francine the debt ceiling will we get through it without a credit event nouriel we do not know yet they may get to the last hour before there is an agreement or it is possible they do not reach an agreement if that does not happen the market will crash and that may force an agreement francine does not erode the credibility of the us the dollar and american financial markets nouriel we talk about dedollarization and the chinese definitely want to increase the force of the raymond d  renminbi if there is a credit event so that will increase the likelihood we will diversify away from normal assets over time francine there are so many stories about what big wall street titans are arriving here to get an audience with the sovereign wealth fund and other decisionmakers is this region going to dominate economically for the next decade nouriel we recently had an energy boom and it will stay here there has been a correction of energy prices and therefore this time they are filling up massive reserves therefore every asset manager in the world is here because there are lots of opportunities of investing outside of the region and within the region francine we hear about wanting to get into other asset classes what does it change is it private markets credit nouriel probably private markets public equities have been overvalued there are still opportunities in private markets and we have been talking about ai machine learning quantum computing information for the future extending technology lots of people are raising money and investors in the region want to be part of that as well francine are you expecting more deals coming out of the middle east and the us i cannot figure out the relationship between middle eastern money and us finances right now nouriel there was a recent announcement that if you are under 1 million in the new ai firm those types of deals can occur and in the private market most of these new firms do not yet have an ipo so we will see much more interest hikes and investors into this region a lot of new developments are occurring in the united states more so than in europe francine what are you worried about in the markets isn  t liquidity geo fragmentation that occurs through and you could get a shock on the markets nouriel there is a geopolitical depression and there is a war in ukraine the invasion of ukraine will get worse this year and could lead to an escalation i was just in israel where we were worried about iran becoming a state and they made a decision on whether to accept the tariffs to give to iran or not and risk shock to the energy prices unfortunately after the g7 summit there will not be any talks between the us and china the chinese reaction to the g7 summit is that others are ganging up against china so this cold war with china will get colder geopolitical tensions will have locations because of the slowdowns in economic growth and you need to factor in market prices francine is there a role for europe between the us and china and can they attract investors from certain parts of asia because of this cold war nouriel the europeans would like a deal to do business with both the us and china the us is telling them what is happening in ukraine given that china is a factored ally of russia and you have to take a stance there has been a movement projected towards asia a whole buildup of a new asian regional security it will also involve europe europe has not communicated effectively those types of concerns francine where do you see the most complacency nouriel it is still in equity markets people think that central banks are done with raising rates and therefore they  this year it is highly unlikely they might see rates hike further in june and there is still a lot of inflation around throughout the big surprise will be inflation and the central bank will have to make a tough choice of either raising rates more with a hard landing and financial instability or not raising rates but then you will have inflation expectations with standing francine all of the warnings we heard from chief economists have not come to fruition about how we could see an economy that falls because of inflation or cuts why this dichotomy nouriel there is a dichotomy because markets believe inflation has peaked and will fall sharply maybe a short and shallow recession will lead them to cutting interest rates and the markets are bullish about a soft landing i think central banks are telling them no we are not done yet we will not cut rates this year and there is risk of correction for the economy the fed is expecting a recession later this year francine how much already weighed about the uk out of the g7 countries  how do feel about the uk out of the g7 countries nouriel they have more of an economic downturn compared to europe and more pressure on upward inflation therefore i would say among the g7 the uk remains the weakest link francine is there anything they can do now to get back on track to foster growth and get back in the game nouriel effectively you will have to somehow factor a reverse brexit if you reach further trade agreements with europe then the bottlenecks in the uk on the good sides labor market and services were made by the brexit decision francine could the uk foster more relationships with asia and the middle east to trade investment nouriel they can but the key trading partners for ukraine is still europe and the euro zone  for the uk is still europe and the eurozone we look at europe and japan for the technology the interest in the middle east as well but i would say having a strong and open relationship with europe francine is your base case some sort of credit crunch in the us nouriel there will be certainly some credit crunch especially among the regional banks those are the ones that are squeezed those are the banks that lend a lot to households and then commercial real estate estimates as of now is the credit crunch is going to reduce economic growth in the us by at least 50 basis points that does not look like a lot but in the first quarter growth was 1 if it goes from 1 to 15 you are in a growth recession and factoring in the other things throughout the year francine when did the markets start factoring in who the next possible us president is we are in an election cycle nouriel markets will not know about it but it will become an elephant  an element that leads to more political uncertainty over time