Speaker 1: Bloomberg Audio Studios, podcasts, radio news, single best idea on
Speaker 1: Apple podcasts, on YouTube podcasts as well. Thrilled with that.
Speaker 1: I'm late to the party, you know, I just you know.
Speaker 1: I got a briefing Friday from a senior guy at
Speaker 1: Westwood One and it was just simply a podcast walkthrough,
Speaker 1: and I really didn't realize YouTube is really beginning to
Speaker 1: do well with podcast distribution. So good morning to that.
Speaker 1: I got to look that up. We'll have much more
Speaker 1: on that this busy week as well. Of course, the
Speaker 1: Fed on Wednesday. As I said last week, something changed
Speaker 1: in the air Thursday, and I've never seen the balance
Speaker 1: between twenty five and fifty bases point a quarter point
Speaker 1: inter straight cut, a half point inter straight cut, and
Speaker 1: the endecision, the uncertainty Doctor Wang and A Wong and
Speaker 1: Bloomberg really led on this. I give her great credit.
Speaker 1: She hit a bar chart out that was just completely
Speaker 1: unusual in the history of the FED. So we got
Speaker 1: through the weekend and we had the Wallstreet Journal had
Speaker 1: an article the ft, had an article this, that and
Speaker 1: the other, and very clearly on a Monday morning, we
Speaker 1: had the bond market showing price up, yield down, and
Speaker 1: lower yields, particularly with a two year yield breaking down
Speaker 1: to a new low. And then at six thirty New
Speaker 1: York time to borrow the phrase, all hell broke loose.
Speaker 1: William Dudley, the former president of the New York Fed, writing
Speaker 1: for Bloomberg Opinion, put out a blistering note saying he
Speaker 1: supports a fifty basis point rate cut always on surveillance.
Speaker 1: We have the privilege of these guests, William Dudley, right
Speaker 1: now on fifty basis points.
Speaker 2: I think what's essentially happened is the change expectations last
Speaker 2: week with those two articles that came out on the
Speaker 2: Wall Street Journal and the Financial Times, sort of suspicious
Speaker 2: article because they basically reopened the possibility of fifty when
Speaker 2: that was sort of getting closed off. Since that time,
Speaker 2: we haven't had any you know, FED intervention in any
Speaker 2: way that's visible. So it seems at least that the
Speaker 2: FED is comfortable with the shifting expectations away from twenty
Speaker 2: five to fifty. So I don't think, you know, as
Speaker 2: time passes, I think what's going to happen is we're
Speaker 2: going to continue to price more in the direction of fifty.
Speaker 1: In a multiple meeting sense, of three more meetings this year,
Speaker 1: wrapped around the presidential election. They literally meet the day
Speaker 1: after with an announcement. The FED decides two days after
Speaker 1: the November fifth election. Part of this in with the analysis,
Speaker 1: of course, the analysis of Bloomberg is how do I
Speaker 1: not lose money in the stock market? How do I
Speaker 1: buy bonds where price goes up yield goes down? How
Speaker 1: do I buy foreign exchange? What do I play in
Speaker 1: the dollar? What does the litmus paper the foreign exchange
Speaker 1: system mean? Paul Sweeney paying under three dollars a gallon
Speaker 1: for the for his it's not a bell. What's the
Speaker 1: I can't remember. I can't remember what card is it
Speaker 1: Paul has? But anyways, you know, the gas is coming down,
Speaker 1: commodities are coming down. It's all this market squirrel of
Speaker 1: the elites. Bill Dudley was iconic out of Berkeley at
Speaker 1: Golden Sachs and with the New York Fed of always
Speaker 1: watching the broad spectrum of the American economy. Maybe with
Speaker 1: that responsibility on the island of Manhattan, of realizing it's
Speaker 1: not just about Manhattan. Bill Dudley, on the FED and
Speaker 1: the poor.
Speaker 2: Well, I actually think the priory motivation for the interest
Speaker 2: rates cut is the deterioration out for low and modern
Speaker 2: income workers.
Speaker 3: We start to think about the you know, the consumer
Speaker 3: spenning reports have gotten recently. It's all about stress at
Speaker 3: the low end, and I think that's what's motivating the
Speaker 3: FED to cut rates more quickly. I think they're definitely
Speaker 3: taking that into consideration.
Speaker 1: Bill Dudley. There the I should say, singing from the
Speaker 1: same hymnal Jerome power, that they look at all Americans. Finally,
Speaker 1: on this communication exercise, just some inside baseball, the Bank
Speaker 1: of England has visible descent, acrimony and good quality, good cheer.
Speaker 1: I should say about descent argument, and that the Fed
Speaker 1: no one descents well. Bowman descended a number of meetings ago,
Speaker 1: but it was sort of kind of like descent. Basically,
Speaker 1: nobody's descentant. You can't figure out what they're doing besides
Speaker 1: this idiotic analysis of the FED speeches the minutes, and
Speaker 1: that maybe Chairman Powell speaks like a Jackson hole and
Speaker 1: clarity is assumed, or maybe there's smoke signals from selected media.
Speaker 1: Bill Dudley on the smoke signals.
Speaker 3: This is sort of awkward and you really shouldn't be
Speaker 3: communicating through these sort of articles in such a subtle
Speaker 3: way that some people get it and some people don't.
Speaker 3: That doesn't seem to be very fair for people to
Speaker 3: get the right signal from the FED. I think what
Speaker 3: basically happened was the issue of twenty five versus fifty
Speaker 3: was getting sort of closed off as you approached the
Speaker 3: blackout period. Coll didn't want it to be closed off
Speaker 3: because he's actually thinking pretty strobably about fifty basis points,
Speaker 3: and this was the way to keep it open. And
Speaker 3: I think what's happened as people have reflected on a
Speaker 3: bit more, the logic for fifty has become very compelling
Speaker 3: to people, and that's why I think that's what the
Speaker 3: Fit's going to do at this meeting this week.
Speaker 1: Bill Dudley there just a generous amount of time with
Speaker 1: us today after his market moving essay for Bloomberg Opinion.
Speaker 1: We will go to Wednesday that fed to size. I
Speaker 1: look for our coverage. My people haven't even briefed me
Speaker 1: yet on who we have, but I'm sure it'll be
Speaker 1: just as good as what we had last time around.
Speaker 1: Great conversation wrapped around the announcement and then on to
Speaker 1: the press conference, and after the press conference, some good work.
Speaker 1: I hope Jeff Rosenberg at Black Rock shows up always
Speaker 1: as after the press conference guest of what the bond
Speaker 1: market thinks of the FED action. We're out at YouTube,
Speaker 1: not only YouTube podcast, but subscribe to Bloomberg podcasts at YouTube.
Speaker 1: That's the best way to get us on your commute,
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