oh, oh, oh, where am i? wha...? stewie, what the hell happened?! oh, well, shortly after you left, da vinci's girlfriend showed up, so i injected her with my dna. you had sex? no, i put my dna inside her. right. you had sex. no, what are you not getting? i put a sample of my dna in a syringe and i injected her on the staircase, the couch and the balcony. well, whatever the case, thank god. yeah, i know. oh, hey, i brought you something from da vinci's workshop. a candle? i can get a candle now. you couldn't have grabbed me one of his original notebooks? you know, i didn't have to bring you back anything. it's almost like you didn't. ♪ ♪ >> announcer: from the most trusted journalists at comedy central... it's america's only source for news. this is "the daily show" with your host, jon stewart! ♪ ♪ [cheers and applause] ♪ ♪ [cheers and applause]

>> jon: boom! welcome to "the daily show," ladies and gentlemen! my name is jon stewart. we have a fabulous show for you tonight. christine lagarde, president of the european central bank, is here. we'll be talking about her new movie, "beetlejuice beetlejuice 3 sisters!" by the way, speaking of europe, let's talk about the middle east. [laughs] as you know, october 7th marks the one year anniversary of the horrific attack against israeli citizens and the kidnapping of hostages, many of whom have died and many who are still being held. since then, there's also been a horrific war in gaza, which doesn't seem to have gottenus any closer to those hostages

getting released. but luckily for both sides, the united states has been working tirelessly since then towards... well, i'll let our former president explain. >> for weeks, i've been advocating a pause in the fighting. >> you know, i've been working tirelessly. >> relentlessly focused. >> i've been working non-stop. >> i'm engaged in this day and night. >> we're working around the clock. >> we are closer than we have ever been. >> we're very close. >> we're close. we're close. >> jon: he stopped to get ice cream once! but other than that, it was all ceasefire all the time! now if you don't mind, i'm going seeing what's going on over there and it's making me a little hungry. i want to tell my going to get some ice cream for myself. [cheers and applause] i'm going to -- i just shot

ice cream into my eyes. ice cream, i give the president credit. they are a dangerous treat. i'm going to take a big bite of my ice cream cone as i find out how our ceasefire efforts are paying off. >> israel launching an all-out assault on hezbollah in lebanon over the weekend. [cheers and applause] >> jon: what? so worth it. wait, we've been working tirelessly for a cease-fire in gaza and then [bleep] lebanon? the whole point was we're going to downgrade hamas, we're going to attack the terrorists there, get the hostages home. what did lebanon do? >> no country can accept the wanton rocketing of its cities. we can't accept it either. >> jon: but you've also been wanton rocketing! what kind of rocketing are you doing in gaza, if not wanton?

[cheers and applause] that is how little criticism they face. by the way, lebanon is also a country. what makes you think they're going to accept your rocketing or whatever other james bond shit you've been up to? >> thousands of wireless pagers simultaneously exploding across lebanon. >> jon: exploding pagers. ah, lebanon expected israel to attack from the south. but instead, they attacked from the 1980s! what? ooh, you know what lebanon should do! well, israel, got any quarters? by the way, a quick message for our viewers under, let's say, 45. this is a pager. [cheers and applause]

this is a pager. i'm going to put it over here. not really sure where we bought those from. you see, there was a time back in the olden days, when we didn't have cell phones, but still wanted to buy drugs. you would -- you would ping your local neighborhood dealer on his pager -- what? and he would come over and then he would say something like, "are you going to smoke all of that?" and then you would say, "do you wanna come in?" and the next thing you know you're driving him to schenectady. the point is, stay in school. [cheers and applause]

but yes, israel -- israel remotely exploded all of hezbollah's pagers and walkie talkies, which is why, going forward, hezbollah will limit its communications to the message boards on nudeafrica.com. because no one will ever find out the things you post on nudeafrica.com, under the username "i am mark robinson, candidate for north carolina governor 836." no one will find out. [applause] now we know the americans have been working tirelessly on a ceasefire in gaza through countless hours and all 31 baskin robbins flavors. apparently. but this new conflagration points to another outcome the united states has been very

much trying to avoid. >> from day one, since october 7th, it's been one of our primary objectives to prevent the conflict from escalating are spreading to other places. >> prevent an escalation or widening or deepening of this conflict. >> we have been laser focused on trying to prevent that wider war since october 7th. >> i don't think we need a wider war in the middle east. that's not what i'm looking for. >> jon: why would you be looking for that? "you know what i'd love? a wider war in the middle east." well, now that a wider war has broken out in the middle east, this is president biden yesterday talking about what we're going to do about it. >> we're going to do everything we can to keep a wider war from breaking out. >> jon: how [bleep] wide does the war have to be before -- "without turkey, it's technically still in the margins!" "look, as far as i'm concerned,

it's not a wide war until it includes mongolian archers!" come on! what are we doing? and by the way, if this isn't the wider war, then what is this? >> it continues to be a very dangerous situation. a very difficult situation. it's a very difficult, volatile situation and the -- the situation could escalate at any moment. >> jon: [bleep] -- i'm sorry, so it's not a war. it's a "volatile situationship." friends with "bomb-efits," if you will. [cheers and applause] what if you really want to experience the full cognitive dissonance and language calisthenics that have to be deployed to describe the

middle east over the last, i don't know, four, five, six, 10,000 years, i give you: the golden soundbite. brought down from sinai to explain how [bleep] convoluted this has to be. >> what the israeli government has said -- and the biden administration is, in many ways, subscribed to this idea -- is de-escalation through escalation. >> jon: or as that is sometimes called: war! that is -- world war ii, look at the subhead! de-escalation through escalation. i mean, do you even hear yourself? my god, that -- de-escalation through escalation. that phrase is right out of...

let me see if i can find it. [cheers and applause] no, it's not in here... let me see if i can find. no, it is not in there. let me see if i can find -- [cheers and applause] oh, my god. jon, that cat has wrecked havoc on your bachelor lifestyle. although, i do take issue with one of garfield's bromides: i happen to love mondays. [cheers and applause] it's the start and end of every work week. though, i hear fridays are nice. but here's the worst part. the country that's providing all the bombs to the middle east, or

bombs "escalators," seems to have no idea when about these bombs are going to be used! >> we were not notified by the israelis about their strike or the intended target of their strike. >> first, this is something we were not aware of or involved in. >> the united states did not know about, nor was it involved in, these incidents. >> jon: oh! they're not telling you anything? have you checked your pager? i mean, my god, there have to be other ways of achieving deescalation without the respectful exchange of missiles. historically, that part is generally followed by years of sorrow and bloodshed. and we know there have been opportunities for de-escalation but netanyahu did not seem particularly interested in it.

oh, my god. i have criticized netanyahu! what have i done? go ahead. >> the people who are criticizing the prime minister, it is shameful, it is pathetic. >> we should be standing shoulder to shoulder with our strongest ally in the middle east instead of launching this criticism. >> they criticize them for going too far constantly and that gives hamas comfort. >> jon: i'm sorry? criticism of the war is shameful and it gives comfort to hamas? you know who might be surprised to hear that? the israelis, who are unbelievably critical of the war and netanyahu! [speaking hebrew] >> jon: what are you going to

say now, [bleep]? get off my back! you heard what he said! he said... [attempts to speak in hebrew] does anyone have a google translate on what he said? >> interpreter: the prime minister did not look the public in the eye and tell the truth: that he won't bring the hostages alive. >> he don't have any intent to end this war. for him, it is a kind of endless war. >> he is trying to do everything to prevent a deal. >> he don't have any intent to end this war. >> netanyahu is lying as he breathes. >> jon: what antisemites! the former prime minister of israel and defense minister are! but still, people are going to see this segment and go, all right, maybe israel isn't perfect, but the criticism feeds the fire. don't you worry about anti-semitism? and to that i say: no.

i believe anti-semitism will be fine. [cheers and applause] i got to say, not for nothing, but from what i have experienced, it's very resilient. and isn't tied to any event or war or activity or reality. for god's sakes, kanye thought we ruined his adidas deal. we just need orthotics, that's all! anti-semitism will survive this war like it survived all wars going back to the brave hebrews at masada. do you see, rabbi? i was paying attention in hebrew school! [cheers and applause] but you know what? you know what? maybe i'm wrong. maybe the "blame the jews" from the black death to the

spanish inquisition to the space lasers will all go away, if israel does right, and peace will reign, and people will no longer baselessly and conveniently blame the jews when things don't work out the way they want them to. >> this is the most important election in the history of the united states. i'm not going to call this as a prediction, but in my opinion, the jewish people would have a lot to do with a loss if i'm at 40%. >> jon: son of a bitch! when we come back, french money lady christine lagarde will be here. don't go away. [cheers and applause]

i love this place, but i need better credit. bad credit? you could just open a new card, but you kinda need good credit to get credit... wow, i could build my credit that fast? nice!

everything you need to outsmart the system. intuit credit karma. nic w. asks... "what makes the new iphone the best one yet?" everything you need to outsmart the system. well nic, iphone 16 pro is designed from the ground up for apple intelligence. plus, only xfinity mobile connects your new iphone to wifi speeds up to a gig on the go, and now at home at no extra cost. wifi as fast as a cheetah with falcon wings! stop it. -ok. learn how to get iphone 16 pro on us with xfinity mobile. bring on the good stuff.

he told us who he was. should abortion be punished? there has to be some form of punishment. then he showed us. for 54 years, they were trying to get roe v wade terminated. and i did it. and i'm proud to have done it. now, donald trump wants to go further with plans to restrict birth control, ban abortion nationwide, even monitor women's pregnancies. we know who donald trump is. he'll take control. we'll pay the price. i'm kamala harris, and i approved this message.

[cheers and applause] >> jon: welcome back to "the daily show." my guest tonight, the president of the european central bank. please welcome back christine lagarde! [cheers and applause] ♪ ♪ thank you so much for being here! we were just talking, last time that i saw you, you were the french minister of finance. >> correct. >> jon: and then you moved on, imf, and you came back, and then

now you are the head of the ecb, which is, for context, similar to what the fed would be, i assume, for the united states. >> that's right. >> jon: and you lowered interest rates as well. >> yes. we started a little earlier in june. >> jon: okay. i didn't know it was going to go there right away. i didn't know we were going to do this right away. >> we did 25. he did 50. >> jon: you only do 25? >> but then we did it again. so it is 50-50. >> jon: do you guys talk? do you say, i'm about to do 25, and he likes them i'm going to do 50? >> [laughs] >> jon: two months later and make you look silly? >> [laughs] >> jon: you don't coordinate? >> no, we talk to each other but we don't coordinate. we don't. >> jon: is this the basis points -- and we all now, there is a certain oracle nature, we wait to see what the central banks will do, and they always talk and coated and coated them

a mysterious language and they say, 25 basis points and we are like, yes! what is that? but is it now, is that the signal inflation has been defeated? >> it is not quite. we are getting there. we are almost at target. >> jon: what are you pointing at? what is -- >> my target is two. 2%. i want to get to 2%. >> jon: what is it now? >> it is 2.2. but i want to make sure that we are at 2 and we stay at 2% because that is regarded at sort of stable inflation and we look at that in the medium term. we don't want to have one month that's 2% and then another month and 2.6%. we wanted to be steady, solid. >> jon: at 2. >> ad 2. >> jon: w who is the 2 chooser? >> interestingly enough, that was way back, i think new zealand was one of those that started -- >> jon: and we are all following new zealand now?

that is what this is? new zealand one day one, you know what will be a good number? 2. >> i think all central bankers around the world thought, 2%, because then that leaves a little wiggle room to negotiate wages increases. we are not exactly sure the statistics are perfect. but there is room to maneuver on all accounts, and 2% is something that goes reasonably unnoticed as long as wages progress as well. >> jon: right. although, when you say 2%, we face kind of a pretty large inflationary spike, so it seems like these higher prices have a certain stickiness that the corporations have gotten accustomed to. like, the supply chains are a little better and things have eased, but, why not? people are still paying it. >> that is a big difference between the level of prices, and the increase in prices. >> jon: i. >> jon: i see. >> when you have had regular

increases in prices, generally, it does not move down. it stays at that level. that is, when you talk about a level of prices. >> jon: why is that? what caused the inflation in the first place? do we have a handle on that? >> yes. >> jon: okay. >> shall we think the last big inflation wave that we had? [laughter] no, okay. >> jon: yes. >> as an example. what caused it? you have three components. one is, you had the worst pandemic ever, since the '20s, the last '20s. >> jon: that's right. the shutdown of -- >> to shut down -- >> jon: that would seem to be deflationary because it seems like demand would disappear. >> well, some demand disappeared and some demand to state them particularly when people continue to receive checks in the mail and -- >> jon: the mistake was keeping people alive. >> no, no. >> jon: i get it now. i get what's happening here. >> [laughs]

>> jon: all right. >> so supply chain completely disrupted. >> jon: yes. >> first. second, we had at least in europe, the worst war since the '40s. >> jon: still going on in ukraine. so energy. >> energy, wheat, all sorts of commodity prices went down, especially given that dear mr. putin anticipated that and weighed on energy prices, so wait on energy supply, so that prices started going up, even before the war started. he had planned that all along. so energy prices were a big component. >> jon: so supply chain disruption. energy spike. now that is in europe. we did not have that to the same extent, i would assume. >> you had some of it. correct. because you have energy on-site in the country, we don't have any energy sources. >> jon: drill, baby, drill. did you know that as our national anthem? that is what we -- we sing it

before every ball game. [cheers and applause] so that is two. we've got two. what is the third? >> i would say three. the pandemic, the war, and the energy prices. so the three of them just pushed prices up in a big way. and more so in europe than in the u.s. we went on average in the euro area, prices went up 10.6%. you never had the double-digit. >> jon: i would imagine certain commodities would go up faster than others, it is not linear, i wouldn't imagine. >> no. but it has a dribbling effect. so if you have oil prices going up, it will have an impact on pretty much all other products because you find energy everywhere. >> jon: so give me a sense, so oil prices go up. how long does it take for that to insinuate itself into the supply chain system and create that -- >> inflation. >> jon: that inflation. >> it was relatively fast. in a matter of four, six months, it is into the various prices.

where there is a lag, which is much longer, is on wages. wages take more time to respond to that increase in prices. and -- >> jon: i don't know if you know this in america, wages have yet to respond. we are talking about from the '50's. like, it is really -- wages don't go up. [cheers and applause] since the '80s, it feels like the economy flipped over to an investment economy, rather than a labor. >> much more capital intensive and the renumeration of capital was higher than the renumeration of labor. you are right. it's a long time, not just the last ten years. >> jon: it seems like the approach of the 80s were the period of the regulation and it sped up. but the tools that we use, whether it is the fed or quantitative easing or those kinds of things, are still working at that supply-side level, and in other words, like in 2008, we bailed out more on the corporate side rather than the people side.

>> well, we secured the financial system to make sure that depositors for all the customers around the world were not completely lost. so that was the key proposal. make sure that the financial system doesn't collapse. and then, you are right. there was, particularly in the last six years, five years, since 2019, when we had covid, we tried to keep the economy afloat. we try to avoid -- >> jon: the more demand-side stimulus. >> yeah, certainly in this country. >> jon: and that is where maybe the rubber meets the road. it feels like, from what i've heard of economists -- >> you want to dampen demand if you want to keep inflation down. but that the same time, increase demand by putting some physical -- >> jon: but on the same time, we kept people alive and in their homes. in 2008, when they decided on the quantitative easing, to give sort of at 0% interest window, and people were able to borrow money at the corporate level, -- >> households as well.

>> jon: there was a horrible recession. it hundred people lost their homes. -- a ton of people lost their homes. the lesson to become a stimulating on the demand side with a more efficient use of capital and also had the moral bonus of covering human needs -- >> the people. >> jon: rather than -- so why does that seem now so controversial? >> it is not controversial in my books. >> jon: well, because you are human. but these guys i am talking to, they give me a whole "that last really and really screwed us for the next ten years," and i'm like, what are you talking about? >> well, everything has to be reasonable and sensible. you don't want to overdo it to a point where you have to withdraw and spun to liquidity's that are out there, and that is the reason why at some stage, you have to stop quantitative easing and you have to also stop the fiscal stimulus and support that you have given to the economy in hard times, because times are getting better. >> jon: do the central banks have mechanisms that can be more

responsive on that demand-side, as you said, rather than at having to filter through the system more on that supply-side? >> the first tool we use as interest rates. that is the most efficient one and it is the one that has been traditionally used. >> jon: almost certainly, if you raise it, will dampen the labor. >> yeah. and if you tighten, which is if you reduce the interest rates, if you cut, then it should stimulate the economy and it should encourage people having lower financing costs to go out, borrow, invest, and buy houses and things like that. >> jon: right. i wonder, is there any school of thought that thanks, we've got this thing flipped on its head, and we would be such a more efficient and humane society, if we stimulated more -- like, i'm thinking about -- you tell me if this is the wrong way of thinking about it -- trump came in, $1.7 trillion tax cut. most of it went to rich people.

got the corporate tax rate from, i think, 35% to 21%. 14%. that is a huge amount of money. he regulated a lot of industries. so i would think, as a package, that is trillions and trillions and trillions of dollars. a lot of it went to stock buybacks. it doesn't trickle into wages and the labor market, but it does pop up our deficit, making us less able to withstand, i don't know, a pandemic. because we feel like, then we can't put that -- >> i'm a little bit scared when you talk about pandemic because i watched the interview that we did together in 2009. >> jon: what did i say? >> well, you said at the time, because we discussed the standing of the economy, and i kind of sad, things are getting better. and then you close to the interview saying, unless we have a global pandemic. [audience reacts]

[applause] >> jon: to the camera, i just want to address anybody quickly. when she says i said that, she is not suggesting, all jews gave us -- what we are trying to do -- i only say that, because there has been some confusion here in the united states. but exactly right. i'm wondering, as a central banker, is there a way to look at the economy, less on the supply side. how do we get labor to benefit more efficiently from all of that money? >> you have to -- you know those things. you have two components. capital, labor, and you bring these together, and you create value. the two have to be compensated. and for decades, capitalists have been better for enumerated then labor, and the labor

share in the value production has been reduced. then it is a matter of give and take. so if the labor market is tight, as it is now, it is for the labor were to actually say, excuse me, i think that should be renumerated as well and probably better than it has for many, many years. so it is a question of -- >> jon: is there a way to do it? >> negotiations, discussions, and persistence. >> jon: right. is there a better way? because it feels like for corporate subsidies, they don't have to fight so hard. it seems like labor has to fight for that seat at the table, where as the larger entities don't. >> the balance of lobbying forces is obviously skewed to one side. >> jon: right, right. >> in most countries. >> jon: you would recommend that poor people get better lobbyists. that would be -- [cheers and applause]

what about this? how about this? is there anything in corporate, like, would you talk about buybacks, it is all in stock, what if workers were automatically invested in that? some companies do that. i think the tech industry does a pretty good job of that. when you get hired there -- >> that is one way to deal with it but it is a very small component, it could be a lot bigger. >> jon: do you think, when you forecast out, what i worry about is, labor is kind of been on the back foot, and it seems like ai is going to further erode labor's position. is that something that you guys figure in? >> that is a big concern. the discussions that are taking place now actually in new york, concerning the governance of ai around the world and how it should be enhancing workers' position, contribution to the economy, rather than replacing workers, is a vital discussion

to be had. >> jon: who is having that? >> i think it is engineered by the united nations and there is a group of, you know, thinkers and philosophers and experts in ai who are saying, watch out. because if there is no global governance on that, just as we have global governance on nuclear, not perfectly complied with, but at least generally respected. at least there is -- >> jon: we are all still here. [laughs] i am worried about that. i happen to run into a couple of, like, leading lights of the ai world. and i said, globalization, you know, really hit american manufacturing and we are still feeling it, and that is something that took decades to really play out. >> it also benefited the consumers, don't forget. >> jon: no question. we did get much cheaper stretchy pants and everything. yes, yes. but that played out over years, and there are still areas where it has decimated and haven't been back. it seems like ai will do the