WEBVTT - Debt Ceiling Stalemate; Santos Faces Criminal Charges

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<v Speaker 1>From the Bloomberg Interactive Burgers Studios. This is Bloomberg day

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<v Speaker 1>Break for Wednesday, May tenth.

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<v Speaker 2>Coming up today, Debt ceiling talks continue after the first

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<v Speaker 2>meeting between President Biden and Speaker McCarthy.

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<v Speaker 1>Congressman George Santos has indicted on federal charges.

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<v Speaker 2>Former President Trump is found liable for sexually assaulting Egene Carol.

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<v Speaker 1>And Wall Street awaits the latest reading on inflation.

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<v Speaker 3>Governor Heppel says New York State is preparing for an

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<v Speaker 3>influx of asylum seekers. Plus we're learning more about the

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<v Speaker 3>gunman who killed eight people on the Texas mall. I'm

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<v Speaker 3>Michael Barr. More ahead, I'm.

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<v Speaker 4>John Stave Sharon Sports. The Yankees won, the Mets lost,

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<v Speaker 4>The Devil's lost Game four, The Knick seb Game five tonight.

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<v Speaker 5>That's all straight Ahead on Bloomberg day Break, The business

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<v Speaker 5>news you need to starn your day in just one

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<v Speaker 5>fifteen minute podcast each morning on Apples, Spotify, the Bloomberg

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<v Speaker 5>Business app, and everywhere you get your podcasts.

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<v Speaker 6>Good morning, I'm Nathan Hager.

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<v Speaker 1>And I'm Karen Moscow. Here are the stories we're following today.

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<v Speaker 2>We have a slew of political news this morning. Not

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<v Speaker 2>much progress came from yesterday's debt ceiling meeting at the

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<v Speaker 2>White House, as the US inches closer to a first

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<v Speaker 2>ever default. Amy Morris has details from our Bloomberg ninety

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<v Speaker 2>nine to one newsroom in Washington. They will have another

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<v Speaker 2>meeting on Friday. House Speaker Kevin McCarthy.

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<v Speaker 4>I didn't find progress. Staff will continue to.

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<v Speaker 7>Meet, but President Biden called it a productive meeting and

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<v Speaker 7>says default is not an option.

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<v Speaker 8>Our economy would fall into a significant recession. It would

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<v Speaker 8>devastate retirement accounts, increase borrowing costs. According to Moodies, nearly

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<v Speaker 8>eight million Americans would lose their job.

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<v Speaker 7>For now, the intensified negotiations can at least temporarily assuage

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<v Speaker 7>markets before June first, that's when Treasury Secretary Janet Yellen

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<v Speaker 7>has warned the nation risks default in Washington. I'm Amy Morris,

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<v Speaker 7>Bloomberg Daybreak.

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<v Speaker 1>All right, Amy, thanks.

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<v Speaker 9>Well.

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<v Speaker 1>Even if KNG Vris and President Biden reach a debt

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<v Speaker 1>ceiling deal, the process could threaten economic growth, especially if

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<v Speaker 1>it involves cutting infrastructure spending. That's a view from Morgan

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<v Speaker 1>Stanley Wealth Management Chief investment Officer Lisa Shalott.

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<v Speaker 10>It matters, you know, to forward looking expectations of growth

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<v Speaker 10>in terms of what is cut, those things have been

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<v Speaker 10>a support to growth and if we need to take

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<v Speaker 10>that out of the forward forecasts, that is going to

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<v Speaker 10>dampen economic growth.

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<v Speaker 1>Morgan Stanley's Lisa Shallett is watching for what Treasury Secretary

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<v Speaker 1>Janet Yellen will do after she gets approval to extend borrowing.

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<v Speaker 2>Well outside of the debt ceiling, Karen, The political headlines

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<v Speaker 2>are hitting George Santos this morning. The congressman from New

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<v Speaker 2>York will now face criminal charges stemming from campaign finance laws.

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<v Speaker 2>Bloomberg's Ed Baxter has the story.

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<v Speaker 11>Santos, who took office despite fabricating much of what he

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<v Speaker 11>claimed about his education and career, has been indicted on

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<v Speaker 11>federal charges. Bloomberg sources say charges could be unsealed as

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<v Speaker 11>early as today, and that he could be prosecuted on

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<v Speaker 11>Long Island. Santos reported he loaned his campaign over seven

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<v Speaker 11>hundred thousand dollars and claimed to be worth between two

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<v Speaker 11>point six and eleven point two million dollars. House Speaker

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<v Speaker 11>Kevin McCarthy says if Santos is convicted, he would have

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<v Speaker 11>to leave Congress in San Francisco. I'm at Baxter Bloomberg Daybreak.

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<v Speaker 1>All right, and thanks well. Donald Trump is also on

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<v Speaker 1>the front pages this morning, and new York jury found

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<v Speaker 1>the former president liable for sexually assaulting a woman and

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<v Speaker 1>then defaming her. We get the details from Bloomberg's John

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<v Speaker 1>Tucker in New York, John Karen.

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<v Speaker 12>The jury returned its verdict sam to just three hours

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<v Speaker 12>of deliberations. Trump's claims he could not have assaulted Egene

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<v Speaker 12>Carroll because she was not his type was at the

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<v Speaker 12>center of the case. Carol's attorneys managed to use those

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<v Speaker 12>words against him. I showed video from his deposition where

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<v Speaker 12>he confused Carol for ex wife Marla Maples when shown

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<v Speaker 12>a photover Trump released a series of videos on social

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<v Speaker 12>media last night with his response.

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<v Speaker 11>I don't even know who this woman is.

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<v Speaker 7>I have no idea who she is, where she came from.

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<v Speaker 12>In a statement, Carol said this victory is not just

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<v Speaker 12>for me, but for every woman who suffered because she

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<v Speaker 12>was not believed. The jury stopped short of finding Trump

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<v Speaker 12>liable for rape. He must pay her five million dollars

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<v Speaker 12>in damages, three million of it for defamation. Trump will

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<v Speaker 12>appeal the verdict in New York. I'm John Tucker Bloomberg Daybreak.

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<v Speaker 2>Well, Johnny, remains to be seen what impact Trump's legal

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<v Speaker 2>problems have on his presidential bid, but we're getting where

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<v Speaker 2>to Wall Street. Titan has met with another presumed Republican candidate.

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<v Speaker 2>Billionaire Steve Schwartzman recently visited Ron DeSantis, but we're told

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<v Speaker 2>the meeting left Schwartzman unconvinced of the Florida governor's White

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<v Speaker 2>House prospects. Bloomberg News has learned for now, the Blackstone

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<v Speaker 2>co founder will hold off donating money to DeSantis. He

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<v Speaker 2>is currently not supporting anyone in the Republican field.

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<v Speaker 1>Meantime, Nathan, the White House remains focused on immigration concerns.

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<v Speaker 1>President Biden is warning of tumultuous conditions at the the

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<v Speaker 1>US Mexico border when pandemic era restrictions are lifted tomorrow.

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<v Speaker 8>We also are in the process of setting up resident

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<v Speaker 8>offices in Columbia and other places where you can or

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<v Speaker 8>someone seeking to Solenton go first. So but it remains

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<v Speaker 8>to me seen it's going to be chaotic for a while.

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<v Speaker 1>And President Biden said he spent close to an hour

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<v Speaker 1>speaking with Mexican President Andreas Manuel Lopez Obrador about the

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<v Speaker 1>situation here.

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<v Speaker 2>There are signs tensions between the US and China are

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<v Speaker 2>starting to soften. Sources tell US US trade representative Catherine

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<v Speaker 2>Tie plans to meet China's commerce minister in Detroit later

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<v Speaker 2>this month. This will be the most senior in person

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<v Speaker 2>encounter between the nations since the US shotdown at alleged

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<v Speaker 2>Chinese spy balloon in early February.

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<v Speaker 1>And finally, Nathan, we're looking at a big day on

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<v Speaker 1>the economic front. While Street awaits the latest reading on inflation,

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<v Speaker 1>CPI data for April is expected to show high prices

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<v Speaker 1>remain a concern for the Fed. We get a preview

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<v Speaker 1>from Bloomberg's Michael McKee.

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<v Speaker 13>Higher interest rates have helped cut inflation in half over

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<v Speaker 13>the past nine months. Now, he kind of has say

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<v Speaker 13>for the hard rents and rising wages for hard to

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<v Speaker 13>find employees, particularly in the service sector, will break progress

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<v Speaker 13>towards the Fed's goal of an average two percent inflation rate.

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<v Speaker 13>The central bankers think progress will continue if slowly. They

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<v Speaker 13>will leave rates high to ensure that happens, and not

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<v Speaker 13>worry too much about month to month inflation data unless

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<v Speaker 13>it unexpectedly jumps. The question is what will investors think,

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<v Speaker 13>will they have the patients of Fed officials, or will

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<v Speaker 13>we see a big rate reaction to the inflation data.

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<v Speaker 13>Michael McKee Bloomberg Daybreak.

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<v Speaker 2>Time now to take a look at some of the

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<v Speaker 2>other stories making news in New York and around the world.

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<v Speaker 2>For that, we are joined by Bloomberg's Michael Barr. Good Morning, Michael,

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<v Speaker 2>Good morning, Nathan. New York is bracing for a surge

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<v Speaker 2>migrants after Title forty two expires tomorrow. For months, migrant

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<v Speaker 2>workers crossing the southern border have been bussed up from

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<v Speaker 2>Texas the states like New York to be sheltered while

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<v Speaker 2>asylum seekers claims are processed. The majority have been sent

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<v Speaker 2>to New York City, but now Mayor Eric Adams plans

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<v Speaker 2>to send migrants to other counties in the state after

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<v Speaker 2>they arrive in the city. Governor Kathy Oakle says there

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<v Speaker 2>are counties that need workers desperately.

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<v Speaker 9>There's a lot of people.

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<v Speaker 10>We have five thousand openings for farm workers.

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<v Speaker 14>The farmers are asking us to.

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<v Speaker 9>Try and make this happen.

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<v Speaker 10>So it's a multi faceted challenge, but my team has

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<v Speaker 10>been heavily engaged.

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<v Speaker 3>Governor Ockle says she signed an executive order to call

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<v Speaker 3>up the National Guard. The White House is reacting to

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<v Speaker 3>last week's death of a homeless New York subway writer.

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<v Speaker 3>According to a statement, Jordan Neely's killing was tragic and

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<v Speaker 3>deeply disturbing. Our hearts go out to the family and

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<v Speaker 3>loved ones. We firmly believe that the events surrounding his

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<v Speaker 3>death demand a thorough investigation. A grand jury may convene

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<v Speaker 3>this week's way possible charges against Daniel Penny, the marine

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<v Speaker 3>veteran who police say put Neely in a chokehold after

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<v Speaker 3>a disturbance on the subway. Manhattan. DA Alvin Bragg is

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<v Speaker 3>also saying something about the case for the first time.

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<v Speaker 3>Prank says just because his office hasn't said anything doesn't

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<v Speaker 3>mean that they aren't taking it seriously. Authorities say the

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<v Speaker 3>gunman who killed eight people and in Allen, Texas mall,

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<v Speaker 3>legally obtained the weapons despite the acute shooter's troubled background.

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<v Speaker 3>Images uploaded to an account last month indicate the gunman

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<v Speaker 3>may have visited the outlet mall multiple times the past year,

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<v Speaker 3>researching peak hours. State Department of Public Safety official Hank Sibley,

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<v Speaker 3>we do know that.

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<v Speaker 1>He had Neo Nazi idiation, he had patches, he had tattoos,

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<v Speaker 1>even his signature, you know, verified.

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<v Speaker 3>That Sibley says the suspected gunman had eight weapons on him.

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<v Speaker 3>Buddy Holly is top dog at Westminster. The petitpassant graffon

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<v Speaker 3>ven Den beat out more than twenty five hundred of

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<v Speaker 3>the canines to take best in Show at America's premier

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<v Speaker 3>dog show and a first for the Breed Global News

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<v Speaker 3>twenty four hours a day, powered by more than twenty

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<v Speaker 3>seven hundred journalist and analysts in over one hundred twenty

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<v Speaker 3>anti countries. I'm Michael Barr. This is Bloomberg Nather.

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<v Speaker 2>I want to ask you to pronounce that breed again.

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<v Speaker 2>Thank you, Michael. It time down for our Bloomberg Sports Update.

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<v Speaker 2>Good morning, John, Staneshawer.

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<v Speaker 4>Good morning Nathan. The day did not begin well for

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<v Speaker 4>the Mets with the news that Max Schurzer was not

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<v Speaker 4>going to be able to make his start in Cincinnati

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<v Speaker 4>next spasm, so David Peterson rushed up from Syracuse and dropped.

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<v Speaker 3>To one and five.

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<v Speaker 4>The Reds led seven to one in the fifth inning,

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<v Speaker 4>the met rally fell short. Cincinnati won seven to six,

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<v Speaker 4>and the Mets have now lost twelve of their last fifteen,

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<v Speaker 4>eight games behind Atlanta. Justin Verlander starts tonight at the Stadium.

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<v Speaker 4>Welcome back Aaron Judge, he had missed the last ten games.

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<v Speaker 4>Yankees got home runs from Clabor Torres and Jake Bowers.

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<v Speaker 4>They both drove in three runs in a ten to

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<v Speaker 4>five win over Oakland, who fell to eight and twenty nine.

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<v Speaker 4>Clark Schmid's eighth start, he finally got his first winning.

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<v Speaker 4>The Yanks go for a series suite this afternoon. The

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<v Speaker 4>Carolina Hurricanes coming off in eight to four loss in

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<v Speaker 4>Game three in Newark one Game four over the Devils

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<v Speaker 4>six to one, the Kings with a five goal second period,

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<v Speaker 4>and now they go back to Raleigh up three to

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<v Speaker 4>one in the series. Dallas won six to three at Seattle.

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<v Speaker 4>That series is tied at two. A couple of game

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<v Speaker 4>fives in the NBA Sixers beat the Celtics easily in Boston,

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<v Speaker 4>so they go home up three too. Denver beat Phoenix.

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<v Speaker 4>Home teams won every game in that series. The next

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<v Speaker 4>hoping that being out of Miami and at the Garden

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<v Speaker 4>can help them stave off elimination. It's not over yet.

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<v Speaker 4>The coach down.

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<v Speaker 9>Thibodel went forward to win a series. So all we're

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<v Speaker 9>thinking about is win the next game. Go quarter by quarter,

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<v Speaker 9>win the first quarter, win, the second quarter, win the third,

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<v Speaker 9>win the fourth, and then the next day we'll worry

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<v Speaker 9>about the next day. Just while we're doing is thinking

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<v Speaker 9>about the next game.

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<v Speaker 4>Nicks have yet to beat the Heat when they've had

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<v Speaker 4>Jimmy Butler. He set out the only game the Heat lost.

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<v Speaker 4>Lakers are up three one. They've got Game five tonight

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<v Speaker 4>at Golden State. John Stash Edward Bloomberg's Toys.

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<v Speaker 5>Live from coast to coast, from New York, tes En Francisco,

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<v Speaker 5>Boston to Washington, DC nationwide on sirisxam The Bloomberg Business

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<v Speaker 5>Appened Bloomberg dot Com. This is Bloomberg Daybreak.

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<v Speaker 12>Good morning.

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<v Speaker 2>I'm Nathan Hager. The first meeting on the debt ceiling

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<v Speaker 2>between President Biden and Speaker McCarthy has ended with an

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<v Speaker 2>agreement to keep talking. Both sides planned to meet again

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<v Speaker 2>Friday to discuss ways to avoid a government default. But

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<v Speaker 2>the President is drawing a line in the sand.

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<v Speaker 8>I made clear during our meeting that default is not

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<v Speaker 8>an option. Repeated that time and again. America is not

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<v Speaker 8>a dead beat.

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<v Speaker 2>Nation President Biden following that White House meeting yesterday. This morning,

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<v Speaker 2>we're joined by Greg Valier, chief US policy strategist at

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<v Speaker 2>AGF Investments. Greg, good morning. I know expectations are pretty

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<v Speaker 2>low going into this meeting, anyway. Did they meet your expectations.

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<v Speaker 14>My expectations, Dathan, We're pretty low, and they weren't met.

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<v Speaker 14>Very inconclusive, not success full, huge differences between the two parties.

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<v Speaker 14>They have to say something positive, and therefore they have

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<v Speaker 14>announced that I have another meeting on Friday. You know,

0:12:10.320 --> 0:12:12.600
<v Speaker 14>maybe there'll be an agreement on a couple of areas

0:12:12.640 --> 0:12:15.880
<v Speaker 14>of spending cuts. But times running out. I mean, I

0:12:15.960 --> 0:12:19.000
<v Speaker 14>don't see a deal for weeks, which means to me

0:12:19.440 --> 0:12:21.199
<v Speaker 14>there's going to have to be an extension.

0:12:21.960 --> 0:12:25.960
<v Speaker 2>Is there going to be a default? Is that still

0:12:26.000 --> 0:12:26.880
<v Speaker 2>a possibility?

0:12:27.559 --> 0:12:30.200
<v Speaker 14>You can't totally rule it out. I think the markets

0:12:30.240 --> 0:12:35.319
<v Speaker 14>have been too sanguine, although treasury yields, especially short treasuries

0:12:35.920 --> 0:12:40.079
<v Speaker 14>for bills, have begun to reflect some anxiety. But no,

0:12:40.480 --> 0:12:42.800
<v Speaker 14>I think at some point it might not be until

0:12:42.840 --> 0:12:45.640
<v Speaker 14>a fall. At some point I think we will get

0:12:45.840 --> 0:12:49.880
<v Speaker 14>a deal, but default is definitely on the table as

0:12:49.920 --> 0:12:50.760
<v Speaker 14>a possibility.

0:12:51.240 --> 0:12:53.959
<v Speaker 2>You mentioned as they did that. There's going to be

0:12:54.080 --> 0:12:56.680
<v Speaker 2>more talks on Friday. We're told as well. They are

0:12:56.720 --> 0:12:59.400
<v Speaker 2>going to be behind the scenes discussions that have we've

0:12:59.480 --> 0:13:03.440
<v Speaker 2>were told kicked off yesterday leading up to that highest

0:13:03.559 --> 0:13:06.440
<v Speaker 2>level meeting on Friday. What kind of progress, if any,

0:13:06.480 --> 0:13:09.280
<v Speaker 2>could we see in the behind the scenes discussions.

0:13:10.040 --> 0:13:12.560
<v Speaker 14>Yeah, I think there's an agreement, and even Biden would

0:13:12.679 --> 0:13:16.280
<v Speaker 14>agree on maybe clawing back some pandemic aid that went

0:13:16.320 --> 0:13:18.880
<v Speaker 14>to states that haven't spent all the money. There might

0:13:18.960 --> 0:13:22.199
<v Speaker 14>be some restrictions on people who get federal benefits like

0:13:22.280 --> 0:13:25.760
<v Speaker 14>food stamps who were unwilling to work. There might be

0:13:25.840 --> 0:13:28.880
<v Speaker 14>an agreement on a spending cap for a year or two.

0:13:29.320 --> 0:13:32.319
<v Speaker 14>So there are areas of agreement. The problem is you

0:13:32.480 --> 0:13:36.760
<v Speaker 14>have to divorce that debate with the debate over extending

0:13:36.800 --> 0:13:39.559
<v Speaker 14>the debt ceiling, and both parties are really dug in

0:13:39.720 --> 0:13:40.400
<v Speaker 14>on that issue.

0:13:40.760 --> 0:13:40.880
<v Speaker 9>Now.

0:13:40.960 --> 0:13:43.760
<v Speaker 2>There's so much going on in Washington apart from the

0:13:43.840 --> 0:13:47.559
<v Speaker 2>debt ceiling talks. Although this could be related given that

0:13:48.080 --> 0:13:51.920
<v Speaker 2>Congressman George Santos is part of a very slim majority

0:13:52.080 --> 0:13:56.360
<v Speaker 2>in this House of Representatives. Now he's facing potential he

0:13:56.520 --> 0:14:00.120
<v Speaker 2>is facing criminal charges. Where do you see this going, Greg.

0:14:00.760 --> 0:14:03.400
<v Speaker 14>Well, probably at some point with his resignation. I don't

0:14:03.400 --> 0:14:06.040
<v Speaker 14>think it's imminent. But Nathan, let me tell you, I

0:14:06.600 --> 0:14:09.880
<v Speaker 14>was taken aback yesterday that all the attention was on

0:14:10.120 --> 0:14:14.760
<v Speaker 14>Santos and of course the Donald Trump legal defeat, and

0:14:14.880 --> 0:14:18.240
<v Speaker 14>virtually no attention was on the death ceiling. It's like

0:14:18.360 --> 0:14:22.240
<v Speaker 14>the death ceiling still has not acquired a sense of urgency.

0:14:22.760 --> 0:14:26.600
<v Speaker 14>All these other stories and there's immigration issues, Hunter Biden issues,

0:14:26.680 --> 0:14:29.800
<v Speaker 14>lots of more stuff this week, it all diminishes the

0:14:29.920 --> 0:14:32.480
<v Speaker 14>sense of urgency on avoiding default.

0:14:32.720 --> 0:14:34.560
<v Speaker 2>Well why do you think that is, Greg, Why don't

0:14:34.600 --> 0:14:36.240
<v Speaker 2>we see that sense of urgency right now?

0:14:36.880 --> 0:14:38.880
<v Speaker 14>Well, it's a good question, Nathan, and I would say

0:14:38.920 --> 0:14:42.040
<v Speaker 14>it's because the markets. The stock market has not shown

0:14:42.120 --> 0:14:45.080
<v Speaker 14>any anxiety. As I mentioned, the short end of the

0:14:45.160 --> 0:14:49.200
<v Speaker 14>bond market has. But I think for stock investors there's

0:14:49.200 --> 0:14:51.760
<v Speaker 14>a feeling that at some point will get a deal.

0:14:51.960 --> 0:14:55.720
<v Speaker 14>And that's probably right, but I think we're weeks or

0:14:55.880 --> 0:14:58.360
<v Speaker 14>months away from getting any kind of a deal.

0:14:58.600 --> 0:14:59.880
<v Speaker 2>Well, it does kind of feel like we have a

0:15:00.120 --> 0:15:02.920
<v Speaker 2>hil on of headlines coming out of Washington, a lot

0:15:02.960 --> 0:15:06.920
<v Speaker 2>of headline risks coming out with the Santos legal pressures,

0:15:07.000 --> 0:15:10.120
<v Speaker 2>and now former President Trump being found liable in the

0:15:10.160 --> 0:15:13.240
<v Speaker 2>eging Carol case, just as he's getting ready to take

0:15:13.280 --> 0:15:18.320
<v Speaker 2>the stage with CNN network that he's repeatedly called fake

0:15:18.440 --> 0:15:23.080
<v Speaker 2>news and not wanted to talk to literally for years. Now,

0:15:23.680 --> 0:15:25.960
<v Speaker 2>how do you see all this playing out in the

0:15:26.040 --> 0:15:30.080
<v Speaker 2>presidential race as the former president takes the stage tonight?

0:15:30.680 --> 0:15:35.800
<v Speaker 14>What a dichotomy right now? Among ordinary Republican voters, the

0:15:35.880 --> 0:15:39.440
<v Speaker 14>Republican base, Trump's got a lead of like thirty points

0:15:39.480 --> 0:15:43.120
<v Speaker 14>against Ron DeSantis. But among Republicans I talk to here

0:15:43.760 --> 0:15:47.520
<v Speaker 14>inside the Beltway in Washington, there's great anxiety that if

0:15:47.560 --> 0:15:50.280
<v Speaker 14>Trump is the nominee, he would lose and he'd probably

0:15:50.400 --> 0:15:53.320
<v Speaker 14>drag down House and Senate seats. So you've got this

0:15:53.520 --> 0:15:56.560
<v Speaker 14>great division within the Republican party that I think is

0:15:56.600 --> 0:15:57.960
<v Speaker 14>going to persist for quite a while.

0:15:58.280 --> 0:16:00.920
<v Speaker 2>In just about thirty seconds left, with so many big

0:16:01.080 --> 0:16:04.200
<v Speaker 2>donors on the sidelines, do you see anyone breaking through

0:16:04.480 --> 0:16:06.760
<v Speaker 2>to get donors to get back in the game.

0:16:07.440 --> 0:16:09.960
<v Speaker 14>Yeah, that's a really interesting angle. I think there are

0:16:10.080 --> 0:16:14.080
<v Speaker 14>some other possible candidates. Joe Manchin still has the itch,

0:16:14.480 --> 0:16:16.920
<v Speaker 14>and what if Kevin McCarthy gets a budget deal, could

0:16:16.960 --> 0:16:21.320
<v Speaker 14>he all of a sudden plunge in. There's lots of

0:16:21.440 --> 0:16:25.840
<v Speaker 14>other possibilities, including Glenn Youngkin, the Governor of Virginia. But

0:16:26.000 --> 0:16:28.320
<v Speaker 14>for right now, I think things will stay frozen until

0:16:28.360 --> 0:16:30.120
<v Speaker 14>we get the budget story resolved.

0:16:33.040 --> 0:16:35.920
<v Speaker 6>This is Bloomberg day Break Today, your morning brief on

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