1
00:00:02,320 --> 00:00:05,680
Speaker 1: Global business news twenty four hours a day at Bloomberg

2
00:00:05,720 --> 00:00:08,800
Speaker 1: dot com, the Radio, plus mobile Lab and on your radio.

3
00:00:09,080 --> 00:00:13,000
Speaker 1: This is a Bloomberg Business Flash, and I'm Karen Moscow.

4
00:00:13,080 --> 00:00:15,840
Speaker 1: Caterpillar down two percent this morning, the biggest maker of

5
00:00:15,880 --> 00:00:19,360
Speaker 1: construction and mining machinery, saying first quarter sales and profit

6
00:00:19,400 --> 00:00:23,640
Speaker 1: well trail analysts estimates amid a deepening slump across commodities.

7
00:00:23,920 --> 00:00:26,920
Speaker 1: Future is lower this morning. SNP eveny futures down eight

8
00:00:26,920 --> 00:00:29,880
Speaker 1: points down, e Many futures down sixty two. Now's dock

9
00:00:29,920 --> 00:00:32,639
Speaker 1: e Many futures down nineteen. The docks in Germany's down

10
00:00:32,680 --> 00:00:36,000
Speaker 1: one point eight percent. Ten. Your treasury up twelve thirty seconds,

11
00:00:36,000 --> 00:00:38,760
Speaker 1: the yelled one point eight six percent. Nine x screwed

12
00:00:38,800 --> 00:00:41,000
Speaker 1: oil up one point six percent, or sixty cents to

13
00:00:41,080 --> 00:00:43,959
Speaker 1: thirty nine oh six of barrel comas. Gold up three

14
00:00:43,960 --> 00:00:46,720
Speaker 1: point three percent, or forty dollar seventy cents to twelve

15
00:00:46,760 --> 00:00:50,320
Speaker 1: seventy fifty ounce. The euro a dollar thirteen eighteen, the

16
00:00:50,400 --> 00:00:53,360
Speaker 1: yen one eleven point to eight. And that's a Bloomberg

17
00:00:53,479 --> 00:00:57,440
Speaker 1: Business Flash. Tom and Mike, Karen, thanks so much. It's

18
00:00:57,440 --> 00:01:00,560
Speaker 1: an eventful morning. No, not like dragging eas CB, but

19
00:01:00,600 --> 00:01:04,360
Speaker 1: the fallout still from yesterday's comments by Cherry yelling and

20
00:01:04,440 --> 00:01:06,720
Speaker 1: moving on to Bank of England. What is it, Mike,

21
00:01:06,760 --> 00:01:09,880
Speaker 1: Bank of England in forty minutes or so Bank of

22
00:01:09,880 --> 00:01:12,759
Speaker 1: England in forty minutes because they're not yet on British summertime.

23
00:01:12,959 --> 00:01:16,840
Speaker 1: They have they have to be sobered over what has

24
00:01:16,880 --> 00:01:19,039
Speaker 1: happened to the list, which is hard to do on

25
00:01:19,120 --> 00:01:21,600
Speaker 1: St Patrick's Day, by the way, as get your explayed

26
00:01:22,240 --> 00:01:25,399
Speaker 1: hard to be sober. For those of you worldwide. What

27
00:01:25,560 --> 00:01:28,640
Speaker 1: St Patrick's Day needs means for me and Mike is

28
00:01:28,720 --> 00:01:31,840
Speaker 1: we get out a pole vault and we will peg

29
00:01:31,880 --> 00:01:35,319
Speaker 1: it on Fifth Avenue to go over the crowds so

30
00:01:35,360 --> 00:01:37,760
Speaker 1: we can pull vault over to the Plaza Hotel and

31
00:01:37,800 --> 00:01:39,559
Speaker 1: for those of you who know New York Second Avenue

32
00:01:39,560 --> 00:01:43,400
Speaker 1: where all the Irish bars are. Anyway, Uh, we're talking

33
00:01:43,560 --> 00:01:48,720
Speaker 1: with Steve Rieman for BMB part about investment, and we're

34
00:01:48,720 --> 00:01:50,800
Speaker 1: talking about the central banks, and we we don't have

35
00:01:50,840 --> 00:01:53,320
Speaker 1: a bank as big as the FED or the European

36
00:01:53,360 --> 00:01:55,559
Speaker 1: Central Bank today, but we're making up in quantity because

37
00:01:55,600 --> 00:01:57,840
Speaker 1: it's not just the Bank of England, but we get

38
00:01:58,120 --> 00:02:02,240
Speaker 1: Noraja's Bank of the Indonesia's have spoken the Swiss have spoken,

39
00:02:02,600 --> 00:02:07,680
Speaker 1: and basically you've got a worldwide credit easing under way,

40
00:02:07,720 --> 00:02:11,120
Speaker 1: even if the Swiss holds steady there way down to

41
00:02:11,200 --> 00:02:15,359
Speaker 1: negative rates anyway. Uh is this going to continue? I mean,

42
00:02:16,040 --> 00:02:19,400
Speaker 1: where are we trying to get to? Yeah? So I

43
00:02:19,400 --> 00:02:22,440
Speaker 1: think there's just a broad appreciation across the central bank

44
00:02:22,560 --> 00:02:26,440
Speaker 1: community that global growth momentum is slowing, uh, and that

45
00:02:26,600 --> 00:02:29,760
Speaker 1: in that environment, uh, they need to be very very

46
00:02:29,760 --> 00:02:33,320
Speaker 1: cautious and where they can, they will be providing additional stimulus.

47
00:02:33,440 --> 00:02:36,040
Speaker 1: And uh is this coordinated? I mean, we had a

48
00:02:36,080 --> 00:02:38,360
Speaker 1: G twenty meeting at which everybody promised to, you know,

49
00:02:38,560 --> 00:02:41,080
Speaker 1: be good boys and uh and do their best for

50
00:02:41,080 --> 00:02:44,120
Speaker 1: global growth. But normally they would tell you they don't

51
00:02:44,600 --> 00:02:47,400
Speaker 1: make deals. Yeah. I think at the very least at

52
00:02:47,440 --> 00:02:49,880
Speaker 1: those types of meetings and and but let's brying mind,

53
00:02:49,880 --> 00:02:52,360
Speaker 1: the central banks are always talking with one another. I

54
00:02:52,400 --> 00:02:55,040
Speaker 1: think what's come about it's probably some sort of informal

55
00:02:55,200 --> 00:02:58,200
Speaker 1: understanding about some of the risk factors that have been

56
00:02:58,240 --> 00:03:01,200
Speaker 1: driving markets and then have been weighing on the global economy.

57
00:03:01,440 --> 00:03:04,480
Speaker 1: I think there's been this sense that uh, global central

58
00:03:04,520 --> 00:03:06,839
Speaker 1: banks have been out of that munition and they're trying

59
00:03:06,880 --> 00:03:10,000
Speaker 1: to counter that impression. There's this sense that central banks

60
00:03:10,040 --> 00:03:13,960
Speaker 1: are engaging and begger than neighbor policies, either UH directly

61
00:03:14,040 --> 00:03:16,960
Speaker 1: or indirectly. UM. And Third, I think it's a big

62
00:03:16,960 --> 00:03:19,600
Speaker 1: part of this. There have been concerns about Chinese effects

63
00:03:19,600 --> 00:03:22,360
Speaker 1: policy in particular, so I think reflecting on these broad

64
00:03:22,720 --> 00:03:25,000
Speaker 1: UH concerns, I think we've seen central banks try to

65
00:03:25,080 --> 00:03:28,320
Speaker 1: push back on these concerns in the market by acting

66
00:03:28,400 --> 00:03:30,320
Speaker 1: in ways where perhaps your policies have less of an

67
00:03:30,320 --> 00:03:32,760
Speaker 1: effect on the exchange right channel, and they're easing through

68
00:03:33,000 --> 00:03:35,320
Speaker 1: through other channels. And I think they're also trying to

69
00:03:35,320 --> 00:03:37,400
Speaker 1: show that they are created, that they still have plenty

70
00:03:37,400 --> 00:03:39,440
Speaker 1: of ammunitions should have been necessary, do they. I mean

71
00:03:39,640 --> 00:03:42,200
Speaker 1: that came up a couple of times or fines. I'm

72
00:03:42,240 --> 00:03:44,720
Speaker 1: sure watching must have loved it. I think eight people

73
00:03:44,840 --> 00:03:48,080
Speaker 1: yesterday said the word toolbox. We're very big. What's the

74
00:03:48,720 --> 00:03:52,400
Speaker 1: economic Guys like you, let's define their jargon free. What's

75
00:03:52,480 --> 00:03:55,960
Speaker 1: the toolbox? So it's it's a number of things, and

76
00:03:56,240 --> 00:03:57,880
Speaker 1: I think there are a number of things in that toolbox.

77
00:03:57,880 --> 00:04:01,680
Speaker 1: So it's short term interest rates, it's a quantity easing,

78
00:04:01,760 --> 00:04:07,000
Speaker 1: it's credit easing, it's forward guidance, it's changing forward, right.

79
00:04:07,480 --> 00:04:10,920
Speaker 1: It's a form of rhetoric where you're trying to influence uh,

80
00:04:11,320 --> 00:04:14,080
Speaker 1: expectations for the path of rates over the longer term,

81
00:04:14,160 --> 00:04:17,120
Speaker 1: or expectations for for quantitative easing. Is there proof it

82
00:04:17,160 --> 00:04:20,480
Speaker 1: works well? Because I've heard a number of people, including

83
00:04:20,560 --> 00:04:23,440
Speaker 1: Mr Dudley at the Economic Club of New York, questioning

84
00:04:23,440 --> 00:04:28,400
Speaker 1: whether Ford guidance will be around. So I think there

85
00:04:28,440 --> 00:04:32,080
Speaker 1: are uses for it. I think at times when you

86
00:04:32,160 --> 00:04:37,040
Speaker 1: are potentially bumping up against a lower bounded interest rates, UH,

87
00:04:37,120 --> 00:04:39,400
Speaker 1: that's signaling that rates will stay low for for years

88
00:04:39,440 --> 00:04:42,440
Speaker 1: to come. Can candy can be quite effective because it

89
00:04:42,480 --> 00:04:45,720
Speaker 1: does tend to lower long term interest rates. Well, now

90
00:04:45,760 --> 00:04:49,240
Speaker 1: we are least according to the w I RP function

91
00:04:49,279 --> 00:04:51,560
Speaker 1: on the Bloomberg. Again, I don't know. I'm not a

92
00:04:51,560 --> 00:04:56,080
Speaker 1: big right to September. I'm not a big believer in

93
00:04:56,080 --> 00:04:58,839
Speaker 1: Fed funds futures because obviously the market has sort of disappeared.

94
00:04:58,839 --> 00:05:02,080
Speaker 1: But it's the only thing we have to give journalistic

95
00:05:02,080 --> 00:05:06,080
Speaker 1: cats like us a reference point. But does get pushed

96
00:05:06,120 --> 00:05:09,560
Speaker 1: out to September in that measure. So what do you

97
00:05:09,600 --> 00:05:11,400
Speaker 1: what's the investment now? What do you do? Do you

98
00:05:11,440 --> 00:05:14,960
Speaker 1: buy as you suggested? The FED wants you to um

99
00:05:15,000 --> 00:05:16,839
Speaker 1: in the in the farther out of the yel curve,

100
00:05:16,920 --> 00:05:20,080
Speaker 1: farther up the risk spectrum. And if so, what so,

101
00:05:20,279 --> 00:05:23,560
Speaker 1: I do think that there there is room for risk

102
00:05:23,600 --> 00:05:26,240
Speaker 1: assets to rally a bit more. We have an accommodative FED,

103
00:05:26,360 --> 00:05:28,280
Speaker 1: we have the e c B being very creative and

104
00:05:28,400 --> 00:05:32,640
Speaker 1: in its use of its tools. Oil prices have stabilized,

105
00:05:32,720 --> 00:05:37,840
Speaker 1: there's much less anxiety about a devaluation by China. UH.

106
00:05:37,880 --> 00:05:40,080
Speaker 1: This concern about central banks running out of ammunition, I

107
00:05:40,080 --> 00:05:41,960
Speaker 1: think it's less now than it was a month ago.

108
00:05:42,120 --> 00:05:45,479
Speaker 1: So I think these all speak positively about about the

109
00:05:45,480 --> 00:05:48,480
Speaker 1: outlet for risk assets in the very near term. UM.

110
00:05:49,000 --> 00:05:51,919
Speaker 1: But I think over time, maybe in a few weeks,

111
00:05:51,920 --> 00:05:53,680
Speaker 1: in a month or two, we're going to be back

112
00:05:53,680 --> 00:05:55,760
Speaker 1: where we are where where we are now in terms

113
00:05:55,760 --> 00:05:59,120
Speaker 1: of concerns about slow and global growth. UM. We're going

114
00:05:59,120 --> 00:06:01,040
Speaker 1: to see a rise and d faults in the high

115
00:06:01,080 --> 00:06:03,520
Speaker 1: yield space in the U S, particularly UM on oil

116
00:06:03,560 --> 00:06:06,720
Speaker 1: and gas related firms. UM. I'm not confident that the

117
00:06:06,760 --> 00:06:08,760
Speaker 1: stability that we've seen in oil prices it's going to

118
00:06:09,240 --> 00:06:12,320
Speaker 1: UH to endure. But the but the the economic growth

119
00:06:12,400 --> 00:06:16,720
Speaker 1: numbers are clear and present right now. Every day, including Caterpillar,

120
00:06:17,080 --> 00:06:20,719
Speaker 1: comes out and says it ain't happening. Is it essentially

121
00:06:20,800 --> 00:06:25,480
Speaker 1: well meaning policymakers adapted to a growth recession. I think

122
00:06:25,480 --> 00:06:27,480
Speaker 1: that's part of it. I think. And when we saw

123
00:06:27,520 --> 00:06:30,400
Speaker 1: that in the forecast yesterday in December the meeting and

124
00:06:30,800 --> 00:06:32,440
Speaker 1: FMC member, I thought growth this year would be at

125
00:06:32,480 --> 00:06:34,600
Speaker 1: two point four percent. That's already come down to two

126
00:06:34,600 --> 00:06:36,640
Speaker 1: point two percent. I think that's going to come down further.

127
00:06:36,920 --> 00:06:39,080
Speaker 1: I think we're slowing to a trend like pace that's

128
00:06:39,120 --> 00:06:48,240
Speaker 1: probably one and a half one politically, get it done well,

129
00:06:48,279 --> 00:06:50,159
Speaker 1: And I think that raises a whole another state of

130
00:06:50,240 --> 00:06:53,800
Speaker 1: questions about about the frustration in the public. Fifteen seconds.

131
00:06:53,839 --> 00:06:56,080
Speaker 1: What will you listen for from Mark Kearney in the

132
00:06:56,120 --> 00:06:59,400
Speaker 1: bandit's over at the Bank of England this morning. I

133
00:06:59,400 --> 00:07:04,000
Speaker 1: will listen for any indications about about whether a negative

134
00:07:04,000 --> 00:07:06,880
Speaker 1: interest rates can be helpful, about whether they plan on

135
00:07:06,960 --> 00:07:10,440
Speaker 1: holding off, on on on raising rates even more, and

136
00:07:10,680 --> 00:07:13,800
Speaker 1: their thoughts on on the impact of exchange rates exactly.

137
00:07:13,880 --> 00:07:15,360
Speaker 1: I want to know what they think. Okay, well, Mike,

138
00:07:15,400 --> 00:07:19,320
Speaker 1: what do you have? Bloomberg News interviewing the President of

139
00:07:19,800 --> 00:07:23,320
Speaker 1: Norway Central Bank uh Mr Rolson saying that zero is

140
00:07:23,360 --> 00:07:26,960
Speaker 1: not a lower bound for Norway, dangling that out there

141
00:07:26,960 --> 00:07:29,400
Speaker 1: there at fifty basis points, now they could go negative.

142
00:07:29,920 --> 00:07:32,640
Speaker 1: Here's the existential question for this morning. Do you think

143
00:07:32,640 --> 00:07:35,600
Speaker 1: the Prime Minister of Canada does looney? Does he think

144
00:07:35,600 --> 00:07:37,840
Speaker 1: in Looney or does he think of the tourist dollar,

145
00:07:37,960 --> 00:07:40,480
Speaker 1: the reciprocal Yeah, well he's in New York, so he's

146
00:07:40,480 --> 00:07:43,720
Speaker 1: thinking dollars. We're gonna find out in the nine o'clock hour.

147
00:07:45,960 --> 00:07:48,640
Speaker 1: Bloomberg surveillance brought you by Flushing Bank. Opening a complete

148
00:07:48,640 --> 00:07:50,840
Speaker 1: business checking account with fifteen thousand dollars or more and

149
00:07:50,880 --> 00:07:53,600
Speaker 1: get a free sixteen gig WiFi tablet. Visit Flushing bank

150
00:07:53,600 --> 00:07:55,840
Speaker 1: dot com for details. Remember f d I se BeO,

151
00:07:55,880 --> 00:07:56,720
Speaker 1: Cale Houses, Linden