Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along
Speaker 2: with Lisa Bromwitz and Amrie Hordern. Join us each day
Speaker 2: for insight from the best in markets, economics, and geopolitics
Speaker 2: from our global headquarters in New York City. We are
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Speaker 2: Terminal and the Bloomberg Business App. We begin with our
Speaker 2: top story, the latest CPI print, boosting expectations for a
Speaker 2: twenty five basis point cup from the Fed next week.
Speaker 2: Mohammad al Erin of Queen's College, Cambridge, writing on X
Speaker 2: that he sees a quote ankorless paradigm, one that is
Speaker 2: crying out for the stabilization influence that usually comes from
Speaker 2: a dominant economic narrative rather than the current ping pong
Speaker 2: one and or forward policy guidance as opposed to this
Speaker 2: era of excessive data dependency. Muhammad has a lot to say.
Speaker 2: It's whether it's the next few hours to say it. Muhammed,
Speaker 2: good morning to see it. Good morning, John, fantastic catch
Speaker 2: up with you, sir, particularly your observation yesterday about what
Speaker 2: was developing in the bomb market at the front end
Speaker 2: of the curve, the swings we saw on the two year.
Speaker 2: Can you share your observations with our audience right now?
Speaker 2: What was that about?
Speaker 3: So we saw a twenty basis points round trip in
Speaker 3: the two year. Twenty basis points. That's a lot for
Speaker 3: that maturity, and we learned two things. One is that
Speaker 3: we have excessive data point dependence. All that happened yesterday
Speaker 3: in the Infation report, as people know, is that monthly
Speaker 3: core came slightly harder than expected. Everything else was aligned,
Speaker 3: and yet we moved ten basis points up. And then
Speaker 3: we discovered a second technical, which is money on the
Speaker 3: sideline being put to work quickly, and that I think
Speaker 3: is our reality, is that we don't have a dominant
Speaker 3: economic view, so we get swung all over. But the
Speaker 3: stabilizer right now is this technical of cash on the sideline. Now,
Speaker 3: financial conditions are good stabilizers with two very important qualifications.
Speaker 3: They are volatile and they have as much perception as reality.
Speaker 3: So we are going to continue with this volatile world
Speaker 3: until we restore either dominant economic paradigm or we saw
Speaker 3: the power forward policy guidance.
Speaker 4: You could argue that even in the face of all
Speaker 4: of this volatility, it shows how strong the economic system
Speaker 4: is that there wasn't some sort of significant disruption. Isn't
Speaker 4: that sort of the ultimate stress test, that when the
Speaker 4: benchmark rate swings around by twenty basis points you don't
Speaker 4: see any massive selling, why is it more pernicious than
Speaker 4: it might seem on the surface.
Speaker 3: So I do think the financial system has been strengthened,
Speaker 3: and in particular the banks, and we are in a
Speaker 3: much better place than we were in the past. So
Speaker 3: you don't get the massive balance sheet effects. You don't
Speaker 3: get the sort of virtuous cycles good the cycles good
Speaker 3: or bad that can happen from that. But don't forget
Speaker 3: that we are the benchmark for the rest of the world,
Speaker 3: and we cause quite a few spillovers that the rest
Speaker 3: of the world says, you know what, enough, now we've
Speaker 3: had enough of this, Please get you act together.
Speaker 4: I was surprised to at Jackson Hall to your point,
Speaker 4: there wasn't more of a discussion, at least not out loud,
Speaker 4: about what the neutral rate is. Essentially that sort of
Speaker 4: paradigm shift that you're looking for, some sort of real
Speaker 4: discussion of what this Federal Reserve is willing to accept
Speaker 4: in terms of inflation and a benchmark rate that'said. It
Speaker 4: sounds like they just don't agree on one, So how
Speaker 4: can they come up with one if they don't really
Speaker 4: have that certainty? And frankly, if the market can't agree
Speaker 4: on one either, is it better just to have one
Speaker 4: even if it's wrong.
Speaker 3: So as usual, you're getting me to front run my
Speaker 3: financial times of a tomorrow.
Speaker 2: That's what you hear films.
Speaker 3: So I think, Lisa, you're absolutely right. But it's not
Speaker 3: just that we don't know what the destination is. We
Speaker 3: don't know what the journey is. We don't know what
Speaker 3: risk mitigation mindset actually means operationally. And also there's disagreement
Speaker 3: as how quickly will FED official go from backward looking
Speaker 3: data dependence to forward leaning. So we have these disagreement
Speaker 3: both within the FOMC and also between the market and
Speaker 3: the end what seems to be the consensus if there
Speaker 3: is one on the FED. So this is for me,
Speaker 3: it's a fascinating time, but it is also a very
Speaker 3: confusing time.
Speaker 5: So amongst all this confusion. What do you want to
Speaker 5: hear from J Powell next week?
Speaker 3: So what I'd like to hear and what I expect
Speaker 3: to hear is that he's going to come by twenty
Speaker 3: five basis points. Beyond that, It's more what I'd like
Speaker 3: to hear than what I expect to hear. I'd like
Speaker 3: to get a sense of where he thinks the neutral
Speaker 3: rate is. I'd like to get a sense of where
Speaker 3: he sees the balance of risks. The market right now
Speaker 3: has modeled the FED as a single mandate FED maximum employment.
Speaker 3: FED official tell us no, no, no, we do mandate FED.
Speaker 3: Let's not forget the inflation component. I'd like to know
Speaker 3: where he is on this.
Speaker 5: Do you want to hear more descent within the Fed?
Speaker 3: Yeah, I would like to. I mean, I admire the
Speaker 3: Bank of England. The last decision was five to four.
Speaker 3: You had a situation where it was six to one.
Speaker 3: I think that's important because that conveys the uncertainty. Yes,
Speaker 3: they should have more discent. I think they viewed dissent
Speaker 3: as weakness. Most of us view descent as having a
Speaker 3: really important information content that has to be priced into markets.
Speaker 2: I remember a series of votes at the Bank of
Speaker 2: England maybe a decade or so ago. I'm sure you
Speaker 2: remember this too, when the committee was out voting King
Speaker 2: a governor. King was leading the Central Bank. Think of
Speaker 2: the time. He wanted to increase QE and you had
Speaker 2: people on the MPC voting against him. Not only that,
Speaker 2: there were more people voting against him than voting with him.
Speaker 2: That's a scenario we don't see at the Federal Reserve.
Speaker 2: You had a warning coming into the September meeting, and
Speaker 2: I remember it at the start of summer. You wanted
Speaker 2: them to reduce interest rates in July, but you acknowledged
Speaker 2: that the difference between going into September versus July wasn't
Speaker 2: that great. But you had one fear if we got
Speaker 2: one hot CPI print, they might get distracted. Was that
Speaker 2: what we got yesterday? How distracted might they be?
Speaker 3: I don't think that much, because it was just one
Speaker 3: element in a broadly consistent data release that certainly was
Speaker 3: very close to consensus forecast. But if we had missed
Speaker 3: on headline, if we had missed on care, if the
Speaker 3: base effects weren't as favorable as they are right now,
Speaker 3: you would have seen a total mess in the marketplace.
Speaker 3: So That was my concern is that, as much as
Speaker 3: they don't want to admit it, they are not just
Speaker 3: data dependent. There's single point data dependent, and that's pretty
Speaker 3: scary for policy setting.
Speaker 2: That's certainly how the market sees it, because it guarded
Speaker 2: the conversation away from fifty and back to Worlds twenty five.
Speaker 2: How do you think they'll look to frame this rate
Speaker 2: cup when they deliver it a week yesterday. Will they
Speaker 2: call it a mid cycle adjustment? Will they say it's
Speaker 2: the beginning of a journey back to neutral? Whatever neutral is?
Speaker 2: How do you think they can frame this decision?
Speaker 3: I suspect it will be what's called the Douvish twenty
Speaker 3: five base points, which means this is the first of many,
Speaker 3: and we may we may be inclined to go even
Speaker 3: more if the labor market weakens. There was this phrase
Speaker 3: in the Jackson Hole speech that was really important. We
Speaker 3: don't want to see the label market get any weaker.
Speaker 3: That is a very strong statement from the FED chair.
Speaker 3: Whether everybody else is there, we don't know.
Speaker 4: Let's say they do what you want and they come out,
Speaker 4: they see this is what neutral is. This is our journey,
Speaker 4: this is our mandate, This is what we're going to do.
Speaker 4: How much have they lost control of the plot anyway,
Speaker 4: just simply because there are other factors at play. You
Speaker 4: think about, for example, fiscal coming out and potentially disrupting things,
Speaker 4: Think about international investment with an auction that's necessarily negative,
Speaker 4: that kind of forces their hand. How much do they
Speaker 4: have ability to set the narrative with such a prescriptive
Speaker 4: tone right now?
Speaker 3: So they certainly should be incorporating fiscal They must be
Speaker 3: doing this. They certainly should be incorporating q QT. I mean,
Speaker 3: we haven't talked about qt QT is ongoing on there.
Speaker 3: They should certainly should should be doing that, and that
Speaker 3: should be reflected in what they say. I hope they're
Speaker 3: doing this internally. I just think they got so burnt
Speaker 3: in twenty twenty one because they did take a forward
Speaker 3: leaning view and they were completely wrong that they don't
Speaker 3: want to make another mistake.
Speaker 4: What if they say this is a victimless crime. We're
Speaker 4: not seeing a problem from this that essentially they're getting
Speaker 4: it right and the markets are generally you hear traders
Speaker 4: actually say Ashley Powell is doing a pretty good job,
Speaker 4: so why should they change it? What would your argument be, Well.
Speaker 3: First We'll go back to the amount of volatility we've
Speaker 3: had in fixed income. It has been unusual, Lisa, I know.
Speaker 4: I know, I watched it every day. We were talking yesterday.
Speaker 3: It was crazy, okay, And that has adverse external effects.
Speaker 3: It undermines also the credibility of the US as the
Speaker 3: benchmark for many others, and we are in a world
Speaker 3: in which countries are building little pipes around the US.
Speaker 3: We don't want to enable that process further. That's the
Speaker 3: first issue. The second issue is we have a major
Speaker 3: reconciliation in our future. We have the treasury part of
Speaker 3: the fixed income market that is signaling quite a high
Speaker 3: probability of recession. We have the credit part of the
Speaker 3: fixed income market that is signaling a very high probability
Speaker 3: of a soft lending. Now, if liquidity doesn't reconcile these
Speaker 3: two things, there's going to be even more volatility in
Speaker 3: this marketplace, and at some point volatility spills back to
Speaker 3: the real economy. And the only thing keeping this real
Speaker 3: economy going right now is deliver market.
Speaker 2: I'm sitting here laughing because we need to clarify what
Speaker 2: you said. Market participants that think Powell are doing a
Speaker 2: great job, they're the bullish once. Let's be very clear
Speaker 2: about that. Accually are still their all time highs. If
Speaker 2: we weren't there, I think they'd have something different to
Speaker 2: say about where we were.
Speaker 4: Maybe they're data point to pedant as well.
Speaker 2: There's data pointment is the S and P five hundred.
Speaker 2: You mentioned where the bond market is and where markets
Speaker 2: are and how their price they want to pick up
Speaker 2: on the amount of demand we've seen for some issuance.
Speaker 2: We had a Guild issue last week, Record order Book
Speaker 2: had an Italian issue this week, Record order Book. We've
Speaker 2: seen a similar dynamic in US high grade corporate debt
Speaker 2: in America, particularly last week's he very busy days, lots
Speaker 2: of demand. Credit spread said very very tight. Can you
Speaker 2: reconcile what each part of the fixed income market is
Speaker 2: talentis right now and whether you can make sense of it?
Speaker 3: And we had yesterday a treasury auction with massive indirect demand.
Speaker 3: I can only reconcile it by the tone of cash
Speaker 3: US on the sideline and the fear that if you
Speaker 3: don't get into and lock indust rates now, you will
Speaker 3: lose interest income in the future. So every time we
Speaker 3: have a backup in rates, people wash back in I
Speaker 3: mean yesterday's dynamic was fascinating for me, that the speed
Speaker 3: of the round trip was significant.
Speaker 2: We've seen it a few times in the last week. Muhammad,
Speaker 2: We're lucky to have you says similar reaction to this,
Speaker 2: and cross Server. It's a Lindsay pie of stephol Lindsay
Speaker 2: your thoughts on the data this morning, the data yesterday
Speaker 2: this morning, and how this sets us up for the
Speaker 2: Federal Reserve next week.
Speaker 1: Well, I think coupled with you yesterday's hotter than expected
Speaker 1: read on the core CPI this morning slightly hotter than
Speaker 1: expected read on the PPI.
Speaker 3: It's not enough to.
Speaker 1: Negate the Fed's intentions to open the door for rate
Speaker 1: cuts next week, but it is a welcomed reminder of
Speaker 1: the Fed's ongoing focus on inflation, as price stability is
Speaker 1: not yet met and with this lingering uncertainty on evenness
Speaker 1: in terms of the disinflationary trend, I think this underscores
Speaker 1: the Fed's need to remain on a very patient, tempered
Speaker 1: approach as we do embark on this policy pathway back
Speaker 1: towards neutral. Now the market has seemingly removed the expectations
Speaker 1: for a larger, more aggressive fifty basis point cut next week,
Speaker 1: but I would argue it was never really on the table.
Speaker 1: If the FED did take that more aggressive move, I
Speaker 1: think that would send the wrong signal to investors, or
Speaker 1: investors would interpret it that incorrectly as the FED maybe
Speaker 1: taking an intention to rapidly reverse us back to an
Speaker 1: accommodative stance. But at this point with the econ me
Speaker 1: still solid, slowing but still solid, I think the Fed's
Speaker 1: intentions is simply to remove policy firming and get us
Speaker 1: back to a more neutral state in terms of policy.
Speaker 3: So lindsay, let's go beyond next week. I completely agree
Speaker 3: with you. The FED has been stressing to the markets
Speaker 3: we are a dual mandate central bank, and the market
Speaker 3: has been responding, no, you're not, your single mandate central bank.
Speaker 3: And the employment part is critical. So now that the
Speaker 3: data has reminded us that they should remain a dual
Speaker 3: mandate central bank, how do you see the west of
Speaker 3: the curve, in particular, what's fristained all the way out
Speaker 3: to September of next year evolve in the next few weeks.
Speaker 1: Well, I do think investors got ahead of themselves, and
Speaker 1: I think the downward momentum that we've seen on the
Speaker 1: longer end does have some wiggle rooms, some room to
Speaker 1: reverse course, not necessarily push us back to earlier highs
Speaker 1: that we saw at the start of the year, but
Speaker 1: certainly gain at least ten twenty basis points on the tenure,
Speaker 1: putting us back into line with a more realistic pathway
Speaker 1: of the Fed's trajectory back to neutral. Again, I do
Speaker 1: think a base case is twenty five basis point cuts
Speaker 1: and not necessarily at every meeting. The FED is going
Speaker 1: to remain data dependent, and if we see inflation stumble
Speaker 1: for back to back months as we saw in yesterday's
Speaker 1: in today's reading, I think they're very likely and very
Speaker 1: willing to skip a meeting. And so I do think
Speaker 1: that again, the market's expectation for this rapid reduction back
Speaker 1: to neutral or even falling below the neutral range by
Speaker 1: mid of next year, is well beyond what the FED
Speaker 1: is realistically willing to do.
Speaker 4: Lindsay, what in the specifics of the inflation data gives
Speaker 4: you pause about just how much inflation is coming down?
Speaker 4: In other words, what are the sticky components that you
Speaker 4: worry most about.
Speaker 1: One of the biggest worries is the housing component, and
Speaker 1: we saw that in yesterday's a CPI report, one of
Speaker 1: the primary drivers of that hotter than expected read. If
Speaker 1: we continue to see the shelter component rise or rise
Speaker 1: above expectations given the sizeable weighting that housing has, not
Speaker 1: just in the CPI, but even in the PCE, that's
Speaker 1: going to be very difficult for the FED to maintain
Speaker 1: a two percent target or achieve that two percent target
Speaker 1: on a sustainable basis. So housing is one of those
Speaker 1: very sticky components that we're focused in on. That being said,
Speaker 1: even when we do strip out housing and we look
Speaker 1: at one of the more narrow measures of inflation, the supercore,
Speaker 1: so we're talking core services excluding housing, we still see
Speaker 1: that that's a read above four percent, so more than
Speaker 1: double the feds intended target. So there are still a
Speaker 1: number of underlying components and underlying measures that are not
Speaker 1: yet cooperating quite as much as the FED would like,
Speaker 1: as they are nearing presumably that first round rate cut
Speaker 1: next week.
Speaker 2: Lindsay, we've got to leave it that appreciate it, LINDSAYPX
Speaker 2: that stathl Let's ask pri did you come right at
Speaker 2: taivy securities that question right now? Perd You welcome to
Speaker 2: the show. I'm sure you heard that question from Mohammad.
Speaker 2: Your thoughts on it plays, Oh.
Speaker 6: Thank you, so yes, easib as expected right now and
Speaker 6: I think, as you mentioned, this is the key question.
Speaker 6: If they are seeing inflation to be at target in
Speaker 6: twenty twenty five, why this slow approach? I think from
Speaker 6: ECB's perspective, the question right now is pretty but basically
Speaker 6: the wage inflation and which is actually standing at five
Speaker 6: point one percent, and this is much about what we
Speaker 6: have seen in the twenty nineteen level, which was around
Speaker 6: two percent. So so far, Laggard has always talked about
Speaker 6: this WPP model, which is wages, productivity and profit margins,
Speaker 6: and I think that's where she will be asked, is
Speaker 6: productivity actually increasing that can help to reduce these wages,
Speaker 6: which doesn't seem the case right now, So I think yes,
Speaker 6: definitely a very key question for Laguard right now is
Speaker 6: if you are seeing inflation at target, why is this
Speaker 6: five percent in wage inflation still being so sticky and
Speaker 6: why are they not cutting rates more aggressively?
Speaker 3: In UWPP, she will be speaking today in the context
Speaker 3: of the Drug Report, and the Drug Report basically says
Speaker 3: without major policy actions that aim at improving the way
Speaker 3: the economy functions, there are no productivity gains that can
Speaker 3: be sustained. Do you agree with that view?
Speaker 6: Yes, no, totally. I think even when you look at
Speaker 6: the weakness in Germany, it's more for structural weakness and
Speaker 6: not a cyclical weakness. So cutting rates does not help
Speaker 6: German growth. And I think I do agree with Graggy's
Speaker 6: model and that we do need that investment, that productivity
Speaker 6: coming from Europe. But we also know that that's a
Speaker 6: long process that cannot happen in one day. And I
Speaker 6: think ECB at this state really needs to think about
Speaker 6: do they just go by the survey data which are
Speaker 6: basically suggesting that wages will reduce aggressively in twenty twenty
Speaker 6: five six, or they stick to the current heard data
Speaker 6: which tells you that if pages are very sticky.
Speaker 4: What do you think would happened in markets? And I'm
Speaker 4: wondering about the market reaction function in addition to the
Speaker 4: ECP reaction function. What would happen in markets if Christie
Speaker 4: mcgoth came out and talked about a more aggressive rate
Speaker 4: cutting pass, particularly the time where the euro is baking
Speaker 4: in sort of the FED and the ECP moving in Tanda.
Speaker 6: So again, if they tell us more aggressive path, yes,
Speaker 6: the front end rallies, we are not prime. We were
Speaker 6: pricing in one and a half rate cuts, so possibly
Speaker 6: going closer to two. But we also know the time
Speaker 6: until the October meeting is basically five weeks, so there's
Speaker 6: nothing much that's changing right now from ECB's data perspective,
Speaker 6: So I think they would have a big downside risk
Speaker 6: to grow at this meeting, which doesn't seem the case
Speaker 6: when we read the statement, So I doubt they are
Speaker 6: going to be very open about the October cut. But
Speaker 6: what is more like is ECB sounding more optimistic about
Speaker 6: reaching the inflation targets, especially given the fact that global
Speaker 6: growth is actually a negative right now across the board,
Speaker 6: especially when we look at US and China, which means
Speaker 6: markets should start pricing more cuts and more aggressive form
Speaker 6: of cuts in twenty twenty five and pull forward this
Speaker 6: neutral rate which is around two.
Speaker 5: Percent, which how difficult is the guard's job in the
Speaker 5: sense that inflation is quite different while you look at
Speaker 5: Central Europe or the periphery.
Speaker 6: Yeah, no, that is the key issue for ECB. I
Speaker 6: think when it comes to EACP, they do have to
Speaker 6: take Europe as aggregate, So even if German growth is
Speaker 6: minus zero point three, they still need to actually look
Speaker 6: at the entire euro growth which is still above stagnation.
Speaker 6: So this is a tricky job as long as financial
Speaker 6: conditions are seen across the board, which has been the
Speaker 6: case since twenty twenty. I think ECB will not go
Speaker 6: a country by country, but look at the total target
Speaker 6: because even like when you said, in Europe, creation negotiations
Speaker 6: work very differently from country to country, so they cannot
Speaker 6: actually say by October they'll have the right number of
Speaker 6: wages for the entire euro area. So I think they
Speaker 6: do need to work more on surveys and Europe as
Speaker 6: a whole.
Speaker 2: Poga, We've got to leavey there. We appreciate it. Pog,
Speaker 2: you come around there. Of TD Security, Michael Shout joins
Speaker 2: US now as Ion Asset Management. Michael, good morning to you, sir.
Speaker 2: Good morning base case. At the moment, the doves won't
Speaker 2: get their fifty, can they achieve the same outcome by
Speaker 2: leaning very heavily on the top plot.
Speaker 7: Yeah, I mean I think we'll probably see a big
Speaker 7: dispersion in the dot plot. You know, at this week's meeting,
Speaker 7: I think that's the way that people are going to
Speaker 7: really say, you know, we think we should be doing more,
Speaker 7: we think we should be we think we should be
Speaker 7: doing less. And then the sort of third part of
Speaker 7: this is which way is j Powell going to lean
Speaker 7: when he talks publicly following the meeting. Is he going
Speaker 7: to be, you know, pointing towards the doves or you know,
Speaker 7: more in the middle of a pack.
Speaker 3: So too far off questions immediately one is giving you
Speaker 3: expectations of more dispersion or right to look at the median.
Speaker 6: Or not?
Speaker 3: And second, isn't it obvious which way Chair Powell is
Speaker 3: going to lean?
Speaker 7: I would probably say no and no, you know, you know,
Speaker 7: it's it's really not clear, you know, which side is
Speaker 7: going to really dominate. I think it's not clear exactly
Speaker 7: who the doves are and who who the hawks are.
Speaker 7: I think Powell sensibly is trying to steer a middle
Speaker 7: path between both bodies, and I think he's happy to
Speaker 7: jump ship to the left or the right, depending on
Speaker 7: what you know. He's probably the most data driven part
Speaker 7: of the FED.
Speaker 5: You think it's unclear what he says or it's unclear
Speaker 5: how much they cut by.
Speaker 7: Oh, I think he'll be very clear. He'll be very
Speaker 7: clear that he doesn't know exactly what they're going to do,
Speaker 7: and he's going to wait until he gets the information
Speaker 7: and to tell him what he should be doing. I mean,
Speaker 7: I think it's going to be very clear about that,
Speaker 7: But what the outcome is is going to be extremely unclear.
Speaker 4: We were talking earlier about how this fusual reserve doesn't
Speaker 4: have this sort of overarching framework of the destination and
Speaker 4: the journey that we have going forward. I wonder if
Speaker 4: as an investor you do can you have that clarity
Speaker 4: if you don't get it for them with this sort
Speaker 4: of conviction that the FED will ultimately follow whatever it
Speaker 4: is that you're seeing that is not with any extra
Speaker 4: data that everybody else doesn't have.
Speaker 7: No, you know, I think the FED, all things being equal,
Speaker 7: is going to start to cut and is going to
Speaker 7: put us on a path for a gradual a gradual easing.
Speaker 7: But the bigger question in my mind is what's actually
Speaker 7: happening in the underlying economy. And when you see members
Speaker 7: of the FED almost having to make up words to
Speaker 7: describe it, there's a long piece using the term equipoise.
Speaker 7: It's a very weird it's a very weird environment.
Speaker 2: So noticed that John Williams has got a phosaurus. I
Speaker 2: thought it was saying yes, yes, I was impressed. I
Speaker 2: was to say, ex repose is somebody who tries too
Speaker 2: hard to make a point, But maybe maybe I shouldn't anyway.
Speaker 2: You know, it's a very strange economy because a lot
Speaker 2: of the strength that we had, a lot of the
Speaker 2: overheating that we've had, has gone away, but it hasn't
Speaker 2: really been replaced by any obvious weakness.
Speaker 7: The labor market is. I haven't seen a labor market
Speaker 7: like this with no real underlying growth, no real power
Speaker 7: to it, and yet absolutely no deterioration and initial claims
Speaker 7: yet again this week confirmed that nobody's hiring, but nobody's firing.
Speaker 7: So it's really the way that that gets resolved that
Speaker 7: ultimately matters much more than what the FED does. The
Speaker 7: FED is going to be responsive to that outcome. I
Speaker 7: don't think it's going to cause it one way or yeah.
Speaker 2: I'll attempt to be direct. Then what are you buying?
Speaker 7: I still think precious medals come out here. I think
Speaker 7: they're the way that you play a policy mistake. I
Speaker 7: think you know, if effed is is a little bit
Speaker 7: too too on the easy side and tries to get
Speaker 7: ahead of things. I think precious medals really over winners.
Speaker 2: The policy mistake then, just to be very clear, is
Speaker 2: amazing too much correct. Interesting, Michael. Thank you, sir Michael
Speaker 2: Schau of ION. This is the Bloomberg Surveillance Podcast, bringing
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