Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.
Speaker 2: Good morning.
Speaker 1: I'm Nathan Hager and I'm Karen Moscow. Here are the
Speaker 1: stories we're following today.
Speaker 2: Karen, the surge in futures this morning comes after a
Speaker 2: Vassil session following the Fed's fifty basis point rate cut.
Speaker 2: The S and P five hundred wiped out a one
Speaker 2: percent gain yesterday after FED share, j Powell cautioned against
Speaker 2: assuming big rate cuts would continue.
Speaker 3: I do not think that anyone should look at this
Speaker 3: and say, oh, this is the new pace. Have to
Speaker 3: think about it in terms of the base case. Of course,
Speaker 3: what happens will happen. So in the base case, what
Speaker 3: you see is look at the SEP. You see cuts
Speaker 3: moving along. The sense of this is we're recalibrating policy
Speaker 3: down over time to a more neutral level, and we're
Speaker 3: moving at the pace that we think is appropriate.
Speaker 2: And Jay Powell, the Fed's first rate cut in four
Speaker 2: years was accompanied by projections indicating an additional fifty basis
Speaker 2: points of cuts across the remaining two policy meetings this year.
Speaker 1: Well, Nathan, we have plenty of reaction from the FED
Speaker 1: raid cut. We caught up with Bloomberg Opinion columnist Muhammad Alarian,
Speaker 1: KMPG Chief US Economist Diane Swank, and former New York
Speaker 1: Fed President Bill Dudley.
Speaker 4: We're going to look back and either this will be
Speaker 4: the absolutely white bet, which is be preemptive on the
Speaker 4: labor market after you were reactive to inflation. This is
Speaker 4: a fundamental change in the reaction function. Alternatively, we will
Speaker 4: look at this as being too aggressive. I'm hoping that
Speaker 4: it will be the first.
Speaker 5: This was a huge victory for j.
Speaker 6: Powell, who really laid out at his Jackson Hole speech
Speaker 6: that he was worried about employment, and that is what
Speaker 6: this is about.
Speaker 5: It's pretty much I was expecting in the sense that
Speaker 5: one of the issues that Paul had is how do
Speaker 5: you two fifty without scaring people that you know something
Speaker 5: bad about the economy? And I think you did that
Speaker 5: very well. He basically said, we're doing this because the
Speaker 5: news is good. We've made progress sound inflation, as opposed
Speaker 5: we're doing this because the news is bad. So I
Speaker 5: thought it was a very providing reassurance to people that
Speaker 5: FED thinks that they've got it.
Speaker 1: That was former New York Fed President Bill Dudley. KPMG
Speaker 1: Chief US Economist Diane Swank and Bloomberg opinion columnist Mohammad Alarian.
Speaker 1: The decision was not without some controversy. Michelle Bowman cast
Speaker 1: a dissenting vote in favor of a smaller quarter point
Speaker 1: rate reduction that marked the first ascent by a FED
Speaker 1: governor since two thousand and five.
Speaker 2: Well, Karen, investors aren't the only ones cheering the Fed's
Speaker 2: rate cut. Bloomberg's John Tucker joins us Now and John.
Speaker 2: The Biden Harris administration may have caused to celebrate as well.
Speaker 7: Yeah, Nathan, and they're taking kind of a victory lap.
Speaker 7: In a speech today to the Economic Club of Washington,
Speaker 7: President Biden will celebrate the Fed's decision of slash interest
Speaker 7: rates as a validation of his economic vision. This is
Speaker 7: part of an effort to recast his handling of the economy,
Speaker 7: particularly as voters continue to give him low marks for
Speaker 7: tackling inflation. It's important for both the President personally and
Speaker 7: the Democrats more broadly, as Vice President harr Is is
Speaker 7: locked in that tight election battle Donald Trump, his eighth say,
Speaker 7: Biden will outline ways he believes the economy could still
Speaker 7: be made stronger while pushing costs lower. I'm John Tucker
Speaker 7: Bloomberg Radio.
Speaker 1: All right, John, thank you. It's now to the Bank
Speaker 1: of England and it's turned to make a policy decision.
Speaker 1: That BOE is expected to maintain a patient approach to
Speaker 1: easing at its meeting today after a first rate cut
Speaker 1: last month. And Bloomberg's Lizzie Burdon has more from London.
Speaker 8: It's decision day on thread Needle Street, but economists that
Speaker 8: investors are expecting policymakers to stick to the status quo,
Speaker 8: holding the benchmark rate at five percent. However, wages are
Speaker 8: increasing on a faster Bank of England cutting cycle ahead
Speaker 8: after inflation readings came in lower than Central Bank forecasts
Speaker 8: in July and August. Attential will be focused on Governor
Speaker 8: Andrew Bailey for hints that borrowing costs could be lowered
Speaker 8: again in November after committee members voted narrowly to end
Speaker 8: their sixteen year high last month. Traders are also awaiting
Speaker 8: news on the speed of quantitative tightening, a decision which
Speaker 8: could prove pivotal for new Chancellor Rachel Reeves is October
Speaker 8: budget in London. Lizzie Burden Blueberg Radio.
Speaker 2: Okay, Lizzie, thank you. Now we want to get you
Speaker 2: caught up on the latest developments in the Middle East.
Speaker 2: Israel has declared a new phase in its regional war
Speaker 2: with Islamist groups. It comes as Hesbola official say explosions
Speaker 2: went off in Beirut and multiple parts of Lebanon in
Speaker 2: an apparent second wave of detonations of electronic devices. We
Speaker 2: get more from Bloomberg's Jumana Barsecchi in Dubai.
Speaker 9: It's a second day of communication devices exploding across not
Speaker 9: just baby routes, but across the entire country, eastern Bikar
Speaker 9: as well as southern Bay Roots. And this time the
Speaker 9: catalyst were walkie talkies. These were walki talkies that Hezballah
Speaker 9: group members had been using. They also exploded be it
Speaker 9: in cars and people's houses, even within cafes, so very
Speaker 9: similar in nature to the attack that took place the
Speaker 9: day before. The Lebanese Health Ministry has put u out
Speaker 9: a statement saying that four hundred and fifty casualties were
Speaker 9: brought into hospitals as a result of these attacks. Twenty
Speaker 9: people have now lost their lives.
Speaker 2: Bloomberg's Jewniver said. She notes Israel has not taken responsibility
Speaker 2: for the attacks.
Speaker 1: None of the latest in the presidential race. Nathan and
Speaker 1: former President Trump was on New York's Long Island for
Speaker 1: a rally last night, and he promised to lift the
Speaker 1: cap on state and local tax deductions that he imposed
Speaker 1: as president but is valuable to many New York homeowners.
Speaker 1: Trump also announced plans to go to Springfield, Ohio, the
Speaker 1: city where he said during last week's debate, Haitian migrants
Speaker 1: have eaten people's pets.
Speaker 5: I'm going to go there in the next two weeks.
Speaker 5: I'm going to Springfield, and I'm going to Aurora.
Speaker 1: You may never see me again, but that's okay.
Speaker 5: Gotta do what I gotta do.
Speaker 10: Whatever happened to Trump, well, he never got.
Speaker 6: Out of Springfield.
Speaker 1: Trump also said he'll go to Aurora, Colorado. He's repeatedly
Speaker 1: claimed that city has been overrun by migranted gangs from Venezuela.
Speaker 2: As for Kamala, Harris Karen, the vice president, plans to
Speaker 2: meet with Vladimir Zelenski next week. The Ukrainian president will
Speaker 2: be in Washington, sources say is expected to push his
Speaker 2: country's bid to join NATO and the European Union, along
Speaker 2: with more advanced weapons, as part of his victory plan
Speaker 2: against Russia. Zelensky plans to present that plan to President
Speaker 2: Biden on the sidelines of the UN General Assembly later
Speaker 2: this month.
Speaker 1: Meanwhile, Nathan the International Brotherhood of Teamsters is declining to
Speaker 1: endorse a candidate for president, and Bloomberg's Amy Morris has
Speaker 1: more from Washington.
Speaker 11: It is a blow to both Kamala Harris and Donald Trump.
Speaker 11: Teamster's general president Sean O'Brien released a statement saying that
Speaker 11: neither candidate was able to make serious commitments to the
Speaker 11: union quote to ensure the interests of working people are
Speaker 11: always put before big business. Now, the Teamsters released internal
Speaker 11: polling data showing members had initially favored endorsing Biden over Trump,
Speaker 11: but after Harris became the nominee, the majority of respondents
Speaker 11: back to Trump. And Poland conducted a few days ago,
Speaker 11: fifty eight percent supported endorsing Trump, compared to thirty one
Speaker 11: percent for Harris. And you may recall O'Brien spoke at
Speaker 11: the Republican National Convention in July, the first time a
Speaker 11: leader of the Union has done so. Amy Morris, Bloomberg Radio.
Speaker 2: Amy, thank you. We have breaking news crossing the Bloomberg terminal.
Speaker 2: Apple is set to be warned by the European Union
Speaker 2: that it needs to open up its highly guarded iPhone
Speaker 2: operating system to rival technologies or eventually risk significant fines.
Speaker 2: Sources say EU watchdogs are due to announce under the
Speaker 2: block's new Digital Markets Act that Apple must step into
Speaker 2: line with strict new rules on making operating systems fully
Speaker 2: functional with other technologies.
Speaker 1: And it's time now for a look at some of
Speaker 1: the other stories making news in New York and around
Speaker 1: the world. And for that we're joined by Bloomberg's Michael
Speaker 1: Barr Michael, Good Morning.
Speaker 12: Good Morning, Karen. Lawyers for Sean Diddycomb's unsuccessfully thought to
Speaker 12: keep him out of jail after his sex trafficking arrest.
Speaker 12: The music Moguls lawyers highlighted a litany of home horrors
Speaker 12: at the Brooklyn Federal lockup, described as hell on Earth.
Speaker 12: They include horrific conditions, rampant violence, and multiple depths. Comb's
Speaker 12: attorney Mark agnifano I.
Speaker 13: Told mister Colmbs, I'm going to try and get his
Speaker 13: case to trial as quickly as possible. I'm going to
Speaker 13: try and minimize the amount of time he spends in
Speaker 13: very very difficult and I believe in humane housing conditions
Speaker 13: in the special housing unit of the Metropolitan Detention Facility.
Speaker 12: Audio courtesy of ABC seven. The judge cited possible witness
Speaker 12: tampering by Combs if bail is granted. Combs was sent
Speaker 12: to the Metropolitan Detention Center after pleading not guilty in
Speaker 12: a case that accuses him of physically and sexually abusing
Speaker 12: women for more than a decade. Disgraced movie mogul Harvey
Speaker 12: Weinstein pleaded not guilty to a new indictment charging him
Speaker 12: with criminal sex acts. According to the Manhattan District Attorney's office,
Speaker 12: three separate women have accused Weinstein of section really assaulting them.
Speaker 12: It's not part of Weinstein's conviction, which was later overturned
Speaker 12: on appeal. This morning, a judge in Washington, d c.
Speaker 12: Will sentence five people accused of helping to lead the
Speaker 12: infamous January sixth initial breach of the Capitol. Prosecutors will
Speaker 12: recommend nine years in prison, saying this group was among
Speaker 12: the first to breach a police barricade, saying hundreds, if
Speaker 12: not thousands, of rioters would follow. A new study finds
Speaker 12: that preventable risk factors are driving a global increase in strokes.
Speaker 12: Doctor Valerie Fagan is the director of the National Institute
Speaker 12: for Stroke and Applied Neuroscience at the University of Auckland
Speaker 12: in New Zealand.
Speaker 14: Stroke is probably one of the most preventable and yet
Speaker 14: very fatal and disabling conditions.
Speaker 12: Dr Fagan says strokes killed more than seven million people
Speaker 12: each year. The study, published in the journal Lancet Neurology,
Speaker 12: finds environmental factors like air pollution and heat waves, and
Speaker 12: individual factors like blood pressure and bad cholesterol are behind
Speaker 12: the recent increase. Global news twenty four hours a day,
Speaker 12: whenever you want it with the Bloomberg News. Now, I'm
Speaker 12: Michael Barr, and this is Bloomberg Cameron.
Speaker 1: All right, Michael Barr, thank you, and it's time now
Speaker 1: for the Bloomberg Spores Update with John Stanshowery John, good morning.
Speaker 10: Good morning Karen. Over the last thirty seasons, Yankees have
Speaker 10: gone to the postseason twenty five times, didn't go last year,
Speaker 10: barely finished over five hundred, but headed back clinched at
Speaker 10: least a wildcard when they won two to one in
Speaker 10: ten innings at Seattle Champagne. Then float in the clubhouse
Speaker 10: Aaron Judge hoping there's more of that next month he
Speaker 10: was on the Yes Network.
Speaker 7: Oh well, we're excited, you know, we definitely know the
Speaker 7: job's not finished.
Speaker 4: Now we're hunting this divisions like.
Speaker 12: You get an opportunity to, you know, punch our ticket
Speaker 12: back in the pro season after last year missing out.
Speaker 4: It means a lot.
Speaker 12: You know, he got a special group here.
Speaker 13: The boys are definitely excited, but they know the mission.
Speaker 12: That's that definitely.
Speaker 10: The win last night was helped by a bizarre double
Speaker 10: play in the bottom of the tent. The Meriners had
Speaker 10: runners at first and third. Nobody at Randy or Rose
Speaker 10: Arena struck out and his bat went flying towards the
Speaker 10: head of Julio Rodriguez at third as he got out
Speaker 10: of the way of the bat. Austin Wells through the
Speaker 10: third and Rodriguez was picked off. Orioles lost again, Yankees
Speaker 10: moving out towards Clinton, the division they lead by five games.
Speaker 10: At City Field, the night after the Mets won ten
Speaker 10: to one, they won ten nothing over Washington. Jose Quintana
Speaker 10: went the first seventy and these gave up just two hits,
Speaker 10: brand of nimmoa three on homer. Arizona and Atlanta both
Speaker 10: won the Mets State tied with the d Backs, with
Speaker 10: both teams two games ahead of the Braves. Red Sox
Speaker 10: won two to one of Tampa Bay Milwaukee clinch the
Speaker 10: NL Central Tonight at MetLife It's the Jets home opener
Speaker 10: New England. Also one and one. First ballot for the
Speaker 10: Pro Football Hall of Fame is out. It has sixteen
Speaker 10: first timers, including Eli Manning, John Stashedward, Bloomberg Sports, Jarnon, Nathan.
Speaker 12: Coast to Coast on Bloomberg Radio, nationwide on Sirius XAM
Speaker 12: and around the world on Bloomberg dot Com and the
Speaker 12: Bloomberg Business app. This is Bloomberg Daybreak.
Speaker 2: Good morning. I'm Nathan Hager. The Fed is determined to
Speaker 2: achieve a soft landing. That is the message Chairman Jpowell
Speaker 2: sent to markets as the Central Bank pivots to cutting
Speaker 2: interest rates with a half percent move.
Speaker 3: The economy is growing at a solid pace, inflation is
Speaker 3: coming down closer to our two percent objective over time,
Speaker 3: and the labor market is still in solid shape. So
Speaker 3: our intention is really to maintain the strength that we
Speaker 3: currently see in the US economy.
Speaker 2: That was the Chairman of the Federal Reserve, Jerome Powell
Speaker 2: at the news conference following that fifty basis point cut.
Speaker 2: For more this morning, we are joined by Veronica Clark,
Speaker 2: us economist at City. Veronica, good morning. You were first
Speaker 2: out of the gate with this call. You've said in
Speaker 2: July that the Fed is going to do fifty basis points.
Speaker 2: Was this the right call?
Speaker 6: Yeah, good morning for having me. I do think it
Speaker 6: probably was. Of of course, in the end, the decision
Speaker 6: was very close, and we didn't know what this was
Speaker 6: going to be going into yesterday, the first time in
Speaker 6: a long time that that's happened. But I do think
Speaker 6: the argument for a fifty basis point Kaui is strong.
Speaker 6: Even tar Pale said it, you know the sense in
Speaker 6: which if you had had those July employments, you know,
Speaker 6: data points, just a couple of days earlier, maybe they
Speaker 6: would have cut in July. Maybe you were making up
Speaker 6: first and lost time. But we are never going to
Speaker 6: be further from a neutral interest rate than when you
Speaker 6: start cutting, so it makes sense to do it right away.
Speaker 2: The same time, Palell said, don't get used to it,
Speaker 2: that this isn't necessarily meaning that it's always going to
Speaker 2: be fifty. You agree with that.
Speaker 6: I think if that is is of course going to
Speaker 6: stay pretty optimistic here, and we did have you know,
Speaker 6: the updated economic production yesterday. They only expect the unemployment
Speaker 6: rate to rise maybe another tent or two from where
Speaker 6: we are now, still expecting strong GDP growth, and I
Speaker 6: think if that plays out then and it's fair that
Speaker 6: you know, the pace of cuts would would slow. But
Speaker 6: I think for us, you know, we're always trying to
Speaker 6: you know, first and foremost based our FED call on
Speaker 6: where we think the economic data are headed, and we
Speaker 6: actually do see the chance of more labor market weakness.
Speaker 6: We do have two more employment reports to go before
Speaker 6: we get to the next said meeting in November. I
Speaker 6: think there could still be some weakness in the labor
Speaker 6: market data and those reports we think they're going fifty
Speaker 6: age and in November. Because of that, do.
Speaker 2: You think we need to hear more clarity from Chairman
Speaker 2: Pale about what the path is going to be for rates,
Speaker 2: what the size of the cuts is going to be.
Speaker 2: Is there too much data dependence from this FED.
Speaker 6: I don't think so. I think you know, he said it,
Speaker 6: of course when we're taking it meeting by meeting, it is,
Speaker 6: you know, really just the labor market data now first
Speaker 6: and foremost and I think we do know that their
Speaker 6: reaction function to if the data evolve in a certain way.
Speaker 6: If we do see weaker labor market data, their reaction
Speaker 6: is going to be to support the labor market is
Speaker 6: as much as they can, So we at least understand
Speaker 6: I think that they have a pretty sensitive reaction function
Speaker 6: to any weaker labor market data.
Speaker 2: Do you think there's still a reaction function to inflation?
Speaker 2: Is the FED taking its eye off the ball on
Speaker 2: inflation too soon?
Speaker 6: Yeah? Yeah, I mean, of course that is the other
Speaker 6: important element of their mandate. And I don't think, you know,
Speaker 6: we're you know, dismissing inflation altogether. But I actually was
Speaker 6: a bit surprised that we did have this stronger CPI reading,
Speaker 6: you know, last week, and we thought, maybe, you know,
Speaker 6: the best compromise then among the Hawks and the doves
Speaker 6: was to just do a twenty five even yesterday. But clearly,
Speaker 6: you know, the labor market is taking precedent here. I
Speaker 6: think we had an even response from Para Powell about
Speaker 6: the stickiness of shelter inflation, and he was somewhat dismissive
Speaker 6: of that. So I think the focus for the FED
Speaker 6: is just very quickly shifting to the labor market data.
Speaker 2: And speaking of the split between hawks and doves in
Speaker 2: our last minute here, how significant was it that Governor
Speaker 2: Bowman dissented on this decision?
Speaker 6: Yeah, not surprising. She is certainly probably the most hawkish
Speaker 6: beneficial I was actually even maybe a bit surprised that
Speaker 6: there weren't more descents. Of course, the market was very
Speaker 6: fifty to fifty split on what the size of the
Speaker 6: cut was going to be. We really didn't know up
Speaker 6: until the last minute. I would have thought maybe there
Speaker 6: were even some more hawks, you know, arguing for starting
Speaker 6: a bit smaller. So I don't think that descent is
Speaker 6: too meaningful. If anything, this is more consensus than I
Speaker 6: would have thought in a split posiion.
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