WEBVTT - Bloomberg Daybreak: January 14, 2022 - Hour 1 (Radio) 0:00:02.600 --> 0:00:05.880 Live from the Bloomberg Interactive Burgers Studios. This is Bloomberg 0:00:05.960 --> 0:00:09.960 Daybreak for Friday, January fourteen two. Coming up this hour. 0:00:10.320 --> 0:00:13.960 US futures stabilize after yesterday sell off. Tech is under 0:00:13.960 --> 0:00:17.439 pressure as FED officials build the case for higher interest rates. 0:00:17.640 --> 0:00:20.319 Banks are in focus. Is JP Morgan's City Group and 0:00:20.320 --> 0:00:23.439 Wells Fargo report earnings and a major stepback for President 0:00:23.480 --> 0:00:27.120 Biden's vaccine mandate. New Jersey Governor Murphy signs and abortion 0:00:27.200 --> 0:00:29.440 rights bill on the state, plus a push to eliminate 0:00:29.480 --> 0:00:31.319 the full of US to rule is all but dead 0:00:31.360 --> 0:00:35.320 in the Senate. Michael blarn More ahead, I'm Don Stashon sports, 0:00:35.360 --> 0:00:38.200 the Nets lost the Rangers one, the Islanders beat the Devils, 0:00:38.200 --> 0:00:41.880 and in Australia Novak Djokovic and as Visa taken away again. 0:00:44.080 --> 0:00:48.640 That's all straight ahead on Bloomberg day Break on Bloomberg Elimentoryo, 0:00:48.760 --> 0:00:53.040 New York, Bloomberg one, Washington, d C, Bloomberg one, O 0:00:53.200 --> 0:00:57.640 six one, Boston, Bloomberg nine sixties, San Francisco, Sirius x 0:00:57.840 --> 0:01:00.880 M one nineteen and around the world Old on Bloomberg 0:01:00.960 --> 0:01:07.920 Radio dot Com and via The Bloomberg Business. Good Morning, 0:01:07.959 --> 0:01:11.080 I'm Nathan Hagar and I'm Karen Moscow and US DOT 0:01:11.120 --> 0:01:13.680 index futures are on the rise this morning ahead of 0:01:13.760 --> 0:01:15.920 big bank earnings. We're coming up to five o one 0:01:15.920 --> 0:01:17.880 on Wall Street, and we check the markets every fifteen 0:01:17.920 --> 0:01:20.760 minutes throughout the trading day. On bloomberg S and P 0:01:20.959 --> 0:01:24.240 futures up ten points down, futures of ninety one, Nasdaq 0:01:24.319 --> 0:01:28.080 futures up twenty five, Ten year Treasury down eight thirty seconds, 0:01:28.120 --> 0:01:30.560 held one point seven three per cent, and the yield 0:01:30.560 --> 0:01:33.199 on the two year point nine two percent. And nim 0:01:33.280 --> 0:01:36.479 X screwed oil is up seven tenths percent. Nathan, Well, Karen, 0:01:36.520 --> 0:01:39.040 We're coming off another day of declines on Wall Street. 0:01:39.080 --> 0:01:41.319 The tech heavy NASDAC posted a loss of two and 0:01:41.360 --> 0:01:44.160 a half percent. That's after several FETE officials beat the 0:01:44.240 --> 0:01:47.160 drum for higher interest rates. It all started with Governor 0:01:47.240 --> 0:01:50.360 Lyle Brainerd as part of her Senate confirmation hearing. Our 0:01:50.440 --> 0:01:54.720 monetary policy is focused on getting inflation back down to 0:01:54.840 --> 0:01:58.480 two percent while sustaining a recovery that includes everyone. This 0:01:58.560 --> 0:02:01.480 is our most important task. Lile Brainerd says the Fed 0:02:01.600 --> 0:02:04.200 could raise rates as soon as March. Consensus calls for 0:02:04.280 --> 0:02:06.960 three or four hikes from the FED this year. Governor 0:02:07.000 --> 0:02:10.240 Christopher Waller calls three increases a good baseline, at least 0:02:10.240 --> 0:02:12.399 for now. We'll have to wait and see what inflation 0:02:12.480 --> 0:02:14.360 looks like in the second half of the year. If 0:02:14.400 --> 0:02:17.040 it continues to be high, the case will be made 0:02:17.080 --> 0:02:20.600 for four, maybe five hikes. Governor Chris Waller made those 0:02:20.600 --> 0:02:23.440 comments in an interview with Bloomberg's Kathleen Hayes. He joins 0:02:23.440 --> 0:02:27.400 Philadelphia FED chiefs Patrick Harker and Jim Bullard of St. Louis. 0:02:27.480 --> 0:02:31.240 They've also floated the idea for increases. Chicago Fed President 0:02:31.360 --> 0:02:34.639 Charles Evans is more conscious he wants more inflation data 0:02:34.840 --> 0:02:37.400 before committing to a March liftoff. We need to get 0:02:37.440 --> 0:02:43.000 inflation back down in the ballpark of our two percent objective. UM. 0:02:43.040 --> 0:02:45.920 I think it's probably going to be UM at the 0:02:46.040 --> 0:02:49.120 end of this year. It's going to be elevated. It's UM. 0:02:49.160 --> 0:02:51.000 I don't think it's gonna be three percent at the 0:02:51.040 --> 0:02:53.000 end of this year, and I think it's more likely 0:02:53.040 --> 0:02:54.800 to be two and a half as measured by the 0:02:55.240 --> 0:02:59.080 personal consumption expenditure. Charles Evans will be watching that PC 0:02:59.360 --> 0:03:02.079 inflation a closely. We get their next reading on that 0:03:02.200 --> 0:03:04.520 coming up at the end of this month. Well, Nathan, 0:03:04.560 --> 0:03:06.760 the White House is set to add some new faces 0:03:06.800 --> 0:03:09.400 at the FED now. President Biden has selected as picks 0:03:09.440 --> 0:03:11.800 to fill open seats at the Central Bank, and Bloomberg's 0:03:11.840 --> 0:03:14.440 Ornia Young and joins us live at the Latest. Good Morning, Nida, 0:03:14.520 --> 0:03:17.960 Good morning Karen Bloomberg. Sources say President Biden is planning 0:03:17.960 --> 0:03:21.200 to nominate Sarah bloom Breskin to the fifth top banking 0:03:21.280 --> 0:03:25.799 regulator spot. He'll also announce economists Philip Jefferson and Lisa 0:03:25.840 --> 0:03:28.800 Cook has picks for governors. Cook would be the first 0:03:28.840 --> 0:03:31.600 black woman on the fifth board and Jefferson would be 0:03:31.639 --> 0:03:34.800 the fourth black man. The picks would also help Biden 0:03:34.920 --> 0:03:37.920 keep his promise to improve diversity at the Central Bank. 0:03:38.320 --> 0:03:42.000 His nominations would as well add experts focused on a 0:03:42.080 --> 0:03:45.240 broad job market recovery as they seek to tame the 0:03:45.280 --> 0:03:48.800 hottest inflation in a generation. Live in New York, I'm 0:03:48.800 --> 0:03:51.480 gonna need a Young Bloomberg daybreak, Okay, Nita, thank you, 0:03:51.480 --> 0:03:53.360 and we get more data for the FED to digest 0:03:53.480 --> 0:03:56.360 this morning. Retail sales figures for December are do out 0:03:56.360 --> 0:03:58.560 at eight thirty am Wall Street Time. Let's get a 0:03:58.600 --> 0:04:01.680 preview now from Bloomberg's Mike McKee. The O Macron variant 0:04:01.680 --> 0:04:04.280 will weigh on the retail sales numbers as many bars 0:04:04.280 --> 0:04:06.800 and restaurants were forced to close during the holiday season. 0:04:07.080 --> 0:04:10.680 Gasoline prices and auto sales also decline dealers struggling to 0:04:10.720 --> 0:04:13.840 get cars, But it does appear core sales were strong, 0:04:13.920 --> 0:04:17.640 everything from toys to supporting goods and clothing. Americans incomes 0:04:17.640 --> 0:04:20.719 were bolstered by a government fiscal aid and rising wages, 0:04:20.960 --> 0:04:24.080 particularly at the lower end of the income spectrum. Then 0:04:24.080 --> 0:04:27.719 not so necessarily good news is retail sales will also 0:04:27.800 --> 0:04:32.200 benefit from soaring inflation, as sales are reported in dollar figures. 0:04:32.480 --> 0:04:35.440 Michael McKee, Bloomberg Daybreak. All right, Michael, thank you. All. 0:04:35.480 --> 0:04:38.680 Earnings also come into focus today. Big banks kick off 0:04:38.680 --> 0:04:40.960 this season with results to do out this morning at 0:04:40.960 --> 0:04:44.800 Bloomberg Global Finance Correspondence, and Ali Bostick has more. JP 0:04:44.920 --> 0:04:49.240 Morgan is kicking off earnings and expectations are high that 0:04:49.360 --> 0:04:53.440 consumer loan growth is coming back and that trading will 0:04:53.480 --> 0:04:56.160 hold up even as it starts to moderate and even 0:04:56.200 --> 0:04:59.200 decline in many places on Wall Street. With that said, 0:04:59.240 --> 0:05:01.880 we're also looking a city group and Wells Fargo earnings 0:05:02.160 --> 0:05:04.520 not only to see that the consumer is returning, but 0:05:04.640 --> 0:05:07.120 also to make sure that those banks can keep costs 0:05:07.440 --> 0:05:10.960 down as they are more under pressure with wages rising 0:05:11.000 --> 0:05:14.080 and more investment in technology. Wells Fargo in City Group 0:05:14.120 --> 0:05:17.920 have regulatory risks as well that investors will want updates on. 0:05:18.520 --> 0:05:21.440 In New York, Shnali Bastic Bloomberg Day Break. Okay, Shinnali, 0:05:21.520 --> 0:05:23.440 thank you now to the latest on the pandemic and 0:05:23.560 --> 0:05:27.000 a major legal setback for President Biden. The Supreme Court 0:05:27.040 --> 0:05:29.760 has blocked his rule that would require large companies to 0:05:29.800 --> 0:05:33.599 mandate vaccines or weekly testing for employees. We got reaction 0:05:33.680 --> 0:05:36.680 from Labor Secretary Marty Walsh. We just have to continue 0:05:36.760 --> 0:05:39.159 our efforts with the present laid out. You know, is 0:05:39.160 --> 0:05:41.000 this a setback. I wouldn't say if the setback, if 0:05:41.000 --> 0:05:43.279 it to be a disappointment is what it is. But 0:05:43.320 --> 0:05:45.360 we're going to continue to do everything we can. I'm 0:05:45.360 --> 0:05:48.160 going to continue everything I can as Secretary of Labor 0:05:48.200 --> 0:05:50.440 for the United States of America to make sure every 0:05:50.440 --> 0:05:54.279 single worker in America is safe. Labor Secretary Marty Walsh 0:05:54.279 --> 0:05:57.479 spoke with our Washington correspondent Joe Matthew on Bloomberg Sound 0:05:57.520 --> 0:06:00.080 On Catch the program weekdays at five pm Eastern on 0:06:00.080 --> 0:06:03.520 Bloomberg Radio. Nathan. When it comes to vaccinated employees, City 0:06:03.560 --> 0:06:06.280 Group is out with its data. The bank says it's 0:06:06.320 --> 0:06:09.160 US employees have complied with its vaccine mandate, and the 0:06:09.200 --> 0:06:12.200 bank expects more workers to comply its order or comply 0:06:12.320 --> 0:06:15.359 with its order before today's deadline. Cities mandate is one 0:06:15.400 --> 0:06:17.880 of the strictest on Wall Street, making COVID vaccines a 0:06:17.920 --> 0:06:21.039 condition of employment. Meantime, Karen, the White House is ramping 0:06:21.120 --> 0:06:24.240 up other plans to tackle the pandemic. President Biden's doubling 0:06:24.320 --> 0:06:26.720 his order of rapid COVID tests to send to Americans. 0:06:26.920 --> 0:06:29.840 He says he'll also distribute high quality masks. Where I'm 0:06:29.880 --> 0:06:32.840 making high quality masks available to American people in the 0:06:32.880 --> 0:06:36.880 American people for free. You know, I know we all 0:06:37.080 --> 0:06:39.880 wish that we could finally be done with wearing masks. 0:06:39.960 --> 0:06:43.919 I get it, but there is they're a really important tool. 0:06:44.160 --> 0:06:46.440 When the President says he'll have a formal announcement on 0:06:46.560 --> 0:06:50.200 distributing masks next week. Turning to the markets now, Nathan, 0:06:50.240 --> 0:06:53.000 Crypto is in focus today. A dodge coin search as 0:06:53.080 --> 0:06:55.760 much as fift percent this morning, after Elon Mush said 0:06:55.760 --> 0:06:58.280 it can be used to buy Tesla merchandise. Muski is 0:06:58.320 --> 0:07:01.400 a frequent booster of dogecoin on social media and is 0:07:01.480 --> 0:07:03.839 hinted at the move for some time. And Karen Tiger 0:07:03.920 --> 0:07:06.479 Woods is in financial news this morning. A blank check 0:07:06.520 --> 0:07:08.600 company backed by the golf Star has filed to raise 0:07:08.640 --> 0:07:10.720 a hundred fifty million dollars in an I p O 0:07:11.200 --> 0:07:13.480 company plans to seek a merger target in the sports 0:07:13.640 --> 0:07:16.400 or health tech sectors with an enterprise value of as 0:07:16.520 --> 0:07:23.800 much as a billion dollars. This is Bloomberg. It's south 0:07:23.880 --> 0:07:26.120 five oh seven on Wall Street where thirty nine degrees 0:07:26.240 --> 0:07:28.520 in Central Park. Already dealing with an accident on the 0:07:28.560 --> 0:07:31.440 westbound Gowanas by Hamilton Avenue. On details for you in 0:07:31.520 --> 0:07:34.320 traffic First, Michael Barr is here with more on what's 0:07:34.360 --> 0:07:37.200 going on in New York and around the world. Happy Friday, Michael, 0:07:37.240 --> 0:07:39.960 Happy Friday to you, Nathan. New York City Mayor Eric 0:07:40.040 --> 0:07:43.760 Adams said he is considering a temporary remote option for 0:07:44.000 --> 0:07:46.680 the city's public schools and a stark reversal from his 0:07:46.800 --> 0:07:49.680 position to keep kids learning in person despite a surgeon 0:07:49.760 --> 0:07:53.600 COVID cases. We want to provide the safest place for 0:07:53.680 --> 0:07:57.320 our children, and we want to have our children in school, 0:07:57.680 --> 0:08:01.480 Adams says, though a substantial number of children's parents aren't 0:08:01.520 --> 0:08:04.680 bringing their kids to school. According to city data, only 0:08:04.720 --> 0:08:08.560 about of the city's one million students have been attending 0:08:08.600 --> 0:08:12.320 classes since schools reopened after the winter break. On January three, 0:08:12.920 --> 0:08:16.720 New Jersey Democratic Governor Phil Murphy, anticipating possible changes to 0:08:16.800 --> 0:08:19.560 the Roe v. Wade ruling from the U. S. Supreme Court, 0:08:19.680 --> 0:08:23.440 signed an abortion rights bill into state law. Murphy signed 0:08:23.440 --> 0:08:26.160 the measure fulfilling a campaign pledge made in the lead 0:08:26.240 --> 0:08:29.040 up to his re election victory in November. On Twitter, 0:08:29.160 --> 0:08:32.360 Murphy posted his comments during a signing ceremony in te Neck. 0:08:33.160 --> 0:08:37.320 Regardless of whether or not the Supreme Court overturns Roe v. Wade, 0:08:37.920 --> 0:08:41.080 New Jersey's position and supporting the right to reproductive autonomy 0:08:41.679 --> 0:08:45.120 will remain clear and unchanged. Governor Murphy also says, in 0:08:45.160 --> 0:08:48.959 addition to abortion rights, the bill also specifically outlines a 0:08:49.120 --> 0:08:52.760 right to access contraception as well as to carry a 0:08:52.840 --> 0:08:56.440 pregnancy to term. President Biden is now casting some doubt 0:08:56.480 --> 0:08:59.920 on whether his voting rights bill can get done. Bloomberg's 0:08:59.920 --> 0:09:02.760 that Baxter reports. If it can be done, it will 0:09:02.800 --> 0:09:05.160 have to be approached in a different way. After weeks 0:09:05.200 --> 0:09:08.480 of talks with senators, Cinema and Mansion both say that 0:09:08.679 --> 0:09:11.600 changing the filibuster rule is not an option. Need changes 0:09:11.679 --> 0:09:16.760 to make the Senate work better, But the President says 0:09:16.800 --> 0:09:19.640 the fight is not over. As long as I have 0:09:19.720 --> 0:09:22.079 a breath in me, as long as I'm in the 0:09:22.120 --> 0:09:24.959 White House, as long as I'm engaged at all, I'm 0:09:25.000 --> 0:09:27.960 going to be fighting to change the way these legislatures 0:09:28.040 --> 0:09:31.200 have moving. The President did meet with both before decisions 0:09:31.240 --> 0:09:34.560 were made in San Francisco. I'm at Baxter Bloomberg Gay Break, 0:09:34.760 --> 0:09:37.240 leaders of the far right group the oath Keepers, with 0:09:37.440 --> 0:09:40.800 charge with conspiring to prevent the certification of Joe Biden 0:09:40.840 --> 0:09:43.439 as president by joining in the attack on the Capitol 0:09:43.520 --> 0:09:47.439 last year. The indictment charges Elmer Stewart Rhodes, described as 0:09:47.640 --> 0:09:50.160 the founder of the group, and ten other individuals with 0:09:50.360 --> 0:09:54.080 seditious conspiracy and other churches. Global News twenty four hours 0:09:54.120 --> 0:09:56.600 a day on here and on Bloomberg quick Take, powered 0:09:56.640 --> 0:09:59.959 by more than journalists and analysts more than a hundred 0:10:00.000 --> 0:10:02.840 when two countries. I'm Michael Barr. This is Bloomberg. Nathan 0:10:03.000 --> 0:10:09.719 thanks Michael almost five ten on All Street Time for 0:10:09.760 --> 0:10:12.480 the Bloomberg Sports up. Faked Morning, John ALRK Your Morning, 0:10:12.559 --> 0:10:15.640 Nathan is Novak Djokovic story is like when fans watch 0:10:15.760 --> 0:10:18.319 a tennis match in their head goes back and forth. 0:10:18.440 --> 0:10:22.880 Last week, Djokovic, despite being unvaccinated, received a medical exemption 0:10:22.960 --> 0:10:25.240 to play the Australian Open. He flew to Melbourne and 0:10:25.240 --> 0:10:27.680 promptly had his visa taken away. There was a mistake 0:10:28.040 --> 0:10:30.960 in the paperwork Monday had Judge Rein stated it. Now 0:10:31.080 --> 0:10:34.360 the Immigration Minister, acting in what he called the public interest, 0:10:34.480 --> 0:10:37.760 removed the visa again and now Djokovic's lawyers were said 0:10:37.800 --> 0:10:40.959 to be planning another appeal. The tournament, which Djokovic is 0:10:41.000 --> 0:10:43.760 one nine times, begins Monday. Nets Off the Big One 0:10:43.800 --> 0:10:46.240 in Chicago, gave Kevin Durant the night off. Kyrie Irving 0:10:46.320 --> 0:10:48.439 can't play home games shure enough. The Nets lost to 0:10:48.480 --> 0:10:51.400 Oklahoma City one thirty to one. On nine, Nicks made 0:10:51.440 --> 0:10:53.559 a trade sent to seldom use Kevin not to the 0:10:53.559 --> 0:10:56.160 first round draft pick that originally belonged to Charlotte to 0:10:56.320 --> 0:10:58.880 Atlanta for Cam cam Reddis, who the Hawks took with 0:10:58.960 --> 0:11:02.199 the tenth overall pick in only twenty two. He'll be 0:11:02.320 --> 0:11:04.640 reunited with r J. Barrett. They were teammates at Too 0:11:04.840 --> 0:11:08.240 Nick's play in Atlanta. Tomorrow Rangers in San Jose. The 0:11:08.320 --> 0:11:13.280 newest blue shirt helped out Alfid Eric keeps it alive, 0:11:13.360 --> 0:11:16.839 slides it over the Heatlele for scroll, robbing all the 0:11:16.920 --> 0:11:20.640 goal line, back out for a shot Store. The rain 0:11:20.679 --> 0:11:24.400 Church get the first Hill goal for a braided Sneider 0:11:24.520 --> 0:11:27.439 it his head Hill debut. Yeah, they don't have a 0:11:27.520 --> 0:11:30.120 two topic lead over the Sharks. Jenny Albert on WP 0:11:30.240 --> 0:11:32.760 and the Rangers speech San Jose three nothing. Chris Cryder 0:11:32.800 --> 0:11:34.719 scored the other two goals. He's got twenty three on 0:11:34.840 --> 0:11:37.079 the season, fourth most in the NHL. The Islanders on 0:11:37.160 --> 0:11:39.480 a Matthew bars Ol goal with five minutes left, bet 0:11:39.520 --> 0:11:42.120 the Devil's three to Seaton Hall, upset by De Paul, 0:11:42.480 --> 0:11:44.160 who came in oh and five. In the Big East. 0:11:44.200 --> 0:11:47.600 It was ninety six ninety two John Stash Award Bluebird Sports. 0:11:48.280 --> 0:11:50.040 All right, John, thank you right now. S and P 0:11:50.200 --> 0:11:52.760 futures are up nine points, Sound Futures up ninety one, 0:11:52.880 --> 0:11:56.320 Nastack futures up twenty one points after a tech led 0:11:56.480 --> 0:12:00.079 sell off yesterday. We'll talk about the Fed path with 0:12:00.280 --> 0:12:07.920 John Sylvia Dynamic Economic Strategy. Next, this is Bloomberg Bloomberg 0:12:07.920 --> 0:12:10.400 eleven three oh Weather turning partly sunny and breezy today 0:12:10.440 --> 0:12:12.640 with low forties for highs, a mix of sun and clouds, 0:12:12.720 --> 0:12:16.520 low twenties for highs. Tomorrow snow developing late Sunday with 0:12:16.559 --> 0:12:22.600 a high near thirty five right now forty degrees. Markets, 0:12:22.720 --> 0:12:25.760 headlines and breaking news twenty four hours a day at 0:12:25.800 --> 0:12:29.199 Bloomberg dot com, The Bloomberg Business Out and at Bloomberg 0:12:29.280 --> 0:12:39.040 Quicktake is your Bloomberg Business lash and I'm Camra in Moscow. 0:12:39.120 --> 0:12:42.079 European stocks following, Asian shares lower after a slew of 0:12:42.120 --> 0:12:46.559 Federal Reserve officials signal the combat inflation aggressively, Treasury yields rising, 0:12:46.600 --> 0:12:49.760 the dollar falling. US futures are taking higher after the 0:12:49.840 --> 0:12:52.880 nasdack fell to its lowest level since October. We checked 0:12:52.880 --> 0:12:55.400 the markets every fifteen minutes throughout the trading day on 0:12:55.480 --> 0:12:58.200 bloomberg s and p Future is up six points this morning. 0:12:58.280 --> 0:13:02.079 Down Future is up seventy six Nasdack futures they're little 0:13:02.200 --> 0:13:04.640 change the decks in Germany's down seven tenths of upper 0:13:04.720 --> 0:13:07.080 cent ten year Treasury down nine thirty seconds. He at 0:13:07.120 --> 0:13:09.800 one point seven three percent yield on the two year 0:13:09.920 --> 0:13:12.800 point nine two percent. Non mex screwed oil is up 0:13:12.880 --> 0:13:15.199 nine tenths percent or seventy one cents at eighty two dollars, 0:13:15.240 --> 0:13:17.600 eighty three cents of barrel comex s gold up about 0:13:17.600 --> 0:13:19.440 a tenth of upper cent of a dollar forty at 0:13:19.480 --> 0:13:23.000 eighteen eighty announced. The euro one point one four six 0:13:23.120 --> 0:13:25.560 zero against the dollar. British found one point three seven 0:13:25.640 --> 0:13:28.520 three zero. The ends at one thirteen point nine six 0:13:28.679 --> 0:13:32.240 bitcoin this morning, moving lower. Had forty two thou five 0:13:32.360 --> 0:13:35.320 hundred dollars JP Morgan Chase City Group, whilst Fargo among 0:13:35.400 --> 0:13:38.360 companies reporting earnings today. And we get a number of 0:13:38.400 --> 0:13:42.640 economic reports today, including December retail sales. That's a Bloomberg 0:13:42.679 --> 0:13:45.040 business flash. Now here's Michael Bart with more on what's 0:13:45.080 --> 0:13:47.720 going on around the world. Uncle, good morning, Good morning, Karen. 0:13:47.800 --> 0:13:50.599 President Joe Biden is all but conceding defeat for this 0:13:50.800 --> 0:13:54.680 year on the Democrats big elections and voting rights legislation. 0:13:55.080 --> 0:13:58.239 Biden spoke at the Capitol after a key fellow Democrats, 0:13:58.280 --> 0:14:01.480 Senator Kirsten Cinema of theres want to dramatically announced the 0:14:01.559 --> 0:14:05.200 refusal to go along with changing Senate rules to muscle 0:14:05.320 --> 0:14:10.040 pass the Republican filibuster. Tennis star Novak Djokovic faces deportation 0:14:10.160 --> 0:14:13.599 again after the Australian the government revoked his visa for 0:14:13.800 --> 0:14:17.559 a second time. Immigration Minister Alex Hawk said today that 0:14:17.679 --> 0:14:21.600 he used his ministerial discretion to revoke Djokovic's visa on 0:14:21.720 --> 0:14:25.040 public interest grounds, three days before the Australian Open is 0:14:25.080 --> 0:14:29.000 to begin. Djokovic's lawyers are expected to appeal. In the NBA, 0:14:29.160 --> 0:14:32.560 the Nets and Warriors lost in the NHL, the Islanders 0:14:32.600 --> 0:14:35.680 beat the Devil's, the Rangers and Bruins. One Global News 0:14:35.720 --> 0:14:38.080 twenty four hours a day on air and on Bloomberg 0:14:38.160 --> 0:14:41.320 Quick Take, powered by more than twenty seven under journalist 0:14:41.360 --> 0:14:44.040 and analysts more than a hundred twenty countries. I'm Michael 0:14:44.120 --> 0:14:46.920 mar This is Bloomberg, Nathan. Thanks Michael. We're coming up 0:14:46.960 --> 0:14:49.440 to five twenty on Wall Street Live from the Burloomberg 0:14:49.560 --> 0:14:53.760 Interactive Brokers Studios. This is Bloomberg Daybreak, with inflation and 0:14:53.880 --> 0:14:57.560 the possibility of faster fed rate hikes front and center 0:14:57.600 --> 0:15:00.760 for investors. Let's bring in John Sylvia under of Dynamic 0:15:00.880 --> 0:15:03.200 Economic Strategy. John, it's good to speak with you on 0:15:03.280 --> 0:15:06.760 this Friday morning as we are hearing calls getting louder 0:15:06.880 --> 0:15:11.320 from a lot more fed voices on faster rate hikes. Potentially, 0:15:11.640 --> 0:15:14.200 is a March lift off a done deal for you? 0:15:16.000 --> 0:15:19.000 At this point? The answer is yes. The inflation numbers 0:15:19.040 --> 0:15:24.280 continue to surprise. There was no deceleration and the CPI 0:15:24.520 --> 0:15:27.960 numbers over the last month, and you're quite right. I 0:15:28.000 --> 0:15:31.880 mean the inflation will probably feed into the retail sales 0:15:32.000 --> 0:15:35.520 numbers that we see today. Let's get a little bit 0:15:35.560 --> 0:15:38.480 more into that. How do you see inflation feeding into 0:15:38.520 --> 0:15:42.600 those retail sales numbers? Well, what we saw was November's 0:15:42.680 --> 0:15:46.359 numbers were a little bit less than expected, and particularly 0:15:46.520 --> 0:15:50.560 in some of the discretionary areas such as appliances, furniture, 0:15:51.160 --> 0:15:54.240 and department stores were down in November and down over 0:15:54.280 --> 0:15:56.760 the last three months. And I think it's important to 0:15:57.680 --> 0:16:01.520 remember that the retail sales number is a nominal number, 0:16:02.120 --> 0:16:05.520 so the pace of inflation does suggest that real spending 0:16:05.680 --> 0:16:08.000 is probably going to slow down, at least in the 0:16:08.080 --> 0:16:11.520 first half. I wanted to ask you a little bit 0:16:11.520 --> 0:16:13.600 more about that as well. Because I think we're probably 0:16:13.680 --> 0:16:16.880 going to see some effect of holiday spending in this 0:16:17.080 --> 0:16:22.960 number as well, aren't we what happens when that goes away? Yeah, 0:16:23.080 --> 0:16:25.560 that's that's going to be a tough one. Holiday spending 0:16:25.640 --> 0:16:28.000 going away. There's probably a lot of pent up demands 0:16:28.080 --> 0:16:31.880 you can imagine with people being sort of cooped up 0:16:32.440 --> 0:16:35.240 because of the shutdowns, they wanted to have that emotional 0:16:35.360 --> 0:16:38.280 release they go out shopping. But the first quarter of 0:16:38.360 --> 0:16:41.480 the year tends to be a slower consumer spending number. 0:16:42.000 --> 0:16:44.440 And I'll go back to your earlier point, Um, with 0:16:44.600 --> 0:16:48.080 the FED raising interest rates, Now that's going to impact 0:16:48.200 --> 0:16:52.240 some of this discretionary spending once again because um, as 0:16:52.280 --> 0:16:57.000 you know with appliances, furniture, um, sometimes electronics, people actually 0:16:57.080 --> 0:17:00.520 put those on financing plans, so there will be that 0:17:00.640 --> 0:17:04.120 negative hit as well. We're seeing some wage pressure as well. 0:17:04.320 --> 0:17:07.159 What impact does that that have when it comes to 0:17:07.440 --> 0:17:09.960 retail spending in the health of the consumer more generally? 0:17:10.000 --> 0:17:16.320 Are we heading into a wage inflationary spiral in some way? Well? Unfortunately, 0:17:17.000 --> 0:17:22.639 the foundations of a lot of economics is that sooner 0:17:22.720 --> 0:17:25.760 or lay to workers wake up to the fact that 0:17:25.840 --> 0:17:29.920 inflation has accelerated, and then they pushed their wage demands 0:17:30.040 --> 0:17:32.920 to follow those inflation numbers, so there is a wage 0:17:33.080 --> 0:17:36.560 price borrow. I do expect that what we will see 0:17:36.720 --> 0:17:40.920 is higher nominal wages going forward, but unfortunately, you know, 0:17:41.480 --> 0:17:44.680 the pace of inflation still exceeds to gain an average 0:17:44.720 --> 0:17:49.200 hourly earnings and UH as as was mentioned in Bloomberg 0:17:49.240 --> 0:17:53.560 several weeks ago by Mike McKee, UM, real wage gains 0:17:53.560 --> 0:17:57.800 are actually declining. So that's that's a tough scenario. Workers 0:17:57.800 --> 0:18:00.119 are going to try to catch up, UM, so there 0:18:00.160 --> 0:18:03.080 will be some wage price FIRA. Yeah, and in some 0:18:03.160 --> 0:18:05.119 ways the Feds trying to catch up as well. Right 0:18:05.160 --> 0:18:09.240 when do you start to see some actual dampening effect 0:18:09.359 --> 0:18:12.919 on inflation from the policy moves at the markets pricing 0:18:13.000 --> 0:18:18.400 in here? Well, historically it takes some time, a good 0:18:18.480 --> 0:18:23.119 three six nine months before any impact on the actual 0:18:23.200 --> 0:18:28.000 inflation numbers comes from the Fed raising interest rates. I 0:18:28.080 --> 0:18:31.679 would expect that, you know, inflation probably will moderate by 0:18:31.720 --> 0:18:35.040 the second quarter of this year. UM it still ends 0:18:35.160 --> 0:18:38.920 up UM. When you look at the overall case of 0:18:39.160 --> 0:18:43.600 the CPI, you're still looking at something like three and 0:18:43.680 --> 0:18:48.840 a half to four consumer prices in UM, so there's 0:18:48.960 --> 0:18:54.280 some sustained inflation pressure going forward. In our last thirty 0:18:54.320 --> 0:18:57.800 seconds here, what do you see moderating that inflation in 0:18:57.920 --> 0:19:01.000 the second quarter? Is it gonna be apply chain issues 0:19:01.040 --> 0:19:03.840 sort of working themselves out? What's your what's your case there? 0:19:05.240 --> 0:19:08.119 My case is both supply and demand. You're quite right. 0:19:08.440 --> 0:19:11.399 Supplies issues are seemed to be working on. If you 0:19:11.480 --> 0:19:15.399 look at the I S M delivery numbers, those numbers 0:19:15.440 --> 0:19:18.360 seem to be declining, so there is some improvement there 0:19:18.520 --> 0:19:22.480 and delivery, and I think overall arrogant demand the US 0:19:22.520 --> 0:19:25.919 economy will moderate as well. So it's both the supply 0:19:26.080 --> 0:19:28.879 and demand story. Thanks John, good having you on with 0:19:29.040 --> 0:19:31.840 us this morning. John Sylvia is the founder of Dynamic 0:19:31.960 --> 0:19:35.920 Economic Strategy. Looking ahead to the market, open futures are 0:19:36.119 --> 0:19:38.760 moving a bit higher. We see SMP futures up seven 0:19:38.800 --> 0:19:40.719 and a half points right now, Dow futures are up 0:19:40.720 --> 0:19:43.280 eighty three points, DANCEDACK futures on the rise by ten 0:19:43.440 --> 0:19:46.880 points ten. Your treasuries down ten thirty seconds, the yield 0:19:47.000 --> 0:19:49.080 one point seven three percent in the yield on the 0:19:49.119 --> 0:19:53.040 two year right now point nine to just ahead, we 0:19:53.240 --> 0:19:55.399 get you set for bank earnings and a legal setback 0:19:55.440 --> 0:19:58.359 for President Biden's vaccine mandates all coming up as we 0:19:58.480 --> 0:20:01.480 check your top stories of the morning right here on 0:20:01.600 --> 0:20:09.080 Bloomberg Daybreak. Daybreak is brought to you by the Breakers. 0:20:09.160 --> 0:20:11.280 This winter, a warm welcome awaits you. The Breakers is 0:20:11.320 --> 0:20:14.280 committed to making your stay even better with exceptional experiences, 0:20:14.280 --> 0:20:17.480 gracious service, and unparalleled seaside glamor. To learn more, visit 0:20:17.520 --> 0:20:24.399 the Breakers dot com. Today broadcasting live from the Bloomberg 0:20:24.480 --> 0:20:27.879 Interactive Broker Studio in New York, Bloomberg E Living for 0:20:28.000 --> 0:20:32.359 you to Washington, d C, Bloomberg to Boston, Bloomberg one 0:20:32.440 --> 0:20:35.600 oh six one, to San Francisco, Bloomberg nine six to 0:20:35.680 --> 0:20:38.760 the country Sirius XM chto one nine ten, and around 0:20:38.800 --> 0:20:42.320 the globe the Bloomberg Business and Bloomberg Radio dot Com. 0:20:42.760 --> 0:20:51.760 This is Bloomberg Daybreak. It's five thirty on Wall Street. 0:20:51.800 --> 0:20:54.720 Good morning. I'm Nathan Hagar and I'm kerin Moscow. How 0:20:54.760 --> 0:20:56.920 we're just about four hours away from the open of 0:20:57.040 --> 0:20:58.880 US training. Let's get you up to date on the news. 0:20:58.920 --> 0:21:01.520 You need to know what this show. Our US futures 0:21:01.720 --> 0:21:05.280 are now little changed following yesterday's sell off, which saw 0:21:05.320 --> 0:21:08.040 the nasdack drop two and a half percent. The FEDS 0:21:08.080 --> 0:21:10.680 push for a higher interest rates to combat inflation is 0:21:10.720 --> 0:21:14.480 growing louder. Governor Christopher Waller tells US at least three 0:21:14.560 --> 0:21:17.560 hikes this year is a good baseline. It really depends 0:21:17.560 --> 0:21:20.399 on what happens with inflation. I mean, if inflation just 0:21:20.960 --> 0:21:23.520 is stubbornly high through the first part of this year, 0:21:23.640 --> 0:21:25.159 first half of this year, we're gonna have to do 0:21:25.240 --> 0:21:27.680 a lot more. But that's what that's our job, and 0:21:27.760 --> 0:21:29.879 that's what we're committed to do, and if we have 0:21:30.000 --> 0:21:32.359 to do more rate hikes, will do it. FED Governor 0:21:32.440 --> 0:21:35.480 Chris Waller tells Our Kathleen Hayes he sees a scenario 0:21:35.640 --> 0:21:38.240 where the FED raises race as much as five times 0:21:38.320 --> 0:21:40.680 this year. Well meantime, Karen, the White House is set 0:21:40.720 --> 0:21:43.000 to add some new faces at the FED. President Biden 0:21:43.040 --> 0:21:44.800 has made his picks to fill open seats at the 0:21:44.840 --> 0:21:47.359 Central Bank, and Bloomberg Jornia Young joins US Live with 0:21:47.440 --> 0:21:50.240 the latest. Good Morning, Na, Good morning, Nathan Bloomberg. Sources 0:21:50.280 --> 0:21:53.439 say President Biden is planning to nominate Sarah bloom Reskin 0:21:53.520 --> 0:21:56.719 to the FITS top banking regulator spot. He'll also announce 0:21:56.800 --> 0:22:00.760 economists Philip Jefferson and Lisa Cooks picks for governors. Cook 0:22:00.800 --> 0:22:03.080 would be the first black woman on the fifth board 0:22:03.320 --> 0:22:06.200 and Jefferson would be the fourth black man. The picks 0:22:06.240 --> 0:22:09.439 would help Biden keep his promise to improve diversity at 0:22:09.480 --> 0:22:12.280 the Central Bank. Live in New York, I'm ren need 0:22:12.320 --> 0:22:14.520