WEBVTT - Investors Await Key Powell Speech; DNC Begins in Chicago

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<v Speaker 1>Bloomberg Audio Studios, podcasts, radio News. Good morning, I'm Nathan

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<v Speaker 1>Hager and I'm Karen Moscow. Here are the stories we're

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<v Speaker 1>following today, Karen.

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<v Speaker 2>Stocks are coming off their best week of the year

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<v Speaker 2>ahead of a key speech from FED chair J Powell.

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<v Speaker 2>The S and P five hundred has gained for seven

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<v Speaker 2>straight sessions. A flurry of strong economic data last week

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<v Speaker 2>was cheered on by investors. Nadia Lovell, as senior US

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<v Speaker 2>equity strategist at UBS Global Wealth Management, she is still

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<v Speaker 2>bullish on tech stocks.

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<v Speaker 3>Well, we have been advising clients to do, particularly our

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<v Speaker 3>international clients that tends to have Leod's exposure to attack

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<v Speaker 3>just because of home bias, is to continue to buy

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<v Speaker 3>on the weakness in tech.

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<v Speaker 4>I mean, we heard some positive data points throughout the

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<v Speaker 4>earnesties and particularly around the AI story. I mean we're

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<v Speaker 4>continuing to see those hyper scales, those large hyper scales,

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<v Speaker 4>those cloud service providers increase capax and quite frankly, we

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<v Speaker 4>think that there's upside the APEX estimates into twenty twenty five.

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<v Speaker 2>UBS isnadi a level notes the Nasdaq one hundreds more

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<v Speaker 2>than five percent game last week was a good sign

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<v Speaker 2>for tech stocks going forward, well as for the FED.

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<v Speaker 1>Nathan. The majority of economists and investors expect a twenty

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<v Speaker 1>five basis point rate cut next month, but City US

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<v Speaker 1>economist Veronica Clark is still looking for something bigger.

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<v Speaker 5>Starting with that fifty basis points in September, of the

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<v Speaker 5>bar is relatively low. There is the sense in which

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<v Speaker 5>you know, if they'd had that July employment data just

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<v Speaker 5>a couple of days earlier at that July FOMC meeting,

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<v Speaker 5>they probably would have cut in July. Maybe you're making

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<v Speaker 5>up for lost time a bit. The trend of the

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<v Speaker 5>unemployment rate has just been consistently rising. That we will

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<v Speaker 5>have one more employment report before September, but that's probably

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<v Speaker 5>not enough to convince you that those risks are not

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<v Speaker 5>asymmetric to the upside of the unemployment rate. So I

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<v Speaker 5>think it's easy for them to start with a fifty

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<v Speaker 5>in September.

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<v Speaker 1>And Citi's Veronica Clark pricing in the swaps market implies

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<v Speaker 1>around thirty basis points of easing next month and about

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<v Speaker 1>ninety three by the end of the year. That marks

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<v Speaker 1>a big retreat from earlier this month, when traders indicated

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<v Speaker 1>more than one hundred and fifty bases points of cuts

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<v Speaker 1>for twenty twenty four.

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<v Speaker 2>Then Karen, we could get more clues on rate cuts

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<v Speaker 2>at the end of the week, that is when Federal

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<v Speaker 2>Reserve chair Jay Powell speaks in Wyoming. Bloomberg's Michael McKee

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<v Speaker 2>will be there for the Jackson Hole Symposium and has

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<v Speaker 2>this preview.

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<v Speaker 6>This is the week all Wall Street has been waiting for.

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<v Speaker 6>The Kansas City Fence Annual Jackson Hole Symposium is actually

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<v Speaker 6>an academic conference about economic theory, not current monetary policy.

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<v Speaker 6>Except for the Federal Reserve Chairman's opening remarks on Friday morning,

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<v Speaker 6>Jay Powell isn't expected to give investors a lot of

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<v Speaker 6>detail about the Central banks plans for rate cuts. He

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<v Speaker 6>is expected to say cuts remain on track as inflation

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<v Speaker 6>keeps coming down. The tone he sets, we'll set market

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<v Speaker 6>expectations for the next month until the next policy meeting

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<v Speaker 6>September eighteenth, Wall Street can decide whether the reality of

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<v Speaker 6>Jackson Hole lives up to the hype. Michael McKee, Bloomberg Radio.

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<v Speaker 1>Right and Mike, thanks, So, we do have a deal

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<v Speaker 1>to tell you about this Morning Circle k operator Kushtard

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<v Speaker 1>has made a proposal to take over much larger rival

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<v Speaker 1>seven eleven Owners, seven and I Holdings. A merger would

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<v Speaker 1>create a global network of roughly one hundred thousand convenience stores.

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<v Speaker 2>Now Karen to the latest from the Middle East, Secretary

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<v Speaker 2>of State Anthony Blinkin is set to meet with Israel's

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<v Speaker 2>Prime minister later today, as mediators say they are closing

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<v Speaker 2>in on a deal to halt the war in Gaza

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<v Speaker 2>and free hostages captured by Hamas. Blinken spoke earlier in

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<v Speaker 2>Tel Aviv.

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<v Speaker 7>I'm here as part of an intensive diplomatic effort on

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<v Speaker 7>President Biden's instructions to try to get this agreement to

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<v Speaker 7>the line and ultimately over the line.

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<v Speaker 8>It is time to get done.

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<v Speaker 2>This is Secretary of State Lincoln's ninth trip to the

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<v Speaker 2>Middle East since the conflict began.

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<v Speaker 1>Well back in the US, Nathan Democrats are coming together

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<v Speaker 1>for their convention in Chicago, but infighting over the Israel

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<v Speaker 1>Hamas war threatens to pull them apart. Bloomberg's Amy Morris

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<v Speaker 1>has more.

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<v Speaker 9>The backdrop of the Democratic National Convention this week is

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<v Speaker 9>made up of pro Palaceian protests, incumbents ousted for criticizing Israel,

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<v Speaker 9>and warnings from the left over rising anti Semitism. Now

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<v Speaker 9>as the party tries to pull together in a show

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<v Speaker 9>of unity, Democrats remain split over Israel's war in Gaza.

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<v Speaker 9>Pro Palestinian and pro Israeli groups say they'll be there,

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<v Speaker 9>which means security is tight. Chicago and the DNC expect

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<v Speaker 9>fifty thousand visitors, twenty thousand members of the press, and

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<v Speaker 9>fifty five hundred delegates and more. President Biden speaks tonight,

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<v Speaker 9>Former President Obama speaks tomorrow night, Former President Bill Clinton

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<v Speaker 9>speaks on Wednesday, and Vice President Harris takes the stage

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<v Speaker 9>on Thursday. Amy Moore as Bloomberg Radio.

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<v Speaker 2>Thanks Amy. Vice President Harris spent the day before the

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<v Speaker 2>convention on a bus tour through the battleground state of Pennsylvania.

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<v Speaker 4>We know our country is going to be as strong

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<v Speaker 4>as our willingness.

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<v Speaker 9>To fight for it and to fight for what.

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<v Speaker 2>We stand for.

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<v Speaker 3>You know, and you know what you stand for.

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<v Speaker 9>You know what to fight for.

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<v Speaker 2>When the vice presidents spoke there to supporters in Beaver County, Pennsylvania.

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<v Speaker 2>Harris heads into the convention with the New Washington Post

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<v Speaker 2>ABC News whose IPSOS poll showing her in the lead

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<v Speaker 2>against former President Trump among registered voters. Forty nine percent

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<v Speaker 2>to forty five percent. The poll's margin of er is

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<v Speaker 2>two percent. The same poll last month showed a dead

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<v Speaker 2>heats between Trump and President Biden.

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<v Speaker 1>And Nathan former President. Trump is planning events in four

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<v Speaker 1>swing states during the four days of the convention, including

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<v Speaker 1>a trip to the border later this week, and Bloomberg's

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<v Speaker 1>Ed Baxter has that story.

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<v Speaker 10>Immigration has been a sweet spot for Republicans in their

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<v Speaker 10>attack against Vice President Kamala Harris. Trump will be in Montezuma,

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<v Speaker 10>Pass Thursday, the same day Harris will accept the nomination.

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<v Speaker 10>Now Democratic Arizona Senator Mark Kelly on CBS has heard

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<v Speaker 10>on Bloomberg says the Republicans just go to the border

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<v Speaker 10>for photo ops, but says the truth is Trump is

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<v Speaker 10>standing in the way. I mean, he specifically told my

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<v Speaker 10>Senate colleagues that they could not support this bill because

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<v Speaker 10>he wanted to have this issue for the election. Trump

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<v Speaker 10>is scheduled to get a briefing as well at the border,

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<v Speaker 10>Ed Baxter, Bloomberg Radio said.

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<v Speaker 2>In Ukraine, President Vladimir Lensky says the name of his

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<v Speaker 2>country's incursion into Russia is to create a buffer zone

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<v Speaker 2>between the two countries. His comments come as key of

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<v Speaker 2>has expanded its operation into the Curs region over the weekend.

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<v Speaker 2>It is nightly addressed to the nations. Zelensky made a

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<v Speaker 2>direct appeal to the US, UK and France.

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<v Speaker 11>In every direction, our troops are doing an outstanding job. However,

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<v Speaker 11>when it comes to supplies from our partners, we need

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<v Speaker 11>things to speed up. There are no holidays in war.

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<v Speaker 11>We need decisions, We need timely logistics with the promised

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<v Speaker 11>aid packages.

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<v Speaker 2>Speaking through an interpreter, Ukrainian President Vladimir Lensky said his

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<v Speaker 2>forces have struck two key bridges in the Curs region

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<v Speaker 2>and disrupted some of Moscow's main supply roots.

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<v Speaker 1>And it's time now if for a look at some

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<v Speaker 1>of the other stories making news in New York and

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<v Speaker 1>around the world. And for that we're joined by Bloomberg's

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<v Speaker 1>Michael Barr Michael, good morning.

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<v Speaker 8>Good morning, Karen. Flooding hit the Northeast after heavy rains

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<v Speaker 8>swamped the area. Vehicles were still in the high water,

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<v Speaker 8>especially in New Jersey, and people had to be rescued.

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<v Speaker 8>This stranded driver told ABC seven he was on a

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<v Speaker 8>date in Woodland Park when water enveloped the parking lot

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<v Speaker 8>and his vehicle wound up disabled.

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<v Speaker 1>Point and laugh. You know, it's like, oh that pour

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<v Speaker 1>succer No, we're the sucker.

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<v Speaker 6>To make for shirt.

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<v Speaker 8>Meanwhile, in western Connecticut.

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<v Speaker 1>This water is at least four to five feet high,

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<v Speaker 1>nearly a.

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<v Speaker 8>Foot of rain falling in just hours. Streets and sidewalks

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<v Speaker 8>were suddenly overwhelmed by water moving fast enough to carry

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<v Speaker 8>away cars. Storms sweeping through New York City disrupted flights

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<v Speaker 8>and train service. Tropical storm in Esto became a hurricane

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<v Speaker 8>again as it turned away from Bermuda and headed further

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<v Speaker 8>out in the northeastern Atlantic. Ernesto is sending powerful swells

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<v Speaker 8>toward the US East Coast, generating dangerous rip currents associated

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<v Speaker 8>with at least one depth and prompting many rescues. Many

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<v Speaker 8>East Coast beaches are closed, including in New York. The

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<v Speaker 8>National Hurricane Said in Miami said Ernesto's maximum sustained wins

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<v Speaker 8>we're seventy five miles per hour. That's barely Category one strength.

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<v Speaker 8>The storm is expected to pass near southeastern Newfoundland late

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<v Speaker 8>today and early tomorrow. Alsted Representative George Santos is expected

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<v Speaker 8>to plead guilty today to multiple felony accounts. The New

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<v Speaker 8>York Republican is charged with nearly two dozen counts, including

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<v Speaker 8>wire fraud, money laundering, and theft of public funds. Santo's

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<v Speaker 8>faced twenty years in prison for the twenty three federal

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<v Speaker 8>charges of fraud that the US Attorney's Office has brought

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<v Speaker 8>against him. With the plea deal, no word on whether

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<v Speaker 8>the plea deal will help them avoid jail time. Finally,

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<v Speaker 8>it's that time of the year when parents and kids

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<v Speaker 8>head to stores from back to school shopping. A Bank

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<v Speaker 8>Great survey finds inflation is impacting buying habits, but not

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<v Speaker 8>as much as it was a couple of years ago.

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<v Speaker 8>Bank Great senior analyst Ted Russman.

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<v Speaker 2>About a third of back to school shoppers thirty two

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<v Speaker 2>percent say that inflation is changing.

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<v Speaker 6>The way they buy.

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<v Speaker 1>A couple of years ago that was forty one percent.

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<v Speaker 8>Analyst Ted Rossman says another area as inflation is having

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<v Speaker 8>a greater impact, but back to school's shopping is one

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<v Speaker 8>area where people seem to be feeling a lot better.

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<v Speaker 8>Global News twenty four hours a day and whenever you

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<v Speaker 8>want it with Bloomberg News Now. I'm Michael Barrn. This

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<v Speaker 8>is Bloomberg Karen.

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<v Speaker 1>All right, Michael barr thank you time now for the

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<v Speaker 1>Bloomberg Sports Update with John stash Hour.

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<v Speaker 12>John, Good morning, Good morning, Karen. The little leaguers who

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<v Speaker 12>got to watch the Yankees and Tigers up close in Wayiamsport,

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<v Speaker 12>Pennsylvania saw bizarre game bottom the night day and the

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<v Speaker 12>Yanks led one did nothing. They had scored a run

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<v Speaker 12>without a hit. To that point. There had only been

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<v Speaker 12>nine hits in the game, all singles. But Detroit tied

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<v Speaker 12>the game with two outs of the night off Clay Holmes,

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<v Speaker 12>who blew a safe for a major league leading tenth time.

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<v Speaker 12>After the Yanks reclaimed the lad top of the tenth,

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<v Speaker 12>the Tigers tied it again in the bottom and were

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<v Speaker 12>not done there. We had a one to two pitch

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<v Speaker 12>scrow bowl side that's through for a base hit and

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<v Speaker 12>could well win it the Kid's tree around third to

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<v Speaker 12>Vegas with a throw of the play in the head

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<v Speaker 12>first slide is in time and the Tigers win in

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<v Speaker 12>walk up fashion.

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<v Speaker 8>Three to two over the Yankees.

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<v Speaker 12>Here in Williamsport, ESPN the call of the Parker Meadows

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<v Speaker 12>walk off of Mark Later it was Jason Dominguez making

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<v Speaker 12>that throw from left field. Teams were allowed to add

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<v Speaker 12>a player and the Yanks brought Domingas up from Scranton.

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<v Speaker 12>He had hit four home runs in eight games to

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<v Speaker 12>the Yanks last season before he got hurt. Last night,

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<v Speaker 12>he went zero for four, struck out three times at Cityfield,

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<v Speaker 12>Marlins beat the Mets three to two. The Mets got

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<v Speaker 12>Sterling mart Day back after missing two months with a

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<v Speaker 12>knee injury, but Brandon Nimmo, who homered and the loss,

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<v Speaker 12>then left the game with an achy shoulder. I'll have

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<v Speaker 12>an MRI today. The Mets tonight host Baltimore. The Orioles,

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<v Speaker 12>despite being out hit eleven to three, beat the Red

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<v Speaker 12>Sox four to two in Baltimore, back in the first

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<v Speaker 12>place time with the Yankees. Then Nationals won six to

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<v Speaker 12>four at Philadelphia, and the Giants won four to two

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<v Speaker 12>in Oakland. Last game ever between two Bay Area teams

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<v Speaker 12>as the Aser move into Las Vegas by way of Sacramento.

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<v Speaker 12>In Memphis Reki Matsuyama, but the other day with a

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<v Speaker 12>five shot lead, he won the Saint Jude Golf by two.

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<v Speaker 12>John Stashawer Bloomberg Sports Karen Nathan.

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<v Speaker 8>Coast to Coast on Bloomberg Radio, nationwide on Sirius XM,

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<v Speaker 8>and around the world on Bloomberg dot Com and the

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<v Speaker 8>Bloomberg Business app. This is Bloomberg Daybreak.

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<v Speaker 2>Good morning, I'm Nathan Hager. Investors are heading into this

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<v Speaker 2>new week with expectations riding high that the Federal Reserve

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<v Speaker 2>is on track to start cutting interest rates next month,

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<v Speaker 2>that all eyes will be on Chairman Powell and his

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<v Speaker 2>speech at Jackson Hole at the end of the week

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<v Speaker 2>to see if he seals in those bets. Joining us

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<v Speaker 2>now to get us ready for what's ahead live in

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<v Speaker 2>our interactive Brookers Studios this morning. Lori Calvacina, head of

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<v Speaker 2>US Equity strategy at RBC Capital Market, It's great to

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<v Speaker 2>have you with us in person this morning, Laurie. As

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<v Speaker 2>we watch S and P on a seven day winning

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<v Speaker 2>streak heading into this week. How much does this rally

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<v Speaker 2>hinge on what Chairman Powell has to say on Friday.

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<v Speaker 7>Well, thanks for having me as all, Nathan, And look,

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<v Speaker 7>I think it's probably his to not mess up at

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<v Speaker 7>this point, not that that's going to be his end goal,

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<v Speaker 7>but I do think that we've settled into the equity

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<v Speaker 7>part of the market, at least just the idea that

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<v Speaker 7>these rate cuts are coming in September. I do feel like,

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<v Speaker 7>at least in my conversations, questions about fifty have been

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<v Speaker 7>dialed down. It does seem like we've sort of I

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<v Speaker 7>wouldn't say we're completely out of the soft patch on

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<v Speaker 7>the economy or the concerns about labor and the consumer,

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<v Speaker 7>but it does seem like we're in a better place

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<v Speaker 7>on that. So, you know, I think at this point

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<v Speaker 7>we need to hear more of the same. You know,

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<v Speaker 7>I would assume that the commentary is going to be

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<v Speaker 7>carefully tailored to match what's been said previously, but as always,

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<v Speaker 7>we're going to have to tune in and.

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<v Speaker 2>See to that point about potentially not being out of

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<v Speaker 2>the rough patch in the economy. We did get some

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<v Speaker 2>pretty positive economic data at the end of the week,

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<v Speaker 2>particularly on retail sales and the dial down of weekly

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<v Speaker 2>jobless claims as well. Do you still have concerns about

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<v Speaker 2>the consumer after what we've heard at the at the

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<v Speaker 2>end of last week.

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<v Speaker 7>So, you know, we've never been in the recession camp.

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<v Speaker 7>We've thought that there was, you know, a moment that

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<v Speaker 7>we've been experiencing right now where consumers are reacting pretty

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<v Speaker 7>profoundly right to the higher interest rate environment. The cumulative

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<v Speaker 7>impact of inflation. As I looked at the retail sales data,

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<v Speaker 7>one thing that struck me was just how how kind

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<v Speaker 7>of back and forth it's been in recent months, you know,

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<v Speaker 7>sort of the idea, at least in my mind, that

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<v Speaker 7>maybe consumers are reacting and then have to go out

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<v Speaker 7>and buy the you know, buy the things and do

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<v Speaker 7>the things they need to do that life goes on.

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<v Speaker 7>They were talking in an earlier segment about back to school, right.

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<v Speaker 7>I mean, it is a great reminder that as long

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<v Speaker 7>as we do have jobs, and that's what we're really

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<v Speaker 7>seeing in that claims data. That's given people so much

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<v Speaker 7>comfort that consumers will go out and do the things

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<v Speaker 7>they need to do, even if they are reacting in

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<v Speaker 7>real time to some of these pressures. And I think

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<v Speaker 7>it's just a very very you know, sort of interesting

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<v Speaker 7>moment that we're in right now. One of the companies

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<v Speaker 7>that reported last week, they had a comment about the

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<v Speaker 7>sort of deferral mindset, and you know, I sort of

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<v Speaker 7>flashed back to kind of the mediate period after COVID.

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<v Speaker 7>I don't know if we you know, exactly where we

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<v Speaker 7>define that, but the idea of demand that was delayed,

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<v Speaker 7>not destroyed, was sort of a phrase. They kind of

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<v Speaker 7>bopped back into my mind, and I think we're going

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<v Speaker 7>to have some puts and takes. I think the data

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<v Speaker 7>is going to be important to watch. In my mind,

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<v Speaker 7>we are going to come out to a better place.

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<v Speaker 2>Yeah, that was some interesting commentary from Home Depot last

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<v Speaker 2>week about this deferral mindset. When we have this idea

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<v Speaker 2>that consumers might be getting a little choosier now in

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<v Speaker 2>this high inflation, high interest rate environment. What sectors do

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<v Speaker 2>well in an environment like this?

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<v Speaker 7>You know, I'm not sure if there's any one particular

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<v Speaker 7>set of sectors or you know, or industries. I do

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<v Speaker 7>think you have to take it company by company. I

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<v Speaker 7>will tell you that we've been neutral the consumer discretionary sector,

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<v Speaker 7>but we've been underweight consumer staples. And if you look

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<v Speaker 7>at consumer staples, it is a quite cheap sector. It's,

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<v Speaker 7>you know, in theory, if you're kind of going into

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<v Speaker 7>an economic soft patch, right, it's one that you might

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<v Speaker 7>think that you want to go into. But I think

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<v Speaker 7>at this point in time, you know, as I read

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<v Speaker 7>through just a very broad array of transcripts from those companies,

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<v Speaker 7>and I'm thinking back, you know, not just this reporting season,

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<v Speaker 7>but going back the last reporting season or two. It

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<v Speaker 7>really seems to me that that's a sector that's been

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<v Speaker 7>very slow to understand the sort of reaction that consumers

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<v Speaker 7>are having. And I do think that they're sort of

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<v Speaker 7>on the front lines of that war, so to speak,

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<v Speaker 7>right now. And that's enough to sort of keep me

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<v Speaker 7>on the sidelines for that sector with an underweight despite

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<v Speaker 7>you know, some attractive valuations on my quant work.

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<v Speaker 2>Just about thirty seconds left, Lourie, But after Chairman Palace

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<v Speaker 2>speech on Friday, we get Nvidia earnings a week from Wednesday.

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<v Speaker 2>I mean, how big a deal is that going to

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<v Speaker 2>be for the rally?

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<v Speaker 7>So I think the AI theme generally, you know, it's

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<v Speaker 7>been a fascinating one to track. I mean, we had

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<v Speaker 7>some you know, disappointments relative to high expectations early on.

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<v Speaker 7>Overlooked parts of this last reporting season. I think we've

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<v Speaker 7>had is that companies are starting to come out and

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<v Speaker 7>talk about how they're trying to use that technology and

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<v Speaker 7>how it's making an impact on the day to day. Now,

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<v Speaker 7>maybe that in and of its office two small potatoes

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<v Speaker 7>for investors and underwhelming, but I do think we've entered

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<v Speaker 7>into a place where you're starting to see some of

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<v Speaker 7>the results manifest.

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<v Speaker 2>This is Bloomberg day Break Today, your morning brief on

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