1 00:00:00,080 --> 00:00:06,800 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. 2 00:00:12,000 --> 00:00:15,600 Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Tom Keene along 3 00:00:15,640 --> 00:00:19,000 Speaker 2: with Paul Sweeney. Join us each day for insight from 4 00:00:19,000 --> 00:00:23,159 Speaker 2: the best in economics, finance, investment, and international relations. You 5 00:00:23,200 --> 00:00:26,520 Speaker 2: can also watch the show live on YouTube. Visit the 6 00:00:26,520 --> 00:00:31,320 Speaker 2: Bloomberg Podcast channel on YouTube to see the show weekday 7 00:00:31,320 --> 00:00:34,360 Speaker 2: mornings from seven to ten am Eastern from our global 8 00:00:34,360 --> 00:00:39,040 Speaker 2: headquarters in New York City. Subscribe to the podcast on Apple, Spotify, 9 00:00:39,400 --> 00:00:42,920 Speaker 2: or anywhere else you listen, and always I'm Bloomberg Radio, 10 00:00:43,120 --> 00:00:47,400 Speaker 2: the Bloomberg Terminal, and the Bloomberg Business App. I can't 11 00:00:47,479 --> 00:00:50,680 Speaker 2: say enough, folks. I was drilled into you with chalk 12 00:00:50,760 --> 00:00:54,520 Speaker 2: being thrown in a classroom over what's called the standard 13 00:00:54,920 --> 00:00:58,760 Speaker 2: error of this statistical derby, Claudia. So I'm with us 14 00:00:58,800 --> 00:01:01,760 Speaker 2: now we'll learn that in the pile of University of 15 00:01:01,800 --> 00:01:06,240 Speaker 2: Michigan economics. Claudia. You nailed it by saying, you know, 16 00:01:06,280 --> 00:01:10,679 Speaker 2: there's some optimism here to see, but just across the board, 17 00:01:11,440 --> 00:01:14,520 Speaker 2: it's mourning in America. Why does so many people not 18 00:01:14,680 --> 00:01:17,480 Speaker 2: feel that way? Right? 19 00:01:17,480 --> 00:01:21,000 Speaker 3: Well, first, you know, it's a take a deep breath, right, 20 00:01:21,080 --> 00:01:23,520 Speaker 3: It's good to have. We've had some really not encouraging 21 00:01:23,600 --> 00:01:25,039 Speaker 3: jobs reports in a row, and this this is a 22 00:01:25,040 --> 00:01:26,920 Speaker 3: good one. I mean, on the surface, you always got 23 00:01:26,959 --> 00:01:31,600 Speaker 3: to dig down deeper. The We're not all going to 24 00:01:31,760 --> 00:01:35,479 Speaker 3: feel the same way about this economy or this labor market. 25 00:01:35,560 --> 00:01:37,959 Speaker 3: You know, we have hundreds of millions of workers who 26 00:01:37,959 --> 00:01:41,039 Speaker 3: have very different circumstances. There still are people out there 27 00:01:41,120 --> 00:01:43,120 Speaker 3: looking for jobs that aren't finding them. They're not going 28 00:01:43,200 --> 00:01:47,080 Speaker 3: to be upbeaten positive about this. And for many things, 29 00:01:47,120 --> 00:01:50,520 Speaker 3: whether it's inflation or unemployment, like this has been a 30 00:01:50,600 --> 00:01:55,040 Speaker 3: really rough ride. So being told from a statistic that's 31 00:01:55,160 --> 00:01:57,400 Speaker 3: very abstract, just some number that pops up on the 32 00:01:57,400 --> 00:02:00,600 Speaker 3: screen that you should be happy is not. You know, 33 00:02:00,880 --> 00:02:03,400 Speaker 3: like these are feelings, not not the numbers. But this 34 00:02:03,440 --> 00:02:05,640 Speaker 3: is encouraging in this you know, we need more of these, 35 00:02:05,960 --> 00:02:08,240 Speaker 3: right because we've had some disappointing ones. But this is 36 00:02:08,280 --> 00:02:09,320 Speaker 3: this is in the right direction. 37 00:02:09,600 --> 00:02:12,320 Speaker 2: Ten You're real yield up eight basis points. We've gone 38 00:02:12,320 --> 00:02:15,240 Speaker 2: from a one fifty six to a one point seven 39 00:02:15,240 --> 00:02:18,160 Speaker 2: to two and two or three days as well, the 40 00:02:18,240 --> 00:02:22,920 Speaker 2: Sweeney yield explodes out up sixteen basis points. All you 41 00:02:23,000 --> 00:02:26,480 Speaker 2: need to know is the word ginormous three point eight 42 00:02:26,720 --> 00:02:29,560 Speaker 2: seven percent, Paul Sweeney, the ten year yield, we're gonna 43 00:02:29,560 --> 00:02:32,640 Speaker 2: get to a four three point ninety five percent. 44 00:02:32,720 --> 00:02:35,240 Speaker 4: Yeah, big moves in the yield space at tom So Claudia. 45 00:02:35,360 --> 00:02:37,119 Speaker 4: Is just the headline numbers for the people that care. 46 00:02:37,240 --> 00:02:40,200 Speaker 4: Unemployment rate four point one percent, that's down from four 47 00:02:40,200 --> 00:02:44,200 Speaker 4: point two percent. Average hourly earnings up four percent on 48 00:02:44,240 --> 00:02:46,519 Speaker 4: a year on year basis versus three point eight percent, 49 00:02:46,760 --> 00:02:49,239 Speaker 4: actually revised up to three point nine percent. So I 50 00:02:49,280 --> 00:02:51,480 Speaker 4: mean the headline numbers for a lot of folks out 51 00:02:51,480 --> 00:02:53,119 Speaker 4: there are pretty solid here. 52 00:02:54,639 --> 00:02:57,440 Speaker 3: Yeah, no, these are these are good numbers. This is 53 00:02:57,440 --> 00:02:58,480 Speaker 3: a good report, you know. 54 00:02:58,639 --> 00:02:59,120 Speaker 5: So, uh. 55 00:03:00,560 --> 00:03:02,000 Speaker 3: Yeah, I'm not again is. 56 00:03:02,840 --> 00:03:04,920 Speaker 4: Gonna Is the Fed gonna read it that way? 57 00:03:06,880 --> 00:03:09,040 Speaker 3: Well, I think the Fed also smiled when they looked 58 00:03:09,040 --> 00:03:13,400 Speaker 3: at this one, you know, because the inflation is coming down, 59 00:03:14,120 --> 00:03:16,280 Speaker 3: that is part of getting back to two percent. We're 60 00:03:16,280 --> 00:03:20,400 Speaker 3: well on our way. Unemployment is low, the maximum employment 61 00:03:20,440 --> 00:03:22,880 Speaker 3: that's the other side, and then they should be out 62 00:03:22,880 --> 00:03:24,720 Speaker 3: of the way. The Fed has interest rates, they are 63 00:03:24,720 --> 00:03:27,120 Speaker 3: still high. You can look at interest rates sensitive sectors 64 00:03:27,120 --> 00:03:28,800 Speaker 3: and the Fed still is having an effect. 65 00:03:29,400 --> 00:03:29,800 Speaker 6: It is not. 66 00:03:29,919 --> 00:03:32,000 Speaker 3: Their job is just to kind of keep things together. 67 00:03:32,040 --> 00:03:34,320 Speaker 3: They're not supposed to be trying to push the economy 68 00:03:34,320 --> 00:03:37,280 Speaker 3: one way or the other in just normal times. So 69 00:03:37,320 --> 00:03:39,680 Speaker 3: the closer they get to checking both boxes on the 70 00:03:39,760 --> 00:03:44,240 Speaker 3: dual mand aid, great, doctor Hilley, thank you so much. 71 00:03:44,280 --> 00:03:47,600 Speaker 2: We're gonna leave it. They're really really appreciated. Claudia sam 72 00:03:47,640 --> 00:03:50,360 Speaker 2: with us this morning with all our good work for 73 00:03:50,440 --> 00:03:54,720 Speaker 2: economics that we've seen this year. Really interesting jobs report 74 00:03:54,960 --> 00:03:57,200 Speaker 2: and a good time to speak with Ellen Zettner, chief 75 00:03:57,240 --> 00:04:01,920 Speaker 2: economic strategist Global had a thematic macro investing Morgan Stanley 76 00:04:02,360 --> 00:04:07,800 Speaker 2: their Global investment audience. Ellen, thank you so much for 77 00:04:07,840 --> 00:04:11,520 Speaker 2: being with us. This is a solid economy. Bring this 78 00:04:11,720 --> 00:04:17,680 Speaker 2: right over to real GDP. Are we three ish forward two? 79 00:04:17,880 --> 00:04:20,919 Speaker 7: It's still too in change? Yeah, it's still to in change. 80 00:04:20,960 --> 00:04:23,839 Speaker 7: I mean if you if you look at this report, 81 00:04:24,720 --> 00:04:27,640 Speaker 7: you know it's on the back of these phenomenal upward 82 00:04:27,640 --> 00:04:33,120 Speaker 7: divisions last week to gross domestic income club, stronger consumer 83 00:04:33,240 --> 00:04:37,000 Speaker 7: spending and income growth, and a higher savings rate. So 84 00:04:37,040 --> 00:04:39,200 Speaker 7: we didn't even have to draw down the savings buffer 85 00:04:39,520 --> 00:04:43,520 Speaker 7: in order to get that stronger spending. And where are 86 00:04:43,560 --> 00:04:45,960 Speaker 7: we spending We're spending on services? Where was the rebound 87 00:04:45,960 --> 00:04:49,120 Speaker 7: in this report in services, I think the decline in 88 00:04:49,200 --> 00:04:52,719 Speaker 7: manufacturing jobs is something to keep an eye on, but 89 00:04:52,800 --> 00:04:55,520 Speaker 7: this was a big rebound in services in the service 90 00:04:55,560 --> 00:04:57,200 Speaker 7: aside of the economy is still strong. 91 00:04:57,839 --> 00:04:59,680 Speaker 4: Ellen, how do you think our freeder reserver is can 92 00:04:59,720 --> 00:05:03,360 Speaker 4: to you this data point here today well favorably? 93 00:05:03,560 --> 00:05:03,760 Speaker 2: Yep. 94 00:05:04,520 --> 00:05:07,760 Speaker 7: You know it's look, there's ample room to cut, to 95 00:05:07,839 --> 00:05:12,160 Speaker 7: use chair Pal's own word, and so given that the 96 00:05:12,200 --> 00:05:15,320 Speaker 7: bar is not particularly high to go fifty basis points 97 00:05:15,360 --> 00:05:17,880 Speaker 7: if the data warrant, this is not data that warranted. 98 00:05:18,960 --> 00:05:21,520 Speaker 7: You know, do people care about this report? I've been 99 00:05:21,680 --> 00:05:24,400 Speaker 7: I've heard that a lot from people because the next 100 00:05:24,440 --> 00:05:27,760 Speaker 7: employment report released during blackout is going to matter. It 101 00:05:27,760 --> 00:05:29,800 Speaker 7: can help them make a game time decision. But so 102 00:05:29,920 --> 00:05:33,359 Speaker 7: far the data flow does not. It supports Pal's baseline 103 00:05:33,360 --> 00:05:35,599 Speaker 7: which he laid out earlier this week with pretty much 104 00:05:35,600 --> 00:05:36,720 Speaker 7: twenty five and. 105 00:05:36,640 --> 00:05:39,279 Speaker 4: A red headline just comeing across the Bloomberg terminal. Traders 106 00:05:39,440 --> 00:05:42,120 Speaker 4: shred bets on fifty basis point cut in November after 107 00:05:42,240 --> 00:05:44,839 Speaker 4: jobs data, So maybe leaning a little bit more towards 108 00:05:45,040 --> 00:05:47,960 Speaker 4: twenty five here does this? What does this say about 109 00:05:48,000 --> 00:05:51,080 Speaker 4: the US economy? Because, as Tom was mentioned before, you 110 00:05:51,120 --> 00:05:52,919 Speaker 4: get numbers like this, and he kind of goes to 111 00:05:53,279 --> 00:05:54,760 Speaker 4: a lot of folks out there who are concerned about 112 00:05:54,800 --> 00:05:56,600 Speaker 4: the US economy that maybe it's a little bit stronger 113 00:05:57,000 --> 00:05:58,400 Speaker 4: than we think. How do you guys think about the 114 00:05:58,440 --> 00:05:59,039 Speaker 4: economy overall? 115 00:05:59,120 --> 00:06:01,200 Speaker 7: Well, look, I think this This is always the case, right, 116 00:06:01,240 --> 00:06:04,040 Speaker 7: we get this restatement in data, whether it's just the 117 00:06:04,520 --> 00:06:07,320 Speaker 7: two month you know net upward revisions in this report, 118 00:06:07,640 --> 00:06:10,799 Speaker 7: or all of those benchmark revisions that came last week, 119 00:06:11,240 --> 00:06:15,600 Speaker 7: you know, oftentimes these revisions can suddenly make us realize 120 00:06:15,600 --> 00:06:17,880 Speaker 7: that we're sitting on an economy that is different from 121 00:06:17,880 --> 00:06:18,920 Speaker 7: what we thought before. 122 00:06:19,440 --> 00:06:21,600 Speaker 1: The foundation is stronger. 123 00:06:22,040 --> 00:06:24,800 Speaker 7: Now, that doesn't mean that the risks are to the 124 00:06:24,880 --> 00:06:28,359 Speaker 7: upside versus the downside. I think that the higher we run, 125 00:06:28,520 --> 00:06:31,320 Speaker 7: the greater the risk is to the downside when companies 126 00:06:31,440 --> 00:06:34,279 Speaker 7: do shift and decide they don't want to the higher anymore. 127 00:06:34,640 --> 00:06:37,120 Speaker 2: Centerre with us with Morgan Stanley, so she could be 128 00:06:37,120 --> 00:06:39,720 Speaker 2: with us Morgan Stanley Global Investment Office. We welcome all 129 00:06:39,800 --> 00:06:42,840 Speaker 2: of you across the country. Since Lisa Matteo gave us 130 00:06:42,839 --> 00:06:45,880 Speaker 2: some numbers, there is a bid to the market. Futures 131 00:06:45,920 --> 00:06:48,440 Speaker 2: up twenty four now up thirty three up six tenths 132 00:06:48,720 --> 00:06:51,839 Speaker 2: of a percent, Nastick up nine tenths of a percent, 133 00:06:52,320 --> 00:06:55,720 Speaker 2: small caps up over stick. Right now, the vis comes 134 00:06:55,760 --> 00:06:59,760 Speaker 2: in solid in a big figure nineteen point one nine 135 00:07:00,080 --> 00:07:04,040 Speaker 2: on the VICS. And yes there is dollar strength as well. Ellen, 136 00:07:04,360 --> 00:07:06,280 Speaker 2: I got to go to a bigger, broader pitch here 137 00:07:06,279 --> 00:07:10,080 Speaker 2: about then unknowns. You've been exquisite this for years out 138 00:07:10,080 --> 00:07:14,000 Speaker 2: of Texas, and the basic idea is there's a productivity mystery, 139 00:07:14,000 --> 00:07:17,920 Speaker 2: there's an immigration migration overlay, yes, all wrapped up in 140 00:07:17,960 --> 00:07:21,320 Speaker 2: the election. Do we have any confidence within our traditional 141 00:07:21,320 --> 00:07:24,120 Speaker 2: models now as we see a two point fifty four 142 00:07:24,200 --> 00:07:25,560 Speaker 2: plus revision. 143 00:07:26,400 --> 00:07:31,480 Speaker 7: So here's what makes forecasting payrolls really difficult. When firms 144 00:07:31,520 --> 00:07:34,760 Speaker 7: aren't laying off, when there's a lot of volatility and 145 00:07:34,840 --> 00:07:37,800 Speaker 7: jobless claims and you can see them rising and falling, 146 00:07:38,560 --> 00:07:43,480 Speaker 7: it translates well into modeling employment growth. When jobless claims 147 00:07:43,480 --> 00:07:47,080 Speaker 7: are just sort of low and steady, you're trying to 148 00:07:47,080 --> 00:07:51,040 Speaker 7: simply model the rate of hiring, and that's much more difficult. 149 00:07:51,920 --> 00:07:55,400 Speaker 7: And so but and also Tom two hundred thousand is 150 00:07:55,440 --> 00:07:58,920 Speaker 7: one standard deviation on the payroll report, So I can 151 00:07:58,960 --> 00:08:01,400 Speaker 7: tell you at more than two hundred and fifty thousand 152 00:08:01,400 --> 00:08:04,960 Speaker 7: in today's print. I'm pretty confident it was positive this month. 153 00:08:05,920 --> 00:08:09,320 Speaker 4: You mentioned, you know, some new revisions to GDP, higher 154 00:08:09,320 --> 00:08:12,400 Speaker 4: corporate income, you did labor share. It's got to be 155 00:08:12,440 --> 00:08:15,440 Speaker 4: good for just overall profits in the market. 156 00:08:15,520 --> 00:08:19,480 Speaker 7: Productivity drives. This is a productivity story because you pair 157 00:08:19,560 --> 00:08:24,360 Speaker 7: those revisions upward in growth in the economy to what 158 00:08:24,400 --> 00:08:26,240 Speaker 7: we know is going to be a downward revision to 159 00:08:26,280 --> 00:08:30,560 Speaker 7: employment when we do get those benchmark revisions, that's stronger productivity. 160 00:08:30,760 --> 00:08:35,439 Speaker 7: And productivity drives profits. And it explains how margins are 161 00:08:35,440 --> 00:08:39,960 Speaker 7: holding up well. It explains the earning surprises. It just 162 00:08:40,240 --> 00:08:43,439 Speaker 7: it brings in a bizarre turn of events. It's bringing 163 00:08:43,480 --> 00:08:44,960 Speaker 7: the economy to the markets. 164 00:08:46,360 --> 00:08:48,080 Speaker 2: Paul, I just did the man. Here we are you 165 00:08:48,080 --> 00:08:50,560 Speaker 2: can see this on YouTube, on radio. I'm holding up 166 00:08:50,559 --> 00:08:54,160 Speaker 2: the HP twelve. See the only reason Ellen Zenner first 167 00:08:54,200 --> 00:08:56,120 Speaker 2: talked to me is a zillion years ago was a 168 00:08:56,200 --> 00:08:59,560 Speaker 2: showed my HP twelve seed and here's the answer to 169 00:08:59,720 --> 00:09:03,080 Speaker 2: three month moving average. Paul went from one hundred and 170 00:09:03,080 --> 00:09:08,199 Speaker 2: sixteen thousand to one hundred and eighty five thousand, Okay, 171 00:09:08,280 --> 00:09:12,600 Speaker 2: with two hundred and fifty four thousand plus a solid 172 00:09:12,840 --> 00:09:17,360 Speaker 2: revision of ninety five thousand. I mean, I'm sorry, your 173 00:09:17,440 --> 00:09:18,920 Speaker 2: vision's got the wind going here. 174 00:09:19,000 --> 00:09:21,360 Speaker 4: Yeah, so, I mean L one hundred and eighty five 175 00:09:21,400 --> 00:09:24,080 Speaker 4: thousand gets your attention. There in HB twelve CE cranking 176 00:09:24,160 --> 00:09:26,840 Speaker 4: along still, I got mine June sixteenth, nineteen eighty six. 177 00:09:26,960 --> 00:09:28,679 Speaker 1: My graph calculator. 178 00:09:29,120 --> 00:09:31,520 Speaker 4: Oh that's geeking, that's serious there. 179 00:09:31,679 --> 00:09:35,640 Speaker 2: Did you ever have a Monro trader? You go dark 180 00:09:35,679 --> 00:09:39,320 Speaker 2: in Jim Karn's door at Morgan Stanley, he'll explain the 181 00:09:39,360 --> 00:09:41,120 Speaker 2: glory of a Monroe trader. 182 00:09:41,200 --> 00:09:44,240 Speaker 4: Well, and now we've got the Bloomberg terminal macro investing. 183 00:09:44,320 --> 00:09:46,280 Speaker 4: When you see a print like this, when you see 184 00:09:46,280 --> 00:09:49,240 Speaker 4: an exceptional US economy like this, how does that think about? 185 00:09:49,280 --> 00:09:51,960 Speaker 4: How does that influenced Morgan Stanley's view with the global 186 00:09:52,040 --> 00:09:53,040 Speaker 4: macro investing here? 187 00:09:53,400 --> 00:09:57,160 Speaker 7: Well, I think that you know, they're a litany of 188 00:09:57,720 --> 00:10:02,560 Speaker 7: risks out there from the global economy, and you know 189 00:10:03,160 --> 00:10:09,120 Speaker 7: the US exceptionalism, right, dollar strength, Yep, the weaker the 190 00:10:09,120 --> 00:10:13,160 Speaker 7: global economy is, the more you're going to drive investments 191 00:10:13,200 --> 00:10:16,680 Speaker 7: to dollar backed assets. You know, we talk about trade 192 00:10:16,760 --> 00:10:20,360 Speaker 7: and uncertainty around trade. Everyone thinks that that's going to 193 00:10:20,400 --> 00:10:23,000 Speaker 7: be a weaker dollar under a Trump presidency. That's a 194 00:10:23,040 --> 00:10:25,360 Speaker 7: stronger dollar. All you have to do is look what 195 00:10:25,400 --> 00:10:27,080 Speaker 7: happened in twenty nineteen. 196 00:10:27,240 --> 00:10:29,120 Speaker 2: D x y out to one oh two. Right now 197 00:10:29,200 --> 00:10:32,200 Speaker 2: euro goes under one ten weaker Euro one oh nine 198 00:10:32,400 --> 00:10:36,360 Speaker 2: eighty three. You pay through the nose in Dublin. I'm 199 00:10:36,440 --> 00:10:38,840 Speaker 2: gonna I'm in Rome. I'm gonna have it. It's going 200 00:10:38,920 --> 00:10:40,920 Speaker 2: to be perfect in Rome. I know I'm going to 201 00:10:40,960 --> 00:10:44,080 Speaker 2: walk by Gucci and Balman and there'll be a store 202 00:10:44,120 --> 00:10:46,959 Speaker 2: down via what's its name where they'll take my wallet 203 00:10:47,000 --> 00:10:49,240 Speaker 2: with a weaker euro. Eleensander, I want you to tell 204 00:10:49,320 --> 00:10:52,000 Speaker 2: us about your new duties at Morgan Stanley with Morgan 205 00:10:52,000 --> 00:10:53,680 Speaker 2: Stanley Global Investment Office. 206 00:10:53,679 --> 00:10:55,640 Speaker 7: Well, yeah, I thought maybe you would run out of 207 00:10:55,640 --> 00:10:57,880 Speaker 7: breath listing out my title. 208 00:10:58,040 --> 00:10:59,319 Speaker 2: Well, they give you a big title. 209 00:10:59,440 --> 00:11:03,720 Speaker 7: It's really lengthy, so I mean you're doing less. 210 00:11:03,960 --> 00:11:05,800 Speaker 1: I wish. 211 00:11:05,880 --> 00:11:08,560 Speaker 7: I have really enjoyed being a part of the Global 212 00:11:08,559 --> 00:11:12,560 Speaker 7: Investment Committee. Now for Morgan Stanley, it's important to have 213 00:11:12,600 --> 00:11:17,640 Speaker 7: a macro voice that can talk to longer run thematic trends, 214 00:11:17,640 --> 00:11:20,640 Speaker 7: that can talk to dynamics around. 215 00:11:20,280 --> 00:11:22,600 Speaker 1: Productivity and growth. 216 00:11:22,200 --> 00:11:25,360 Speaker 7: And how companies hire and trying to close that gap 217 00:11:25,400 --> 00:11:28,280 Speaker 7: between understanding markets and the economy. 218 00:11:28,679 --> 00:11:31,920 Speaker 2: I mean within that, let's go right to productivity. We've 219 00:11:31,920 --> 00:11:36,320 Speaker 2: got capital dynamics, labor dynamics, and I'm sorry, it's a 220 00:11:36,640 --> 00:11:41,480 Speaker 2: huge mystery in our modern total factor productivity. Is it 221 00:11:41,679 --> 00:11:45,760 Speaker 2: just a polarization of America into the halves of productivity 222 00:11:46,000 --> 00:11:46,760 Speaker 2: and the have nots? 223 00:11:46,880 --> 00:11:47,040 Speaker 8: Well? 224 00:11:47,120 --> 00:11:52,320 Speaker 7: Total factor productivity, which is the productivity from technological enhancements, 225 00:11:52,760 --> 00:11:56,960 Speaker 7: that is the most difficult piece of productivity to measure. 226 00:11:57,200 --> 00:12:00,200 Speaker 7: And it's one reason why when I was moderating Sir 227 00:12:00,280 --> 00:12:04,120 Speaker 7: Pal earlier this week, I was trying to see how 228 00:12:04,160 --> 00:12:08,079 Speaker 7: he felt about those revisions that GDP and GDI are up, 229 00:12:08,080 --> 00:12:10,839 Speaker 7: but employment is going to be revised down. So that's 230 00:12:10,840 --> 00:12:13,840 Speaker 7: greater productivity. And understand whether that is some sort of 231 00:12:14,400 --> 00:12:18,960 Speaker 7: you know, post COVID, you know, normalization or distortion, or 232 00:12:19,080 --> 00:12:22,640 Speaker 7: is it something AI and you just can't say that 233 00:12:22,679 --> 00:12:26,560 Speaker 7: it's technological advancements Yet I am in the camp of 234 00:12:26,600 --> 00:12:29,959 Speaker 7: being very positive what technological inventsments from AI can bring 235 00:12:30,040 --> 00:12:33,000 Speaker 7: us in terms of productivity. So I can tell you 236 00:12:33,000 --> 00:12:35,240 Speaker 7: that productivity is much higher than we think right now. 237 00:12:35,320 --> 00:12:37,640 Speaker 7: When we get that data, we'll see that, But I 238 00:12:37,679 --> 00:12:40,560 Speaker 7: can't tell you that it's something that will be sustained. 239 00:12:40,600 --> 00:12:42,400 Speaker 2: I mean, Paul, as simple as this, if you've got 240 00:12:42,440 --> 00:12:45,920 Speaker 2: to run rate two point eight percent real GDP for 241 00:12:46,000 --> 00:12:50,000 Speaker 2: the haves is real GDP three point five or four 242 00:12:50,040 --> 00:12:53,840 Speaker 2: percent China like GDP, And for the have nots they're 243 00:12:53,880 --> 00:12:56,000 Speaker 2: in recession. It's as simple as that. 244 00:12:56,200 --> 00:12:57,240 Speaker 4: Yeah, I don't know the answer to that. 245 00:12:57,320 --> 00:13:00,200 Speaker 7: Yeah, well, the have nots have been in recession or 246 00:13:00,200 --> 00:13:04,680 Speaker 7: some time. Gas prices coming down so much have helped 247 00:13:04,760 --> 00:13:07,680 Speaker 7: buying power. But of course we'll see if this pop 248 00:13:07,720 --> 00:13:09,640 Speaker 7: and oil prices is going to last, because about a 249 00:13:09,679 --> 00:13:11,640 Speaker 7: two week lag it starts to show up in gasoline 250 00:13:12,280 --> 00:13:16,480 Speaker 7: prices and also lower interest rates from the Fed, whether 251 00:13:16,520 --> 00:13:19,320 Speaker 7: it's twenty five or fifty. Interest rates are coming down, 252 00:13:19,360 --> 00:13:21,560 Speaker 7: and while the market prices in the entire path of 253 00:13:21,600 --> 00:13:24,600 Speaker 7: FED easing, the rate you pay on your credit card 254 00:13:24,720 --> 00:13:25,760 Speaker 7: moves as the. 255 00:13:25,679 --> 00:13:27,360 Speaker 1: FED is cutting rates. 256 00:13:27,440 --> 00:13:30,600 Speaker 7: And so with strong job gains, especially in the service 257 00:13:30,640 --> 00:13:33,680 Speaker 7: sector and some of these other positives, you can put 258 00:13:33,679 --> 00:13:36,520 Speaker 7: a floor under lower income households here. 259 00:13:36,720 --> 00:13:39,160 Speaker 2: I mean, Paul, what's so important here is Zentner's never 260 00:13:39,280 --> 00:13:41,920 Speaker 2: talked much about she wins this trophy, this one. This 261 00:13:42,040 --> 00:13:45,679 Speaker 2: prediction's like Steve Stanley over at Santander. They got all 262 00:13:45,720 --> 00:13:49,720 Speaker 2: these awards hardware and on the fireplace in the second 263 00:13:49,720 --> 00:13:53,160 Speaker 2: living room, Ellen, you won those trophies. Off a view 264 00:13:53,160 --> 00:13:56,880 Speaker 2: of the consumer, what is the state of the American consumer? 265 00:13:57,320 --> 00:14:00,520 Speaker 2: With two hundred and fifty four thousand job created? 266 00:14:00,679 --> 00:14:04,280 Speaker 7: Well with this uh, with this pop and services sector right, 267 00:14:04,559 --> 00:14:06,360 Speaker 7: this rebound and service sector jobs. 268 00:14:07,160 --> 00:14:08,360 Speaker 1: We see that that. 269 00:14:08,480 --> 00:14:11,000 Speaker 7: Wage gains and job gains continue to be positive for 270 00:14:11,080 --> 00:14:15,280 Speaker 7: lower income groups, but they they are still battling with 271 00:14:15,600 --> 00:14:18,800 Speaker 7: higher rates of food and housing inflation. 272 00:14:19,560 --> 00:14:19,920 Speaker 1: UH. 273 00:14:19,960 --> 00:14:23,040 Speaker 7: And wage growth is strong, but it has been been slowed. 274 00:14:23,080 --> 00:14:24,880 Speaker 7: But they're in better shape than they than they were. 275 00:14:25,240 --> 00:14:29,240 Speaker 7: And then the wealthy households are just on fire. No 276 00:14:29,360 --> 00:14:30,120 Speaker 7: slow down there. 277 00:14:30,400 --> 00:14:33,280 Speaker 4: What is the Morgan Stanley GDP call these days? 278 00:14:33,560 --> 00:14:38,560 Speaker 7: So the the economics team, my former team is still 279 00:14:38,600 --> 00:14:40,560 Speaker 7: looking north of two percent for gd. 280 00:14:42,080 --> 00:14:44,720 Speaker 6: Of course, Okay, I just checking out. 281 00:14:44,800 --> 00:14:49,120 Speaker 2: Of course, my lovely team Stanley, Google, Roach, Burner and 282 00:14:49,240 --> 00:14:51,120 Speaker 2: Roach were not on speaking terms like. 283 00:14:51,120 --> 00:14:54,960 Speaker 7: Fifteen no, no, no, that that US economics team on 284 00:14:55,000 --> 00:15:00,000 Speaker 7: the institutional security side of Morgan Stanley is number one hands. 285 00:15:00,320 --> 00:15:03,360 Speaker 2: Okay, we're going to digress here, Paul, I want to 286 00:15:03,440 --> 00:15:05,800 Speaker 2: keep this is two important folks that we see with 287 00:15:05,920 --> 00:15:09,720 Speaker 2: futures of forty two. Steve Roach, with the backing of 288 00:15:09,800 --> 00:15:16,120 Speaker 2: Morgan Stanley Management including mister Mac, invented heated debate. They're 289 00:15:16,160 --> 00:15:19,000 Speaker 2: the first team I know that got off the We 290 00:15:19,160 --> 00:15:22,440 Speaker 2: are the world. We have one voice, malarkey, and they 291 00:15:22,520 --> 00:15:26,600 Speaker 2: used to fight like cats and dogs, and Roach supported it, 292 00:15:26,920 --> 00:15:27,960 Speaker 2: and that's a heritage. 293 00:15:28,240 --> 00:15:30,160 Speaker 1: We don't need to fight like cats and dogs. We 294 00:15:30,200 --> 00:15:31,040 Speaker 1: can be respectful. 295 00:15:31,360 --> 00:15:33,360 Speaker 2: You haven't talked to Jim Carroll. 296 00:15:33,480 --> 00:15:36,800 Speaker 1: You just like to stir the pot potter, So. 297 00:15:36,840 --> 00:15:39,560 Speaker 4: Ellen, just real quickly here, I mean, what's the next 298 00:15:40,040 --> 00:15:41,600 Speaker 4: I guess data point that you and your team going 299 00:15:41,640 --> 00:15:43,560 Speaker 4: to be looking for here? Is it earnings coming up? 300 00:15:43,600 --> 00:15:45,160 Speaker 4: Is there some economic data that you're looking for? 301 00:15:45,520 --> 00:15:48,000 Speaker 7: Yeah, I mean earnings is always a great time to 302 00:15:48,680 --> 00:15:51,720 Speaker 7: scour those transcripts and see if there's some early signs 303 00:15:51,720 --> 00:15:54,840 Speaker 7: of something changing. You know, I want to try to 304 00:15:54,840 --> 00:15:57,040 Speaker 7: get a sense of how much of this activity is 305 00:15:57,080 --> 00:16:01,160 Speaker 7: front loading ahead of the election and poss tariffs and 306 00:16:01,600 --> 00:16:05,160 Speaker 7: possible difficulty hiring for the holidays, and so you're doing 307 00:16:05,160 --> 00:16:07,080 Speaker 7: a lot of things early here, So I want to 308 00:16:07,080 --> 00:16:10,160 Speaker 7: be sure that that earnings are really supporting what we're 309 00:16:10,160 --> 00:16:11,120 Speaker 7: seeing in the economy. 310 00:16:11,280 --> 00:16:13,560 Speaker 2: One more question, Where are you fishing next? 311 00:16:14,360 --> 00:16:14,600 Speaker 9: Oh? 312 00:16:14,680 --> 00:16:17,560 Speaker 7: Gosh, I'm still fishing small stream Pennsylvania. 313 00:16:18,160 --> 00:16:19,640 Speaker 1: Really, yeah, yeah, I. 314 00:16:19,560 --> 00:16:22,400 Speaker 7: Haven't been able to make it out to big water Weststribb, 315 00:16:22,680 --> 00:16:23,920 Speaker 7: small stream Pennsylvania. 316 00:16:24,400 --> 00:16:25,800 Speaker 2: I don't want to know the secret spot. 317 00:16:25,960 --> 00:16:28,600 Speaker 7: It's it's a six and a half foot rod with 318 00:16:29,000 --> 00:16:29,880 Speaker 7: just wrist flicks. 319 00:16:30,280 --> 00:16:32,440 Speaker 1: Wrist flix is a sturgeon? 320 00:16:32,560 --> 00:16:33,360 Speaker 2: What are you looking for? 321 00:16:33,480 --> 00:16:33,640 Speaker 9: Oh? 322 00:16:33,680 --> 00:16:36,080 Speaker 1: No, trout, trout, sturgeon. 323 00:16:36,160 --> 00:16:40,360 Speaker 7: You can't fit sturgeon in Pennsylvania a small stream? Really, Tom, Really, 324 00:16:40,440 --> 00:16:42,160 Speaker 7: you really don't know a lot about it. 325 00:16:42,200 --> 00:16:46,840 Speaker 2: Do you wait? That's our Jersey's line. Ella Zettner, thank 326 00:16:46,920 --> 00:16:49,360 Speaker 2: you so much for being with us everywhere. I'm not 327 00:16:49,360 --> 00:16:51,800 Speaker 2: going to name her title now. I think mister Peck 328 00:16:51,880 --> 00:16:54,120 Speaker 2: do something about her title. Let's just way too gaily. 329 00:16:54,680 --> 00:16:59,400 Speaker 2: That One's that in her thematic? Okay, one word thematic. 330 00:16:59,480 --> 00:17:03,120 Speaker 2: She's at Morgan Stanley's Global Investment office. Ellen, thank you 331 00:17:03,160 --> 00:17:06,439 Speaker 2: so much for being with us today. The Vixers are 332 00:17:06,520 --> 00:17:10,240 Speaker 2: twenty where now through nineteen one point five seven big 333 00:17:10,280 --> 00:17:13,040 Speaker 2: points eighteen point ninety two. Let me come down to 334 00:17:13,080 --> 00:17:17,000 Speaker 2: oil where I've got a seventy eight point zero three oil. 335 00:17:17,080 --> 00:17:19,520 Speaker 2: Ebbs back a little bit here. Of course, I don't 336 00:17:19,560 --> 00:17:22,879 Speaker 2: know the time's on here. It's a late afternoon in Israel, 337 00:17:22,960 --> 00:17:25,800 Speaker 2: in Lebanon, in Iran, so we'll have to see how 338 00:17:25,840 --> 00:17:28,240 Speaker 2: that goes into their evening. With all that her figures, 339 00:17:28,240 --> 00:17:32,440 Speaker 2: Thank you Joe Matthew Balance of Power for that Eastern 340 00:17:32,440 --> 00:17:33,440 Speaker 2: Mediterranean brief. 341 00:17:33,520 --> 00:17:35,840 Speaker 4: I think people are looking at this report, Tom and saying, 342 00:17:35,840 --> 00:17:38,679 Speaker 4: all right, this economy is in decent shape. It's and 343 00:17:38,720 --> 00:17:41,359 Speaker 4: maybe stronger shape them than we thought. The Fed is 344 00:17:41,400 --> 00:17:44,199 Speaker 4: cutting race, but maybe maybe not fifty basis points in 345 00:17:44,240 --> 00:17:46,680 Speaker 4: the next maybe maybe a series of twenty five basis 346 00:17:46,680 --> 00:17:48,680 Speaker 4: point cuts. And that's kind of overseeing in the market. 347 00:17:48,680 --> 00:17:52,240 Speaker 4: But again the two year up fifteen basis points, Tom, I'm. 348 00:17:52,080 --> 00:17:54,080 Speaker 2: Going to go with Jason Furman, who I love his 349 00:17:54,160 --> 00:17:58,320 Speaker 2: annualized work. He looks at one month annualized, which is 350 00:17:58,359 --> 00:18:01,200 Speaker 2: you know, blowny, but he does it three months annualized, 351 00:18:01,240 --> 00:18:04,360 Speaker 2: which was my crutch for years. Six month twelve month 352 00:18:04,440 --> 00:18:09,280 Speaker 2: annualize three month average non farm payrolls Paul went from 353 00:18:09,320 --> 00:18:13,400 Speaker 2: one sixteen up to one eighty five. That's a wow statistic. 354 00:18:13,440 --> 00:18:16,040 Speaker 4: That's a wow statistic, and that you know, shows the 355 00:18:16,040 --> 00:18:19,159 Speaker 4: FED that they've got this economy in a pretty decent shape. 356 00:18:19,400 --> 00:18:22,440 Speaker 2: Iira, Jersey never believed in fifty basis points. He joins 357 00:18:22,520 --> 00:18:26,160 Speaker 2: us now from Bloomberg Intelligence and Fixed Income. Okay, we're 358 00:18:26,160 --> 00:18:29,359 Speaker 2: done with that silliness, Ira, What is the power of 359 00:18:29,400 --> 00:18:34,520 Speaker 2: a measured twenty five basis point path forward for Jerome Powell? 360 00:18:35,359 --> 00:18:37,800 Speaker 8: Well, I think you know, this data is going to 361 00:18:37,800 --> 00:18:40,800 Speaker 8: take out any chance of fifties probably through the next 362 00:18:41,280 --> 00:18:44,440 Speaker 8: two meetings at least, if not, if not through January 363 00:18:44,520 --> 00:18:47,960 Speaker 8: at least, and then after that. You know, I think 364 00:18:48,000 --> 00:18:50,200 Speaker 8: that that this and this is where the two year 365 00:18:50,280 --> 00:18:54,080 Speaker 8: yield being being somewhat higher could could be maintained. And 366 00:18:54,400 --> 00:18:56,800 Speaker 8: that's where does the terminal rate go. Remember we were 367 00:18:56,840 --> 00:19:00,679 Speaker 8: pricing just a week ago for interest rates by the 368 00:19:00,720 --> 00:19:03,040 Speaker 8: end of next year to be under three percent for 369 00:19:03,200 --> 00:19:06,440 Speaker 8: the Fed funds rate, So that probably is starting to 370 00:19:06,480 --> 00:19:10,360 Speaker 8: get repriced now we're now around around three and an 371 00:19:10,359 --> 00:19:13,040 Speaker 8: eighth and I suspect that that might go a little higher, 372 00:19:13,080 --> 00:19:16,560 Speaker 8: particularly if we get a you know, an inflation print 373 00:19:16,560 --> 00:19:20,560 Speaker 8: that doesn't show that that inflation is moderating even further. 374 00:19:20,680 --> 00:19:23,199 Speaker 8: So I think there is a risk here that this 375 00:19:23,320 --> 00:19:25,879 Speaker 8: is the better scenario that we've been talking about like 376 00:19:25,920 --> 00:19:28,280 Speaker 8: we never believed in the soft landing. It was either hey, 377 00:19:28,320 --> 00:19:30,399 Speaker 8: the economy's either going to chug along or we're going 378 00:19:30,440 --> 00:19:32,480 Speaker 8: to fall in recession. And it seems like maybe that, 379 00:19:33,040 --> 00:19:35,240 Speaker 8: you know, beginning one is where we're headed. 380 00:19:35,960 --> 00:19:38,720 Speaker 4: So the yield curve today just ira flattening out a 381 00:19:38,760 --> 00:19:41,119 Speaker 4: little bit again, the two year up about fifteen sixteen 382 00:19:41,119 --> 00:19:43,800 Speaker 4: basis points and the ten year up about nine basis points. 383 00:19:44,359 --> 00:19:46,200 Speaker 4: How do you think about the shape of the yield 384 00:19:46,280 --> 00:19:48,640 Speaker 4: curve this day? What's that telling the average investor? 385 00:19:49,320 --> 00:19:51,440 Speaker 8: Well, I think that the knee jerk reaction being a 386 00:19:52,280 --> 00:19:54,720 Speaker 8: bear what we call bear flattening. So two year yields 387 00:19:54,800 --> 00:19:58,840 Speaker 8: going up faster than ten year yields is is the 388 00:19:59,080 --> 00:20:01,520 Speaker 8: quote unquote proper reaction to this, because a lot of 389 00:20:01,520 --> 00:20:04,359 Speaker 8: people were in were in yield curve steepeners, they were 390 00:20:04,440 --> 00:20:07,159 Speaker 8: long two year notes, three year notes, and then you 391 00:20:07,200 --> 00:20:10,119 Speaker 8: know market weight or underweight the long end of the curve. 392 00:20:10,960 --> 00:20:12,760 Speaker 8: And so this is going to be a little bit 393 00:20:12,800 --> 00:20:16,360 Speaker 8: of an unmind of that because that possibility that two 394 00:20:16,400 --> 00:20:20,240 Speaker 8: year yields head down towards three percent is going to 395 00:20:20,280 --> 00:20:22,520 Speaker 8: be is going to be tested here with the data 396 00:20:22,520 --> 00:20:25,639 Speaker 8: that we get over the next couple of weeks. But 397 00:20:25,920 --> 00:20:29,080 Speaker 8: I do think that eventually, when two year yields get 398 00:20:29,080 --> 00:20:32,399 Speaker 8: back up towards say four percent, that then the next 399 00:20:32,440 --> 00:20:35,480 Speaker 8: move might end up being a bear steepener, So meaning 400 00:20:35,480 --> 00:20:38,159 Speaker 8: that two year yields maybe hover four percent plus or 401 00:20:38,200 --> 00:20:41,160 Speaker 8: minus twenty five basis points, but ten year yields wind 402 00:20:41,240 --> 00:20:44,040 Speaker 8: up moving up higher, maybe back up toward four and 403 00:20:44,040 --> 00:20:47,560 Speaker 8: a half to five percent. But that is predicated on 404 00:20:47,840 --> 00:20:50,440 Speaker 8: the on this data being confirmed. Right, so we need 405 00:20:50,600 --> 00:20:54,080 Speaker 8: a strong retail sales number, you know, inflation like I said, 406 00:20:54,119 --> 00:20:56,840 Speaker 8: that doesn't moderate quite as much. Those are the things 407 00:20:56,840 --> 00:21:00,960 Speaker 8: that will need to see a more persistent higher in rates. 408 00:21:01,000 --> 00:21:03,040 Speaker 2: What's the real yield dynamic off of this is that 409 00:21:03,119 --> 00:21:05,280 Speaker 2: we mentioned we got a three month moving average non 410 00:21:05,320 --> 00:21:08,520 Speaker 2: firm payrolls popping from a one sixteen out to one 411 00:21:08,560 --> 00:21:11,720 Speaker 2: eighty five. I get it, it's a jump condition, but 412 00:21:11,800 --> 00:21:13,760 Speaker 2: what does that do to what every businessman in the 413 00:21:13,760 --> 00:21:16,240 Speaker 2: country wants to know the ten year really yield? 414 00:21:17,000 --> 00:21:20,440 Speaker 8: Yeah, so the real yield as expressed by the tips market, 415 00:21:20,480 --> 00:21:25,000 Speaker 8: by the treasure inflation protected securities market, is that's a 416 00:21:25,040 --> 00:21:28,199 Speaker 8: bulk of this move. So tips are basically that the 417 00:21:28,200 --> 00:21:30,520 Speaker 8: way that we measure tips and the way that we 418 00:21:31,240 --> 00:21:34,119 Speaker 8: try to determine fair value is in large part, what 419 00:21:34,280 --> 00:21:36,440 Speaker 8: is the policy rate going to be? And that's why 420 00:21:36,480 --> 00:21:38,840 Speaker 8: you see a ten basis point sell off or so 421 00:21:39,880 --> 00:21:43,399 Speaker 8: in the five year real yield as expressed by tips, 422 00:21:44,080 --> 00:21:47,800 Speaker 8: because now there's, like I mentioned, the lower possibility of 423 00:21:47,880 --> 00:21:52,159 Speaker 8: much lower possibility of larger, larger rate cuts in the 424 00:21:53,240 --> 00:21:56,160 Speaker 8: near term and then also a higher terminal rate. Right, 425 00:21:56,200 --> 00:21:59,359 Speaker 8: so that's the idea that hey, maybe the Fed's only 426 00:21:59,359 --> 00:22:01,320 Speaker 8: going to cut the four four percent now instead of 427 00:22:01,520 --> 00:22:03,680 Speaker 8: cutting all the way down to two and three quarters. 428 00:22:03,760 --> 00:22:06,320 Speaker 2: Paul, my head is spinning. I don't know if it's 429 00:22:06,320 --> 00:22:10,199 Speaker 2: a jobs report, the METS one, yeah, or Astonville is 430 00:22:10,920 --> 00:22:13,080 Speaker 2: destined on the continent. I don't know which. 431 00:22:13,080 --> 00:22:15,440 Speaker 4: I don't know where we go, Ira, What's what's next 432 00:22:15,440 --> 00:22:17,520 Speaker 4: for your treasury market? Here? I mean this data point 433 00:22:17,560 --> 00:22:20,480 Speaker 4: here was a big one. Where do we go from here? 434 00:22:21,840 --> 00:22:22,080 Speaker 2: Yeah? 435 00:22:22,080 --> 00:22:23,919 Speaker 8: So it's going to be the retail sales and the 436 00:22:23,920 --> 00:22:25,720 Speaker 8: CPI data are going to be the next big one. 437 00:22:25,760 --> 00:22:28,520 Speaker 8: So when you look at the market sensitivity, it's really 438 00:22:28,560 --> 00:22:31,600 Speaker 8: shifted over the last year where it was. You know, 439 00:22:31,640 --> 00:22:33,960 Speaker 8: payrolls has always been the number one report that the 440 00:22:34,000 --> 00:22:37,560 Speaker 8: treasury market cared about. But CPI was the number that 441 00:22:37,600 --> 00:22:41,040 Speaker 8: we cared about from twenty twenty one until until late 442 00:22:41,119 --> 00:22:44,480 Speaker 8: last year, and that's now shifted to retail sales actually 443 00:22:44,480 --> 00:22:48,320 Speaker 8: being the number two most important number to the market. 444 00:22:48,520 --> 00:22:50,399 Speaker 8: And the reason for that is that the sign of 445 00:22:50,880 --> 00:22:54,560 Speaker 8: general health of the economy is the consumer spending. So 446 00:22:54,560 --> 00:22:56,960 Speaker 8: so yeah, I think the retail sales report, obviously is 447 00:22:57,040 --> 00:22:59,680 Speaker 8: number is really going to be the next big number 448 00:22:59,680 --> 00:23:02,200 Speaker 8: that the market's going to look at for how healthy 449 00:23:02,240 --> 00:23:02,840 Speaker 8: is the economy? 450 00:23:02,880 --> 00:23:05,040 Speaker 2: Yeah, Iron keeps this employed. I mean it used to 451 00:23:05,040 --> 00:23:07,879 Speaker 2: be just simple jobs day, go home, yep. And now 452 00:23:07,920 --> 00:23:11,439 Speaker 2: I got CPI October tenth retail and I'm looking for 453 00:23:11,560 --> 00:23:13,840 Speaker 2: I don't have it up here. I gotta learn how 454 00:23:13,840 --> 00:23:16,520 Speaker 2: to see. Paul's the one folks that really knows the terminal. 455 00:23:16,560 --> 00:23:18,280 Speaker 2: I mean, I don't know what I'm doing here. 456 00:23:18,359 --> 00:23:20,560 Speaker 4: Iira what's the latest on Reel Central New Jersey. Give 457 00:23:20,600 --> 00:23:21,639 Speaker 4: us thirty seconds there. 458 00:23:22,440 --> 00:23:24,840 Speaker 8: We got a big game. We're playing last year's champions 459 00:23:24,880 --> 00:23:28,200 Speaker 8: on Sunday night, so we're we're fourth place right now 460 00:23:28,240 --> 00:23:31,240 Speaker 8: and hoping to move up the second or third after 461 00:23:31,320 --> 00:23:31,800 Speaker 8: a Sunday. 462 00:23:32,040 --> 00:23:34,000 Speaker 2: Are you like where you live in New Jersey? Are 463 00:23:34,040 --> 00:23:35,119 Speaker 2: you Phillies or Mets. 464 00:23:36,440 --> 00:23:39,359 Speaker 8: Well, we're in the Brackish area in central New Jersey 465 00:23:39,480 --> 00:23:41,680 Speaker 8: right in between the two, so about half and half. 466 00:23:41,960 --> 00:23:45,439 Speaker 8: Now you're red second, Well, I grew up on Long Island, 467 00:23:45,480 --> 00:23:47,560 Speaker 8: so you can guess which should I have the bias? 468 00:23:47,560 --> 00:23:50,320 Speaker 2: Stared Irin Jersey. Thank you for the time in publishing today. 469 00:23:50,359 --> 00:23:54,240 Speaker 2: Look for that on the terminal out to Bloomberg Intelligence, 470 00:23:54,280 --> 00:23:57,600 Speaker 2: Ira Jersey and his team publishing on this changed fixed 471 00:23:57,680 --> 00:24:11,000 Speaker 2: kincome market. When you get to a really wonderful glass 472 00:24:11,040 --> 00:24:14,480 Speaker 2: half full person, an optimist in the American Economic Experiment 473 00:24:14,600 --> 00:24:17,840 Speaker 2: Constant hundred from EIU joining us here in a moment, 474 00:24:17,880 --> 00:24:20,760 Speaker 2: Let's get right to it on YouTube across this nation 475 00:24:20,920 --> 00:24:24,680 Speaker 2: on your Friday commute with our from the Interactive Broker 476 00:24:24,760 --> 00:24:27,160 Speaker 2: Studios with our Bloomberg business flash. 477 00:24:27,600 --> 00:24:30,560 Speaker 9: Lisa, you got it. Futures sell on the rise after 478 00:24:30,600 --> 00:24:33,359 Speaker 9: that blowout jobs report showed non farm payrolls rose by 479 00:24:33,359 --> 00:24:36,040 Speaker 9: two hundred and fifty four thousand in September, way above 480 00:24:36,040 --> 00:24:39,400 Speaker 9: one hundred and fifty thousand expected. The unemployment rate came 481 00:24:39,400 --> 00:24:42,920 Speaker 9: in lower than forecasts at four point one percent. Traders 482 00:24:42,960 --> 00:24:44,960 Speaker 9: now cutting their bets on a fifty basis point cut 483 00:24:44,960 --> 00:24:46,960 Speaker 9: of November by the FED. We'll get to the few 484 00:24:47,080 --> 00:24:50,119 Speaker 9: NASTAK futures first up more than one percent two hundred 485 00:24:50,119 --> 00:24:52,080 Speaker 9: and fifty three points at twenty thousand, two hundred and 486 00:24:52,119 --> 00:24:55,080 Speaker 9: forty three. Down futures up six tens and percent at 487 00:24:55,119 --> 00:24:57,800 Speaker 9: forty two thousand, five hundred and eighty nine, SMP futures 488 00:24:57,880 --> 00:25:00,560 Speaker 9: up about eight tens percent at five thousand, seven hundred 489 00:25:00,560 --> 00:25:02,520 Speaker 9: and ninety nine. We have the two year yield three 490 00:25:02,520 --> 00:25:05,760 Speaker 9: point eight six percent. That's up fifteen basis points. The 491 00:25:05,800 --> 00:25:07,960 Speaker 9: ten year yield three point nine four percent, that's up 492 00:25:07,960 --> 00:25:10,600 Speaker 9: about nine basis points. I want to check in with currency. 493 00:25:10,760 --> 00:25:13,000 Speaker 9: We have the dollars stronger, Japanese yen and week are 494 00:25:13,119 --> 00:25:15,400 Speaker 9: down to one percent at one forty eight seventy four 495 00:25:15,400 --> 00:25:18,320 Speaker 9: against the dollar, Euro, British pound, week er Bitcoin up 496 00:25:18,320 --> 00:25:21,480 Speaker 9: more than one and a half percent at sixty one thousand. 497 00:25:22,320 --> 00:25:25,639 Speaker 9: Shipping stocks slumping, US stock workers strike on hold. We 498 00:25:25,640 --> 00:25:28,919 Speaker 9: have mayersks down about five percent. In Germany, ZIM Integrated 499 00:25:28,960 --> 00:25:32,640 Speaker 9: shipping down about eleven percent, and finally, Humana on track 500 00:25:32,680 --> 00:25:36,119 Speaker 9: for its worst week since March of twenty twenty. It 501 00:25:36,240 --> 00:25:39,240 Speaker 9: announced it'll lose medicare quality ratings on some plans. It 502 00:25:39,359 --> 00:25:41,520 Speaker 9: shares right now down about two tens eve an percent, 503 00:25:42,000 --> 00:25:44,399 Speaker 9: but it's stock placed Brunch is twenty two percent on 504 00:25:44,440 --> 00:25:47,800 Speaker 9: Tuesday and Wednesday alone. That's a Bloomberg business flash. 505 00:25:47,840 --> 00:25:49,879 Speaker 2: Tom and Paul, Lisa, thanks so much. Really want to 506 00:25:49,880 --> 00:25:51,960 Speaker 2: mention dollar strength. You're out to one o two on 507 00:25:52,080 --> 00:25:55,639 Speaker 2: d X Y. We mentioned hero earlier and I'm sorry 508 00:25:55,760 --> 00:25:59,440 Speaker 2: I missed the yen move. It is Titanic here this 509 00:25:59,520 --> 00:26:03,360 Speaker 2: week to almost round it up a one dollar yen 510 00:26:03,720 --> 00:26:08,040 Speaker 2: much weaker. Japanese yet called it in three days as well. 511 00:26:08,840 --> 00:26:11,560 Speaker 2: This is wonderful. She is the chief economist at the 512 00:26:11,680 --> 00:26:17,680 Speaker 2: eCOM Economist Intelligence Unit. All in the industry say EIU, 513 00:26:18,000 --> 00:26:20,439 Speaker 2: and the reason is is they change the world of 514 00:26:20,480 --> 00:26:24,080 Speaker 2: economics in nineteen eighty six. In nineteen eighty six, the 515 00:26:24,160 --> 00:26:27,280 Speaker 2: economist in EIU came out with an index with Paul, 516 00:26:28,520 --> 00:26:33,080 Speaker 2: I'm sorry and two happy meals changed economics and that 517 00:26:33,280 --> 00:26:36,960 Speaker 2: is the Big Mac index of the EIU Constance Hunter 518 00:26:37,040 --> 00:26:39,000 Speaker 2: joints us down. You're going to be in London next week. 519 00:26:39,040 --> 00:26:40,879 Speaker 2: Do you have to go to the Liverpool station with 520 00:26:41,040 --> 00:26:43,400 Speaker 2: a team and they have McDonald's. 521 00:26:42,720 --> 00:26:45,360 Speaker 5: I think we're right by Charing Cross, so we might 522 00:26:45,440 --> 00:26:48,119 Speaker 5: have to look for McDonald's closer to the office. 523 00:26:48,280 --> 00:26:50,680 Speaker 2: Tell us about EIU, what's the value add right now? 524 00:26:50,680 --> 00:26:53,400 Speaker 2: I mean it claimed I've read every book they've ever published. 525 00:26:53,440 --> 00:26:55,720 Speaker 2: What are you going to do? As chief economists? Ei U? 526 00:26:56,119 --> 00:27:00,640 Speaker 5: So at EU we cover two hundred countries and we 527 00:27:01,160 --> 00:27:04,439 Speaker 5: cover six industries, so we have a saying that the 528 00:27:04,440 --> 00:27:07,200 Speaker 5: world has covered sixty five percent by water. 529 00:27:07,440 --> 00:27:09,320 Speaker 6: The rest is covered by the EU. 530 00:27:09,160 --> 00:27:14,040 Speaker 2: Astutely Brandy Brandy well branded. Okay, you know I saw 531 00:27:14,080 --> 00:27:16,120 Speaker 2: you at c far the world was coming to an end. 532 00:27:16,480 --> 00:27:19,479 Speaker 2: I'm going to say seven months ago. I just got 533 00:27:19,520 --> 00:27:22,880 Speaker 2: an adjusted three months moving average on non farm payrolls 534 00:27:23,000 --> 00:27:26,520 Speaker 2: from one sixteen after one eighty five with visions. 535 00:27:27,160 --> 00:27:31,000 Speaker 5: Why well, I think as Claudia, you know you had 536 00:27:31,000 --> 00:27:33,800 Speaker 5: her on earlier. Claudia Sam has been warning right the 537 00:27:34,440 --> 00:27:36,560 Speaker 5: some rule might not be indicating that the world is 538 00:27:36,560 --> 00:27:40,000 Speaker 5: about to end, and we have this underlying strength. And look, 539 00:27:40,160 --> 00:27:42,720 Speaker 5: I mean the FED move wasn't enough to change the 540 00:27:42,800 --> 00:27:46,560 Speaker 5: job's outlook for September, but I do think that there 541 00:27:46,680 --> 00:27:50,080 Speaker 5: this is an underlyingly strong economy. If you look at 542 00:27:50,119 --> 00:27:52,760 Speaker 5: where we're going to probably print for third quarter, we're 543 00:27:52,800 --> 00:27:54,800 Speaker 5: looking at two point seven to three point. 544 00:27:54,560 --> 00:27:57,440 Speaker 2: Oneber maybe up to two point two. 545 00:27:57,560 --> 00:28:01,880 Speaker 5: Yeah, So it's it's looking very good. And we have productivity, 546 00:28:01,960 --> 00:28:04,840 Speaker 5: and I think I think that's where we need to focus. 547 00:28:04,920 --> 00:28:05,080 Speaker 4: Right. 548 00:28:05,119 --> 00:28:05,880 Speaker 6: We have had. 549 00:28:05,880 --> 00:28:09,920 Speaker 5: Extraordinary and extraordinary run of productivity. And the question is 550 00:28:09,920 --> 00:28:11,600 Speaker 5: is this the nineties reducts? 551 00:28:11,760 --> 00:28:12,000 Speaker 6: Right? 552 00:28:12,359 --> 00:28:14,600 Speaker 5: May the Fed only need to cut one hundred basis 553 00:28:14,600 --> 00:28:17,040 Speaker 5: points or one hundred and twenty five basis points instead 554 00:28:17,040 --> 00:28:19,520 Speaker 5: of the full number of basis points they were expecting 555 00:28:19,560 --> 00:28:21,600 Speaker 5: to get the economy to be on solid flooding? 556 00:28:21,920 --> 00:28:25,280 Speaker 2: Can you see Lisa Matteo with like the Olivia Newton 557 00:28:25,359 --> 00:28:28,879 Speaker 2: John nineties look? Oh yeah, Gwen and Blondie. You know, 558 00:28:29,280 --> 00:28:30,679 Speaker 2: I just we don't want to go back to the 559 00:28:30,760 --> 00:28:32,560 Speaker 2: nineties constance. 560 00:28:32,600 --> 00:28:35,520 Speaker 4: I mean there's something for everybody. I mean, this job's 561 00:28:35,600 --> 00:28:37,560 Speaker 4: numbered today, whether you're looking at the you know, the 562 00:28:37,560 --> 00:28:41,000 Speaker 4: two hundred and fifty four thousand NONA non farm payrolls, 563 00:28:41,240 --> 00:28:43,760 Speaker 4: the unemployment rate down to four point one percent, average 564 00:28:43,760 --> 00:28:47,600 Speaker 4: hourly earnings annualized up to four percent. That feels like 565 00:28:47,640 --> 00:28:51,720 Speaker 4: a really strong labor market. Are these numbers really reflective 566 00:28:51,720 --> 00:28:52,640 Speaker 4: of what's going on out there? 567 00:28:53,000 --> 00:28:54,920 Speaker 6: Well, you know, that's a good question. 568 00:28:55,040 --> 00:28:57,920 Speaker 5: And I haven't had time to delve into the part 569 00:28:57,920 --> 00:29:00,479 Speaker 5: time versus full time, which I always get, you know, 570 00:29:00,520 --> 00:29:03,760 Speaker 5: the tweets the people at me like, oh no, it's 571 00:29:03,800 --> 00:29:06,800 Speaker 5: all part time jobs. The economy has fallen apart, and 572 00:29:06,880 --> 00:29:10,360 Speaker 5: so you know, I think in some respects, if you 573 00:29:10,440 --> 00:29:12,680 Speaker 5: want a part time job, that it's great that we 574 00:29:12,760 --> 00:29:15,239 Speaker 5: have a labor market that's flexible enough to allow you 575 00:29:15,280 --> 00:29:17,640 Speaker 5: to have one. But if you want a part time 576 00:29:17,720 --> 00:29:20,680 Speaker 5: job because you're taking care of an elderly parent or 577 00:29:20,720 --> 00:29:24,800 Speaker 5: you can't find childcare, right, that is not an ideal economy. 578 00:29:24,880 --> 00:29:27,040 Speaker 5: So we really have to dig down into these numbers 579 00:29:27,080 --> 00:29:29,120 Speaker 5: and look, there's always going to be things to improve. 580 00:29:29,440 --> 00:29:31,840 Speaker 5: There's always going to be parts of the economy that 581 00:29:31,960 --> 00:29:37,200 Speaker 5: need attention, right, and so yes like that, there's always 582 00:29:37,240 --> 00:29:38,680 Speaker 5: going to be people that where we need to do 583 00:29:38,720 --> 00:29:43,440 Speaker 5: more for. But by and large, this is a solid economy. 584 00:29:43,480 --> 00:29:47,240 Speaker 5: And the question now is are rates too high? 585 00:29:47,440 --> 00:29:47,680 Speaker 6: Right? 586 00:29:47,800 --> 00:29:51,400 Speaker 5: Is the is the FED still restrictive? And how much 587 00:29:51,440 --> 00:29:53,920 Speaker 5: do they need to adjust and calibrate. 588 00:29:53,400 --> 00:29:54,200 Speaker 6: To be neutral? 589 00:29:54,240 --> 00:29:55,880 Speaker 5: Like does this job s afford to allow them to 590 00:29:55,880 --> 00:29:57,680 Speaker 5: be neutral? And I think, look, you don't want to 591 00:29:57,680 --> 00:29:59,840 Speaker 5: take too much away from one print. You were right 592 00:29:59,880 --> 00:30:03,520 Speaker 5: to look at the six month moving average and it's solid. 593 00:30:03,800 --> 00:30:07,560 Speaker 2: Okay. People say, do they stop the industry? How do 594 00:30:07,600 --> 00:30:09,560 Speaker 2: you do it? You know, how do you do this 595 00:30:10,280 --> 00:30:13,000 Speaker 2: parlor game? And the answer, folks, is I stole this 596 00:30:13,080 --> 00:30:15,960 Speaker 2: from John Michols. Wait years ago, you read a fourteen 597 00:30:16,080 --> 00:30:20,640 Speaker 2: page essay in the Economist magazine. I know you're writing 598 00:30:20,960 --> 00:30:24,560 Speaker 2: a fourteen page you're right now on China. Constance Hunter 599 00:30:24,960 --> 00:30:25,600 Speaker 2: on China. 600 00:30:25,760 --> 00:30:28,880 Speaker 5: Go So, I don't think the bazooka has very many 601 00:30:28,880 --> 00:30:32,040 Speaker 5: bullets or has enough bullets. And that's because there's no 602 00:30:32,120 --> 00:30:34,800 Speaker 5: way to really have enough bullets when you are in 603 00:30:34,880 --> 00:30:37,680 Speaker 5: a balance sheet recession, which is what China is in. 604 00:30:37,760 --> 00:30:42,000 Speaker 5: They have had a massive, massive adjustment to their property market. 605 00:30:42,040 --> 00:30:44,720 Speaker 5: And just to calibrate this for you, in the US, 606 00:30:44,800 --> 00:30:48,880 Speaker 5: before the Global Financial crisis, real estate residential real estate 607 00:30:48,960 --> 00:30:51,960 Speaker 5: was six percent of our GDP. We recalibrate it, it's 608 00:30:52,040 --> 00:30:56,720 Speaker 5: three percent now, okay. China's was twenty five percent. Okay, 609 00:30:56,760 --> 00:31:00,760 Speaker 5: So think about the magnitude of this recalibration it is 610 00:31:00,800 --> 00:31:03,520 Speaker 5: going to take. And we did stimulus right coming out 611 00:31:03,520 --> 00:31:06,440 Speaker 5: of the Global financial crisis, and it still took us 612 00:31:06,480 --> 00:31:08,800 Speaker 5: a decade really to get back. And I think what 613 00:31:08,840 --> 00:31:12,320 Speaker 5: probably jolted us into place was all the stimulus from 614 00:31:12,360 --> 00:31:15,320 Speaker 5: the pandemic, right, and so to think that China's going 615 00:31:15,400 --> 00:31:17,960 Speaker 5: to get over this in like a year, that's insane. 616 00:31:18,280 --> 00:31:20,800 Speaker 5: The question is how many decades will it take now? 617 00:31:20,840 --> 00:31:23,080 Speaker 2: They don't have they don't on a labor model. And 618 00:31:23,120 --> 00:31:28,200 Speaker 2: in protest in the answer Lands, Ambassador Chinese Ambassadors of 619 00:31:28,240 --> 00:31:31,440 Speaker 2: the US, Nick Burns, was out in Chengdu this week 620 00:31:31,480 --> 00:31:35,280 Speaker 2: by train out there by train. They don't have time 621 00:31:35,360 --> 00:31:37,000 Speaker 2: for years to fix us, do they. 622 00:31:37,600 --> 00:31:42,440 Speaker 5: I mean, it will possibly strain the social fabric. You know, 623 00:31:42,440 --> 00:31:44,360 Speaker 5: you have high youth unemployment right now. 624 00:31:44,520 --> 00:31:45,520 Speaker 6: That's amazing. 625 00:31:46,320 --> 00:31:50,200 Speaker 5: Well it's hard to actually calibry because they stopped publishing it. 626 00:31:50,360 --> 00:31:52,920 Speaker 4: But what's that mean for the rest of the global economy. 627 00:31:52,920 --> 00:31:54,800 Speaker 4: Don't we depend upon them to make stuff to buy 628 00:31:54,800 --> 00:31:55,520 Speaker 4: stuff on it? 629 00:31:55,800 --> 00:31:56,120 Speaker 6: Well? 630 00:31:56,240 --> 00:31:58,840 Speaker 5: Yes, I mean the US economy is really a large 631 00:31:58,880 --> 00:32:01,920 Speaker 5: closed economy in many respects. Trade you know, net trade 632 00:32:01,960 --> 00:32:04,520 Speaker 5: is not a huge part of our GDP. And that's 633 00:32:04,680 --> 00:32:06,760 Speaker 5: how we can be the reserve currency. We couldn't be 634 00:32:06,800 --> 00:32:08,960 Speaker 5: the reserve currency if we were a small, open economy 635 00:32:09,000 --> 00:32:11,480 Speaker 5: because we wouldn't be able to withstand fluctuations in the 636 00:32:11,520 --> 00:32:15,960 Speaker 5: dollar right, so, but Europe were looking to improve slightly, 637 00:32:16,040 --> 00:32:17,920 Speaker 5: but that's from a very low base. 638 00:32:18,560 --> 00:32:20,640 Speaker 2: Please come back after you go to London and have 639 00:32:20,680 --> 00:32:23,000 Speaker 2: the Big Mac at Liverpool station to make the Big 640 00:32:23,040 --> 00:32:25,840 Speaker 2: Mac index go. I really want to talk to you 641 00:32:26,040 --> 00:32:30,000 Speaker 2: about the draggy model I would miss with Stephanie Flanders. 642 00:32:30,280 --> 00:32:33,560 Speaker 2: This week mccran was on Fire. 643 00:32:33,760 --> 00:32:37,200 Speaker 6: I watched that interview. That was amazing. It was amazing. 644 00:32:37,480 --> 00:32:39,800 Speaker 6: But yeah, he did a great job at sign job. 645 00:32:39,760 --> 00:32:42,360 Speaker 2: Fire about the drug We haven't talked enough about the 646 00:32:42,400 --> 00:32:45,640 Speaker 2: drug thing, Paul. I think it's you mean Constant in Paris. 647 00:32:46,480 --> 00:32:49,320 Speaker 6: I think that that's must must do, must do radio. 648 00:32:49,680 --> 00:33:04,560 Speaker 2: Absolutely constant, Honey, thank you so much, the one guy 649 00:33:04,640 --> 00:33:08,160 Speaker 2: who stayed on top of the story that's out there 650 00:33:08,400 --> 00:33:13,240 Speaker 2: with the eight other distractions, the horrific hurricane results that 651 00:33:13,320 --> 00:33:16,240 Speaker 2: we see all the politics of the moment. You know, 652 00:33:16,280 --> 00:33:18,640 Speaker 2: what are the candidates doing today, Paul, besides yelling at 653 00:33:18,640 --> 00:33:20,360 Speaker 2: each other? Yeah, I don't know me. That's it. We 654 00:33:20,400 --> 00:33:23,520 Speaker 2: go to our expert, Joe Matthew with us a balance 655 00:33:23,560 --> 00:33:27,080 Speaker 2: of power. Joe, if all this foolishness wasn't going on, 656 00:33:27,680 --> 00:33:30,880 Speaker 2: Di'd be only one topic, which is are we putting 657 00:33:30,880 --> 00:33:35,720 Speaker 2: our military forces in harm's way in the Eastern Mediterranean? 658 00:33:36,160 --> 00:33:41,200 Speaker 2: Are we applying military force to Iran this weekend? 659 00:33:42,000 --> 00:33:46,360 Speaker 10: Well, applying is an interesting word there. Defending I suspect 660 00:33:46,440 --> 00:33:50,040 Speaker 10: is what the Pentagon would suggest. But yeah, we've serveged 661 00:33:50,200 --> 00:33:52,600 Speaker 10: thousands of troops into the region, and we have to 662 00:33:52,640 --> 00:33:56,640 Speaker 10: remember that while this most recent attack by Iran against 663 00:33:56,680 --> 00:34:00,200 Speaker 10: Israel brought defensive measures from a couple of US destroyers, 664 00:34:00,520 --> 00:34:02,960 Speaker 10: it was airmen and sailors who helped to knock down 665 00:34:03,160 --> 00:34:05,840 Speaker 10: a couple of hundred drones and rockets from Iran back 666 00:34:05,880 --> 00:34:08,240 Speaker 10: in April. So we do have to acknowledge the fact 667 00:34:08,520 --> 00:34:11,799 Speaker 10: that there are American service members who are potentially in 668 00:34:11,920 --> 00:34:15,160 Speaker 10: harm's way in our effort to defend Israel. This is 669 00:34:15,200 --> 00:34:17,320 Speaker 10: why we're so worried about a wider war bloom. 670 00:34:17,320 --> 00:34:20,239 Speaker 2: We've got a great map north to south on the 671 00:34:20,280 --> 00:34:24,960 Speaker 2: Iranian border of where various sundry targets are. From your sources, 672 00:34:24,960 --> 00:34:29,120 Speaker 2: a balance of power. What is the Pentagon considering in 673 00:34:29,280 --> 00:34:32,600 Speaker 2: assisting Israel or they just said get out of our way. 674 00:34:33,239 --> 00:34:35,120 Speaker 10: I think it's more get out of the way here, Tom. 675 00:34:35,120 --> 00:34:36,799 Speaker 10: I don't think You're going to see the US take 676 00:34:36,840 --> 00:34:40,520 Speaker 10: part in an attack on Iran, but what form that 677 00:34:40,560 --> 00:34:43,920 Speaker 10: attack will take remains a big question. People are assuming 678 00:34:43,960 --> 00:34:47,600 Speaker 10: that we're talking about ballistic missiles, maybe some sort of 679 00:34:47,640 --> 00:34:51,800 Speaker 10: ground incursion. But let's remember Stucksnet twenty years ago. Almost 680 00:34:51,840 --> 00:34:54,600 Speaker 10: at this point, Tom, could there be a cyber component 681 00:34:54,680 --> 00:34:57,840 Speaker 10: to this that would allow Iran to say, hey, nothing 682 00:34:57,920 --> 00:35:00,040 Speaker 10: happened here. They barely laid a glove on us, and 683 00:35:00,080 --> 00:35:03,319 Speaker 10: in fact could instill some real damage if they tried 684 00:35:03,360 --> 00:35:07,000 Speaker 10: again to attack, for instance, the centrifuges in their nuclear program. 685 00:35:07,000 --> 00:35:10,280 Speaker 10: Getting to those bunkers deep underground and deep under mountains 686 00:35:10,280 --> 00:35:12,239 Speaker 10: with munitions is a much taller order. 687 00:35:12,800 --> 00:35:17,120 Speaker 4: Joe, toit extent, is the White House the administration frustrated, 688 00:35:17,480 --> 00:35:20,200 Speaker 4: perhaps that they don't have more influence on NETANYAHUO. He 689 00:35:20,280 --> 00:35:22,480 Speaker 4: seems to be just kind of ignoring any and all 690 00:35:22,560 --> 00:35:24,760 Speaker 4: calls for moderation of the last Really. 691 00:35:24,840 --> 00:35:27,279 Speaker 10: I'd say that's ever ones. It's probably a ten out 692 00:35:27,280 --> 00:35:29,560 Speaker 10: of ten here, Paul. I don't know if the White 693 00:35:29,560 --> 00:35:32,680 Speaker 10: House has any influence right now. The deteriorating relationship between 694 00:35:32,880 --> 00:35:35,920 Speaker 10: Joe Biden and Benjamin Nettyah, who has been widely noted 695 00:35:36,080 --> 00:35:39,600 Speaker 10: and weekly calls for restraint have not been heard. That's 696 00:35:39,640 --> 00:35:42,360 Speaker 10: why we're on the precipice here and a very concerned 697 00:35:42,360 --> 00:35:45,360 Speaker 10: White House. If this coincides with our election in November, 698 00:35:45,480 --> 00:35:47,880 Speaker 10: that's where Tom Keane started, We've got problems. 699 00:35:47,960 --> 00:35:51,400 Speaker 2: How are the candidates adapting the newsold folks. My basic 700 00:35:51,480 --> 00:35:53,920 Speaker 2: theme here is if none of this was going on, 701 00:35:54,600 --> 00:35:57,759 Speaker 2: there would be no other topic in Amera this morning, 702 00:35:57,880 --> 00:36:01,600 Speaker 2: even the Jobs Day here in thirty minutes, Joe Matthew, 703 00:36:01,880 --> 00:36:05,239 Speaker 2: the Harris Trump distinction on what we see in the 704 00:36:05,280 --> 00:36:06,440 Speaker 2: Eastern Mediterranean. 705 00:36:06,960 --> 00:36:10,120 Speaker 10: It's all based on assumptions. Right now, people think that 706 00:36:10,200 --> 00:36:12,920 Speaker 10: Donald Trump will be friendlier to Benjamin Nett and Yahoo 707 00:36:12,920 --> 00:36:14,759 Speaker 10: and Kamala Harris will not. But the fact of the 708 00:36:14,840 --> 00:36:17,719 Speaker 10: matter is, if you look at the spoken words, the 709 00:36:17,760 --> 00:36:20,160 Speaker 10: actual words that are used by Kamala Harris, they sound 710 00:36:20,239 --> 00:36:23,840 Speaker 10: a lot like Joe Biden. We talk about October surprises. 711 00:36:23,880 --> 00:36:26,080 Speaker 10: This is like the October slog. We've got three of 712 00:36:26,120 --> 00:36:28,799 Speaker 10: them going right now. Because that doc workers strike isn't 713 00:36:28,800 --> 00:36:30,480 Speaker 10: over yet, guys, they still have to figure out the 714 00:36:30,520 --> 00:36:33,520 Speaker 10: automation component. All three of these could bend the race 715 00:36:33,760 --> 00:36:36,160 Speaker 10: in one direction or the other. As we're sitting here 716 00:36:36,200 --> 00:36:38,680 Speaker 10: in a one point race in the States, they count well. 717 00:36:38,760 --> 00:36:40,800 Speaker 4: So on that race front there when we have a 718 00:36:40,840 --> 00:36:42,680 Speaker 4: lot of news data points. As you point out, Joe, 719 00:36:42,680 --> 00:36:46,359 Speaker 4: I mean Liz Cheney endorsing Kamala Harris. What does that 720 00:36:46,400 --> 00:36:48,000 Speaker 4: mean for you folks in Washington. 721 00:36:48,160 --> 00:36:50,480 Speaker 10: I'm not sure if it means anything. It's a heck 722 00:36:50,520 --> 00:36:52,239 Speaker 10: of an optic to think that these two who don't 723 00:36:52,239 --> 00:36:54,480 Speaker 10: agree on a single political issue, we're sharing a stage 724 00:36:54,520 --> 00:36:56,920 Speaker 10: together like this. She said, she's been a Republican her 725 00:36:57,000 --> 00:37:00,200 Speaker 10: whole life since before Donald Trump started spray tanning, and 726 00:37:00,239 --> 00:37:02,520 Speaker 10: so this ought to mean something. But does that take 727 00:37:02,560 --> 00:37:04,800 Speaker 10: people out of the mushy middle here one way or 728 00:37:04,800 --> 00:37:05,080 Speaker 10: the other? 729 00:37:05,120 --> 00:37:05,480 Speaker 2: I don't know. 730 00:37:05,520 --> 00:37:07,360 Speaker 10: That's look, they're trying to do anything they can to 731 00:37:07,360 --> 00:37:08,480 Speaker 10: get every vote that counts. 732 00:37:08,520 --> 00:37:11,640 Speaker 2: I mean, bouncer powers extending to a six hour broadcast here, 733 00:37:12,680 --> 00:37:14,640 Speaker 2: Matthew's not going to walk out of the building t 734 00:37:15,320 --> 00:37:19,440 Speaker 2: at PM away from the Eastern Mediterranean? What's your number 735 00:37:19,480 --> 00:37:22,120 Speaker 2: one topic? Is you and Kayley plan the day? 736 00:37:22,640 --> 00:37:26,280 Speaker 10: I'm watching Georgia today, guys, Donald Trump and Brian Kemp, 737 00:37:26,360 --> 00:37:28,640 Speaker 10: are you kidding me? Remember Donald Trump called him a 738 00:37:28,680 --> 00:37:31,000 Speaker 10: bad guy and an average governor? Today they're actually going 739 00:37:31,080 --> 00:37:34,719 Speaker 10: to be together in Georgia, as they were both invited 740 00:37:34,760 --> 00:37:37,239 Speaker 10: to get an update here on the storm damage. Maybe 741 00:37:37,280 --> 00:37:38,000 Speaker 10: they'll break bread. 742 00:37:38,000 --> 00:37:38,360 Speaker 2: I don't know. 743 00:37:38,400 --> 00:37:40,880 Speaker 10: But he's got Elon Musk covering him in Butler this weekend. 744 00:37:40,920 --> 00:37:43,800 Speaker 10: So Donald Trump's keeping company with some interesting folks. 745 00:37:44,160 --> 00:37:46,719 Speaker 4: Well, I mean this news on the dock workers, Joe, 746 00:37:46,719 --> 00:37:48,120 Speaker 4: I mean, I guess if you're President of Biden, you 747 00:37:48,160 --> 00:37:50,160 Speaker 4: want to or Kamala Harris and you want to wave 748 00:37:50,200 --> 00:37:52,200 Speaker 4: that around. That's got to be a net positive on 749 00:37:52,239 --> 00:37:54,080 Speaker 4: the margin for sure. 750 00:37:54,320 --> 00:37:56,239 Speaker 10: As I mentioned though, they still have to work out 751 00:37:56,280 --> 00:37:58,279 Speaker 10: the automation component. But yeah, they just took a big 752 00:37:58,280 --> 00:38:01,560 Speaker 10: problem off the table at least between now and November. 753 00:38:01,920 --> 00:38:04,520 Speaker 10: And Kamala Harris. Interesting, they each kicked out their own 754 00:38:04,560 --> 00:38:06,480 Speaker 10: statements last night. You see that it wasn't just from 755 00:38:06,520 --> 00:38:09,200 Speaker 10: the White House. You got one from Joe one from Kamala. 756 00:38:09,280 --> 00:38:12,200 Speaker 10: They essentially said the same thing. She's calling for fairness 757 00:38:12,520 --> 00:38:15,800 Speaker 10: and acknowledging the power as they say, of collective bargaining. 758 00:38:15,800 --> 00:38:17,719 Speaker 10: But that's not something that she wanted to answer to 759 00:38:17,960 --> 00:38:19,600 Speaker 10: between now and November, and it could have, as you 760 00:38:19,640 --> 00:38:22,839 Speaker 10: well know, caused a massive economic interruption that doesn't help 761 00:38:22,880 --> 00:38:24,879 Speaker 10: the price of oil though, guys, which brings us back 762 00:38:25,080 --> 00:38:26,319 Speaker 10: to this story in the Middle East. 763 00:38:27,000 --> 00:38:29,760 Speaker 2: I mean Joey, I mean, he's got a clock embedded 764 00:38:29,800 --> 00:38:33,040 Speaker 2: in his neck. You know, he got Sergiy Dunpez general. 765 00:38:33,200 --> 00:38:34,120 Speaker 10: You have one of those too. 766 00:38:34,160 --> 00:38:37,319 Speaker 2: I think you know it's October four, which I'm going 767 00:38:37,400 --> 00:38:40,560 Speaker 2: to say is thirty one days to joy. What's the 768 00:38:40,920 --> 00:38:43,760 Speaker 2: breathlessness of the two campaigns. 769 00:38:44,680 --> 00:38:47,200 Speaker 10: The breathlessness is really. 770 00:38:47,160 --> 00:38:48,839 Speaker 2: The shortness of it all. 771 00:38:49,000 --> 00:38:51,360 Speaker 10: Look, I think that normally we'd be gearing up for 772 00:38:51,400 --> 00:38:53,480 Speaker 10: another debate right now. I've heard you talk about this 773 00:38:53,600 --> 00:38:56,680 Speaker 10: gap between the vice presidential debate and actual election day. 774 00:38:56,760 --> 00:38:59,680 Speaker 10: That's real, which gives these campaigns a little more time, 775 00:38:59,719 --> 00:39:02,160 Speaker 10: I guess to spend money and get ready for closing arguments. 776 00:39:02,160 --> 00:39:05,520 Speaker 10: But I'll remind you people are already voting, and that's 777 00:39:05,560 --> 00:39:08,080 Speaker 10: what matters right now, including the two states that were 778 00:39:08,160 --> 00:39:10,439 Speaker 10: ravaged by this storm. And I wonder what that means 779 00:39:10,440 --> 00:39:10,960 Speaker 10: for turnout. 780 00:39:11,000 --> 00:39:11,160 Speaker 5: Yeah. 781 00:39:11,160 --> 00:39:14,319 Speaker 2: I talked to Mike McKee, Joe Matthew, and we both 782 00:39:14,360 --> 00:39:18,719 Speaker 2: decided we're so permanently scarred from nineteen eighty six that 783 00:39:18,840 --> 00:39:21,120 Speaker 2: we can't get it on for the amazings. Were you 784 00:39:21,239 --> 00:39:23,680 Speaker 2: able to watch the Alonso home run last night. 785 00:39:24,600 --> 00:39:27,040 Speaker 10: I still have my nineteen eighty six bumper sticker on 786 00:39:27,080 --> 00:39:29,160 Speaker 10: my guitar case, Tom, which is something that someday I 787 00:39:29,160 --> 00:39:30,440 Speaker 10: hope I get a chance to show. 788 00:39:30,320 --> 00:39:33,280 Speaker 2: You that would be good. Joe Matthew, thank you so much. 789 00:39:33,480 --> 00:39:36,720 Speaker 2: This is a Bloomberg Surveillance podcast, bringing you the best 790 00:39:36,719 --> 00:39:41,439 Speaker 2: in economics, finance, investment, and international relations. You can also 791 00:39:41,560 --> 00:39:45,600 Speaker 2: watch the show live on YouTube. Visit the Bloomberg Podcast 792 00:39:45,719 --> 00:39:49,759 Speaker 2: channel on YouTube to see the show weekday mornings from 793 00:39:49,800 --> 00:39:53,040 Speaker 2: seven to ten am Eastern from our global headquarters in 794 00:39:53,160 --> 00:39:56,839 Speaker 2: New York City. Subscribe to the podcast on Apple, Spotify, 795 00:39:57,200 --> 00:40:02,040 Speaker 2: or anywhere else you listen, and Alwaysloomberg Radio, the Bloomberg Terminal, 796 00:40:02,360 --> 00:40:04,080 Speaker 2: and the Bloomberg Business app.