Away with blaming this on the coronavirus when we know that the entire bail reform was changed he basically whats taken the largest city in america, and now were challenging chicago as a killing field. Its a tragedy. The man is a disgrace. Maria crime is surging in our largest city. New york city saw a a violent fourth of july weekend, 44 shootings, don. I saw weekend statistics, i thought i was looking at one of the Second Quarter statistics. I couldnt believe the damage of one weekend of activity. Maria should states and cities be reaching out to the federal government for help in terms of these spikes in crimes . Absolutely. And the president s been very clear about that, that localities and states, if they need assistance, then they should certainly call on the federal government. Maria broadly speaking, whether its china or tech or sectors, tell me where you want to allocate capital today. I think its time to start adding a little more defense to the portfolio now that weve already seen the market rebound 42 now that the covid news getting is changing. Maria is there a screaming buy to you right now, art . You seemed cautious earlier. This has been a techled rally, tech and Health Care Companies have led for most of this rally, and i would not be surprised to see some transition over to cyclical stocks. Maria is there truth that theres censorship . I think they are censoring. I dont think they believe they are, and i dont know that they would ever admit that they are. Maria and, of course, then there is china. The crackdown and focus this week, the white house is looking to banning chinese apps like tiktok over concerns and how they handle user data. Fbi director Christopher Wray, meanwhile, gave a speech detailing the threat of communist china expect concerns over corporate espionage, the theft of intellectual property and your perm data. Joining me now to talk more about that is the founder of the atlas foundation, author of chinas vision of victory, dr. Jonathan ward. Jonathan, thanks very much for joining us. A lot of movement this week on china by the administration. Your thoughts on sanctions being put into place on any chinese official who is involved in the human rights abuses over the uighur community. There are, what, a million and a half weeingers locked up uighurs locked up in camps right now . Hi, maria, its great to be back. Thats right. I think you see u. S. Government coming together across a series of departments, and this is very important because, you know, earlier thered been an adjustment, lets say in the pentagon or at the state department, but youre starting to see the departments Work Together whether its commerce, treasury, state. You know, there were comments from the state department to the sec this past week saying that, you know, that essential essentially the s rule that allows Foreign Companies to list on u. S. Exchanges without abiding by sec regulations, that should be eliminated. The imposition of sanctions on chinas senior officials involved in the human rights abuses and atrocities a major step. It includes one politt are burrow member, so this is about as high up as officials have ever been sanctioned. And youre talking about a turning point in the u. S. china relationship where our government is starting to find its footing on a new strategy towards china. Maria yeah. Well, i mean, it definitely is [inaudible conversations] if yeah. Yeah, its definitely a consistent message now coming out of this administration. Weve heard from secretary pompei owe, weve heard from a. G. Bill barr who sat down and talked with me about this. He says this is theft of our children and our grandchildren because theyre actually stealing our technology, military data, medicine data. So Christopher Wray this week said this china as led by the Chinese Communist party going to continue to try to misappropriate our ideas, influence, our policymakers, manipulate our Public Opinion and steal our data. They will use all tools and all sectors approach, and that demands our own alltools and our own allsectors approach in response. Jonathan, it feels like the administration is pointing directly at the corporate sector to say, stop looking at profits over longterm impact to national security. That is exactly what a. G. Barr told me in hi my exclusive interview that Companies Want to sell their widgets to 1. 4 billion people, and theyre forgetting that the Chinese Communist party is stealing and has all this theft of intellectual property, and they are getting ahead of us in some of these important industries. Your response. Well, thats right. Were in an existential contest with china, and this is just getting started. This is not going to blow over. Its just the beginning. So c suite withs need to rethink their china strategy, their global strategy, they need to understand how they fit at the intersection of u. S. Government response and sort of, you know, chinas advances not only in the china market, but worldwide. And then Institutional Investors and portfolio strategists need to start looking at their exposures. Really Everybody Needs to do a comprehensive Risk Assessment and understand how theyre positioned in this situation. Maria meanwhile, the president continues to encourage investors and things like the railroad, 401 k s, the Railroad Workers 401 k s not to invest in chinese companies. The chinese stock market has been on fire. In an 8day period, the shanghai composite was up 17 probably because the Chinese Communist party told its citizens we want the bull market in place because thats going to be part of our recovery, and as soon as they said that, like in seconds, in minutes millions of chinese citizens went and opened retail stock market accounts. And, of course, at the end of the week the Chinese Communist party said, well, maybe its getting ahead of itself, and then the market ended lower. Its amazing the way its so topdown there. Your reaction to what has taken place in terms of investing in chinese companies. The party is able to move markets and, essentially, whether theyre allocating capital to Strategic Industries and technologies or simply, you know, participating in their own stock market, its not the same as how it works over here. I think part of, you know, what is coming is a review of chinas access to our Capital Markets and strategically the United States is going to have to stem the tide of capital to china. So i think when you look at the bills in congress that have to do with delisting chinese companies, when you look at the sort of interplay between Government Departments talking about this issue, i think this is coming, and i think the Chinese Government is preparing to have a different approach to Capital Markets. Maria jonathan ward, great with insights as always. Appreciate your time this weekend. Thank you, sir. We will see you soon. Thank you, maria. Maria dont go anywhere, weve got the head of the dallas Federal Reserve, Robert Kaplan, the president and ceo. Hes up next. If. Marco. polo marco. polo marco. polo marco. polo marco. polo si . Marco. polo scusa . Marco. polo ma io sono marco polo, ma playing marco polo with marco polo . Surprising. Ragazzini, io sono marco polo. 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If i can take of everyone who is sick out there, my money should work as hard as i do. Thats why i use my freedom unlimited card every time i get gas. Give me a little slack with freedom unlimited, youre always earning. I said i need some slack on pump three maria welcome back. Well, the second half of the year, the state of the economy in focus. While there has been signs the recovery is in full swing, concerns over the rising cases of coronavirus nationwide have some predicting the growth will be limited in the third quarter. What part of that, another round of stimulus plays, also among the conversation. Joining me right now i to talk about all of that and more is the president of the dallas Federal Reserve, Robert Kaplan. Robert, its great to have you this weekend. Thank you so much for being here. Let me kick it off with getting your state of play here. How would you assess where we are in terms of this recovery because we saw good retail Sales Numbers recently, pretty good jobs numbers for two months in a row. Should we assume the recovery has begun . Yes, we saw a weaver contraction in the second we saw a severe contraction in the Second Quarter, but its my view we started to grow out of that in may. Weve been growing in june. Thats consistent with the strong jobs numbers, strong retail sales, strong consumer. The issue is the recent resurgence in cases may mute the growth from here. We still believe at the dallas fed well grow in the third quarter, and well grow in the fourth quarter. The question how fast. If we saw better control of the virus, wed grow faster. And if this resurgence continues, were going to grow slower than we would. But we still think recovery, and its just a question at what rate. Maria so how does it feel to you there in texas, you know, a lot of conversation recently about the hot spots of the country, and thats florida, texas, arizona, california seeing spikes. Do you feel those spikes . Has that slowed the reopening plans substantially in texas . Yeah, it has, in my opinion. And i literally spend every day talking to Small Businesses, mediumsized businesses, big businesses. I walk around every day and try to understand and talk to people whats going on. And, yeah, we saw Pretty Healthy growth, as i mentioned, in i may and in june. And in the last couple, three weeks you can see traffic is somewhat less. Some people that were going in to work have decided to stay home. Restaurants are less crowded. You see a little weaker price of oil. And so, yeah, it, it feels to us looking at the mobility if data and talking to people out there its slowing. And im most worried about the Small Businesses who weathered the shutdown, many of them did a ppp loan, they paid it back, the loan got forgiven, they brought their people back, and now theyre slowing again. And they dont have access to a second round of ppp loans, and theyre struggling now to figure out where they go from here. And its the Small Businesses in particular if im very worried about as we see this growth slowing. More yeah, for sure. And there will be structural changes, i know, to this economy which we want to get to in the next block. But let me get this from you. On mornings with maria you joined me this week, and we were talking about masks. You said the more people wear masks, the growth will rise. So youre looking at masks as a very important part of this recovery then. Yes. And this is based on lots of conversations with epidemiologists, Infectious Disease experts, local as well as national. And the one piece of advice ive gotten consistently from all of them is if people broadly wore masks in the country, transmission would slow substantially. And its not just to protect yourself, its to protect others. And if people wore masks probably broadly, wed grow faster. So you heard me say Monetary Policy and fiscal policy have a role to play, but probably at the forefront of Economic Policy in this country right now is following these Health Care Protocols. Thats the vehicle to growing faster. Maria i want to take a short break. When we come back, i know you and your colleagues are thrown a lot of stimulus at this economy. It is the reason were expecting growth in the second half of the year, but theres been criticism about that as well. I want to get your take on what jim grant had to say in a recent wall street oped, get your take on the criticism of the Federal Reserve when we come right back. Stay with us, more with robert cap hand when we come back. Kaplan when we come back. Hey, can i. Safe drivers save 40 guys guys safe drivers save 40 safe drivers save 40 safe drivers save 40 thats safe drivers save 40 . It is, thats safe drivers save 40 . Hes right there. Its him safe drivers do save 40 . Click or call for a quote today. In a highly capable lexus suv at the golden opportunity sales event. Lease the 2020 nx 300 for 339 a month for 36 months. Experience amazing at your lexus dealer. Iredefined the wordng thschool this year. Experience amazing its why, at xfinity, were committed to helping kids keep learning through the summer. And help College Students studying at home stay connected through our university program. Were providing affordable Internet Access to low income families through our internet essentials program. And this summer, xfinity is creating a Virtual Summer camp for kids at home all on xfinity x1. Were committed to helping all families stay connected. Learn more at xfinity. Com education. Interest rates no longer are prt reliably direct investment flows, and Interest Rates are the artificial constructs of the fed doing its best to step in and make something happen in the absence of Economic Activity as we used to know it. Maria and that was the founder of grants Interest Rate observer, jim grant, talking to me this past week. Talk about this recent wall street journal oped on the dangers of rock bottom Interest Rates. Im with Robert Kaplan this weekend. It has been a massive amount of stimulus, robert. What is your reaction to what jim grant just told us in terms of the negative implications of these rock bottom rates . I think its good to be mindful of these concerns and that in a crisis, which were in, i personally think its been quite necessary to drop the fed funds rate to zero, to do a number of these programs that weve instituted to help stabilize the functioning of the financial markets, corporate bonds, municipal bonds, a whole range of money markets, etc. However, as we go through this crisis and, hopefully, move past this virus the challenge will be how to withdraw and sunset some of these programs and also be mindful that undue awe comation this is, again, in the future can have distorting effects on markets. Were not to that point yet, in my opinion. I think were right in the teeth of the crisis right now. But i think these concerns, for me, are worth keeping in mind in the future as we, as we move through this. And i think showing some restraint as we go through this will be appropriate. Were not to that point yet in that were still in the middle of this crisis. Maria right. But i think its good to be mindful of these concerns. Maria yeah. I certainly am. Maria well, especially since this has really dictated behavior on the part of investors. When you dont get any yield from fixed income, youve got rock bottom rates, youre going to put your money somewhere else, and maybe its going to be into stocks like tesla which it has no end to going if up with the momentum in the nasdaq. Jim grant writes this groundscraping Interest Rates turn savers into speculators. They facilitate overborrowing, suppress market signals, misdirect investment dollars and promote the dubious business of turning wellfinanced public if companies into heavilyindebted private ones. So i guess the issue here is what would it be to turn your feeling about rates to start thinking, well, it is time to start normalizing . I mean, what are you looking for in terms of understanding when to actually normalize rates . I know jay powell has said rates will be near these levels until 2023. Yeah. So we need to, we need to be making progress in growing gdp, getting down the Unemployment Rate so that the official Unemployment Rate is 11 and a fraction percent. U6, the broader measure of slack which includes discouraged workers, people who work part time that want to work full time, thats at 18 now. This is why ive said, ooh ive been very vocal the last number of weeks about the Health Care Protocols. If we wear masks broadly, we do a good job on the Health Care Protocols and we grow faster, it means we wont have to do as much monetary and fiscal policy. If i i would very much want that. To the extent we dont do a good job on the Health Care Protocols and we grow more slowly, were going to be in a longer period of requiring more monetary and fiscal policy. Maria robert, how close hi are you watching the rest of the world . There is this, i would say, economic cold war underway with china. 150 bills in congress trying to keep china accountable. Youve got issues from the uighurs in camps to companies that trade on u. S. Exchanges and they dont follow the psalm accounting rules same accounting rules to covid19 and everything else. Is this going to Impact Global growth . Yeah, it is, its having a negative effect on global growth. And were watching and studying very carefully here at the dallas fed. My team broadly at the fed, countries around the world and what theyre doing to combat the virus, their own incidence, how theyre responding in terms of growth. And a number of them have, are right now having better experiences in muting the spread of the virus although they have some resurgences, but theyre modest relative to ours. And i worry a little bit about the divergence between u. S. Performance regarding the virus and many other countries, and thats probably the number one issue im watching. Maria and real quick, robert, before you go, are you seeing a change in capx . If are businesses starting to loosen up the pursestrings and start investing in Capital Expenditures at this point . Not really, is the answer. Maria okay. Ing and i think theres so much uncertainty, most ceos i talk to broadly are taking a wait and see approach. Theyre being relatively cautious. Capx in the oil sector is going to be down as much as 50 this year. So youre going to see maria wow. Very weak capx. The extent we get more visibility and certainty, youll see better capx. Maria robert, its great to see you this weekend, thank you, sir. Robert kaplan, president and ceo of the dallas Federal Reserve. Thank you, sir. Dont go anywhere, more wall street right after this. At Fisher Investments, we do things differently and other Money Managers dont understand why. Because our way works great for us but not for your clients. Thats why were a fiduciary, obligated to put clients first. So, what do you provide . Cookie cutter portfolios . Nope. 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Eastern here on fox business, for another edition of wall street. This weekend join me live on sunday morning over on the Fox News Channel for account for sunday morning futures former new york city mayor rudy giuliani, my special guest joining the show live sunday over on fox news at 10 a. M. Eastern, sunday morning futures. Fox business, start smart weekdays 69 a. M. Eastern for mornings with maria. Set the tone for the day. Have a great rest of the weekend, everybody. Thank you so much for joining me. Well see you again next time. Hello e and welcome to the wall street journal at large im James Freeman filling in for jerry baker. Lower covid19 fatality rates nationwide should be cause for celebration, but a rise in cases has the lockdown color race once again raising restrictions. Their claim is after the shutdown spring, reopening has been deadly. Atlanta mayor ceesh a shah bottoms put the blame squarely ho