Better than expected retail Sales Numbers coming out, up fourtenths of a percent. The odds are as high as 75 for a recession, but is he right . Former imf chief economist joins me right now, ken, it is great to have you. Thank you for joining us. Thank you for having me. Maria weve got the Federal Reserve meeting on tuesday and wednesday. Its pretty much baked in the cake that the fed is going to cut rates by a quarter point, 25 basis points. Do you expect that and what is your view of the broad economy right now in. Well, certainly expect that. Theres just no inflation, and they dont really know how much more they can cut it and still not have inflation. Maybe its the trade war, maybe its a global recession going on outside the United States, but whatever. I think the u. S. Economy is Pretty Healthy except the trade wars absolutely weighing on cap x. Its hurting china a lot more than its hurting the United States, but chinas important. China hurting, hurting germany and europe, so the rest of the world is very weak at the moment. Maria the fed is in a tricky spot. Youve got the president pushing the Federal Reserve to lower rates more. He wants a full, a point over time. And yet you have ab an economy that is showing an economy that is showing very strong signs. So the Consumer Retail sales out on friday, up fourtenths of a percent. What was your aisment of that . Assessment of that . Absolutely, Consumer Confidence is high, and i think its reflected in the retail sales, and its probably high because employments very strong. Its, we have wages growing faster than inflation, so the u. S. Economy, that 70 or so thats consumption is doing very well. But on the other hand, businesses are nervous, theyre not investing as much as we would like them to, and that hurts our growth Going Forward and out years beyond. Maria i had treasury secretary Steven Mnuchin on this week, and he said, look, you know, its not because of trade. Its because the Global Economy is slowing. I pushed back on that because im not buying it. I do think in the uncertainty around the president s trade policy is causing managers to sit on cash a bit because you have cap x actually showing a decline. Well, absolutely. Thats one of the ways that its ricocheting back at us, because our firms get a lot of profits from abroad. Its a very important part of corporate profits, and the uncertainty in trade is absolutely hitting everybody else. Its one of these things where it hurts us, it hurts them more maybe, but its absolutely the reason why businesses are uncertain. Maria so china is not going to tax soybeans and certain pork products. No surprise, they need pork badly. Theyve got swine flu going on over there, by the way. But what do you think about the china u. S. Trade talks . The president signaled this past week that, well, maybe ill look at a shorter deal, smaller deal, but id rather a big one. We know that the chinese want to separate National Security issues from the trade issues, which i cannot see how the president can do that. No, he cant do that. A lot of the debate is over how we protect our intellectual property. Its perfectly okay they dont want to debate defense size or something, but, no, i think we have to understand were probably in the first inning of the u. S. china trade talks maria theres a long this is going to go on for decades. Maria yeah. Its the showing, coming to the surface much deeper problems that arent going away. Maria this week we learned that mario draghi and company has a stimulus plan, they called it a major stimulus plan. They cut Interest Rates, theyre going to be buying more assets. Look at all the Central Banks that are cutting Interest Rates right now, theres easing going on globally. Whats your reaction to the ecb, what does that mean Going Forward . Well, the ecb has sort of reached a point where it cant do much with Monetary Policy. It cut Interest Rates a little bit. It needs to make Interest Rate more negative, but it cant right now. So what theyre doing, its not Monetary Policy and im not criticizing it, but its fiscal policy. Theyre basically helping the poorer countries borrow more money, stimulating those economists. Economies. But very much the way the fiscal authorities do. And the risk is, of course, it may be very small, but some say they run into trouble and the german and french taxpayers have to pay for it. Maria rick reither was on this program a couple months ago, he said when Christine Lagarde gets in there, theyre going to start buying equities. Dont they need structure reform in terms of labor laws, in terms of tax rates . I think theres a sales tax of 50 . [laughter] i dont know about that. Maria 50 . I dont know if its the sales tax or some tax in france taxes are Something Like almost 60 of income. Maria exactly, thats what im saying. They need reform, absolutely. Theyre not going to grow fast without structural the reforms. And buying equities, the problem in europe is the poorer countries, the less fastgrowing cubs need more countries need more financing. The ecbs trying to find ways to do it. Maria is a recession on the way in the United States . I think thats less than 50 . I mean, we could have the first global recession that didnt include the United States. Maria ken, its great to have you. Thank you. Maria thank you so much. Ken rogoff. Stay with me, my one on one with the former head of the New York Stock Exchange, dick grasso, up next. Back from the brink, dick grasso helps return the New York Stock Exchange to glory after the tragedy of september 11th. Everyone was on the same team; get the Stock Exchange back up. 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This is the family who wanted to connect. Shipsticks. Com saves you time and money. To go where they could explore and experience adventure in unexpected places. Who were inspired by different cultures and found that the past can create new memories. Leading them to discover were woven together by the moments we share. For everywhere you go, expedia has everything you need, all in one place. Maria welcome back. This week marked the 8th anniversary of 18th anniversary of the attacks of september 11th, a day that changed the course of the country and the world. In spite of the devastating blow, it was important to send a message that was u. S. Was still standing. 2,977 americans died on that fateful day. Less than a week after the attacks, former nyc chairman dick grasso was tasked with opening the exchange and signaling that the country was open for business. I spoke with dick on 9 11 this week about that fateful week. It was a very, very difficult day, or obviously, for all americans, but for those of us who were there, the tragedy was magnified to the nth degree. My greatest recollection was talking to my colleague, and that was in tower two, almost 150 people having he having just received notice that a small plane had hit the north tower, that everyone in tower two should stay where they are. And we were in that space during the 93 bombing. And our people got trapped in the building for six hours. And as i was speaking with him, the visual came on from a tv camera pointed towards the north tower, and i said to him, david, im no expert, but thats no small plane. All four corners of tower one were black. I said get em out now. And what i really, you know, on this day and on every september 11th since, you know, stop to remember and say a prayer for those 403 firefighters, new York City Police officers and Port AuthorityPolice Officers who gave their lives that day so that 25,000 people could flee those towers. The greatest rescue in the history of this country. It was the darkest day, certainly, in my life, comparable only to pearl harbor day. But it was a bright day in the sense of america coming together. The firefighters going up the stairs, assuring people youre going to make it, just keep going. And they going up knowing that there might not be a happy ending for them. Days, you know, days followed that were very dark, but the Financial Community came together, the city of new york had the blessing of a great leader in rudy giuliani. The con ed people led by then gene mcgrath and verizon by Ivan Seidenberg and larry babio, everyone was on the same team, get the Stock Exchange back up not because of stock trading being important, but rather as a signal to the terrorists that youve killed thousands of people, youve destroyed billions in the property, but you could never defeat the american way of life as evidenced by the New York Stock Exchange. Maria thats right. And thats what was really felt, and thats what resonated the following monday when you reopened the New York Stock Exchange. Facing pushback to do so, i remember. 2,977 people lost their lives on september 11th, and im wearing this pin today because you gave me this pin, and on this pip you designed it pin you designed it with london jewelers, and youve got the two towers on the pinker obviously. Thats what this pin is. And then the number is 343. Thats the number of firefighters we lost. 37, that was the number of Police Officers from Port Authority in new jersey and then 23, the Police Officers on the nypd. You designed this pin, im honored that you gave me this pin. Youre wearing the pin as well. You only wear it on this day. This is when i wear it, every september 11th. Its in memory of those incredible men and women. You know, there are 25,000 people alive today, okay, that have to thank and pray for those firefighters and Police Officers because, without them, who knows how many would have perished. Maria i always say remember, when they were coming out, the Fire Department of new york was going in, and they were going off that 100 up that 100plus floors. And you mentioned bringing the country total. That is also my one important takeaway from september 11th, its september 7th, its the 17th, its the day that you red the opening of the New York Stock Exchange. You had the first responders, the firefighters, the mayor, the golf, the senators the governor, and everybody on that podium and all i could think, you all came down to the floor, and i interviewed a rot of you afterwards, and all i could think was, okay, were down, were mourning, we lost our loved ones, we lost our friends,but we are not out. We will rise again. The resilience of america is what i remember. That was the message. The proxy for the american way of life, its the American Economic system. And the American Economic system, at the heart of which is the New York Stock Exchange, you get that going, youve sent the signal we will not be defeated. Maria stay with us, more with dick grasso when we come back. Rejected, the london Stock Exchange says no to hong kongs takeover bid. Whats dick grassos take on the offer . Its a logical move. More of marias one on one with the titan of wall street when we return. 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And when it is, a few hours of shuteye to rest up for tomorrow, the day well finally get something done. there, hello startsy getwith hi mple. How can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Maria welcome back. In 1994 dick grasso made the decision to allow me to broadcast from the Stock Exchange floor, first time anybody had done that regularly. We spoke about that as well as the many changes that the exchange has gone under since then. In addition, we talked about news of the week. We had a bid and then a rejection. Hong kong made a bid to acquire the london Stock Exchange this week for 36. 6 billion. London came back and said, not happening, we are rejecting this bid even though dick grasso said it was very rich. Watch this. First, let me say cnns great loss, the loss of maria bartiromo, was cnbc at the time and the nyses great gain, because you became the ambassador of the Trading Floor to the millions of people who watch financial news. And i was always very concerned that the insular image of the New York Stock Exchange heres this private club owned by 1366 boys, if you will, all right needed to be further understood in middle and throughout america that it was americas institution. Because in those days you had 100 Million People who either owned stock directly or had, you know, 401s or iras or insurance policies. They were indirect investors. But they didnt understand what the floor of the New York Stock Exchange was, what a stock was, how an order got executed. Maria bartiromo became the ambassador, the interpreter and brought us to the living rooms and kitchen tables of hundreds of millions of people. Maria it was incredible. It was the first time that, you know, you you could actually wah somebody on the floor on a regular basis, and i was honored to be that person thanks to dick brass sew. You were that person, and you were exclusive for a period of time [laughter] and the other networks hated it. Will[laughter] maria they would call me up and say how do you allow those people to bump into you . Next day theyre calling, they wanted to be on the floor as well. Theres news this week, the hong kong Stock Exchange trying to acquire the london Stock Exchange. Look, youve seen a lot of consolidation on your watch. Youve done deals in terms of this sector. Whats your reaction to hong kong wanting to acquire london . Its a logical move that there be fewer but larger, call it transaction managers. We call them Stock Exchanges. Hong kong, i think strategically positioned with london creates the opportunity for a 24 hour a day, 5 day a week or more marketplace. I think its a very interesting price level. I think its high maria its rich. It is high, and, you know, i wouldnt be surprised if the bid gets changed higher. Because i dont think london is going to accept the first bid it gets. Nor do i discount the possibility that london turns around and bids for hong kong. Maria there are fewer companies today public than there ever have been, by the way. And the private market is also heating up. Give me your reaction to whats going on in the public i think what weve experienced in the last call it ten years is that Companies Stay private longer. Why . Because theres plenty of capital in the private markets. And, you know, in the private markets youre not subjected to the rigors of public ownership; disclosure, corporate governance, all the things that are earmarks of publiclyowned companies in america. I think the marketplace is starting right now to discern the winners from the losers. And when i say that, i dont mean in terms of their stock prices, but investors are looking at companies that want to go public and saying this companys not profitable, doesnt have the prospect of becoming profitable, why should it be valued at x, y or z billions of dollars . You know, its an interesting phenomenon going on with well, wework. One of the largest shareholders has said dont do it. Maria soft bank. Thats soft bank. If you look behind the curtains, its pretty predictable why they would say that. They were a private investor at a much higher price. Now, if they go at the level theyre kind of indicating which is half of what soft bank paid soft bank is going to have to take a charge. Now, soft banks a public company, and i think going public is a good discipline if you need capital, if you want script shares to incentivize employees, to bring on new employees. But you have to be prepared for what the public marketplace wants; transparency, clarity of reporting, clarity of business definition. Somethings going public some things going public today are undervalued because they havent done that properly. Some Companies Going public today have no business being public. Maria do you think its all going to go digital . I mean, you oversaw when i first started on the floor of the New York Stock Exchange, i believe there were more than 5,000 people in five rooms, right . Thats correct. Maria youre talking now one room, 500 people not even. Maria okay. So what theres a plus and the minus to that. The plus, of course, is that technology has been a great driver of bringing the marketplace on a democratic basis maria not a political statement. Right . To a broader spectrum at a lower price. Thats the positive. The negative is the transaction price discovery, i dont think, is as fair as it once was. Now, the public always came first in terms of price discovery at the New York Stock Exchange. Whether it was 100 shares, my grandmother in tennis shoes or 100,000 shares, a big institution. Today its who gets to the market fastest. And traditionally, thats not the small investor. And thats a loss. Of course, even greater loss is defined in the human loss. Youre right, 5,000 people once; today about 200. Finish. Maria my thanks to dick grasso. Stay with us, much more wall street right after this. Great presentation, tim. Could you email me the part about geico making it easy to switch and save hundreds . Oh yeah, sure. Um. You dont know my name, do you . laughs nervously of course i know your name. I just get you mixed up with the other guy. Whats his name . Whats your name . Switch to geico®. You could save 15 or more on car insurance. Could you just tell me . I want this to be over. Why accept it frompt an incompyour allergy pills . E else. Flonase sensimist. Nothing stronger. Nothing gentler. Nothing lasts longer. Flonase sensimist. 24 hour nondrowsy allergy relief every curve, every innovation, every feeling. A product of mastery. Lease the 2019 es 350 for 379 a month for 36 months. Experience amazing at your lexus dealer. Maria thanks so much for joining me ts week. Were going to end this somber week on a high note. Last sunday spanish tennis star rafael nadal won his fourth u. S. Hope and 19th grand slam. We spoke to rafa right after his historic win. Have a great rest of the weekend, everybody. See you next time. Tennis is a very competitive sport mentally you need to be stronger single day. You have to have a spirit of trying to do good all the time because your rivals are improving. So yeah, i really like everyt just did. Gerry hello and welcome to wall street journal at large. This week another high profile Trump Administration official was showning the door. Now, what he was fired or quit, National Security adviser john bolton is out apparently after months of bickering with the president over foreign policy. Mr. Bolton was said to be unhappy with a number of the president s diplomatic initiatives including his plan to hold secret peace talks with the taliban in an effort to end the military involvement in afghanistan. The president eventually did cancel those talks. There were also tensions over iran and possible talks with