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Speaker 1: Live from the Bloomberg Interactive Rooks Studios. This is Bloomberg

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Speaker 1: day Break for Monday, March twenty seventh. Coming up today,

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Speaker 1: Silicon Valley Bank is sold. We are live with the

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Speaker 1: latest details. The chairman of Saudi National Bank resigns on

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Speaker 1: the heels of a controversial interview with Bloomberg. A top

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Speaker 1: FETE official says banking strains are bringing the US closer

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Speaker 1: to recession, and Twitter suffers a leak of its proprietary

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Speaker 1: source code. Israel's consul general of New York has resigned

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Speaker 1: as protests continued. It's going to treat plus, a new

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Speaker 1: dangerous drug has New York authorities concerned. I'm Michael laugh

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Speaker 1: Or Ahead, I've done Stashdaward, Sports, the Nets, Bloth in Orlando,

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Speaker 1: San Diego State and Miami advanced to the Ncuba Bay

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Speaker 1: Final four. That's all straight Ahead on Bloomberg day Break,

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Speaker 1: The business news you need, disturn your day, and just

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Speaker 1: one fifteen minute podcast each pointing on Apples, Spotify, the

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Speaker 1: Bloomberg Business app and everywhere you get your podcasts. Good morning,

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Speaker 1: I'm Nathan Hager and I'm Cameron Moscow. Here are the

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Speaker 1: stories we're following today. We begin the day with major

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Speaker 1: news in the banking industry. Let's start here in the US,

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Speaker 1: where we have a deal to buy Silicon Valley Bank.

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Speaker 1: Bloomberg's John Tucker joins us live with the very latest.

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Speaker 1: Good morning, John and Nathan. The buyer is First Citizens,

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Speaker 1: based in North Carolina. So what do they get One

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Speaker 1: nineteen billion dollars of deposits in all of Silicon Valley

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Speaker 1: Banks outstanding loans, and that comes at something of a bargain,

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Speaker 1: seventy two billion dollars of assets from SVB at sixteen

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Speaker 1: billion dollars below their value. Starting this morning, all depositors

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Speaker 1: of SVB and the seventeen branches they ran will operate

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Speaker 1: under the First Citizens banner. Svb's failure is going to

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Speaker 1: likely cost the FDIC about twenty billion dollars. A Silicon

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Speaker 1: Valley Bank unraveled in less than forty eight hours, becoming

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Speaker 1: the biggest US bank to fail in more than a decade.

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Speaker 1: Live to New York on John Tucker Bloomberg Daybreak. All right, John,

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Speaker 1: Thanks well. Regional banks are rallying in the pre market

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Speaker 1: after that news on SVB, shares a first Republic leading

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Speaker 1: the way. They're up more than twenty six percent. Sentiment

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Speaker 1: appears to be improving after a report on Friday that

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Speaker 1: US authorities are considering more support for banks. Well. Another

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Speaker 1: developing story of following this morning, Karen Is oversees a

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Speaker 1: Marl Kadery, the chairman of Saudi National Bank, has resigned.

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Speaker 1: That bank is the largest shareholder in credit suites. Kadary's

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Speaker 1: resignation follows a Bloomberg interview two weeks ago when our

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Speaker 1: use of kamal Ldan asked Kadery if he would offer

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Speaker 1: more support for credit suite I'm wondering whether you would

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Speaker 1: be open to assisting further if there was another call

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Speaker 1: for additional liquidity from credit suites. The answer is absolutely not,

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Speaker 1: for many reasons outside the simplest reason, which is regulate theory.

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Speaker 1: Again stature. We now own nine point eight percent of

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Speaker 1: the bank. If we go above ten percent, four kinds

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Speaker 1: of new rules kick in. Now. That was the chairman

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Speaker 1: of Saudi National Banks. With Bloomberg's use of kamal Ldan

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Speaker 1: two weeks ago. A credit sweet stock plunged following those comments.

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Speaker 1: They eventually reached a level where the lender required a

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Speaker 1: takeover by UBS. Well, back here in the US, Nathan

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Speaker 1: markets are focused on the banking sector and the risk

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Speaker 1: from FED policy. Minneapolis Fed President Neil cash Carry warns

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Speaker 1: that recent bank turmoil has increased the risk of her session.

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Speaker 1: At the same time, he tells CBS it's too soon

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Speaker 1: to judge what it means for monetary policy. The positive

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Speaker 1: sign is deposit outflows seem to have slowed down, some

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Speaker 1: confidences being restored among smaller and regional banks. At the

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Speaker 1: same time, we've seen the capital markets have largely been

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Speaker 1: closed for the past two weeks. If those capital markets

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Speaker 1: remain closed because borrowers and lenders remain nervous, then that

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Speaker 1: would tell me, Okay, this is probably gonna have a

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Speaker 1: bigger input on the economy and Minneapolis Fed President Neil

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Speaker 1: cash Carry may the comments unface the nation from CBS

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Speaker 1: heard every Sunday on Bloomberg Radio. Meantime, Karen former Treasury

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Speaker 1: Secretary Larry Summers as he's hoping for more government support

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Speaker 1: for banks. He wants US regulators to back uninsured deposits

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Speaker 1: at any banks that fail in the next year. Summers

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Speaker 1: says it's a move that could help build confidence in

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Speaker 1: the sector if we can provide near term assurance with

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Speaker 1: respect to deposits and medium term assurance, with respect to

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Speaker 1: the appropriateness of regulation that affords the best prospect of

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Speaker 1: moving through this crisis in an effective way. Former Treasury

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Speaker 1: Secretary Larry Summers made those comments on Bloomberg's Wall Street

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Speaker 1: Week with David Weston. You can catch the program every

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Speaker 1: Friday at six pm Eastern, or download the show wherever

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Speaker 1: you get your podcasts. Well. Nathan Morgan Stanley says the

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Speaker 1: banking turmoil could show up in earnings. CHIEFUS strategist Mike

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Speaker 1: Wilson says earnings guidance is too high in the way

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Speaker 1: of the banking crisis, and that's putting stocks at risk

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Speaker 1: for sharp declines. Stay tuned for more with Mike Wilson.

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Speaker 1: He joins Tom John and Lisa on Bloomberg Surveillance, coming

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Speaker 1: up at seven am Eastern. In Corporate News this Morning,

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Speaker 1: Karen Twitter has had a leak. The company says part

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Speaker 1: of its proprietary source code was published online last week.

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Speaker 1: Bloomberg Steve Rappaport joins US Live with the latest. Steve,

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Speaker 1: Good morning, Nathan and Karen. A free speech enthusiast is

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Speaker 1: at the center of this digital who'd done it? Twitter?

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Speaker 1: Says that's the name of an account that published the

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Speaker 1: information on Microsoft's GitHub, which is known for housing open

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Speaker 1: source code. Gethub complied with Twitter's request to remove the data.

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Speaker 1: The platform in a court filing, also wants the identity

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Speaker 1: of the person behind the account, as well as the

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Speaker 1: names and other personal information of anyone who shared or

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Speaker 1: downloaded the coding data. The New York Times reports Twitter

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Speaker 1: has launched an internal investigation. Live in New York, I'm

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Speaker 1: Steve Rappaport Bloomberg Daybreak. Thanks Steve, turning to politics now.

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Speaker 1: Last week came and went with no indication or indictment

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Speaker 1: rather of Donald Trump, and now the former president's prediction

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Speaker 1: of violence from its potential arrest is drawing a strong

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Speaker 1: response from former prosecutors. Bloomberg's and Baxter has the story.

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Speaker 1: A group of more than one hundred and seventy five

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Speaker 1: former federal prosecutors has released an open letter denouncing Donald

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Speaker 1: Trump's in Cindi area attacks on Manhattan DA Alvin Bragg.

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Speaker 1: Trump is, among other things, predicted death and destruction if

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Speaker 1: he's indicted. The group says Trump is inciting violence. The

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Speaker 1: group says Trump's statements are meant to intimidate Bragg and

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Speaker 1: that a democracy cannot fight crime and criminals if that

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Speaker 1: activity is allowed to happen. In San Francisco. I'm at

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Speaker 1: Baxter Bloomberg Daybreak. Thanks Ed straight Ahead, your latest local headlines,

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Speaker 1: and a check of sports. This is Bloomberg. It's forty

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Speaker 1: seven degrees in New York. He should have some rain

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Speaker 1: by this afternoon. We'll go to near fifty five. Some

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Speaker 1: of that rain could be mixed with what snowflakes north

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Speaker 1: and west of the city tonight as we head down

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Speaker 1: to near forty. Time now to look at some of

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Speaker 1: the other stories making news in New York and around

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Speaker 1: the world with Bloomberg's Michael bar Good morning, Michael, Good morning. Nathan,

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Speaker 1: Israel's consul general in New York, has resigned. Soft Zamir

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Speaker 1: says the political situation in Israel has reached a critical point,

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Speaker 1: but says his resignation as a move to fight for

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Speaker 1: Israeli people and its future. In Tel Aviv, tens of

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Speaker 1: thousands of Israelis took to the streets early to the

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Speaker 1: day after Prime Minister Benjamin net and Yahoo fired his

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Speaker 1: defense minister, who had spoken out against the government's judicial

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Speaker 1: overhaul plan. Federal and state officials yesterday toured the devastation

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Speaker 1: from Friday's ea Ford tornado in the town of Rolling Fork, Mississippi.

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Speaker 1: President Biden As signed an emergency disaster declaration for the area,

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Speaker 1: bringing additional resources from FEMA and other agencies to the state.

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Speaker 1: At least twenty five people were killed and thousands are

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Speaker 1: likely displaced following the storm. FEMA administrator Dian Chriswall what

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Speaker 1: this major Disaster Declaration does is it ensures that we

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Speaker 1: can bring in the right resources now to help start

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Speaker 1: the recovery process and support any of the ongoing response

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Speaker 1: actions that may be needed in these communities. Chris Bells

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Speaker 1: says the FEMA aide will help the residence of the

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Speaker 1: horror to hit Sharky, Humphreys, Cairol, and Monroe Counties. The

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Speaker 1: NYPD says officers shot an emotionally disturbed man in the Bronx.

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Speaker 1: It happened yesterday inside a building on Grand Concourse, where

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Speaker 1: Rule de la Cruz's father called nine to one to

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Speaker 1: one and told dispatches his son was having a medical episode.

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Speaker 1: Police say the forty two year old man came at

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Speaker 1: them with a knife. De la Cruz was taken to

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Speaker 1: a local hospital and is in critical condition. There are

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Speaker 1: warnings about a dangerous new street drug. It's a legal

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Speaker 1: animal tranquilizer also called trunk, coming into the country through

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Speaker 1: China and Mexico. Unlike in opioid, narcon does not reverse

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Speaker 1: its effects. Senate Majority Leader Chuck Schumer is calling on

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Speaker 1: the DA to send a diversion controlled team to the

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Speaker 1: New York City area to stop its sale and distribution.

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Speaker 1: Zila zine. It's a deadly, skin rotting zombie drug that

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Speaker 1: evil drug dealers are now mixing with fentanyl, with heroin,

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Speaker 1: and with other drugs. Schumer says the drugs already caused

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Speaker 1: death and overdoses in upstate New York. Global News twenty

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Speaker 1: four hours a day, powered by more than twenty seven

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Speaker 1: hundred journalist an analyst in over one hundred twenty countries.

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Speaker 1: How Michael Barr, this is Bloomberg, Nathan. Thank you, Michael.

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Speaker 1: Time now for our Bloomberg Sports update, and for that

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Speaker 1: we bring in John stash Our hes Nathan. The NCAA

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Speaker 1: tournament has gone from sixty eight teams down to the

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Speaker 1: final four. There are no one, two or three seeds remaining.

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Speaker 1: There's a four, two, fives, and a nine. Three of

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Speaker 1: the teams get into Houston, who will be in their

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Speaker 1: first Final four. That's unprecedented. San Diego State with a

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Speaker 1: one point whatever creating the aspects one on a free

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Speaker 1: throw with one second left, will now take on Florida Atlantic.

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Speaker 1: Miami then came from thirteen down on the second half

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Speaker 1: to nap off Texas. The Hurricanes will meet Yukon. The

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Speaker 1: Husky is the only one of the final four that

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Speaker 1: has a history of being their nets lost at Orlando

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Speaker 1: one nineteen one oh six. The Knicks are back home

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Speaker 1: tonight to play Houston match Play Golf. They anticipated final

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Speaker 1: was Rory McElroy against Scottie Scheffler, except both lost in

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Speaker 1: the semifinals and matches. They went to a playoff, so

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Speaker 1: they did play, but in the consolation match McElroy one.

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Speaker 1: The final was won easily by Sam Byrne six and

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Speaker 1: five over Cameron Young. Yankees beat the Blue Jays. Johnny

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Speaker 1: Brito pitched into the sixth then he did not allow

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Speaker 1: a hit. Looks like he's going to be the fifth

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Speaker 1: starter due to all the injuries in the rotation. The

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Speaker 1: Yankees opening days shortstop Thursday in the Bronx will be

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Speaker 1: rookie Anthony Volpe. Here's how Aaron Brune broke the news

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Speaker 1: to the twenty one year old. Yeah, we talked about

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Speaker 1: the start of this piano competition and and he killed him.

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Speaker 1: But at the end of the day he got twenty

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Speaker 1: seven games, a triple A. There's always room for development,

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Speaker 1: but at the end, I think that development should happen

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Speaker 1: in the big leagues. Welcome to New York. Ropey will

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Speaker 1: be an Opening Day Yankee shortstop at the same age

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Speaker 1: Derek Jeter was in nineteen six John Saw. We're Bloomberg

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Speaker 1: Sports Live from coast to coast, from New York to

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Speaker 1: San Francisco, Boston to Washington, DC, nationwide on Sirius XAM,

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Speaker 1: the Bloomberg Business app, and Bloomberg dot Com. This is

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Speaker 1: Bloomberg Daybreak. Good morning. I'm Nathan Hagar on the morning

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Speaker 1: where we're watching bank stocks move higher following the deal

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Speaker 1: for first citizens to buy Silicon Valley banks assets after

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Speaker 1: a couple of weeks that have really shaken confidence in

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Speaker 1: the US banking system. Joining us Live now is Dennis Gartman,

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Speaker 1: chairman of the University of Akron Endowment Investment Committee and

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Speaker 1: the former publisher of the Gartment letter Dennis, Good morning.

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Speaker 1: Will this purchase by First Citizens helped to restore confidence

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Speaker 1: in the system. There's no question that that's what's happening

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Speaker 1: this morning. There there's a lesser amount of disconcertion in

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Speaker 1: the market's a greater amount of optimism in the markets.

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Speaker 1: The fact that we have taken Silk and Valley Bank

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Speaker 1: off the watch list for all intents and purposes, is

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Speaker 1: a is a great change. There was a change that

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Speaker 1: was occurring. You could see it, you can almost feel it.

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Speaker 1: On Friday when for technical purposes, many of the bank stocks,

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Speaker 1: many of the rits, made the news and then closed

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Speaker 1: higher on the day, reversing to the upside, which is

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Speaker 1: something that I watched very closely. It was as if

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Speaker 1: the worst had had occurred, the selling had washed itself out,

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Speaker 1: and now you've got a bounce coming. So we'll see.

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Speaker 1: But yes, there's a greater sense of optimism this morning

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Speaker 1: than there had been for a while. At least there

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Speaker 1: was no more bank collapses over the weekend then, and

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Speaker 1: the fact that the one major bank that had been

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Speaker 1: problematic had been taken off the watch list and put

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Speaker 1: on the sidelines is very important. So yes, there's a

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Speaker 1: greater sense of optimism, and we've seen in quite some

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Speaker 1: period of time. Do you expect that optimism to last

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Speaker 1: as probably not. I really don't think so. I think

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Speaker 1: that we are heading towards recession. I think that the

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Speaker 1: SAIDs monetary policies have been very tight in recessionary in orientation,

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Speaker 1: and therefore I think that the stock prices make new

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Speaker 1: and newer lows. But for a while, for a week

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Speaker 1: or two or three, we're going to get a bounce.

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Speaker 1: So I think that this bounce is one that if

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Speaker 1: you are long, you should use this dis bounce, this

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Speaker 1: return of a sense of optimism to reduce your exposure

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Speaker 1: as best you can. No, I don't think it'll last

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Speaker 1: very long. Yeah. It sort of echoes the comments we

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Speaker 1: heard over the weekend from the president of the Minneapolis Fed,

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Speaker 1: Neil cash Kari, who had been turning pretty hawkish when

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Speaker 1: it comes to fighting inflation, now saying that he also

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Speaker 1: sees a potential for a risk for a US recession.

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Speaker 1: Do you think that this banking crisis could lead to

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Speaker 1: a change in the policy path for the FED? If

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Speaker 1: you'd asked me six weeks ago, I'd have said that

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Speaker 1: we're going to have fifty base points in the last meeting,

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Speaker 1: then twenty five, twenty five and twenty five. Obviously that

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Speaker 1: has changed. We had twenty five this pass meeting, we'll

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Speaker 1: probably get two more twenty five basis point increases, and

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Speaker 1: therefore the terminal rate has been reduced by about fifty

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Speaker 1: basis points from where I thought it would be six

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Speaker 1: weeks ago. So, yes, there's some change. There's not material,

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Speaker 1: but there's a change. It's it's not quite as manifestly

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Speaker 1: over manifestly the recession area as it had been. But

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Speaker 1: nonetheless we're going into recession. Interesting because obviously a lot

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Speaker 1: of the pricing we're seeing in the market now is

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Speaker 1: that we could have a FED cut potentially as early

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Speaker 1: as June. Is the market wrong about this? If so,

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Speaker 1: why I think the odds of getting a cut by

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Speaker 1: June are borderline zero. To be quite honest, the FED

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Speaker 1: has made it abundantly clear that they continue to fight inflation.

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Speaker 1: They're going to continue to tighten, and it'll be months,

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Speaker 1: maybe a year before after they've reached the terminal rate

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Speaker 1: of where wherever that terminal rate shall be, which is

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Speaker 1: probably another fifty to seventy five basis points higher than

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Speaker 1: where it is right now, then the SAID will do

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Speaker 1: nothing for a long period of time, perhaps six months

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Speaker 1: to a year. So I think it'll be a long

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Speaker 1: period before the FED begins the process of actually reversing

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Speaker 1: the tightening and allowing the overnight said funds rate to decline.

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Speaker 1: It'll be a long period of time before that happens.

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Speaker 1: So you don't see the possibility then that if we

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Speaker 1: do start to see financial conditions tighten up, that the

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Speaker 1: lending standards pull back within some of these regional banks,

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Speaker 1: that the Fed could change course. Got about a minute

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Speaker 1: left here, Dennis. I think the odds of the SAD

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Speaker 1: changing its policy and beginning to allow the overnight said

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Speaker 1: funds rate to decline is a long way into the future.

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Speaker 1: If I've learned anything in nearly fifty years of being

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Speaker 1: involved in the markets, that's when the set has begun

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Speaker 1: the policy of tightening monetary policy or the policy of

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Speaker 1: easing monetary policy. It takes rates much farther and for

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Speaker 1: a longer period of time than anybody wants to dream

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Speaker 1: is going to happen. So I think it'll be at

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Speaker 1: least twenty twenty four before we start to see the

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Speaker 1: overnight said funds rate begin to decline. It'll be a

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Speaker 1: long period of time, so be patient and be a

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Speaker 1: little bit depressed about that time. This is Bloomberg Daybreak Today,

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