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Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.

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Speaker 2: Good Morning, I'm Nathan Hager and I'm Karen Moscow. Here

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Speaker 2: are the stories we're following today.

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Speaker 3: Karen, we begin with the ongoing controversy around the probe

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Speaker 3: into j Powell and the FED. Bloomberg's John Tucker joins

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Speaker 3: us with the very latest. John, Good morning, and good morning.

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Speaker 4: Nathan.

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Speaker 5: Bloomberg has learned that Washington, DC, US attorney and former

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Speaker 5: Fox host Jeanine Piro subpoena of the Federal Reserve without

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Speaker 5: ever seeking permission from her bosses at the Justice Department,

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Speaker 5: and she doesn't plan to back down. The blowback from

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Speaker 5: lawmakers and government officials continues to grow. Federal Reserve Bank

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Speaker 5: of New York President John Williams among those leaping to

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Speaker 5: the defense of FED Chair Jerome Powell.

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Speaker 6: He's proven himself to be a man of impeccable integrity

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Speaker 6: and a man who has been calmly leading the Federal Reserve.

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Speaker 5: Former Philadelphia Fed President Patrick Harker, as members of Congress

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Speaker 5: can't let this happen.

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Speaker 7: Grim, You've talked to members of Congress on both sides

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Speaker 7: of the aisle. They understand this. They may have different

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Speaker 7: rhetoric out in public, but you talked to them one

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Speaker 7: on one. They understand how critical the Federal Reserve is

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Speaker 7: and they are going.

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Speaker 8: To push back.

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Speaker 5: Senator Tom Tilli is a key GOP member, and the

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Speaker 5: Banking Committee bound to oppose any Trump nominees to the

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Speaker 5: FED until this is resolved. Senate Majority Leader John Thune

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Speaker 5: said the threat of a legal battle with the Fed

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Speaker 5: could make confirming future nominees quote challenging. Axios reported the

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Speaker 5: Treasury Secretary Scott Besson warrent President Trump the investigation had

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Speaker 5: created a mess that could be banned for financial markets,

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Speaker 5: and judging by market reaction, investors doubt the probe of

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Speaker 5: the FED is going to lead anywhere In New York.

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Speaker 5: I'm John Tucker, Bloomberg Radio.

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Speaker 2: All right, John, thank you. By the Trump administration is

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Speaker 2: facing new legal action over the immigration crackdown. In Minnesota.

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Speaker 2: The Estate is suing the Department of Homeland Security and

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Speaker 2: Secretary Christi nom over the precedented surge of ICE officers

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Speaker 2: at Minneapolis and Saint Paul. Here's Minnesota Attorney General Keith Ellison.

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Speaker 9: The deployment of thousands of armed mass DHS agents to

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Speaker 9: Minnesota has done our state serious harm. This is, in essence,

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Speaker 9: a federal invasion of the Twin Cities and Minnesota, and

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Speaker 9: it must stop.

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Speaker 2: Minnesota Attorney General Keith Ellison's lawsuit comes nearly a week

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Speaker 2: after an ice officer shot and killed thirty seven year

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Speaker 2: old Renee Good in Minneapolis. Her death during a tense

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Speaker 2: confrontation in her car has sparked protests across the country.

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Speaker 3: Tourneing to US foreign policy now Karena by partisan congressional

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Speaker 3: delegation is headed to Copenhagen later this week to show

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Speaker 3: unity with Denmark mid tensions over Greenland. Delaware Senator Chris

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Speaker 3: Coons is leading the trip. It includes at least nine

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Speaker 3: members of Congress. They plan to meet with Danish and

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Speaker 3: Greenlandic officials on Friday and Saturday.

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Speaker 2: Let's get to the latest from the Middle East, Nathan.

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Speaker 2: President Trump plans to meet with advisors today to weigh

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Speaker 2: options on responding to deadly protest in Iran. On social media,

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Speaker 2: the president announced a twenty five percent tariff on countries

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Speaker 2: that do business with the Islamic Republic that could upset

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Speaker 2: his one year trade truce with China. Alivias is Iran

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Speaker 2: Project director at International Crisis.

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Speaker 10: Group we have to see if that thread is really implementable,

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Speaker 10: because Iran's biggest trade trading partner is China, and of

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Speaker 10: course the US is a complicated relationship when it gets

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Speaker 10: through in position of tariffs on China second most important

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Speaker 10: trading partner is the UEE, again the close ally of

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Speaker 10: the United States, and it's hard to imagine that these

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Speaker 10: countries would be willing to really cut off all their

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Speaker 10: ties with Iran.

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Speaker 2: Overnight Aliviyas with International Crisis Group notes, China is the

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Speaker 2: world's biggest buyer of Iranian oil. It's unclear if President

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Speaker 2: Trump would stack the new tariffs on top of existing

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Speaker 2: duties or announce carve outs for China.

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Speaker 3: In Japan, Karen Prime Minister Sanai Atakiichi is reportedly planning

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Speaker 3: to call a snap election. Success at the holes for Takaichi,

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Speaker 3: who has been in the premiership since October, would provide

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Speaker 3: a mandate for her to continue hawkish diplomacy and pro

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Speaker 3: stimulus policies. Stocks rallied and the end week into its

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Speaker 3: lowest level since July twenty twenty four on the news.

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Speaker 2: Well in the US here Nathan stocks and bonds rebounded

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Speaker 2: on Wall Street to eke out gains. After initially dropping

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Speaker 2: on news, the Trump administration escalated its attack on the FED.

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Speaker 2: Steve Chiverone is Deputy Chief Investment Officer of Equities at

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Speaker 2: Federated Hermes.

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Speaker 11: It doesn't matter how you get to where we were.

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Speaker 11: It's not good, right. If you have a FED share

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Speaker 11: that's engaging in illegal activity, that's not good. If you

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Speaker 11: have political pressure on a FED share being exerted through

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Speaker 11: the courts, that's not good to have. The video release

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Speaker 11: is certainly not helpful for markets. So nobody benefits from this.

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Speaker 2: And Federated Hermes Steve Chivarone. Right now, futures again are lower.

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Speaker 2: SMP futures down a tenth of uve percent this.

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Speaker 3: Morning, and attention will now turn Karen to real economic data.

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Speaker 3: This morning we get the latest inflation report for December.

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Speaker 3: Bloomberg's Michael McKee has a CPI preview.

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Speaker 12: We get a full month's data in the December CPI,

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Speaker 12: but the numbers will remain somewhat unreliable because there was

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Speaker 12: no October data. The Bureau of Labor Statistics imputed them.

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Speaker 12: The imputation was zero no change, which to anyone who

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Speaker 12: went shopping during the month knows is wrong. That decision

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Speaker 12: biased the November CPI lower. For December, we should see

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Speaker 12: some payback an upward bias. That bias may or may

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Speaker 12: not push the annual inflation rate higher. Analysts are divided,

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Speaker 12: so confidence in what the numbers are telling us may

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Speaker 12: be low. Markets however, don't see the Fed moving anyway

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Speaker 12: this month, and we'll have January and February CPI data

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Speaker 12: in hand before the next Fed meeting.

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Speaker 10: Michael L.

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Speaker 12: Key, Bloomberg Radio.

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Speaker 2: All right, Michael, thank you. In addition to the CPI report,

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Speaker 2: investors will get earnings from the first of the big banks,

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Speaker 2: JP morgan Chase reports. Before the opening bell, we get

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Speaker 2: a preview with Bloomberg's Tom Busby.

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Speaker 6: JP Morgan Chase's trading and investment thinking businesses will be

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Speaker 6: in focus, with revenue from trading stocks and bonds expected

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Speaker 6: to rise thirteen percent from a year ago, helping share

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Speaker 6: so the bank up thirty five percent in the past

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Speaker 6: twelve months, easily topping the sixteen percent gain in the

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Speaker 6: SMP five hundred Financials index. Bloomberg consensus calls for adjusted

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Speaker 6: revenue of forty six point three five billion dollars for

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Speaker 6: the fourth quarter on adjusted earnings per share of four

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Speaker 6: dollars ninety two cents. Tom buzzby Bloomberg Radio.

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Speaker 3: Okay, Tom, thank you. Look at company news now. City

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Speaker 3: Group is among three major companies cutting jobs. The bank

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Speaker 3: is set to slash about one thousand positions this week

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Speaker 3: as part of CEO Jane Fraser's March to keep a

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Speaker 3: lid on costs, and Blackrocks cutting hundreds of jobs across

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Speaker 3: its company as well. Those cuts total about one percent

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Speaker 3: of blackrocks global headcount and include members of its investment

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Speaker 3: in sales teams and meta platforms. Plans to cut about

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Speaker 3: ten percent of its employees in the reality Labs division.

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Speaker 3: That's part of a broader strategy to shift money away

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Speaker 3: from some virtual reality products and into other AI wearables.

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Speaker 2: Nathan President Trump says big tech must bear the costs

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Speaker 2: of raining in electricity costs. In a post on truth

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Speaker 2: Social the President said his administration have been talked with

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Speaker 2: Microsoft to ensure that consumers quote don't pick up the

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Speaker 2: tab for enormous data centers. The rapid construction of data

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Speaker 2: centers is widely seen as one reason why electricity has

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Speaker 2: become more expensive in the US, though it is not

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Speaker 2: the only one.

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Speaker 3: Later Today Karen, President Trumble visit a key battleground state

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Speaker 3: to promote his tariff and manufacturing policies and flesh out

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Speaker 3: a more populist economic message. He'll visit a factory that

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Speaker 3: makes Ford F one to fifty trucks and promote his

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Speaker 3: policies and an event sponsored by the Economic Club of Detroit.

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Speaker 3: This is the president's third trip to a bellweather state

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Speaker 3: since early December.

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Speaker 2: Time now for a look at some of the other

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Speaker 2: stories making news in New York and around the world

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Speaker 2: and from ever. Joined by Bloomberg's Michael Barr Michael, Good Morning,

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Speaker 2: Good Morning Karen.

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Speaker 4: About fifteen thousand nurses in New York City are on

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Speaker 4: the streets into the second day of their strike. Nurses

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Speaker 4: say they'll stay there until their demands are met.

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Speaker 13: We want a fair contract, so we want to save

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Speaker 13: our healthcare, save our pension, and provide safe staffing for

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Speaker 13: our patients.

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Speaker 4: Nurses are also calling for higher wages and better staffing.

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Speaker 4: Hospital officials say union leaders are making reckless demands, including

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Speaker 4: nearly forty percent wage increases. A New York City Council

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Speaker 4: employee was detained by federal immigration officials when he appeared

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Speaker 4: for a routine immigration appointment. That's according to City Council

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Speaker 4: Speaker Julie Menin, who says the employee works as a

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Speaker 4: data analyst and has the legal authorization to remain in

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Speaker 4: the country until October.

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Speaker 13: DHS confirmed that this employee had gone in for a

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Speaker 13: routine court appointment and was nevertheless detained. They provided no

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Speaker 13: other basis for his detainment.

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Speaker 4: According to the DHS, the employee is a criminal alien

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Speaker 4: from Venezuela who has an assault arrest and no work authorization.

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Speaker 4: New York Mayor Zoram Mamdani calls the detention and assault

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Speaker 4: on democracy and demands the employee's immediate release. New York

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Speaker 4: Governor Kathy Hockle will reveal how she plans to tackle

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Speaker 4: making housing more affordable for people. Hokel would use today's

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Speaker 4: State of the State address to detail how she plans

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Speaker 4: to cut red tape for developers to boost the state's

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Speaker 4: housing supply amid a widespread shortage of affordable units. It

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Speaker 4: would be through her let Them Build program. The proposal

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Speaker 4: has drawn criticism from green groups, who argue that changes

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Speaker 4: to the law could open up loopholes that could be

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Speaker 4: exploited by business interests. Global News twenty four hours a

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Speaker 4: day and whenever you want it with Bloomberg News Now,

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Speaker 4: I'm Michael Barr. This is Bloomberg Karen.

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Speaker 12: Thanks Michael.

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Speaker 2: All time now for our Bloomberg Sports updating. For that,

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Speaker 2: we bring in John stash Hour.

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Speaker 14: Thanks. During the end of the NFL Wild Guard Playoff

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Speaker 14: round of the Houston Texans had a one point le

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Speaker 14: in the fourth quarter in Pittsburgh and then scored twenty

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Speaker 14: three points in a span of ten and a half minutes.

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Speaker 14: They had two defensive touchdowns. Houston won thirty to six

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Speaker 14: to advance to play New England on Sunday. Was this

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Speaker 14: the last game for Aaron Rodgers? Will he retire? There

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Speaker 14: was talk the Packers might fire coach Matt Lafleur. Instead,

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Speaker 14: they're talking about a contract extension with him. John Harbaugh's

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Speaker 14: first coaching interview with Atlanta. That to Bloomberg Sports Update.

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Speaker 8: Stay with us.

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Speaker 2: More from Bloomberg Daybreak coming up after this.

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Speaker 1: Coast to coast on Bloomberg Radio, nationwide on Sirius XM,

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Speaker 1: and around the world on Bloomberg dot Com and the

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Speaker 1: Bloomberg Business opp This is Bloomberg Daybreak.

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Speaker 14: Good morning.

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Speaker 3: I'm Nathan Hager. The Justice Department's moved to launch a

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Speaker 3: grand jury probe against fedchair Jay Powell is drawing rare

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Speaker 3: pushback from many Republicans on Capitol Hill. Louisiana Senator John

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Speaker 3: Kennedy is among them. He says, a perjury allegation against

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Speaker 3: Congress is a serious allegation.

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Speaker 8: Is serious as four heart attacks on a stroke.

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Speaker 12: And if you make an allegation like that, by God,

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Speaker 12: you better be prepared to put it tobaccul up.

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Speaker 3: That was Republican Senator John Kennedy of Louisiana on Capitol

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Speaker 3: Hill this morning. We're joined by Bloomberg New senior editor

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Speaker 3: Alistair Bull and Alistair. We're just getting word from central

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Speaker 3: banks around the world issuing a joint statement of solidarity

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Speaker 3: for Chairman Powell as well. It does seem as though

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Speaker 3: the pushback against this Justice Department probe is pretty remarkable.

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Speaker 8: Good morning, morning morning, Thanks for having me on it.

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Speaker 15: It is remarkable, But I think the most remarkable thing

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Speaker 15: is the strident tone taken by key Republican senators.

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Speaker 8: Who are in a position to do something about it.

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Speaker 15: Investors may well heat comments by other central bankers and

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Speaker 15: bis it could affect their long term view on US assets.

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Speaker 8: That's obviously important.

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Speaker 15: The bombmarket vigilantes do have a role to play here.

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Speaker 15: Senate Republicans can stop Trump from putting his NOMA nominees

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Speaker 15: on the FED board, and that really sort of like

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Speaker 15: blocks the Trump campaign to get more control over the

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Speaker 15: Central Bank.

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Speaker 8: So that's very serious pushback.

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Speaker 3: What are we hearing in terms of how these subpoenas

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Speaker 3: came about. It sounds like there might have been some

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Speaker 3: kind of disconnect between the Attorney General or the US

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Speaker 3: Attorney in DC and the Justice Department rid large.

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Speaker 15: Well, you know, that's very interesting because the reporting yesterday

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Speaker 15: made it clear that there were a lot of people

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Speaker 15: around the White House who didn't know this coming and

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Speaker 15: were not happy to happen, including Treasury Secretary Scott Besson, who,

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Speaker 15: according to Axios, was very quickly on the phone to

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Speaker 15: Trump on Sunday night to tell him this was going

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Speaker 15: to be a mess and it was going to put

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Speaker 15: a stick in the spokes of his effort to nominate

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Speaker 15: a new FED share. We don't entirely know what happens next. Really,

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Speaker 15: the ball really is.

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Speaker 8: In the court of.

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Speaker 15: Because till The Republican Senator Tom Tillis said this needs

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Speaker 15: to be cleared up soon. And that clip you played

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Speaker 15: from Senator to Kennedy said, if you're going to make

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Speaker 15: these allegations, you better back them up.

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Speaker 8: So I think people are going to want to.

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Speaker 15: See movement, but they've really not very said very much

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Speaker 15: to clarify what happens.

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Speaker 3: Now, what kind of role could Congress play to get

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Speaker 3: that kind of transparency from the Justice Department. Could we

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Speaker 3: see a clash there?

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Speaker 8: Yeah, I expect so. I mean I think till this

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Speaker 8: also sits on the Justice Committee, so I mean he

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Speaker 8: has power here.

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Speaker 15: The important thing is that the Senate has oversight, Congress

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Speaker 15: has oversight of the Federal Reserve, which was very carefully

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Speaker 15: constructed to insulate it away from political pressure. Now the

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Speaker 15: Trump president Trump is testing those layers of defense, but

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Speaker 15: he hasn't breached them yet. And there's another important thing

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Speaker 15: that's going to happen this month, which is a Supreme

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Speaker 15: Court going to start here the argument around Governor Lisa Cook,

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Speaker 15: who Trump fired for cause, and she's fighting that the

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Speaker 15: Supreme Court indicated that it wants to give some sort

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Speaker 15: of carve out to the FED as a special quasi

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Speaker 15: private public agency. If a Supreme Court comes down on

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Speaker 15: Lisa Cook's side. That's going to give the FED even

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Speaker 15: more protection and insulate Powell further from sort of an

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Speaker 15: assault that he has identified as.

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Speaker 8: A threat to FED independence.

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Speaker 15: And importantly, Republican senators say they agree with him, they

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Speaker 15: say it is a threat to FED independence.

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Speaker 3: And of course this is coming as we're still waiting

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Speaker 3: for an announcement from President Trump on who his successor

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Speaker 3: choice for chairman Powell will be. With Senator Tilla saying

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Speaker 3: he'd block any further FED nominees, that has to complicate

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Speaker 3: even that announcement, doesn't it.

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Speaker 15: Yeah, absolutely, I mean that's the big story, the big

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Speaker 15: news we are expecting on the FED this week or

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Speaker 15: maybe after Trump goes to Davos for the World Economic Forum.

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Speaker 15: Was his pick for FED share but that's been completely

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Speaker 15: overshadowed by this. And if Tilli sticks to his word,

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Speaker 15: if he if he votes, if he votes to block

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Speaker 15: any norminee, he basically has a vita on Senate Banking

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Speaker 15: it's split it thirteen eleven. If he crosses the floor

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Speaker 15: to join the Democrats, that's twelve twelve that blocks it

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Speaker 15: there to move out of the committee over an objection

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Speaker 15: sixty senators under the current rules. You've already got lis Mkowski,

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Speaker 15: You've got Kramer, You've got Kennedy sounding dubious. You've got

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Speaker 15: John fun Who's you know, majority leader, saying this needs

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Speaker 15: to be fixed soon, so they you know, Trump may

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Speaker 15: not have the votes in the Senate. So it basically

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Speaker 15: freezes the whole plan, which is why when you read

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Speaker 15: the Besson Treasury sectary, Psson was.

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Speaker 8: Very angry and frustrated by this. You're not surprised.

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