Speaker 1: Bloomberg Audio Studios, podcasts, radio news, single.
Speaker 2: Bust Idea on a Monday before an eventful week. Of
Speaker 2: course Chicago, Amory Horden having trouble getting Chicago. Terrible storms
Speaker 2: in New York, and I would say hundreds, if not
Speaker 2: thousands of people in the greater New York, Boston Washington
Speaker 2: area couldn't get to Chicago. So it's going to be
Speaker 2: a really eventful Monday Tuesday to get out there. Chris
Speaker 2: President Biden speaking with all the emotion to his Democratic Party,
Speaker 2: and then on we will go and then Jackson Hole
Speaker 2: after that, Lisa Bramwots and I really looking forward to that.
Speaker 2: We just had to stand up meeting here at Bloomberg
Speaker 2: on Jackson Hall. Excited about being with you seven a m.
Speaker 2: Eastern time on Friday. Is where we're focused on for that,
Speaker 2: and of course Chairman speech and we'll have all that coverage,
Speaker 2: here's no question about that. On bonds price up, yield
Speaker 2: down as a basic belief, we've seen that JPM Morgan,
Speaker 2: Bob Michael and Kelsey Barrow have really led the charge
Speaker 2: of the big banks, saying you will see a bid
Speaker 2: price up, yield down. Kelsey Barrow on where we are
Speaker 2: at the end of the summer in bonds.
Speaker 3: I mean, I don't think you really need to say
Speaker 3: that much. I mean, it's really interesting you think about
Speaker 3: the price action this year, and it's really not been
Speaker 3: driven by the Fed speak. It's been driven by the data.
Speaker 3: Right The market has reacted to the data. When the
Speaker 3: data suggests that there's risk of upside on inflation, the
Speaker 3: market reduces the amount of rate cuts for this year.
Speaker 3: When that unwinds, the market prices in more rate cuts.
Speaker 3: So I actually don't think that Chair Pawell needs to
Speaker 3: say that much. That being said, though, I think it
Speaker 3: should be clear that if you look at simple policy rules,
Speaker 3: they would suggest and this is regardless of your view
Speaker 3: on the labor market, simple policy rules would suggest that
Speaker 3: the appropriate policy rate right now is probably about one
Speaker 3: hundred basis points lower than it is today. And that's
Speaker 3: just onfletion coming down alone. Because the Fed, they don't
Speaker 3: see the Fed Funds rate static for the last thirteen months.
Speaker 3: They actually see the real Fed Funds rate has risen
Speaker 3: one hundred and fifty basis points in the last thirteen months.
Speaker 3: That's equivalent to five more rate hikes. So policy has
Speaker 3: been getting incrementally tighter for the last year, and they
Speaker 3: recognize it. It's time to kind of start to move
Speaker 3: away from that regime.
Speaker 2: Kelsey Barrow of JPTE Morgan. There a lot of discussion
Speaker 2: on yield and of course how yield folds into the
Speaker 2: equity markets as well. After what we saw last week,
Speaker 2: best weeks since Nixon was president. I'm kidding, but what
Speaker 2: we saw on the stock market last week, it's amazing
Speaker 2: how the two aur correlated here into the end of
Speaker 2: August and of course our first look into Q four
Speaker 2: of twenty twenty four. One of the joys of August
Speaker 2: is fancy people maybe have time in their schedule to
Speaker 2: want under into the building at our world headquarters. Today
Speaker 2: got Amkunda Legendary at Harvard Business School. We talked about that,
Speaker 2: his relationship with Clay Christensen, who was hugely helpful to
Speaker 2: me over the years. He's missed. Professor Christensen's missed each
Speaker 2: and every day and we lost him way too young
Speaker 2: an age. Mccundu was in, of course, in his wonderful
Speaker 2: terse books on presidential politics. He's now lecturing at Yale
Speaker 2: University among other duties, and he said something that was
Speaker 2: like a third rail. To me, I really really agree
Speaker 2: with this strongly, and that there's this wistful belief that
Speaker 2: we should take our politics back to the normal of
Speaker 2: post World War two American polity the fifties and sixties,
Speaker 2: maybe even into Vietnam in the post Vietnam seventies, where
Speaker 2: I would say, and this was what Professor mccunda was saying,
Speaker 2: is that that wasn't normal, and normal was the span
Speaker 2: of two hundred and fifty years of amony and polarization.
Speaker 2: Got to Macunda of Yale.
Speaker 4: It's actually gone back to the past. Right. What we're
Speaker 4: seeing is an ideological slant toward the slant to media
Speaker 4: that is not we sort of say it's it was
Speaker 4: actually cyclical. It's come back to what it was a newspaper.
Speaker 4: If you read newspapers from the late nineteenth century early
Speaker 4: twentieth century, they were just as partisan as Fox News
Speaker 4: is today. And so what I think what we're seeing
Speaker 4: is people have to relearn the media consumption reflexes that
Speaker 4: they had in that era, and you know, many of
Speaker 4: them won't. What we sort of see if most people
Speaker 4: vote the party line, most people who say their independence
Speaker 4: vote their party line. So the idea that we have
Speaker 4: all ever existed in this kind of sort of socratic
Speaker 4: state where we're having rational discussions about politics. I'm not
Speaker 4: sure that was ever true. I think it's actually the
Speaker 4: job of our system to kind of figure out ways
Speaker 4: to make it work without asking people to do something
Speaker 4: that there's just no historical events they've ever done.
Speaker 2: Professor mccundam, he's at Yale University. We begin an eventful
Speaker 2: we and of course part of it is our study
Speaker 2: of technology. We are just blown away by the YouTube
Speaker 2: development over the summer. Can't wait to get the ending
Speaker 2: August statistics. Got a couple more weeks to go on that.
Speaker 2: We're out at Apple car play, out at Android Auto,
Speaker 2: and on YouTube. We're really featuring the coverage in the
Speaker 2: evening our live show in the evening of the Pacific
Speaker 2: rim and over to India. Today I featured Bangalore is
Speaker 2: the tech center of India. Every day we're featuring somebody
Speaker 2: different within the YouTube world. Please stay with us on
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