WEBVTT - Bloomberg Daybreak: August 19, 2022 - Hour 2 (Radio) 0:00:03.080 --> 0:00:06.480 My from the Bloomberg Interactive Burgers Studios. This is Bloomberg 0:00:06.559 --> 0:00:10.440 day Break for Friday, August nine. Coming up this hour, 0:00:10.720 --> 0:00:14.440 Beneficials sent mixed signals on September rate heights. A new 0:00:14.480 --> 0:00:17.720 survey finds companies across the country are preparing for layoffs 0:00:17.760 --> 0:00:21.720 at Amazon reportedly scrapping its COVID leave policy. And we 0:00:21.720 --> 0:00:24.520 get more earnings today with John Deere set to report, 0:00:25.040 --> 0:00:27.520 New York City cracks down on the end and outdoor 0:00:27.600 --> 0:00:30.920 dining sheds. Plus the UN calls any military action at 0:00:30.920 --> 0:00:35.240 a Ukrainian nuclear power plants suicide. I'm micloblower more Head, 0:00:35.960 --> 0:00:38.560 I'm John Stashhower. And sports, The Yankees suffered a one 0:00:38.560 --> 0:00:41.200 sided loss to the Blue Jays. The Braves beat Jacob 0:00:41.240 --> 0:00:45.720 de Graham in the meth That's all trendy ahead on 0:00:45.840 --> 0:00:51.520 Bloomberg Daybreak on Bloomberg eleven, Free on New York, Bloomberg one, Washington, 0:00:51.600 --> 0:00:55.240 d C, Bloomberg one oh six one, Boston, Bloomberg nine 0:00:55.280 --> 0:00:59.600 sixties and Francisco Syrius XM one nineteen and around the 0:00:59.640 --> 0:01:02.920 world on Bloomberg Radio dot com and via the Bloomberg 0:01:03.000 --> 0:01:09.720 Business App. Good morning, I'm John Tucker and I'm Karen 0:01:09.800 --> 0:01:12.960 Moscow and US DOT Index futures are lower this morning. 0:01:12.959 --> 0:01:14.640 We're coming up to six o one on Wall Street. 0:01:14.680 --> 0:01:16.920 Let me check the markets every fifteen minutes throughout the 0:01:16.920 --> 0:01:20.160 trading day. On Bloomberg, Guess and P futures down about 0:01:20.160 --> 0:01:22.720 thirty five points this morning. DAL future is down two 0:01:22.800 --> 0:01:26.039 hundred eight and NASDAG futures down one hundred thirty one. 0:01:26.120 --> 0:01:29.160 The decks in Germany's down seven tenths of per cent ten. 0:01:29.240 --> 0:01:31.960 Your Treasury down eleven thirty seconds, yield two point nine 0:01:32.000 --> 0:01:34.400 two percent. They yield on the two year three point 0:01:34.440 --> 0:01:38.360 to four percent. COMEXS. Gold is down three tens of percent, 0:01:38.400 --> 0:01:41.640 down five dollars ten cents at seventeen sixty six ten announced, 0:01:41.840 --> 0:01:45.520 and Bitcoin is down seven percent at one seven hundred 0:01:45.600 --> 0:01:48.920 forty dollars. John and Karen Marcus this morning, reacting to 0:01:49.080 --> 0:01:51.400 mix signals from the Federal Reserve when it comes to 0:01:51.440 --> 0:01:54.240 the next move on the interest rates. St. Louis Fed 0:01:54.320 --> 0:01:58.080 Governor Jim Bollard leaning hawkish, urging his seventy five bases 0:01:58.120 --> 0:02:01.520 point move in September, while can the city's Esther George, 0:02:01.600 --> 0:02:05.000 is sounding more cautious. San Francisco's Mary Daly is open 0:02:05.040 --> 0:02:09.440 to fifty or seventy basis points, and Minneapolis Fed Chief 0:02:09.520 --> 0:02:13.200 Neil cash Carry says the central Bank remains laser focused 0:02:13.200 --> 0:02:16.800 on combating inflation. The question right now is can we 0:02:16.840 --> 0:02:21.200 bring inflation down without triggering a recession? And my answer 0:02:21.240 --> 0:02:24.239 that question is I don't know. Neil cash Carry making 0:02:24.240 --> 0:02:27.200 the comments a day after the release of July's FED minutes, 0:02:27.560 --> 0:02:30.840 which showed officials waing exactly when to slow the pace 0:02:30.880 --> 0:02:34.960 of rate hikes well lowering inflation and avoiding a recession 0:02:35.000 --> 0:02:37.600 as the best case scenario for the Federal Reserve. With 0:02:37.680 --> 0:02:41.080 prices already read hot, former FED Governor Randy Krosner says 0:02:41.360 --> 0:02:44.200 the central Bank will be lucky to meet this inflation target. 0:02:44.400 --> 0:02:48.080 It's very difficult to know exactly where you are because, 0:02:48.120 --> 0:02:50.040 as I said, the dataways coming with a leg, and 0:02:50.080 --> 0:02:51.919 there could be a lot of shocks that that come in. 0:02:52.400 --> 0:02:54.760 So I'm sure they're not going to get it exactly right. 0:02:54.919 --> 0:02:56.560 I think if they're going to make a mistake, it's 0:02:56.560 --> 0:02:59.320 going to be on tightening a little bit too much. 0:02:59.639 --> 0:03:02.200 And for Murfed Governor Randy Krasner made the comments on 0:03:02.240 --> 0:03:05.480 Bloomberg's balance of power catch the program weekdays at noon 0:03:05.600 --> 0:03:09.800 Eastern on Bloomberg Radio and Television looks. Let's look at 0:03:09.840 --> 0:03:13.600 the markets overseas now, stocks in Asia falling overnight to 0:03:13.680 --> 0:03:17.800 post a weekly decline. Shina growth concerns continued away on sentiment, 0:03:18.120 --> 0:03:21.200 and Bloomberg's Juliet Salay joins us from Singapore with the latest. 0:03:21.200 --> 0:03:23.799 Good morning, Juliet, Good morning John, and Karena. Jump in 0:03:23.960 --> 0:03:27.600 Chinese textures and energy stocks helped cap deeper losses on 0:03:27.639 --> 0:03:30.800 the regional benchmark index. Nickel stocks in the region rose 0:03:30.840 --> 0:03:33.799 after Indonesia, the world's biggest producer of the commodity, told 0:03:33.800 --> 0:03:36.760 Bloomberg it plans to impose attacks on exports this year. 0:03:37.160 --> 0:03:39.720 Investors now look ahead to the Jackson Whole Symposium and 0:03:39.760 --> 0:03:42.240 close at a home and likely cut by Chinese lenders 0:03:42.280 --> 0:03:45.520 to the loan prime rate concerns about China's slowing economy 0:03:45.600 --> 0:03:48.440 sending the MSCI Asia Pacific Index down for the week. 0:03:48.680 --> 0:03:52.200 In Singapore, Juliet Sale Bloomberg daybreak. All right, Juliette, thank 0:03:52.240 --> 0:03:54.200 you for taking a look at oil now. Prices are 0:03:54.200 --> 0:03:56.920 slumping this morning. When night make screwed oil down one 0:03:56.960 --> 0:03:59.280 point six percent on a dollar forty at eighty nine 0:03:59.320 --> 0:04:02.080 dollars tens. Sense of barrel oil is on track for 0:04:02.120 --> 0:04:05.520 a weekly loss. With the lingering concerns over an economic slowdown. 0:04:05.760 --> 0:04:08.400 Crewed has now given up all gains that followed Russia's 0:04:08.400 --> 0:04:11.440 invasion of Ukraine. The most active stock of the pre 0:04:11.520 --> 0:04:15.400 market bed Bathroom Beyond the shares down forty two percent. 0:04:15.920 --> 0:04:19.760 The move comes after activist investor Ryan Cohen exited. He 0:04:19.839 --> 0:04:22.120 is the entire stake in the company Cohen pocket at 0:04:22.120 --> 0:04:25.080 sixty eight million dollars in profits after holding bid Bathroom 0:04:25.080 --> 0:04:28.000 Beyond sears for seven months. It's setting out to be 0:04:28.040 --> 0:04:30.799 a repeat of other meme stock moments, with the price 0:04:30.839 --> 0:04:34.040 draw for retail investors who related to the trade being 0:04:34.120 --> 0:04:38.320 just as dramatic as its ascent. Taking a look at 0:04:38.320 --> 0:04:40.520 the labor market now, john a new survey from p 0:04:40.760 --> 0:04:44.400 w C is painting a bleak picture. It says layoffs 0:04:44.440 --> 0:04:47.440 are in the works at half of US companies. Bloomberg 0:04:47.520 --> 0:04:51.279 Shirley Pillett has that story. Last month, PwC pulled more 0:04:51.279 --> 0:04:54.880 than seven hundred US executives and board members across a 0:04:55.040 --> 0:04:59.080 range of industries. Half of respondents said they are reducing 0:04:59.120 --> 0:05:03.760 headcount or land to and fifty two of implemented hiring freezes, 0:05:04.120 --> 0:05:07.480 more than four in ten are rescinding job offers, and 0:05:07.600 --> 0:05:11.200 a similar amount are reducing or eliminating the sign on 0:05:11.240 --> 0:05:14.279 bonuses that had become common to attract talent in a 0:05:14.400 --> 0:05:19.159 tight job market in New York. Charlie Bloombird Daybreak. Nice Charlie, 0:05:19.160 --> 0:05:21.520 turning to the pandemic. Now we're seeing more signs that 0:05:21.640 --> 0:05:25.640 corporate America is turning away from prior policies. Days after 0:05:25.680 --> 0:05:30.480 the CDC shifted its COVID quarantine guides, Amazon reportedly scrapping 0:05:30.480 --> 0:05:33.960 its COVID leave policy, and Bloomberg's Really the Young Joins 0:05:34.080 --> 0:05:36.000 is lie with that story. We need a good morning, 0:05:36.040 --> 0:05:38.520 Good morning John. The two weeks of paid lead for 0:05:38.680 --> 0:05:43.920 COVID nineteen cases that Amazon offered employees now gone. Amazon 0:05:44.040 --> 0:05:47.960 is returning to standard sick leaf policies beginning today, and 0:05:48.080 --> 0:05:52.000 an internal memo published by Business Insider shows the company 0:05:52.040 --> 0:05:55.479 is also scrapping contact tracing across much of its network 0:05:55.520 --> 0:06:00.400 of warehouses. This could affect hundreds of thousands employees at Amazon. 0:06:00.760 --> 0:06:04.119 It applies to all US employees except for those living 0:06:04.120 --> 0:06:09.000 in California, New York, Colorado. In Philadelphia, live in New York. 0:06:09.040 --> 0:06:11.280 I'm gonna need a young Bloomberg day break. We need 0:06:11.279 --> 0:06:13.560 to thank you. Ab Earning season is winding down, but 0:06:13.640 --> 0:06:16.920 we get one more reportive note this morning. Farming machinery 0:06:16.960 --> 0:06:20.880 maker Dear publishers results shortly. Bloomberg Intelligence says higher production 0:06:20.920 --> 0:06:24.919 and supply chain easing should support accelerated growth for the company. 0:06:26.839 --> 0:06:31.760 And right now, Karen, we're looking at uh. Finally, let's 0:06:31.800 --> 0:06:34.960 talk politics. The legal trouble circling former President Trump. A 0:06:35.040 --> 0:06:37.920 judge of the marra Longo FBI search warrant hearing indicating 0:06:38.440 --> 0:06:41.320 he'll try to unseal at least parts of the search 0:06:41.320 --> 0:06:43.360 warrant at the heart of the search. Let's get more 0:06:43.400 --> 0:06:46.000 from Ed Baxter. The judges ordered the d o J 0:06:46.200 --> 0:06:49.400 back to court next week with suggested redactions. One of 0:06:49.440 --> 0:06:52.279 the attorneys for media groups seeking the release of the document, 0:06:52.320 --> 0:06:55.520 Diana Schulman, says she feels good about the herring. He 0:06:55.640 --> 0:06:59.000 understands that the public is going to likely be entitled 0:06:59.080 --> 0:07:03.120 to some parts of this warrants application and it's affidavit. 0:07:03.320 --> 0:07:06.000 So the next hearing is next Thursday, and it seems 0:07:06.120 --> 0:07:09.560 most likely scenario is that something will be released in 0:07:09.760 --> 0:07:13.440 very heavily redacted forum in San Francisco. I'm at Baxter 0:07:13.520 --> 0:07:16.040 Bloomber daybreak. All right, thanks and ahead of the open 0:07:16.080 --> 0:07:19.360 on Wall Street and SMP futures thirty six points lower 0:07:23.120 --> 0:07:25.280 as now six seven up Wall Street. Let's bring it, 0:07:25.320 --> 0:07:27.200 Michael barn down to find out what else is going 0:07:27.200 --> 0:07:29.440 on in New York. Hand around the world, John, thank 0:07:29.440 --> 0:07:32.560 you very much, Sarah. New York City Mayor Eric Adams says, well, 0:07:32.680 --> 0:07:35.720 outdoor dining is here to stay. The city will remove 0:07:35.760 --> 0:07:40.400 abandoned dining sheds. Adam says that abandoned or dangerous outdoor 0:07:40.440 --> 0:07:44.120 dining structures must be torn down quickly. When a dining 0:07:44.240 --> 0:07:47.680 shed is no longer in use and it's it's abandoned, 0:07:47.760 --> 0:07:50.480 it's a safety has it, we have to turn it, 0:07:50.960 --> 0:07:54.600 tear it down. It can't be a safe haven for rats, 0:07:55.080 --> 0:07:58.240 it can't be a safe haven for illegal behavior. It 0:07:58.280 --> 0:08:01.760 has to be a place to allow people to enjoy dining, 0:08:02.120 --> 0:08:05.640 Mayor Adams. The United Nations is urging Russia to stand 0:08:05.680 --> 0:08:08.440 down and not proceed with its mission to carry out 0:08:08.480 --> 0:08:12.480 military action at a nuclear power plant in Ukraine. Secretary 0:08:12.560 --> 0:08:16.280 General Antonio Guterres adjusted any action there would be in 0:08:16.400 --> 0:08:21.360 his words, suicide posess must be any actions that might 0:08:21.600 --> 0:08:25.880 make people the safety, your security and the Lucia plants, 0:08:26.480 --> 0:08:28.960 and if the must not be used the spot with 0:08:29.040 --> 0:08:34.120 any guilit inferation. UN Secretary General Antonio Guterras repeatedly urged 0:08:34.160 --> 0:08:37.679 for the plan to be demilitarized. A former top executive 0:08:37.720 --> 0:08:40.960 of the Trump organization has pleaded guilty to tax evasion. 0:08:41.360 --> 0:08:44.320 Alan Weisselberg's guilty plea as part of a larger deal 0:08:44.400 --> 0:08:48.600 to testify against former President Trump's real estate company. Weiselberg 0:08:48.600 --> 0:08:51.240 will serve five months in jail and pay nearly two 0:08:51.240 --> 0:08:54.760 million dollars in taxes, penalties, and interest. The number of 0:08:54.880 --> 0:08:58.360 migrants apprehended entering the US could hit a record two 0:08:58.360 --> 0:09:01.680 million this year, and they're least to await processing as 0:09:01.679 --> 0:09:05.160 Texas Governor Greg Abbott sending bus loads of them to Washington, 0:09:05.240 --> 0:09:08.680 d C. And New York City. The busload of migrants 0:09:08.800 --> 0:09:12.120 is expected soon in the city. Climate change is being 0:09:12.160 --> 0:09:14.920 considered a factor in the recent return of a brain 0:09:15.040 --> 0:09:18.960 eating amiba, often found in fresh water sources, that's being 0:09:19.000 --> 0:09:21.280 linked to the death of a child in eastern Nebraska. 0:09:21.760 --> 0:09:24.040 It is the second such probable death in the bit 0:09:24.040 --> 0:09:27.000 of last this summer. With another incident suspected in Missouri. 0:09:27.120 --> 0:09:30.720 Last month in Nebraska, Douglas County Health Director Dr Lindsay 0:09:30.800 --> 0:09:35.600 Hughes suggested being mindful of your exposure and freshwater sources. 0:09:35.800 --> 0:09:40.120 We are urging the public to simply be aware and 0:09:40.200 --> 0:09:43.439 to take precautions when they are being exposed to any 0:09:43.720 --> 0:09:49.640 warm freshwater sources out in public so lakes, streams, ponds. 0:09:50.320 --> 0:09:53.760 Dr Hughes says, though the illness is rare. Global news 0:09:53.760 --> 0:09:56.400 twenty four hours a day on air end on Bloomberg Quicktick, 0:09:56.440 --> 0:09:59.360 powered by more than hundred journalists and analysts more than 0:09:59.360 --> 0:10:02.199 a y countries. I'm Michael Barr. This is Bloomberg. John, 0:10:02.360 --> 0:10:08.640 Great Michael, thank you. That's how six ten of Wall Street, 0:10:08.679 --> 0:10:11.120 this time with the Bloomberg Sports Update. Good morning John 0:10:11.160 --> 0:10:13.679 stash Our, Morning John. The Mets and Braves just played 0:10:13.760 --> 0:10:16.360 nine games in fifteen days. Mets won four or five 0:10:16.360 --> 0:10:18.640 in New York, Graves one, three or four. In Atlanta. 0:10:18.679 --> 0:10:21.120 They beat Jacob Graham storing seventh inning for a three 0:10:21.120 --> 0:10:22.959 to victory that gets them back to three and a 0:10:23.000 --> 0:10:25.080 half games behind the Mets in the n L East. 0:10:25.080 --> 0:10:27.560 The Yankee lead a L he's a healthy nine games, 0:10:27.559 --> 0:10:30.400 but at the stadium the night after that dramatic tenn 0:10:30.440 --> 0:10:32.880 and he went over Tampa Bay. Toronto got to New 0:10:32.920 --> 0:10:36.120 Yank starter Frankie Mantas with a five ron second and 0:10:36.160 --> 0:10:38.319 in that included the three ro homber by Vladimir Guerrero 0:10:38.400 --> 0:10:39.960 June to The Blue Jays went on to win nine 0:10:40.040 --> 0:10:42.440 to two. George Springer had four hits for the Jays. 0:10:42.480 --> 0:10:45.560 Manzas and three starts with the Yanks has pitched fourteen 0:10:45.600 --> 0:10:48.600 innings and has allowed fourteen runs. The guy he replaced 0:10:48.600 --> 0:10:51.320 in the Yankee rotation, Jordan Montgomery, now with St. Louis. 0:10:51.679 --> 0:10:54.439 He's made three starts to the Cardinals and in seventeen 0:10:54.440 --> 0:10:57.160 innings he's given up one run. Speaking of the Cardinals, 0:10:57.320 --> 0:11:00.079 they beat Colorado thirteen to nothing. They pinch hit and 0:11:00.240 --> 0:11:03.000 slam for forty two year old Albert Poohle's career home 0:11:03.040 --> 0:11:06.280 run number six ninety. The big NFL story resolution on 0:11:06.320 --> 0:11:08.800 how long does Shaun Watson suspension will be. The NFL 0:11:08.880 --> 0:11:11.600 wanted it longer than the six games originally ruled by 0:11:11.600 --> 0:11:14.520 an arbitrator. The two side settled on eleven games, a 0:11:14.640 --> 0:11:17.880 record fine of five million. Watson apologize, but did not 0:11:18.000 --> 0:11:21.320 admit they're committing any sexual misconduct. I'm moving on with 0:11:21.360 --> 0:11:23.560 my career in my life, and I'll continue to stand 0:11:23.559 --> 0:11:26.880 on my innessis. Just because you know, settlements and things 0:11:26.920 --> 0:11:29.400 like that happened doesn't mean that a person is is 0:11:29.440 --> 0:11:32.840 guilty for anything. I feel like person has the opportunity 0:11:32.840 --> 0:11:35.040 to stend on his innessis and prove that, and we 0:11:35.200 --> 0:11:37.440 proved that on the legal side, and we're just gonna 0:11:37.440 --> 0:11:39.520 continue to push forward as an individual, as a person. 0:11:39.520 --> 0:11:41.600 Watson's first game of this new team Cleveland, will be 0:11:41.600 --> 0:11:44.280 week roteam against his old team, Houston Golf and Delaware. 0:11:44.320 --> 0:11:48.000 Kegan Bradley shot seven under for a one shot Boobird. 0:11:48.760 --> 0:11:50.440 Thanks John to head of the cast. Show. But on 0:11:50.440 --> 0:11:53.880 Wall Street this morning, down theaters two hundred eleven points 0:11:53.880 --> 0:11:56.760 slower and and p Emity futures there down thirty six 0:11:57.080 --> 0:12:00.560 but ANSAC futures down one hundred thirty five points. You're 0:12:00.600 --> 0:12:08.600 listening to Bloomberg Daybreak and Jui Hella Bloomberg Daybreak. We'll 0:12:08.640 --> 0:12:10.520 get you set up for the training day ahead with 0:12:10.640 --> 0:12:14.480 Jeffrey Yuugh, senior market strategist at b N wind ballad 0:12:15.000 --> 0:12:24.160 This is Bloomberg day break, markets, headlines and breaking news 0:12:24.280 --> 0:12:26.920 twenty four hours a day at Bloomberg dot Com, The 0:12:26.920 --> 0:12:31.040 Bloomberg Business Outland at Bloomberg Quick Tape, He's a Bloomberg 0:12:31.120 --> 0:12:40.120 Business Flash and I'm teren Moscow. You are. Stock Index 0:12:40.160 --> 0:12:43.240 futures are falling along with treasuries after a chorus of 0:12:43.280 --> 0:12:46.679 Federal Reserve officials reiterated their resolved to continue right hikes. 0:12:46.920 --> 0:12:49.360 We checked the markets every fifteen minutes throughout the training 0:12:49.440 --> 0:12:51.760 day on Bloomberg Guess and p Future is down thirty 0:12:51.800 --> 0:12:54.440 four points this morning. Now Future is down two hundred 0:12:54.480 --> 0:12:57.600 four NASDAG futures and add twenties seven and the decks 0:12:57.600 --> 0:12:59.920 in Germany's down seven tenths of upper sent the ten 0:13:00.000 --> 0:13:02.440 Your Treasury down twelve thirty seconds, yield two point nine 0:13:02.480 --> 0:13:05.120 two percent, the yield on the two year three point 0:13:05.120 --> 0:13:08.319 to five percent. Nimex Screwed oil is down one of 0:13:08.400 --> 0:13:10.680 three quarters percent at a dollar fifty eight at eighty 0:13:10.679 --> 0:13:13.480 eight dollars nine two cents. A barrel comes goll down 0:13:13.480 --> 0:13:15.600 four tenths per cent or seven dollars ten cents at 0:13:15.640 --> 0:13:18.920 seventeen sixty four. Ten announced the Euro one point zero 0:13:19.040 --> 0:13:22.160 zero six three against the dollar, British found one five 0:13:22.240 --> 0:13:24.959 five and the yen one thirty six point five nine, 0:13:25.240 --> 0:13:28.680 and bitcoins down seven point three percent at twenty one thousand, 0:13:28.760 --> 0:13:31.840 seven hundred dollars. As a Bloomberg Business Flash, now here's 0:13:31.840 --> 0:13:34.280 Michael Barr with more on what's going on around the world. 0:13:34.360 --> 0:13:36.800 Michael Karen, thank you very much. A federal judge has 0:13:36.920 --> 0:13:41.760 ordered the Justice Department to put forward proposed redactions as 0:13:41.800 --> 0:13:44.800 a judge committed to making public at least part of 0:13:44.840 --> 0:13:48.240 the affidavit supporting the search warrant for former President Donald 0:13:48.280 --> 0:13:51.120 Trump's the state in Florida. The judge dave prosecutors a 0:13:51.120 --> 0:13:54.319 week to submit a copy of the affidavit. After being 0:13:54.360 --> 0:13:56.960 accused by more than two dozen women of a sexual 0:13:57.000 --> 0:14:00.880 misconduct Cleveland, Brown's quarterback to Shaun Watson will now serve 0:14:00.920 --> 0:14:04.400 in eleven games suspension and pay a five million dollar fine. 0:14:05.240 --> 0:14:08.559 In baseball, the Yankees and Mets lost the Red Sox. 0:14:08.679 --> 0:14:13.520 Orioles A's and Giants also lost the Nationals. One Global 0:14:13.520 --> 0:14:16.160 News twenty four hours a day on air and on 0:14:16.240 --> 0:14:19.480 Bloomberg Quick Take, powered by more than twenty seven hundred 0:14:19.520 --> 0:14:22.040 journalists and analysts, more than a hundred twenty countries. H'm 0:14:22.080 --> 0:14:24.720 Michael bar This is Bloomberg. Michael, thank you, coming up 0:14:24.760 --> 0:14:27.040 on six twenty on Wall Street and we are live 0:14:27.080 --> 0:14:29.720 from the Bloomberg into Rancor Broker Studios. This is East 0:14:29.720 --> 0:14:32.840 Bloomberg Daybreak. There are those in the equity markets who 0:14:32.840 --> 0:14:36.200 believe a string of weak economic data will encourage the 0:14:36.200 --> 0:14:39.760 fatty into a devilish pivot. Are they right? Let's get 0:14:39.800 --> 0:14:41.320 you set up for the trading day head now with 0:14:41.400 --> 0:14:44.600 b and Y Melon, Senior market strategist Jeffrey. You always 0:14:44.600 --> 0:14:47.640 a pleasure, jeff, Thanks for being with us our investors 0:14:47.720 --> 0:14:52.560 foolishly dismissing the risk of a more aggressive federal reserve. UM. 0:14:52.880 --> 0:14:55.040 I think if you had asked me this question a 0:14:55.040 --> 0:14:56.920 couple of weeks ago, we would have been a bit concerned. 0:14:57.120 --> 0:15:00.280 Then now I think some reality is coming back. Fair 0:15:00.640 --> 0:15:05.360 has to their credit and it's successfully communicated that the 0:15:05.400 --> 0:15:07.800 part up ahead is not going to be straightforward to 0:15:07.840 --> 0:15:11.280 think that the world is undefined again, especially with the 0:15:11.280 --> 0:15:14.120 supply bottlenecks and inflation that's going to come off from 0:15:14.160 --> 0:15:17.840 ad best. Inflation is peaking, which in itself is certainly 0:15:17.800 --> 0:15:21.120 a favorable development, but in terms of getting back to 0:15:21.200 --> 0:15:23.400 where the good of economy needs to be with inflation. 0:15:23.440 --> 0:15:25.720 We're a long long way away from that. Yeah, do 0:15:25.840 --> 0:15:30.840 we have to derail even the economies? Is that inevitable 0:15:30.880 --> 0:15:34.320 to control inflation? The US? Absolutely not. You know, the 0:15:34.400 --> 0:15:36.680 US is in a very good position. Labor markets firm 0:15:36.680 --> 0:15:40.280 and they consumer confidence is holding. So everything points to 0:15:41.240 --> 0:15:44.240 reasonably good chance of a soft landing. If by look 0:15:44.280 --> 0:15:48.040 at where I am right now in the UK um So, 0:15:48.280 --> 0:15:52.560 the UK rates futures are pricing against higher terminal rates 0:15:52.880 --> 0:15:55.520 we've had through the Federal Reserve. Now I find that 0:15:55.920 --> 0:15:58.840 very very hard to countenance. Uh, the next a hundred 0:15:58.880 --> 0:16:00.720 basis points. I think, by the something we've done as 0:16:00.760 --> 0:16:03.920 quickly as possible, the markets after the speak's inflation numbers 0:16:03.960 --> 0:16:06.440 are pricing in an additional under basis point on top 0:16:06.480 --> 0:16:08.520 of that, I'm not sure you know how the British 0:16:08.560 --> 0:16:11.000 consumer will be able to withstand the hit on that 0:16:11.120 --> 0:16:13.600 scale already. So I think that that's where quite a 0:16:13.600 --> 0:16:15.960 bit of adjustment is needed. And the BOV has been 0:16:16.000 --> 0:16:18.560 a bit more open and saying six quarters of contraction, 0:16:18.640 --> 0:16:20.680 that's a proper recession, right, that that's going to be 0:16:20.720 --> 0:16:23.120 needed at the very least to bring down inflation. Yeah, 0:16:23.200 --> 0:16:26.400 and what is the future for British pounds sterling at 0:16:26.440 --> 0:16:30.960 this point given all this, So it's quite fascinating that 0:16:31.040 --> 0:16:34.200 we've had an aggressive surge in pricing for the Bank 0:16:34.240 --> 0:16:36.560 of England and that Sterling has not benefited from that 0:16:36.720 --> 0:16:40.280 at all. So um, it really is a sign of 0:16:40.840 --> 0:16:43.160 the lack of confidence in the direction of chravel for 0:16:43.200 --> 0:16:46.600 the UK economy. We saw the very very weak consumer 0:16:46.600 --> 0:16:50.200 confidence and figures released over nine and next week, and 0:16:50.320 --> 0:16:52.360 the entire country is going to be braced for the 0:16:52.400 --> 0:16:55.520 announcement of the new energy the highest cap which is 0:16:55.520 --> 0:16:58.400 expected to go towards our four thousand, eight hundred pounds. 0:16:58.400 --> 0:17:04.440 So um, the these are extremely distressing numbers. So if 0:17:04.440 --> 0:17:07.199 you believe that Sterling is going to trade based on 0:17:07.400 --> 0:17:11.840 UK growth expectations rather than inflation expectations and policy expectations, 0:17:12.040 --> 0:17:14.960 these two have totally detachment from each other than grows, 0:17:15.000 --> 0:17:16.480 it's going to be very stop. So Sterling in the 0:17:16.520 --> 0:17:19.080 short gender's going to be under a bit depression. Explite 0:17:19.160 --> 0:17:22.520 everybody the difference in inflation that the UK is facing 0:17:22.560 --> 0:17:26.040 as opposed to the inflation that those of us in 0:17:26.080 --> 0:17:28.960 the United States are facing. Can you control one and 0:17:29.040 --> 0:17:32.800 not the other through policy. So for the UK, I 0:17:32.800 --> 0:17:35.320 would say the energy angle is far more acute. You know, yes, 0:17:35.359 --> 0:17:37.840 we are facing labor market issues and just general supply 0:17:37.920 --> 0:17:41.040 issues in general, but as you can understand, in Europe, 0:17:41.320 --> 0:17:44.360 much greater dependency on natural gas prices. You know, that's 0:17:44.400 --> 0:17:47.399 where the pinch point is going to be. I just 0:17:47.400 --> 0:17:50.159 looked at my own building for example, compared like like 0:17:50.320 --> 0:17:52.680 this summer, you know versus last Summer've actually used a 0:17:52.720 --> 0:17:55.960 lot less less gas, significantly less gas, and are might 0:17:56.000 --> 0:18:00.600 add the prices actually marginally higher, and gas prices or 0:18:00.680 --> 0:18:03.879 energy cap prices is going to be much much higher 0:18:04.000 --> 0:18:06.120 from even current levels. So I think that that's where 0:18:06.600 --> 0:18:08.400 the pain is going to come from. And general price 0:18:08.440 --> 0:18:10.800 insvation few down the life as well, so probably less 0:18:10.800 --> 0:18:12.800 of the labor component compared for the US. If I 0:18:12.840 --> 0:18:15.359 could pivot back to the U s here. J Powell 0:18:15.440 --> 0:18:19.119 lost credibility with his Jackson Hall speech last year. I 0:18:19.160 --> 0:18:21.639 think I'm safe in saying that can he recapture that 0:18:21.760 --> 0:18:26.440 credibility a week from today? I think it's a bit harsh, 0:18:26.480 --> 0:18:28.959 and I think you can compare light for light, right, 0:18:29.000 --> 0:18:31.199 So Jackson the Hall last year, was anyone predicting a 0:18:31.240 --> 0:18:33.840 war um. I don't know. Half the year after that 0:18:34.160 --> 0:18:38.040 probably not right, so nuclearly that the transitor issue despises 0:18:38.040 --> 0:18:40.880 and then they've lost a lot longer relative to expectations. 0:18:40.960 --> 0:18:44.760 The one was anticipating China to face these some COVID concerns. 0:18:44.840 --> 0:18:47.119 So I'm not trying to just by global central bankers 0:18:47.200 --> 0:18:50.320 in the missing inflation side of they're clearly looking back 0:18:50.480 --> 0:18:52.520 and they wish some things could have been done differently. 0:18:52.960 --> 0:18:55.080 But now there is a time to start to set 0:18:55.119 --> 0:18:58.560 the record straight and properly guide markets up ahead. And 0:18:58.840 --> 0:19:02.040 as I mentioned that the program um they're be a 0:19:02.160 --> 0:19:04.920 general speech guidance from various septumbers. They've lost two or 0:19:04.960 --> 0:19:08.280 three weeks successfully in a bringing back that expectation um 0:19:08.520 --> 0:19:11.239 and just giving market to dose of reality. I think 0:19:11.280 --> 0:19:15.240 that's been quite successful. So I just I guess Chennen 0:19:15.280 --> 0:19:17.640 Powell just needs to do a bit more of the same. Jeff, 0:19:17.680 --> 0:19:21.240 always a pleasure appreciated. B and Y Melon Senior's Market strategists. 0:19:21.240 --> 0:19:24.000 Every you joining us this morning and ahead of the 0:19:24.040 --> 0:19:26.159 cash of about Wall Street, we have futures in the 0:19:26.200 --> 0:19:28.640 red this morning. Down future is two hundred four points lower. 0:19:28.680 --> 0:19:31.760 That's down six tenths of a percent SMP evening futures 0:19:32.280 --> 0:19:35.280 down thirty three points right now, down eight tenths of 0:19:35.320 --> 0:19:38.520 a percent, and then as next futures one D one 0:19:38.560 --> 0:19:42.280 points lower, a nine tenths of a percent declined. Footsie 0:19:42.359 --> 0:19:46.959 in London is up just four points right now, relatively unchanged. 0:19:47.400 --> 0:19:50.440 As you look at the Sterling one eighteen sixty that 0:19:50.600 --> 0:19:54.040 is down six tenths of a percent this morning, and 0:19:54.560 --> 0:19:58.080 you are listening to Bloomberg Daybreak. Just ahead, we'll have 0:19:58.200 --> 0:20:07.800 a check of your top stories and Bloomberg weather for 0:20:07.880 --> 0:20:11.200 it today from meteorologist Rob Carolin. Mainly sunny warm in 0:20:11.400 --> 0:20:14.840 New York City, the Heights emperature ninety tomorrow, partly Sunday, 0:20:14.960 --> 0:20:17.159 chance of the eight day shower, the Heights amperature topping 0:20:17.200 --> 0:20:23.440 out at eight five to ninety degrees. Broadcasting live from 0:20:23.480 --> 0:20:27.280 the Bloomberg Interactive Broker Studio in New York, Bloomberg E 0:20:27.359 --> 0:20:31.280 living three on to Washington, d C, Bloomberg to Boston, 0:20:31.440 --> 0:20:34.840 Bloomberg one O six one to San Francisco, Bloomberg M 0:20:34.920 --> 0:20:38.159 sixty to the Country, Sirius XM Cho one nine and 0:20:38.240 --> 0:20:41.560 around the globe. The Bloomberg Business app and Bloomberg Radio 0:20:41.720 --> 0:20:50.440 dot Com This is Bloomberg Daybreak. It's six thirty on 0:20:50.560 --> 0:20:53.639 Wall Street. Good morning. I'm John Tucker and I'm Karen Moscow. 0:20:53.760 --> 0:20:56.120 We are just about three hours away from the open 0:20:56.160 --> 0:20:58.040 of US trading. It's time to the five things that 0:20:58.200 --> 0:21:00.200 you need to notice start your day. Bro to you 0:21:00.359 --> 0:21:04.840 buy Interactive Brokers. Interactive Brokers charges margin loan rates from 0:21:04.880 --> 0:21:07.600 two point three percent to three point three percent. Their 0:21:07.640 --> 0:21:09.959 clients can also are an extra income by lending their 0:21:10.000 --> 0:21:12.920 fully paid shares of stock. Rates subject to change. Learn 0:21:12.960 --> 0:21:16.440 more at ib k r dot com. Slash compare up first. 0:21:16.720 --> 0:21:19.359 US futures are lower this morning as traders react to 0:21:19.440 --> 0:21:22.320 mixed signals from the Fed. It's unclear exactly how big 0:21:22.359 --> 0:21:25.160 the central banks next move will be on interest rates. St. 0:21:25.240 --> 0:21:27.919 Louis FED Governor James Bullard wants a seventy five basis 0:21:27.960 --> 0:21:32.080 point move in September. Kansas Cities Esther George is more cautious. 0:21:32.320 --> 0:21:35.320 San Francisco's Mary Daily has open to fifty or seventy 0:21:35.359 --> 0:21:38.600 five basis points, and Minneapolis Fed Chief Neil cash Carry 0:21:38.720 --> 0:21:41.840 warrants a recession could be on the horizon as we 0:21:41.960 --> 0:21:45.040 continue to raise rates, As we continue to raise costs 0:21:45.240 --> 0:21:48.399 to speak of borrowing across the economy, it should be 0:21:48.520 --> 0:21:51.159 putting tappling the brakes on the US economy, and that 0:21:51.280 --> 0:21:53.560 makes it more likely that we would end up in 0:21:53.680 --> 0:21:56.480 a reception now. Cash Cary made the comments a day 0:21:56.640 --> 0:21:59.480 after the release of julys FED minutes, which showed officials 0:21:59.520 --> 0:22:02.440 wagging actually when to slow the pace of rate hikes. 0:22:02.640 --> 0:22:05.679 A new p WC survey is painting a bleak picture 0:22:05.760 --> 0:22:08.640 on the future of the US labor market. The results 0:22:08.680 --> 0:22:11.399