1
00:00:04,000 --> 00:00:08,320
Speaker 1: Broadcasting live to New York, Bloomberg eleven, Brio to Washington,

2
00:00:08,400 --> 00:00:12,520
Speaker 1: d C, Bloomber to Boston, Bloomberg twelve under It to

3
00:00:12,640 --> 00:00:17,079
Speaker 1: San Francisco, Bloomberg to the country. Julie is at Channel

4
00:00:17,160 --> 00:00:20,800
Speaker 1: one and around the globe the Bloomberg Radio plus DApp

5
00:00:20,840 --> 00:00:24,680
Speaker 1: and Bloomberg got gone. This is taking Stock coming up

6
00:00:24,680 --> 00:00:29,360
Speaker 1: on Taking Stock to Fannie May Home Purchase Sentiment Index.

7
00:00:29,480 --> 00:00:32,360
Speaker 1: It fell one and a half per points to five

8
00:00:32,479 --> 00:00:36,479
Speaker 1: in August, but continued its gradual climb upward for the

9
00:00:36,520 --> 00:00:40,000
Speaker 1: same period last year. We've got more details coming up.

10
00:00:40,440 --> 00:00:43,000
Speaker 1: And when you hear the name McAfee, do you think

11
00:00:43,159 --> 00:00:47,040
Speaker 1: cyber security, Well, John McAfee, he is the pioneer who

12
00:00:47,479 --> 00:00:50,800
Speaker 1: got so much of this cyber security online rolling. We're

13
00:00:50,800 --> 00:00:54,080
Speaker 1: gonna speaking to him in this half hour as well. Now,

14
00:00:54,160 --> 00:00:56,920
Speaker 1: let's get right back to Charlie Pellett in the Bloomberg

15
00:00:56,920 --> 00:00:59,360
Speaker 1: newsroom with a Bloomberg Business lave and I thank you

16
00:00:59,440 --> 00:01:01,480
Speaker 1: very much, cat Lean, Hey, thank you, pim Fox, the

17
00:01:01,600 --> 00:01:05,800
Speaker 1: tal the smp Nastact. They are all lower. Stocks dropping

18
00:01:05,840 --> 00:01:09,679
Speaker 1: from near record levels, the dollar gaining as traders digest

19
00:01:09,800 --> 00:01:12,440
Speaker 1: mixed data in the U S economy, amid bets interest

20
00:01:12,520 --> 00:01:15,320
Speaker 1: rates will stay low. This update is brought to you

21
00:01:15,360 --> 00:01:17,520
Speaker 1: by Sector Spider e t F S. Why by a

22
00:01:17,560 --> 00:01:21,040
Speaker 1: single stock when you can invest in the entire sector.

23
00:01:21,480 --> 00:01:25,480
Speaker 1: Visits Sector sp d r S dot com or call

24
00:01:26,160 --> 00:01:30,119
Speaker 1: six Sector e t F. The U S economy grew

25
00:01:30,120 --> 00:01:32,640
Speaker 1: at a modest pace in July and August as a

26
00:01:32,720 --> 00:01:35,720
Speaker 1: strong labor market fail to put much upward pressure on

27
00:01:35,800 --> 00:01:39,399
Speaker 1: wages and prices. That is, according to the Federal Reserves

28
00:01:39,480 --> 00:01:43,120
Speaker 1: Beige Book report. It said, quote in general, expectations of

29
00:01:43,160 --> 00:01:46,040
Speaker 1: wage growth for the coming months where modest and price

30
00:01:46,120 --> 00:01:49,600
Speaker 1: increases quote remains slight overall. So where does all of

31
00:01:49,640 --> 00:01:52,480
Speaker 1: this leave the Federal Reserve at this month's FED meeting.

32
00:01:52,480 --> 00:01:55,920
Speaker 1: Bruce Kasman as chief economist to JP Morgan Securities. He

33
00:01:56,080 --> 00:01:59,080
Speaker 1: was interviewed moments ago right here on taking stock. I

34
00:01:59,120 --> 00:02:01,280
Speaker 1: think there's a case for a rate high in September.

35
00:02:01,320 --> 00:02:03,240
Speaker 1: I don't think the FIT is going to decide to

36
00:02:03,360 --> 00:02:06,360
Speaker 1: raise rates in September. I think they're more likely to

37
00:02:06,480 --> 00:02:09,240
Speaker 1: use the meeting to basically set us up that if

38
00:02:09,320 --> 00:02:12,800
Speaker 1: kid things continue, that as they expect that they're going

39
00:02:12,840 --> 00:02:14,800
Speaker 1: to move at the end of the year. The US

40
00:02:14,840 --> 00:02:18,320
Speaker 1: Airlines climbing the most in almost two months after Southwest

41
00:02:18,360 --> 00:02:22,040
Speaker 1: said it would slow capacity growth next year. Southwest shares

42
00:02:22,080 --> 00:02:25,040
Speaker 1: a four and a half percent. American Airlines up five

43
00:02:25,080 --> 00:02:28,519
Speaker 1: point four p u a l parent of United Than Continental,

44
00:02:28,560 --> 00:02:32,360
Speaker 1: up by five point two percent. Billionaire activists Bill Ackman

45
00:02:32,639 --> 00:02:36,120
Speaker 1: taking aim at Chippotle Mexican grill. Chipotle up five point

46
00:02:36,160 --> 00:02:39,280
Speaker 1: seven percent, Apple out with a new iPhone seventh down

47
00:02:39,360 --> 00:02:42,040
Speaker 1: one tenth of one percent. And now let's look at

48
00:02:42,080 --> 00:02:45,760
Speaker 1: some of the other stories making news. Thank you, Charlie

49
00:02:45,800 --> 00:02:49,160
Speaker 1: from the Bloomberg Newsroom. I'm Matt Millard. Donald Trump says

50
00:02:49,200 --> 00:02:52,799
Speaker 1: his foreign policy would aim to achieve peace through strength

51
00:02:53,200 --> 00:02:57,000
Speaker 1: and focus on diplomacy, not destruction. In the speech in

52
00:02:57,040 --> 00:03:01,160
Speaker 1: Philadelphia today, the Republican presidential nominee also said if he wins,

53
00:03:01,360 --> 00:03:03,720
Speaker 1: he'll instructs his generals to come up with a plan

54
00:03:03,840 --> 00:03:08,040
Speaker 1: within thirty days to defeat and destroy the Islamic State.

55
00:03:08,919 --> 00:03:12,399
Speaker 1: President Obama is paying tribute to survivors in Laos who

56
00:03:12,400 --> 00:03:16,359
Speaker 1: were hurt by leftover bombs from the Vietnam War. Bloomberg's

57
00:03:16,360 --> 00:03:20,000
Speaker 1: Michael Barr has the story. President Obama tour the rehabilitation

58
00:03:20,120 --> 00:03:23,200
Speaker 1: center in the Lyotian Capital. The President says the US

59
00:03:23,240 --> 00:03:27,240
Speaker 1: has a profound moral and humanitarian obligation to work to

60
00:03:27,280 --> 00:03:30,880
Speaker 1: prevent more bloodshed from the remnants of the US bombardment.

61
00:03:31,080 --> 00:03:33,480
Speaker 1: These bombas have taken the lives of farmers working in

62
00:03:33,520 --> 00:03:37,839
Speaker 1: the fields, traders gathering scrap metal, children playing outside. Who

63
00:03:37,840 --> 00:03:41,440
Speaker 1: thought these small metal balls could be turned into a toy?

64
00:03:41,560 --> 00:03:45,120
Speaker 1: On Tuesday, President Obama pledged loos ninety million dollars over

65
00:03:45,200 --> 00:03:48,760
Speaker 1: three years for clean up efforts. Michael Barr Bloomberg Radio,

66
00:03:49,000 --> 00:03:53,440
Speaker 1: Florida Republican Congressman David Jolly brought some unusual guests with

67
00:03:53,520 --> 00:03:56,600
Speaker 1: him to the House floor. Jolly showed his fellow lawmakers

68
00:03:56,600 --> 00:04:00,120
Speaker 1: a jar of one live mosquitoes, trying to highlight the

69
00:04:00,240 --> 00:04:05,680
Speaker 1: fear of zekea that Flutidians are living with. Can you imagine, colleagues,

70
00:04:05,960 --> 00:04:08,560
Speaker 1: the fear and anxiety in this chamber. If these hundred

71
00:04:08,600 --> 00:04:11,920
Speaker 1: mosquitoes were outside this jar, not inside this jar, members

72
00:04:11,960 --> 00:04:13,920
Speaker 1: of Congress would run down the hall to the physician's

73
00:04:13,960 --> 00:04:17,520
Speaker 1: office to be tested. They would spray themselves before coming

74
00:04:17,520 --> 00:04:21,280
Speaker 1: down here. This is the fear of Floridians right here.

75
00:04:21,560 --> 00:04:23,560
Speaker 1: Global News twenty four hours a day, powered by over

76
00:04:24,480 --> 00:04:28,040
Speaker 1: journalists and analysts and more than one countries. I'm Matt Miller.

77
00:04:28,240 --> 00:04:33,320
Speaker 1: This is Bloomberg, and we thank you US Equities. Laurel

78
00:04:33,440 --> 00:04:36,040
Speaker 1: little changed right now with the SMP down two points

79
00:04:36,120 --> 00:04:39,400
Speaker 1: to three, a decline of one tenth of one percent.

80
00:04:39,839 --> 00:04:44,640
Speaker 1: I'm Charlie Pellett and that's a Bloomberg business flash. This

81
00:04:45,040 --> 00:04:48,799
Speaker 1: is taking stock. The FED in focus on Bloomberg Radio

82
00:04:49,480 --> 00:04:53,200
Speaker 1: if had a reserve, just released its Beige Book, anecdotal

83
00:04:53,360 --> 00:04:57,039
Speaker 1: summary of the US economy gathered from its twelve district

84
00:04:57,120 --> 00:04:59,080
Speaker 1: banks to that is focused on jobs to feed, his

85
00:04:59,160 --> 00:05:02,080
Speaker 1: focus on inflation, and the FETE is focused on the consumer,

86
00:05:02,160 --> 00:05:05,800
Speaker 1: and certainly a look at housing is very important. One

87
00:05:05,839 --> 00:05:07,680
Speaker 1: of the reasons people argue that VET should be very

88
00:05:07,680 --> 00:05:10,400
Speaker 1: weary of raising rates too quickly is that low mortgage

89
00:05:10,480 --> 00:05:14,680
Speaker 1: rates have helped lower home affordability and it helped keep

90
00:05:14,720 --> 00:05:19,320
Speaker 1: the housing sector steady and growing. Duck Duncan joins US now.

91
00:05:19,400 --> 00:05:22,440
Speaker 1: He's senior vice president and chief economists at Fannie May

92
00:05:22,560 --> 00:05:25,880
Speaker 1: in Washington, d C. He's gonna share share with US

93
00:05:25,880 --> 00:05:31,520
Speaker 1: Fannie new newly released consumer survey of attitudes on housing. Doug,

94
00:05:31,520 --> 00:05:33,800
Speaker 1: welcome to the show. Thank you to be here. Well,

95
00:05:33,839 --> 00:05:36,760
Speaker 1: first of all, let's say the Beige Book, uh really,

96
00:05:36,920 --> 00:05:39,039
Speaker 1: as as Bruce Kasman from jp borg and just said,

97
00:05:39,040 --> 00:05:42,080
Speaker 1: they don't call it beige for nothing. Really, when you

98
00:05:42,160 --> 00:05:45,000
Speaker 1: run through it seems there's nothing so striking about it,

99
00:05:45,080 --> 00:05:49,160
Speaker 1: just a view that the economy's moving along kind of steady,

100
00:05:49,560 --> 00:05:52,039
Speaker 1: not a lot of momentum, but maybe not a lot

101
00:05:52,080 --> 00:05:54,760
Speaker 1: of pullback either. What do you see, Doug, Definitely not

102
00:05:54,920 --> 00:05:58,800
Speaker 1: very exciting. Our our forecast for the years unchanged from

103
00:05:58,800 --> 00:06:01,040
Speaker 1: the beginning of the earth a little less than UH

104
00:06:01,400 --> 00:06:04,720
Speaker 1: two growth, which is not very exciting. We we don't

105
00:06:05,320 --> 00:06:08,599
Speaker 1: from from the Fed perspective. Um, you know, they're trying

106
00:06:08,640 --> 00:06:12,000
Speaker 1: to prepare the market for some move We would agree

107
00:06:12,040 --> 00:06:14,120
Speaker 1: not until the end of the year, at least. In fact,

108
00:06:14,240 --> 00:06:16,440
Speaker 1: in our own forecast we don't have them moving until

109
00:06:16,520 --> 00:06:20,840
Speaker 1: next year. We think the the third quarter numbers will

110
00:06:20,880 --> 00:06:25,160
Speaker 1: be stronger, but some move back in in December. They

111
00:06:26,360 --> 00:06:29,520
Speaker 1: talk about being data dependent, but they don't describe exactly

112
00:06:29,560 --> 00:06:32,960
Speaker 1: which data, so it's a little hard to tell. Um.

113
00:06:32,960 --> 00:06:37,400
Speaker 1: Clearly employment data is part of it, and the market

114
00:06:37,480 --> 00:06:41,800
Speaker 1: took the most recent employment report as putting them off

115
00:06:41,839 --> 00:06:44,359
Speaker 1: of September. We would agree with that even though in

116
00:06:44,360 --> 00:06:48,160
Speaker 1: the long run our view is to sustain the unemployment

117
00:06:48,240 --> 00:06:51,360
Speaker 1: rate at a level. A constant level only takes between

118
00:06:51,400 --> 00:06:54,080
Speaker 1: eighty and two jobs a month, So if they want

119
00:06:54,120 --> 00:06:56,640
Speaker 1: to use that for a justification, they can, but the

120
00:06:56,640 --> 00:06:59,760
Speaker 1: market is not prepared for it. In September, Dun, duncan,

121
00:07:00,240 --> 00:07:04,160
Speaker 1: can you explain how you formulate the Fannie May Home

122
00:07:04,240 --> 00:07:09,160
Speaker 1: Purchase Sentiment Index and what is it telling us currently? Sure,

123
00:07:09,320 --> 00:07:12,360
Speaker 1: it's a We survey a thousand households of months. We've

124
00:07:12,360 --> 00:07:14,760
Speaker 1: been doing that for a number of years now. Out

125
00:07:14,800 --> 00:07:16,840
Speaker 1: of that, we took a look at all the questions

126
00:07:16,880 --> 00:07:20,920
Speaker 1: that we ask and ask which were most influential on

127
00:07:21,200 --> 00:07:25,080
Speaker 1: the on affecting the attitude of people about buying a house,

128
00:07:25,200 --> 00:07:27,360
Speaker 1: because it's buying a house that we think is the

129
00:07:27,400 --> 00:07:32,160
Speaker 1: housing sector's largest contribution to economic growth and um. Those

130
00:07:32,560 --> 00:07:35,760
Speaker 1: questions include things like, is it a good time to

131
00:07:35,800 --> 00:07:37,720
Speaker 1: buy a house, is it a good time to sell

132
00:07:37,800 --> 00:07:39,720
Speaker 1: house in the next twelve months? What do you think

133
00:07:39,760 --> 00:07:41,920
Speaker 1: house prices will do in the next twelve months, What

134
00:07:41,960 --> 00:07:45,160
Speaker 1: do you think mortgage rates want to do? About six

135
00:07:45,280 --> 00:07:48,440
Speaker 1: questions they're intended to look forward in time over the

136
00:07:48,480 --> 00:07:50,920
Speaker 1: next twelve months. What does your attitude tell you about

137
00:07:50,920 --> 00:07:54,720
Speaker 1: the housing market. So the most recent release was down

138
00:07:54,880 --> 00:07:58,600
Speaker 1: slightly from the all time high. Now we've been doing

139
00:07:58,600 --> 00:08:01,080
Speaker 1: this since about two thus in ten, so it hasn't

140
00:08:01,120 --> 00:08:03,880
Speaker 1: gone through a full housing cycle. So we caution people

141
00:08:04,160 --> 00:08:07,480
Speaker 1: don't overinterpret what you're seeing, and it varies a little

142
00:08:07,480 --> 00:08:09,720
Speaker 1: bit from month to month, but over the course of

143
00:08:09,760 --> 00:08:12,760
Speaker 1: the past year, it's been largely aligned with our forecast,

144
00:08:12,800 --> 00:08:15,840
Speaker 1: which is for about a four percent growth in total

145
00:08:15,880 --> 00:08:20,480
Speaker 1: home sales this year. People are increasingly confident about the

146
00:08:20,520 --> 00:08:24,680
Speaker 1: stability of their employment, and they've seen reasonable progress on

147
00:08:24,720 --> 00:08:28,280
Speaker 1: their financial outlook. Well, look, it's interesting to me that

148
00:08:28,520 --> 00:08:30,320
Speaker 1: the nuts share of Americans who say it's a good

149
00:08:30,320 --> 00:08:33,800
Speaker 1: time to buy a house increased for the third consecutive month.

150
00:08:33,840 --> 00:08:36,240
Speaker 1: It rose by a percentage point in latest survey to

151
00:08:36,400 --> 00:08:38,360
Speaker 1: thirty four percent. But those who say it's a good

152
00:08:38,360 --> 00:08:40,679
Speaker 1: time to sell fell five percentage points from an all

153
00:08:40,679 --> 00:08:44,120
Speaker 1: time high in July uh and it felt a fifteen percent.

154
00:08:44,880 --> 00:08:48,880
Speaker 1: People don't expect prices to go up as much. Are

155
00:08:49,440 --> 00:08:51,719
Speaker 1: Is this just reflecting the fact that prices already when

156
00:08:51,800 --> 00:08:55,240
Speaker 1: up so much that the sellers are facing reality. I'm

157
00:08:55,240 --> 00:08:57,640
Speaker 1: a little bit surprised that buyers are still so optimistic

158
00:08:57,640 --> 00:08:59,679
Speaker 1: when in many places they are facing prices that are

159
00:08:59,679 --> 00:09:02,520
Speaker 1: so much higher. Yeah, it is, Uh, it seems a

160
00:09:02,559 --> 00:09:05,480
Speaker 1: little bit contradictory, although I would say part of it

161
00:09:05,559 --> 00:09:08,880
Speaker 1: is seasonal. That is, for those who wish to sell

162
00:09:08,920 --> 00:09:11,760
Speaker 1: a house, were past the seasonal peak in home sales,

163
00:09:12,160 --> 00:09:14,520
Speaker 1: so that's probably being picked up a little bit by

164
00:09:14,559 --> 00:09:17,000
Speaker 1: the good time to sell. In terms of a good

165
00:09:17,040 --> 00:09:21,240
Speaker 1: time to buy, well, it's a fairly small increase, and

166
00:09:21,280 --> 00:09:25,320
Speaker 1: I think that probably goes along with their attitude about

167
00:09:25,360 --> 00:09:29,160
Speaker 1: the stability of their employment and their prospects for their

168
00:09:29,320 --> 00:09:35,400
Speaker 1: household financial uh progress The no question, the biggest hurdle

169
00:09:35,480 --> 00:09:39,160
Speaker 1: today is the lack of adequate supply, particularly at the

170
00:09:39,200 --> 00:09:42,760
Speaker 1: low price points. In some markets on the West Coast,

171
00:09:42,760 --> 00:09:45,600
Speaker 1: for example, one month supply at the current pace of sales.

172
00:09:45,679 --> 00:09:49,680
Speaker 1: That's leading to significant price increases uh in many of

173
00:09:49,720 --> 00:09:52,080
Speaker 1: those markets, particularly as I say, at the low end,

174
00:09:52,120 --> 00:09:54,679
Speaker 1: which is where the first time homebuyers typically are. Well.

175
00:09:54,679 --> 00:09:56,720
Speaker 1: I'm glad to mention the West Coast because I wonder

176
00:09:56,760 --> 00:09:58,480
Speaker 1: if you could tell us is there anything that we

177
00:09:58,520 --> 00:10:03,199
Speaker 1: should know about geograph quickly because housing is a local business. Yeah,

178
00:10:03,320 --> 00:10:09,160
Speaker 1: there's the question is our builders able to build in

179
00:10:09,320 --> 00:10:12,400
Speaker 1: the local jurisdiction at a price point that would meet

180
00:10:12,600 --> 00:10:16,800
Speaker 1: the the financial ability of households who would like to buy.

181
00:10:16,840 --> 00:10:19,880
Speaker 1: And clearly in a number of West Coast markets which

182
00:10:19,880 --> 00:10:22,800
Speaker 1: have been very strong and employment and are restrictive in

183
00:10:22,920 --> 00:10:28,320
Speaker 1: terms of development, housing has become unaffordable in a number

184
00:10:28,360 --> 00:10:31,920
Speaker 1: of those of those markets. That that's really the big

185
00:10:32,000 --> 00:10:35,600
Speaker 1: question as where the supply side grow uh and slow

186
00:10:35,640 --> 00:10:38,360
Speaker 1: the pace of price increases. Thank you very much for

187
00:10:38,400 --> 00:10:42,120
Speaker 1: spending time with us. So. Doug Duncan is Senior vice president,

188
00:10:42,320 --> 00:10:46,599
Speaker 1: chief economist for Fannie May, based in Washington, d C.

189
00:10:46,800 --> 00:10:50,840
Speaker 1: Home to Bloomberg one and one oh five point seven

190
00:10:51,000 --> 00:10:54,120
Speaker 1: h D two. This is taking Stock. I'm pim Fox.

191
00:10:54,200 --> 00:11:01,360
Speaker 1: My co host Kathleen Hayes. This is Bloomberg be in Focus.

192
00:11:01,360 --> 00:11:03,960
Speaker 1: Brought to you by Willoughby since eighteen ninety eight, New

193
00:11:04,000 --> 00:11:06,839
Speaker 1: York City's boutique camera store for precision crafted, hostile, blood

194
00:11:06,840 --> 00:11:08,680
Speaker 1: and Like a cameras, plus a full selection of go

195
00:11:08,840 --> 00:11:12,080
Speaker 1: pro action adventure cameras. Willoughby's at the corner of Fifth

196
00:11:12,120 --> 00:11:13,440
Speaker 1: Avenue and thirty first Street,