Are The Stimulus Plans Working?

" Well we've got to talk about the United States spending 787. Billion dollars to stimulate the US economy. And China has its own stimulus plan -- roughly eight. Four trillion -- convert it 585 billion dollars US and they're not alone all over the world countries is -- money. It was their economies what kind of impact of beef to -- plant haven't. Joining me now is Bob Hormats of Goldman Sachs international vice chairman. And Bob Dylan in Saatchi and thought -- chairman. And the author of start with an answer and other wit and wisdom or firing leader skies gentlemen thank you for being here good to see you do. Great to be all right I think you're both Bob I'm going to do mr. does that make you sound like we're in school here I think this is still let me let me start with you. The first ball and the role right now of a place like shine in this global recovery. How it is that you're speaking specifically to the Chinese consumer is different than unions -- Well."

" We've been in China since 1992. And we went there would Procter & Gamble and they have a tremendous business there. I think in China TV is the big medium. It's also the Internet and mobile phones you need to talk to the Chinese people in a way that is unique in respectful to their culture. And put our products in the context of Chinese life. But it's a tremendous dynamic society and going wonderfully."

" EU Bob we talked a little bit earlier about the need to feed China we cover. Perhaps be the one of the first to recover as -- global economy. Works its way through a recession. What are the key -- that why he's trying to show crucial in this story."

" crucial because that's the biggest economy in Asia it's the third biggest economy in the world their previous national economy in the world. And it is very important for commodity markets. For American high technology companies. And generally if you can get China and the United States' growing at the same time. It has a very positive effect. On the entire global economy and and and and therefore it's at the plots particularly for our an Asian partners because of Korea and Japan and others can import sell more to China then they can buy more from the United States so it helps to boost our trade with those economies --"

" You know and this is feeling you've you've sent that in fact you guys have been married since 92 a lot has changed in amendments have a couple of decades. And is rising role of the middle class in China is a big story there but they've been facing their share of head winds. How public trust that with the consumer."

" Well China has indeed fallen off in terms of the media spend you know last year they were up 19% thin as we look at it. These -- of 2009 they're probably only to be up like five and a half percent so they dropped fourteen points. But knew we basically try to stay with the fundamental. Communications and values and build the business and good times and bad times."

" Isabel he propositioned them different in terms is selling what it is that accompanies all about the bland the value that connection to the consumer. When they're at such a difficult time like this and they have a lot less ability to go out there and expect."

" Right well I think we try to re frame value for the reality of the environment that we're in. But we also try to stay true to the brand equity to build the business in the first place. Because these kind of downturns are great opportunity for companies to position themselves to build market share. For when the inevitable rebound occurs. So you don't want to position your brand is just something it's the brain to buy when there's a recession going on our if you want it to be the brand that has long term value is in will be there. When everything turns around."

" Bob part of that that -- and connection to United States is helping finance our debt minor detail. And and that is a huge role or -- our relationship I guess that fitness back and forth between the two of us. And how interconnected our -- economies are also as well for exports in China. How essential is that. That not only that we keep that relationship that that connection for debt and export driven. But also just just sort of relationship wise. That where the dominant players in the industry were becoming more dominant."

" Well it's critically important I think that that the debt relationship the trade relationship. We need China on energy their big users of energy. Any environmental problems that have to be dealt with the global economy have to be worked out between the United States and China and they want to voice at the table. They're not going to be contentious to sit there that governor of the central bank of China has indicated they have views on a new global reserve currency or. At least strengthen the role the of the FDR -- IMF. The whole range of things they want to major -- to the table Bob pointed out. What we have to do in in the advertising area as well as in others because they'll understand that the Chinese dignity that they're playing a major role they were the big economy in the world. 200 years ago 300 years ago. Now they're coming back and and they want to play a major role and we have to also make sure that our capital markets. Maintain the confidence of Chinese investors if we do not overrule medium period of time improve our national finances. And and make sure capital markets function well the Chinese or indicated they're concerned. About that not so much today or tomorrow but but over the long term we have to maintain the confidence of the Chinese. In our markets there are the ones that we rely on for capital."

" Very valid concern you wouldn't let me ask this last question. -- we were trying war war to focus on what's happening overseas in the international markets and we get you book your thoughts on this before we got. And explains the American people why -- people need to know what's happening in China why they need to know what's happening in Latin America why we are war interconnected than ever. How do you explain on the advertising front."

" Well I think it's just simply true that we're a global economy and what goes on everywhere else is interacting. In the Internet and courses that thing to brings it altogether if connects the world. So would that connectivity and with all of these trends interacting both economically and culturally I think we're becoming one world."

" I totally grew that I think Americans may not realize that we export equivalent to 13% of our GDP giver tonight. A lot of jobs in this country depend on exports millions and millions of jobs salute to the extent the rest the world prospers. We prosper also and and if you want to talk about American recovery. American recovery depends primarily what we do at home but it can be enhanced or retarded. But what happens abroad if if the rest -- world does not recover. In a very effective way that slows down a recovery if on the other hand China and other countries to better. Then it enhances prospects for recovery."

" Right Bob Hormats I thank you so much for being your only warning. About -- you're gonna stay with may want to talk a little bit more about the advertising industry a couple of things. You've run a lot of companies in your day and I got some questions to you about the board of directors as well. Read Harry had come."