
that people have been discussing is what is the motivation
really of the Chinese when it's sending off these messages.
And I spoke to Jimmy Goodrich, who's an advisor to
Rand and he had told me that the the Chinese
are really walking a very fine line because on the
one hand, they want to make sure that they get
these chips in which are important for say the Ali
Baba's and the deep Seeks as well as ByteDance, but
then at the same time they want to send some
messages like hold on, we don't want to be too
dependent on this particular chip, and to an outsider in
Nvidia at that Okay, this.
Speaker 1: Is getting crazy because now the Chinese are worried that
we're going to spy on them, which is what we've
been worried about them spying on us with technology. And
the other thing that Unis just said was that they're
worried about being too dependent upon a foreign source, namely
the chips from America. So it's the same exact argument
here's Unus.
Speaker 5: I think it's an issue that is on the table.
At least that's what the messaging has been, and we
know that the Chinese have wanted to get their hands
on it more advanced chips. I think what was interesting
is that we saw the FT actually reporting that the
Chinese were looking to get the HBM or high Bandwidth
memory chips on the table that they were hoping to
be able to get that in the discussion. And when
I was talking with Jimmy Goodrich, he had told me
that the H twenty chip actually has these hbms in them,
and they're really important because these HBM chips would help
the Chinese be able to create their own AI chips
because they're so supportive and important for companies like Huawei.
So in that way, this could be part of the discussion.
Speaker 1: One guy that's not worried about them using Nvidia chips
to make Huawei make AI chips is Kevin O'Leary, mister wonderful.
He thinks it gives us an advantage. Here's his argument.
Speaker 6: Well, first of all, there's two issues here that you
brought up that are very important. Number one is should
we ship any chips that give China an advantage in
the AI race or the AI war or whatever you
want to call it, Yes or no to that. Then secondly,
this industrial policy of taxing a specific company to have
the right granted by the government to ship product to
a specific country, that, for lack of better words, is
a little funky chicken. But at the same time, it's
a form of tariffs. So let's coract to issue Number one,
should we ship chips to China or any adversary? And
the answer to that is yes, because we want all
of these countries using American technology and developing on the
American tech stack. We do not want to give Huawei
a chance to catch up to what's going on on
the firmware and software development that is crucial.
Speaker 3: That means you ship it.
Speaker 6: Even in North Korea. Everybody gets it because that keeps
them under control of the American tech stack. We can
deliver them two generations back, three generations back, one generation back,
doesn't matter, but they have to spend all of their
energy developing on the technology and the software developed in
the US that keeps the US in control. Number two,
the fifteen percent tariff, Well, I call that very creative,
a form of blackmail if you wish, but it's no
different than a tariff, and the companies are going to
pay it. And if you're a shareholder of MD or Navidia,
you like it because it's still incremental cash flow. Even
though it's eating into the margin of those chips shipped,
it's still incremental and the market has already decided both
stocks are up. Tomato tomato doesn't matter. It's a tax,
and I would hope that the administration would take this,
all of these tariffs and taxes and shakedowns, I don't
care what you call it, and reduce the deficit with it.
That's what the market is hoping for, because if it's
really true that we added on three trillion with a
big bill, how are we going to reduce that and
get back to balance budgets. I would hope the next
phase of all this, and I'm not the only person
hoping this is us a reduction because we're getting to
the limit of how much we can burden the long bond.
In other words, as long as the world has confidence
that America is the number one place to invest, it's
going to continue to allow us to have capital a
low cost right now under five percent on the long board.
The minute they think we're completely out of control, and
I don't know when the tipping point is, nobody does,
then we're in trouble and we're spending a ton of
money that we don't need to by Many people feel
because we've overstimulated right through the pandemic five years ago,
it's time to sober up. And start paying down the debt.
So this idea of money for nothing and chicks for free,
start sending checks out to everybody. I hate that idea.
Many people hate that idea. I want to see the
confidence of America maintained in terms of being an investment location.
That's what I care about, investor. I want the world
to continue to send fifty two cents of every dollar
to America because that's the number one place to invest.
It won't be if all of a sudden we get
into hyperinflation or the long bond goes crazy because they
think we're drunken sailor spending money. I'm not the only
person bringing that up.
Speaker 3: That's what should apping.
Speaker 6: No free checks to anybody.
Speaker 3: That's my view, all.
Speaker 1: Right, So no free checks to anybody. I'm with him
on that. And yeah, you heard him say this is
something total. Donald Trump is gone crazy with tariffs. So
that's we charge companies for buying from foreign sources. This
is a fifteen percent tariff or tax on Nvidia in
order for them to sell their chips to China. So
after all these things about we're worried about them spying
on us, they're worried about us spying on them. They
don't want to be reliant upon a foreign source for
their chips, and then throw on that. Donald Trump comes
along and says, yeah, that's a fifteen percent export tax.
So that's he's just getting money on anything coming or
going from the ports. It's a whole new part of
the tariff story. Meantime, this is going to be a
busy week. Tomorrow, we get the consumer Price Index, the
inflation numbers out. Wall Street's bracing for an increase of
over three percent. We'll have to wait until late thirty
in the morning to find out about that. Oh, by
the way, guess who compiles those inflation numbers. Yes, the
Bureau of Labor Statistics, the same group that came up
with the huge revisions on unemployment. So we'll get those
numbers tomorrow and we'll see whether you believe them or
not whatever they turn out to be. We've also got
the big meeting coming up on Friday in Alaska, and
they're still scrambling to put all the details together, and
it looks like it's just going to be a meeting
between Donald Trump and Vladimir Putin. Zelinsky's been left out
of this whole thing, so we'll see Putin has handled
a lot of US presidents to his success. Let's hear
from General Jack Keane about what he thinks is going
to happen on Friday.
Speaker 7: Well, we don't really know. Certainly is some initial confusion
over what really was the Putin offer, And after a
couple of days of soaring through that, I think we
got a clear understanding of it. Now he's willing to
go to a cease fire, but Ukraine would have to
give up the remaining parts of the danask Oblast as
you had circled, and the remaining part of Luan's which
is just only two percent. But when you take a
look at the danask Oblast inside there in the part
that Putin wants is the so called fortified belt, five
Ukrainian cities, all fortified along a fifty mile round on
Highway twenty that he has been unable to going all
the way back to twenty fourteen and for the last
two years. Why does he want that? Because if he's
able to take that territory to the north of that
is open, non defensible terrain that leads right to Kharkiv,
the second largest city in Ukraine. So if Putin could
get this conciliatory not having a fight for it, go
to a ceasefire. You know, he's going to violate a ceasefire.
He has always violated them in the past, and he
would be in a much better position to really grab
off some territory inside of Ukraine. So that's at the issue.
And we listen. I discovered last week. I didn't know it,
but in the Ukrainian constitution President Zelenski cannot give up
land without the Rada his legislature approven it bill, and
then he has to get a national referendum from the
people to go ahead. Our constitution also restricts the president
from doing that without congressional approval. So it's not surprising
it's in there. Many of us just didn't know one
other thing. First, I mean, a key meeting took place
in the UK on Saturday. The Vice President was there,
a foreign minister from the UK, other European nations representing
the Ukraine's much of our national security team, not all President,
but on the phone at least Rubio, Kellogg, Whitkoff, etc.
And they came up with a counter proposal proposed by
the Europeans and the Ukraines to Putin's offer, and that
is that the discussions in Alaska should initially be just
about a ceasefire and not any territory whatsoever. And if
we can get a ceasefire, then move to discussions towards
end of war. How do we do that? What's the
framework for that? One of the security guarantees for Ukraine,
the United States delegation was favorable to that. President Trump
has been briefed on it by our US delegation, by
the President of Finland. The Europeans are going to talk
to the President on Wednesday about this as well. Strategy
is a work in progress as to the summit itself.
Where is Putin coming from here? One? I think he
gets a lot out of this in terms of legitimacy
and meeting with the President, regardless of where that meeting
takes place. He gets a lot out of that because
he's an international pariah. He's been committing war crimes and
he's been internationally isolated as a result of it. But
what he's really after here, I think is that he,
under the cover of negotiations, he wants to delay these sanctions.
I believe the President has got his attention that sanctions
and tariffs are coming his economy is already in trouble
and will be severely harmed with these tariffs and sanctions
in addition to military arms going to Ukraine. And what
is Putin good at. We've seen it for six months
under the guys and cover of negotiations, delayed, delayed, delay,
and stall. President is on to this, and I don't
think he's going to put up with It's what Putin
is pulling on him. He's going to walk walk away
from the summit unless there's something really on the table
about going to a ceasefire.
Speaker 1: So that may be the outcome of this. Is very
much like Ronald Reagan did in RAYKEBC when he walked
away from the table when he was meeting with the
president of the Soviet Union. So we may see that
turn out to be what this is all about. Nothing.
It could be like the general said, where Putin has
done it over and over and over again, of just stall, salstall,
so he can continue to keep fighting. We'll find out
on Friday exactly what Putin's going to do. So an
update for you on all things. Epstein, the judge in
the case where they went and said, we'd like you
to release the transcripts from the grand jury judge said no,
this is in Julane Maxwell case, and he said, absolutely not. Jury's.
Grand jury's are sacra sanct you can't those are secret.
We're not going to release them. And by the way,
there was the second judge that ruled not to release
the grand jury transcript regarding Julane Maxwell. Judge in this
case said, would not reveal any new information of any consequence.
There's next to nothing new and there's no there there.
So Harry Enton, the guy who does all the statistician
stuff over at CNN, this is his take on the
fact that Epstein looks like it's fade in a way.
Speaker 8: Yeah, I would say that this is from at least
a political point of view, quickly turning into a dud
of a story.
Speaker 3: What am I talking about it? Which is wild exactly.
Speaker 8: Take a look here Google searches for Epstein down eighty
nine percent versus just three weeks ago, falling through the floor.
It is no longer the top term searched, alongside Donald
Trump's nay. That's been trading off between Taros and Vladimir Putin,
with obviously the meeting coming up later this week, but
at this particular point, the American people's interest in this story.
It's quickly because coming something of a nothing burger. Take
a look here, let's take a look at the overall numbers.
Trump's approval rating in July of twenty twenty five, it
was forty five percent. It's still well within that Marginovara
here at forty four percent, and you compare that to
where he was in his first term at this point
he was at thirty seven percent. So he's seven points higher,
very much in a different political universe. Now significantly higher
in terms of his overall approval rating than he was
at this point in his first term, and more than that,
among Republicans, his approval rating is near a record high,
covering right at about that ninety percent. More so, No,
he hasn't lost any of that base, and when it
comes to that center of the electorate, he's basically holding
on there. And his overall approval rating forty four percent
is pretty gostar and good for him considering where he
was at this point in term Number one. Yeah, why
hasn't hasn't there been more movement? I think this is
pretty simple. Take a look here. Nation's top issue is
the Epstein case. This is the number of respondents. This
isn't the percentage of responses. This is the number of
responding And our last CNN poll look at this zero respondents.
Speaker 3: Said that the Epstein case was the top issue.
Speaker 8: How About among independents zero independence and that and among
Republicans and therefore overall just a single one. So, yes,
there used to be a lot of interest in this story.
But the bottom line is that even amongst those who
had high interest in the story, it wasn't something that
they thought was all that important. And as I said
at the beginning, the interest in this story has fallen
off the table. It would just say this, Donald Trump
has some of the best political instincts of any politician
I've seen, and in this particular issue, you see it
full well and clear, because he has been saying, you know,
if this is no an issue, and it turns out
that the a lot of the American public actually seemed
to agree with him.
Speaker 1: Yeah, you knew this was going to die down at
some point. I mean, it got a lot of hubub
and when the hubbubs like that, it's always going to
die down. But it was mismanaged by the communication people
at the White House big time. It just was mismanaged,
especially with the Attorney General the way that she handled it.
So maybe that's going to be a story that we
only play at the end of the year as we
look back on stories of twenty twenty five. With that,
let's take a look at Wall Street again. Tomorrow morning
we get the consumer Price Index issued by the Bureau
of Labor Statistics, and Wall Street's worried that it will
be three percent or higher. Even if so, the latest
Fed futures bet is eighty five percent chance that the
Fed will cut interest rates in their mid September meeting
because the rest of the economy is starting to show
some slowing. The CEO of Intel went to Washington today.
He was supposed to have a meeting with the President
in the White House. Haven't heard how that went, but
this is the CEO that was brought in to shape
up Intel. And the President called out Intel and called
out this guy and wanted him fired because of the
fact that years ago he had a company that did
business with China and he was involved somehow, and President
was worried about the fact that the guy in charge
of Intel had some Chinese connections. And then Friday, of course,
is the big Trump Putin meeting in Alaska, which it's
going to be interesting to see if Vladimir Putin tries
one more time to pull a stunt on an American president.
I think Trump is ready for that. So it should
be interesting to see what happens on Friday today. On
Wall Street now finished down. It was decent. It wasn't huge,
but it was down two hundred points below forty four
thousand again, down to forty three thousand and nine to
seventy five S and P down sixteen, Nasdaq down sixty four.
Holy smokes, is this right? Yes? Gold down ninety seven
dollars a day, and that's because Donald Trump changed his
mind on tariffs regarding gold, and now he's saying, oh,
guess what, there's no tariff on gold, and the people
in Switzerland were having a major cow about it. So
once the President changed the tariff on gold to zero,
gold sunk ninety seven dollars down to thirty three ninety
three today, and oil prices up a dime, just right
at sixty four dollars a barrel. That's it for today.
Thank you for coming by. Hope to see you again
tomorrow