WEBVTT - Bloomberg Daybreak: December 15, 2022 - Hour 1 (Radio) 0:00:02.520 --> 0:00:05.240 Live from the Bloomberg into Ractive Brooker Studios. This is 0:00:05.240 --> 0:00:09.280 Bloombergy tape right for Thursday, December fifteen two. Coming up, 0:00:09.320 --> 0:00:13.039 the shower stocks continue their sell off following J. Powell's 0:00:13.119 --> 0:00:15.920 hawkish tone. Now it's the E. C. D and Beck 0:00:15.960 --> 0:00:19.639 of England's turn to make great decisions. China's economy weekend 0:00:19.880 --> 0:00:23.680 before the government dropped COVID zero and Elon Muska dumps 0:00:23.800 --> 0:00:27.320 more shares of Tesla. I maybe Morris New Jersey Transit 0:00:27.320 --> 0:00:31.040 will spend ninety seven million dollars for new transportation, and 0:00:31.160 --> 0:00:34.760 investigators are searching for the cause of that NYPD warehouse 0:00:34.840 --> 0:00:37.680 fire in Brooklyn. I'm John Stas and sports. The Knicks 0:00:37.720 --> 0:00:40.240 made it five straight wins. They beat the Bowls in overtime. 0:00:40.240 --> 0:00:45.760 The Ranger SECRETI straight win tonight. That's all trading ahead 0:00:45.800 --> 0:00:49.360 on Bloomberg day Break on Bloomberg eleven, Free on New York, 0:00:49.560 --> 0:00:54.240 Bloomberg one, Washington, d C, Bloomberg one oh six one, Boston, 0:00:54.520 --> 0:00:58.920 Bloomberg nine sixties and Francisco Sirius x M one nineteen 0:00:59.160 --> 0:01:01.960 and around the world Old on Bloomberg Radio dot Com 0:01:02.040 --> 0:01:06.960 and via the Bloombird Business app. I'm Stephen Carrol eu lead. 0:01:08.240 --> 0:01:11.080 Good morning. I'm Nathan Hagar and I'm Karen Moscow, and 0:01:11.200 --> 0:01:14.959 US stock index futures are falling this morning. It is 0:01:15.080 --> 0:01:17.319 five oh one on Wall Street. We check the markets 0:01:17.360 --> 0:01:19.760 all day long. Here on Bloomberg right now is in 0:01:19.840 --> 0:01:22.720 p Futures are down forty four points, sets down one 0:01:22.760 --> 0:01:26.440 point one percent. Down futures down two one, that's down 0:01:26.480 --> 0:01:29.600 nine tens of a percent, and NASDAC features down one sixty, 0:01:29.680 --> 0:01:32.119 that's down one and a third percent. And the tenure 0:01:32.160 --> 0:01:35.679 Treasury that'll change, you'll three point four seven percent. Nathan, Yeah, 0:01:35.680 --> 0:01:38.440 the sell off continues this morning, Karen. Following the Federal 0:01:38.480 --> 0:01:41.800 Reserves final policy decision of the year, as expected, the 0:01:41.800 --> 0:01:44.840 Central Bank raised interest rates by another fifty basis points, 0:01:45.080 --> 0:01:48.200 but Chairman J. Powell pushed back at market hopes for 0:01:48.280 --> 0:01:52.120 a pivot to lower rates anytime soon. Price stability is 0:01:52.160 --> 0:01:54.880 the responsibility of the Federal Reserve and serves as the 0:01:54.880 --> 0:01:59.400 bedrock of our economy. Without price stability, the economy doesn't 0:01:59.400 --> 0:02:02.600 work for any one. In particular, Without price stability, we 0:02:02.640 --> 0:02:05.640 will not achieve a sustained period of strong labor market 0:02:05.640 --> 0:02:08.680 conditions that benefit all. J. J. Powell says the FED 0:02:08.720 --> 0:02:11.920 plans to stay the course until the job is done well. 0:02:12.000 --> 0:02:15.760 Nathan Stock snapfter two day winning streak after Powell's remarks 0:02:15.760 --> 0:02:19.200 about Buggenheim chief investment officer Scott Minor, it says Powell's 0:02:19.200 --> 0:02:22.359 tone should not have come as a surprise. We knew 0:02:22.480 --> 0:02:26.120 they had to be very hawkish, and the reason they 0:02:26.120 --> 0:02:29.440 had to be hawkish is that, you know, financial conditions 0:02:29.840 --> 0:02:33.560 have loosened pretty dramatically over the last six weeks. Uh. 0:02:33.600 --> 0:02:37.040 You know, the stock markets up substantially, rates her down 0:02:37.240 --> 0:02:40.359 meaningfully and so um. You know, the FED I think, 0:02:40.400 --> 0:02:43.120 felt that it needs to lean into that. And those 0:02:43.160 --> 0:02:45.880 are marks from Scott Minored at Guggenheim are being echoed 0:02:45.919 --> 0:02:49.760 by KPMG chief economist Diane Swung. They are more than 0:02:49.800 --> 0:02:53.160 willing to start helping rights if inflation comes down more rapidly. 0:02:53.400 --> 0:02:56.160 They have to send this message right now, and I 0:02:56.200 --> 0:02:59.160 think that's where they stand. They will be a political Panada. 0:02:59.480 --> 0:03:02.079 I have no out about j. Powell's ability to handle 0:03:02.160 --> 0:03:05.440 the politics, given what he's already been through. KPMG Day 0:03:05.440 --> 0:03:08.680 and Swunk and Scott Minored were joined joined us on 0:03:08.680 --> 0:03:11.840 a special edition of Bloomberg Surveillance following the FED decision, 0:03:12.200 --> 0:03:15.720 and we have more central bank decisions on the way, Karen, 0:03:15.800 --> 0:03:18.520 two big ones out of Europe. We begin our team 0:03:18.560 --> 0:03:22.119 coverage with Bloomberg's Lizzie Burden in London, where the Bank 0:03:22.160 --> 0:03:24.280 of England is expected to follow the FED with a 0:03:24.320 --> 0:03:27.360 fifty basis point hike. For me, what's the most interesting 0:03:27.400 --> 0:03:30.079 thing today will be the vote split, because potentially it's 0:03:30.080 --> 0:03:31.959 going to see a lot about where we had from 0:03:32.000 --> 0:03:36.000 here in terms of tightening. Bank of America JP Morgan 0:03:36.120 --> 0:03:39.200 and Numura have pointed to the possibility of a four 0:03:39.240 --> 0:03:42.640 way split between seventy five fifty twenty five and no 0:03:42.840 --> 0:03:45.000 hike at all. It would be the first time in 0:03:45.040 --> 0:03:49.400 the bank's independent history and that might seem chaotic, but 0:03:49.640 --> 0:03:52.160 really some welcome it as a confirmation that there's no 0:03:52.280 --> 0:03:56.040 groupthink on thread Needle Street. Bloomberg's Lizzie Burden reports the 0:03:56.040 --> 0:03:58.760 BOE decision comes down less than two hours from now, 0:03:59.200 --> 0:04:02.160 and just over an hour after the BOE announcement, Nathan 0:04:02.240 --> 0:04:05.600 we hear from the European Central Bank. Bloomberg's Maria today 0:04:05.640 --> 0:04:09.040 O continues our team coverage with details on that from Frankfurt, 0:04:09.200 --> 0:04:11.120 there was this debate would it be fifty, would it 0:04:11.160 --> 0:04:13.680 be seventy five? But of course we can't ignore that 0:04:13.720 --> 0:04:16.679 this is coming off the back of the Fed going 0:04:16.920 --> 0:04:21.400 for fifty. The animal spirits also in Frankfort, suggesting this 0:04:21.480 --> 0:04:25.400 is now inclined towards fifty basis points that would take 0:04:25.440 --> 0:04:29.120 the deposit weight to two percent, and of course signal 0:04:29.200 --> 0:04:33.560 discontinuation of hikes from the central bank. Bloomberg's Maria today 0:04:33.640 --> 0:04:35.799 O says all but three of the fifty one economist 0:04:35.839 --> 0:04:38.880 surveyed by Bloomberg predict a fifty basis point move from 0:04:38.880 --> 0:04:41.400 the e c B. Fifty basis points seems to be 0:04:41.440 --> 0:04:44.120 a theme for central banks. Karen, we also heard from 0:04:44.120 --> 0:04:46.600 the Swiss National Bank this morning and they raised rates, 0:04:46.720 --> 0:04:50.640 you guessed it, by fifty basis points, bringing the benchmark 0:04:50.720 --> 0:04:54.640 in Switzerland to one. Alright, we turned to Asia now, Nathan, 0:04:54.680 --> 0:04:57.599 we're economic data in focus, and fresh data out of 0:04:57.600 --> 0:05:00.480 Beijing shows growth slowed in November. That's before the government 0:05:00.560 --> 0:05:03.760 dropped as COVID zero policy. Bloomberg day Break Asia anchor 0:05:03.760 --> 0:05:07.280 Brian Curtis has more from Hong Kong. Retail sales contracted 0:05:07.320 --> 0:05:09.920 five point nine percent in November from a year ago 0:05:10.200 --> 0:05:12.120 and that was worse than the four percent to climb. 0:05:12.120 --> 0:05:15.719 In a Bloomberg survey, Industrial output grew two point two 0:05:15.760 --> 0:05:18.600 percent from a year ago, that also missed the estimate. 0:05:18.920 --> 0:05:21.600 COVID outbreaks across the country meant that people went out 0:05:21.640 --> 0:05:25.599 less and spent less money. Economists expect more disruption in 0:05:25.640 --> 0:05:29.680 the coming months. Brian Curtis, Bloomberg Radio. Okay, Brian, thanks. 0:05:29.680 --> 0:05:32.360 In Corporate News this morning, we're watching shares of Tesla 0:05:32.440 --> 0:05:35.400 after Elon Musk sold another chunk of his steak in 0:05:35.440 --> 0:05:38.440 the company. It's got the latest Live with Bloomberg Steve Rappaport, 0:05:38.440 --> 0:05:40.680 Good morning, Stave. You had morning, Nathan and Karen Well. 0:05:40.720 --> 0:05:42.840 It wouldn't be a newsday without a mention of Musk 0:05:42.880 --> 0:05:45.720 and his latest move, the Tesla founder unloading another three 0:05:45.720 --> 0:05:49.000 point six billion dollars in company shares. Musk already sold 0:05:49.040 --> 0:05:51.480 off eighteen billion in stock this year to finance his 0:05:51.520 --> 0:05:55.680 acquisition of Twitter and the electric automaker. Stock plummeted this 0:05:55.800 --> 0:05:59.159 year as investors grow concerned about Musk purchasing the platform. 0:05:59.440 --> 0:06:02.080 With this year sell off, Tesla valuation dropped below five 0:06:02.160 --> 0:06:06.040 hundred billion dollars for the first time since November. Live 0:06:06.080 --> 0:06:09.600 in New York. I'm Steve Rappaport Bloomberg Day Break Right, Steve, Thanks, 0:06:09.600 --> 0:06:11.800 and Tesla shares are down two point seven percent in 0:06:11.880 --> 0:06:15.080 early trading. Meanwhile, the fallout continues in the crypto space 0:06:15.360 --> 0:06:18.160 after the collapse of f t X. Democratic Senator Elizabeth 0:06:18.200 --> 0:06:20.880 Lawren is announcing if by partisan bill aim to crack 0:06:20.920 --> 0:06:24.320 down on digital currencies used in money laundering. This is 0:06:24.360 --> 0:06:27.360 all about what we need to do right now, and 0:06:27.400 --> 0:06:30.400 we need to stop the money laundering. We need to 0:06:30.400 --> 0:06:33.680 stop the cheating that's going on in crypto, and that 0:06:33.720 --> 0:06:36.640 means just getting a set of rules in place. Same 0:06:36.720 --> 0:06:40.120 kind of transaction, same kind of risk, means we've got 0:06:40.120 --> 0:06:42.920 to have the same rules. And it also means we've 0:06:42.920 --> 0:06:45.520 got to have a cop on the beat who was 0:06:45.600 --> 0:06:50.240 well enough financed. And if Senator Lawrensville becomes law, crypto 0:06:50.320 --> 0:06:53.320 exchanges will be required to verify customer identities the way 0:06:53.360 --> 0:06:56.640 banks and other financial institutions already do. Straight ahead your 0:06:56.720 --> 0:07:03.920 latest local headlines and this is Bloomberg. Thanks Karen. It 0:07:04.080 --> 0:07:06.960 is thirty three degrees in midtown Manhattan. We got rain 0:07:07.000 --> 0:07:09.040 moving in this afternoon, heading to the mid forties. It 0:07:09.040 --> 0:07:12.320 will turn breezy tonight, evening lows in the forties. Temperatures 0:07:12.320 --> 0:07:16.080 will rise overnight as rain continues. Time now to look 0:07:16.080 --> 0:07:17.760 at some of the other stories making news in New 0:07:17.840 --> 0:07:19.840 York and around the world. For that, we're joined by 0:07:19.880 --> 0:07:23.200 Bloomberg's Amy Morris. Good morning, Amy, all right, Good morning Nathan. 0:07:23.240 --> 0:07:26.520 The courts will not step into immediately stop New York 0:07:26.600 --> 0:07:29.800 Mayor Eric adams plans to force mentally ill people from 0:07:29.880 --> 0:07:33.160 the streets and into treatment. The judge found no evidence 0:07:33.160 --> 0:07:36.160 that irreparable harm would occur before he issues his final 0:07:36.240 --> 0:07:38.760 ruling on the practice in a couple of weeks. Advocates 0:07:38.760 --> 0:07:41.360 for people with mental illnesses. When it stopped, they say 0:07:41.400 --> 0:07:45.160 police officers should not be first responders for those needing healthcare. 0:07:45.480 --> 0:07:48.640 Crews are still looking for hot spots as investigators search 0:07:48.720 --> 0:07:51.160 for the cause of a huge fire at an NYPD 0:07:51.280 --> 0:07:55.440 evidence warehouse in Brooklyn. Former police Chief Terry Monahan says 0:07:55.480 --> 0:07:58.480 everything's been destroyed. They really don't even expect anything to 0:07:58.520 --> 0:08:01.520 be salvageable in there. Obviously, they're not going to oversaw 0:08:02.000 --> 0:08:04.840 until they get inside and start looking around on hands 0:08:04.880 --> 0:08:07.280 and some items in the warehouse, We're going to be destroyed. 0:08:07.320 --> 0:08:10.160 Anyway before the blaze, but some of the eleven thousand 0:08:10.280 --> 0:08:14.440 barrels of evidence were related to COLT cases. New Jersey 0:08:14.440 --> 0:08:17.280 Transit is spending nineties seven million dollars to buy a 0:08:17.280 --> 0:08:21.680 new ferry, sixty new busses, and rebuild thirty five locomotives, 0:08:21.880 --> 0:08:24.640 and jay dot com reports the board exercised an option 0:08:24.680 --> 0:08:28.400 with New Flyer to buy sixty more articulated buses. They 0:08:28.440 --> 0:08:32.360 awarded seven million dollars in contracts to Hornblower Yacht for 0:08:32.400 --> 0:08:35.320 a new ferry, and they'll contract with Caterpillar for the 0:08:35.320 --> 0:08:38.400 new locomotives. The Transits Board of Directors signed off on 0:08:38.400 --> 0:08:41.440 the plan yesterday. New Jersey Governor Phil Murphy is urging 0:08:41.440 --> 0:08:44.760 parents to get their young children updated coronavirus booster shots. 0:08:45.000 --> 0:08:47.880 Murphy says children ages six months to five years old 0:08:47.920 --> 0:08:51.040 are eligible now to get those vaccines, but only five 0:08:51.080 --> 0:08:53.240 and a half percent of New Jersey children between the 0:08:53.240 --> 0:08:56.440 ages of six months and four years have completed their 0:08:56.440 --> 0:09:02.120 primary series. Russian cosmonauts can'ts to plan spacewalk yesterday when 0:09:02.160 --> 0:09:06.560 they noticed a leak outside their spacecraft. NASA officials talked 0:09:06.559 --> 0:09:09.600 about it. We noticed a visible stream of flakes coming 0:09:09.679 --> 0:09:12.280 from the aft of the Sayers near the instrumentation and 0:09:12.320 --> 0:09:17.360 propulsion module that was indicative of the spacecraft is ducked 0:09:17.400 --> 0:09:20.640 at the International Space Station Russia. Still trying to figure 0:09:20.679 --> 0:09:23.200 out what it is and what caused it. Global News 0:09:23.240 --> 0:09:26.120 twenty four hours a day on airin Don Bloomberg Quick Take, 0:09:26.200 --> 0:09:30.120 powered by more than journalists and analysts in more than 0:09:30.160 --> 0:09:34.320 one countries. I'm anymore is this is Bloomberg, Nathan, Thank 0:09:34.360 --> 0:09:41.400 you Amy. Time now for the Bloomberg Sports Upday, brought 0:09:41.440 --> 0:09:44.040 to you by Tri stayed out. He here's John Stanho. 0:09:44.160 --> 0:09:46.040 Good morning, John, Good morning. Eat the next with the 0:09:46.040 --> 0:09:49.320 start of an unusual two games series in Chicago. Played 0:09:49.320 --> 0:09:51.400 the Bulls last night and they'll be there again tomorrow. 0:09:51.440 --> 0:09:54.520 Last night went overtime, Nicks pulled out the win on 0:09:55.440 --> 0:09:57.480 their fifth win in a row, and Julius Randalls had 0:09:57.520 --> 0:09:59.200 a lot to do with that plane. Much more like 0:09:59.280 --> 0:10:02.360 you did two years ago then last season when he struggled. 0:10:02.440 --> 0:10:05.000 Randalls scored thirty one at thirteen b bound seven assist 0:10:05.040 --> 0:10:08.360 thirty points. Here Jalen Brunson. The Warriors lost at Indiana, 0:10:08.400 --> 0:10:10.720 defending NBA champs. Can't went on the road. They're two 0:10:10.760 --> 0:10:14.320 and thirteen and Steph Curry left last night when injured shoulder. 0:10:14.400 --> 0:10:17.600 Rangers host Toronto Tonight. Blue Shirts have won their last 0:10:17.600 --> 0:10:20.319 four college hopes easy went for Seaton Hall over Drexel 0:10:20.360 --> 0:10:23.040 battle of top twenty teams. U C l A went 0:10:23.080 --> 0:10:25.240 to Maryland and won easily, up by twenty nine at 0:10:25.240 --> 0:10:27.960 a half. Sunday's World Cup Final promises to be a 0:10:27.960 --> 0:10:31.040 classic Argentina, with Lionel Messi looking for his elusive first 0:10:31.120 --> 0:10:34.040 championship taking on France, who has a chance to win 0:10:34.120 --> 0:10:36.800 back to back World Cups. It's only happened once, and 0:10:36.800 --> 0:10:39.360 that was Brazil sixty years ago. As the Jets get 0:10:39.360 --> 0:10:42.120 ready to host the Detroit Lyons, Sunday, coach Rob Sala 0:10:42.160 --> 0:10:45.720 asked about quarterback Zack Wilson, who lost his starting job. 0:10:46.320 --> 0:10:49.640 Been doing a great job, he he has. He's been 0:10:49.679 --> 0:10:53.160 deliberate in his approach over the last three weeks. Um, 0:10:53.280 --> 0:10:56.600 he's been pulled himself accountable with regards to how he 0:10:56.640 --> 0:11:00.280 wants to attack practice. Uh, how he's been warming in 0:11:00.360 --> 0:11:02.760 practice going against our defense, which I think is a 0:11:02.760 --> 0:11:05.880 pretty good defensive goal against. Salvo has moved Wilson from 0:11:06.000 --> 0:11:08.880 third string up the second behind Mike White, the forty 0:11:08.960 --> 0:11:11.440 Niners bring their sixth game winning straight tonight into Seattle. 0:11:11.640 --> 0:11:13.480 Chance of the Niners that clinch the NFC West. Their 0:11:13.559 --> 0:11:16.880 quarterback now is rookie Rock Purdy, though the Niners listing 0:11:16.920 --> 0:11:20.120 as questionable rib and oblique injuries X Matt Noah Synder 0:11:20.120 --> 0:11:23.720 guards signed with the Dodgers. John Stashwarre Bloomberg Sports, Nathan 0:11:23.920 --> 0:11:26.680 all Right, John, thank you, and Bloomberg Sports was brought 0:11:26.679 --> 0:11:29.240 to you by Audie. Don't let someone else drive off 0:11:29.600 --> 0:11:32.080 in the autie model you've always wanted. Visit your local 0:11:32.120 --> 0:11:34.000 price state autie dealer to get behind the wheel of 0:11:34.000 --> 0:11:38.240 yours today, or visit outie offers dot com for more information. 0:11:38.840 --> 0:11:42.400 SMP futures down forty three points, a drop of one 0:11:42.480 --> 0:11:45.559 point one percent following the FED decision. DAL futures down 0:11:45.600 --> 0:11:48.480 two hundred seventy nine points. In NASDAC futures on the 0:11:48.559 --> 0:11:51.080 decline by a hundred fifty five points. That's the drop 0:11:51.120 --> 0:11:54.440 of one point three percent. The tenure treasury is down 0:11:54.480 --> 0:11:56.839 one thirty second. The yield three point four eight percent 0:11:56.880 --> 0:11:59.480 yield on the two year four point to four percent. 0:12:02.800 --> 0:12:06.199 Live from coast to coast, from New York to San Francisco, 0:12:06.400 --> 0:12:10.280 Boston to Washington, d C. Nationwide on Sirius Examp, the 0:12:10.320 --> 0:12:14.960 Bloomberg Business app, and Bloomberg dot Com. This is Bloomberg Daybreak. 0:12:16.160 --> 0:12:18.680 You are listening to Bloomberg day Break. Good morning. I'm 0:12:18.760 --> 0:12:22.520 Nathan Hagar on a morning following some tough medicine from 0:12:22.520 --> 0:12:25.600 Federal Reserve chair Jerome Powell to a market that has 0:12:25.640 --> 0:12:28.600 been hoping for lower interest rates next year, Pal says 0:12:28.640 --> 0:12:31.640 there is still a ways to go to get inflation 0:12:31.760 --> 0:12:34.400 under control. And later this morning the European Central Bank 0:12:34.400 --> 0:12:37.119 in the Bank of England get their turn in the spotlight. 0:12:37.200 --> 0:12:40.160 Let's get more insights now. Simon French is with US 0:12:40.520 --> 0:12:44.840 chief economist at PAMR Gordon Simon, good morning. Were you 0:12:44.880 --> 0:12:49.480 surprised by the hawkish tone from Chairman Powell? Good morning? 0:12:49.520 --> 0:12:52.000 Nice and h No, I wasn't. If I'm honest, I 0:12:52.040 --> 0:12:56.120 think the while we've seen a rollover in both core 0:12:56.200 --> 0:12:59.480 and headline U S insation, I think it's still uncomfortably 0:12:59.520 --> 0:13:02.040 high from any people on the FMC. And what was 0:13:02.200 --> 0:13:05.400 I was really struck by in the summary of economic 0:13:05.400 --> 0:13:10.080 projections is quite how much FMC participants still see the 0:13:10.240 --> 0:13:13.480 risks to their inflation forecasts as skewed to the high side, 0:13:14.320 --> 0:13:20.400 and the risks therefore of more interest rate increases during 0:13:21.400 --> 0:13:23.720 the the market is pricing. But let's make no mistake 0:13:23.840 --> 0:13:27.640 that Jerom Powell is taking on the bond market, which 0:13:27.679 --> 0:13:31.880 is not believing of that policy action. Is this a 0:13:31.960 --> 0:13:35.199 FED that's trying to steer the market then towards tighter 0:13:35.240 --> 0:13:38.720 conditions to kind of do some of the work for 0:13:38.800 --> 0:13:43.640 the Fed. I think you're absolutely right. Financial conditions across 0:13:43.640 --> 0:13:47.880 a broad set of metrics have have loosened in recent weeks. 0:13:47.960 --> 0:13:53.480 On those simply on extraly market evaluations moving higher, a 0:13:53.600 --> 0:13:56.520 bit of a sell off on the US dollar loosening, 0:13:56.559 --> 0:13:59.200 the kind of financial conditions that Jerom Powell the FED 0:13:59.240 --> 0:14:04.600 actually want to snuff out core inflation in the US economy. 0:14:04.640 --> 0:14:09.400 Were thinking wages, shelter rents, the type of persistent wage 0:14:09.679 --> 0:14:13.280 pressures that actually monetary policy is better at addressing, and 0:14:13.320 --> 0:14:15.679 he is worried that that job becomes harder than more 0:14:15.720 --> 0:14:20.040 the market tries to front run any either plateau ng 0:14:20.120 --> 0:14:23.880 or subsequent cuts in in the FED funds rate. So yeah, absolutely, 0:14:23.880 --> 0:14:28.520 I think he's uncomfortable with pricing. And yesterday's dynamics were 0:14:28.560 --> 0:14:31.480 designed to lean into that. So then where does that 0:14:31.600 --> 0:14:36.280 leave market expectations for where rates could go from here? 0:14:36.320 --> 0:14:39.560 Does that open the possibility of a little bit of 0:14:39.560 --> 0:14:42.640 wiggle room for this FED, even as at least rhetorically 0:14:43.120 --> 0:14:48.000 it's saying that rates aren't going to come down anytime soon. Well, 0:14:48.080 --> 0:14:50.280 it wants to be data dependent, It wants to go 0:14:50.440 --> 0:14:53.000 meeting to meeting with were certainly in the era and 0:14:53.080 --> 0:14:55.520 not just for the FED but for all major central 0:14:55.560 --> 0:15:01.640 banks of stopping forward guidance, with stopping guide markets explicitly 0:15:01.720 --> 0:15:06.960 beyond the next scheduled meeting. And I think in an 0:15:07.040 --> 0:15:11.000 environment where we're all guessing, look, we can have sophisticated models, 0:15:11.080 --> 0:15:14.560 we can have well created communications, but all of us 0:15:14.600 --> 0:15:19.200 in markets, economists, central bankers are guessing how persistent this 0:15:19.480 --> 0:15:21.840 bout of inflation the types that we haven't seen for 0:15:21.840 --> 0:15:24.520 forty years? Hopps, this new will be so Yes, when 0:15:24.520 --> 0:15:28.160 you're talking about riggle room, I do think FMC members 0:15:28.160 --> 0:15:31.640 put a high value on having the ability to say, look, 0:15:31.640 --> 0:15:34.920 the data has changed, so are expected pathway has changed, 0:15:34.960 --> 0:15:38.040 and you need to price that into your m your 0:15:38.080 --> 0:15:41.280 expectations for what the risk free rate looks like during 0:15:42.640 --> 0:15:44.640 does the FED set us up for the central bank 0:15:44.680 --> 0:15:46.560 decisions that we're going to be getting today. I mean, 0:15:46.600 --> 0:15:48.760 we've already heard from the Swiss National Bank with a 0:15:48.800 --> 0:15:51.520 fifty basis point move of its own, and there's an 0:15:51.520 --> 0:15:55.800 expectation in the market for fifty from the ECB and 0:15:55.960 --> 0:15:59.960 the b o E this morning. Safety and numbers mate 0:16:00.040 --> 0:16:02.800 and safety in numbers, and that is if you don't 0:16:02.840 --> 0:16:07.400 know what your transmission mechanism is from monkey policy through 0:16:07.440 --> 0:16:10.080 to the real economy. If you're worried about being picked 0:16:10.120 --> 0:16:13.360 on because you're an outlier, you're seen as behind the curve, 0:16:13.840 --> 0:16:18.280 then actually moving as a herd as the central banks 0:16:18.280 --> 0:16:22.680 appear to be doing is probably the list least risky 0:16:22.720 --> 0:16:25.040 option here. So yes, the fact that we see four 0:16:25.080 --> 0:16:27.680 of the major central banks, potentially by the end of today, 0:16:28.200 --> 0:16:32.520 all moving fifty basis points um. That is an indication 0:16:32.600 --> 0:16:35.320 of where they are psychologically and know where they are 0:16:35.360 --> 0:16:37.880 in terms of their interpretations of the data, trying to 0:16:37.920 --> 0:16:41.080 minimize their errors rather than being certain of the correct stance. 0:16:41.600 --> 0:16:44.920 Only about thirty seconds left here, Simon, But the European 0:16:45.000 --> 0:16:49.440 banks have a lot of different inflation dynamics compared to 0:16:49.440 --> 0:16:53.120 the US don't they, particularly given the war in Ukraine. Yeah, 0:16:53.160 --> 0:16:57.000 it's all about supply driven energy lead inflation. In Europe. 0:16:57.000 --> 0:16:59.400 There's no real signs of demand search like you've got 0:16:59.400 --> 0:17:03.960 in the US. Very different backdrop for the ECB, and 0:17:04.000 --> 0:17:07.680 that suggests their terminal rates for much policy will be 0:17:07.720 --> 0:17:10.719 considerably lower than the federal reserves because it's just different 0:17:10.720 --> 0:17:14.680 inflation they're dealing with much less responsive to raising the 0:17:15.080 --> 0:17:18.240 bank right man. We get those decisions from the Bank 0:17:18.280 --> 0:17:20.840 of England in just a little bit less than two 0:17:20.840 --> 0:17:24.520 hours time seven am Wall Street time, and then the 0:17:24.560 --> 0:17:27.440 European Central Bank an hour and fifteen minutes after that 0:17:27.800 --> 0:17:31.360 at eight fifteen. Lots to dig into, lots of central 0:17:31.359 --> 0:17:34.200 bank moves. Great to get your thoughts this morning, Simon again, 0:17:34.240 --> 0:17:36.920 thanks for being with us. That was Simon French, chief 0:17:36.920 --> 0:17:42.600 economist at PAMRA Gordon SMP futures following the Fed's decision 0:17:43.000 --> 0:17:45.879 down forty five points, a drop of one point one percent, 0:17:45.960 --> 0:17:49.520 DAL futures down two and NASTAC futures leading the declines, 0:17:49.600 --> 0:17:52.359 down nearly one point four percent, a drop of a 0:17:52.440 --> 0:17:55.360 hundred sixty one points. The tenure Treasury is down one 0:17:55.400 --> 0:17:59.080 thirty second yield three point four eight percent. This is 0:17:59.080 --> 0:18:05.119 Bloomberg Markets headlines and breaking news twenty four hours a 0:18:05.200 --> 0:18:08.520 day at Bloomberg dot Com, the Bloomberg Business Atland at 0:18:08.520 --> 0:18:17.880 Bloomberg Quicktake, This is a Bloomberg Business flash, and I'm 0:18:17.960 --> 0:18:21.360 kared Moscow US DOT Index futures and European shares following 0:18:21.400 --> 0:18:24.760 after the Federal Reserve rebuffed expectations for a dubish Tilton 0:18:24.840 --> 0:18:27.560 said interest rates will go higher for longer. We checked 0:18:27.560 --> 0:18:29.680 the markets all day long here on Bloomberg Guess and 0:18:29.760 --> 0:18:32.680 P futures They're down about forty seven points. You're down 0:18:32.720 --> 0:18:35.080 one point two percent down futures down nine tens of 0:18:35.200 --> 0:18:37.959 upper cent or three hundred eight points, and NASDAG futures 0:18:38.000 --> 0:18:40.399 down one and a half percent on one d seventy 0:18:40.400 --> 0:18:42.840 one points. The docks in Germany's down one at a 0:18:42.920 --> 0:18:46.600 third percent ten, Your treasury down one and one thirty second. 0:18:46.640 --> 0:18:48.960 The yel three point four eight percent yield on the 0:18:48.960 --> 0:18:51.760 two year four point to four percent. Nine. Mex scrude 0:18:51.800 --> 0:18:54.040 oil is down about two tens of upper cent or 0:18:54.040 --> 0:18:57.240 seventeen cents at seventy seven twelve aparrel coll Max School 0:18:57.280 --> 0:18:59.800 down one point eight percent on thirty two dollars thirty cents. 0:18:59.800 --> 0:19:02.880 It's sventeen eighties six forty announced. The euro one point 0:19:03.040 --> 0:19:05.400 six one nine against the dollar, British found one point 0:19:05.640 --> 0:19:08.640 three zero the end one thirty six point seven too. 0:19:09.160 --> 0:19:11.719 And Bitcoin this morning is down a tens of a percent. 0:19:11.840 --> 0:19:14.919 It's at about seventeen thousand and seven hundred dollars. We 0:19:14.920 --> 0:19:17.400 continue to watch shares of Tesla down about three percent 0:19:17.480 --> 0:19:20.120 in early trading after Elon muscle at three point six 0:19:20.200 --> 0:19:22.639 billion dollars of shares. And we have a busy morning 0:19:22.680 --> 0:19:26.159 for economic data. Among the reports we're getting November retail 0:19:26.240 --> 0:19:29.120 sales and the weekly report on initial jobless claims. That's 0:19:29.119 --> 0:19:31.760 a Bloomberg business flash. Now here's Amy Morris with Moore 0:19:31.840 --> 0:19:34.359 on what's going on around the world. Amy, good morning, 0:19:34.680 --> 0:19:37.320 good morning, and thank you. Karen Fiser has an agreement 0:19:37.359 --> 0:19:40.560 to sell its anti viral medication batchel of It in China. 0:19:40.680 --> 0:19:43.800 This as sources tell Bloomberg, the White House will reopen 0:19:43.800 --> 0:19:46.520 a program today to allow people in the US to 0:19:46.680 --> 0:19:50.040 order batches of at home COVID tests for free. The 0:19:50.160 --> 0:19:54.280 intruder accused of attacking how speaker Nancy Pelosi's husband has 0:19:54.280 --> 0:19:57.880 been ordered to stand trial for attempted murder. Prosecutors say 0:19:58.000 --> 0:20:01.200 David de Pop has a list of their targets, including 0:20:01.480 --> 0:20:05.800 California Governor Gavin Newsom and after Tim, Tom Hanks and sports. 0:20:05.800 --> 0:20:08.680 In the NBA, the Wizards and Warriors lose the NIXT win. 0:20:08.840 --> 0:20:11.760 The World Cup Final is set for Sunday, when Argentina 0:20:11.920 --> 0:20:15.600 takes on France Global News twenty four hours a day 0:20:15.680 --> 0:20:18.440 on air rand on Bloomberg quick Take, bowered by more 0:20:18.440 --> 0:20:21.760 than twenty d journalists and analysts in more than one 0:20:21.840 --> 0:20:25.680 hundred twenty countries. I'm Amy Morris. This is Bloomberg, Nathan, 0:20:25.880 --> 0:20:28.399 Thank you, Amy. It's coming up to five four on 0:20:28.480 --> 0:20:32.000 Wall Street on Nathan Hagar, this is Bloomberg Daybreak. The 0:20:32.080 --> 0:20:35.080 collapse of f t X has left investors asking what's 0:20:35.119 --> 0:20:38.040 next for the crypto exchange and the industry at large. 0:20:38.320 --> 0:20:41.159 The new CEO of f t X, John J. Rays, 0:20:41.200 --> 0:20:43.480 has to find on Capitol Hill this week with a 0:20:43.600 --> 0:20:48.359 blunt explanation for the collapse. This isn't uh, you know, 0:20:48.400 --> 0:20:51.920 sophisticated whatsoever. This is just plain old embezzlement. And after 0:20:52.000 --> 0:20:55.920 that testimony from John Ray, Guggenheim Chief investment Officer Scott 0:20:55.920 --> 0:20:59.600 Miner joined Bloomberg's Tom Keene and Lisa Abramowitz to warn 0:20:59.680 --> 0:21:03.000 of war shoes to drop after the f t X fallout. 0:21:03.280 --> 0:21:07.160 Still mind, it is confident the currency digitalization will proceed. 0:21:07.240 --> 0:21:10.119 But what he had to say, you are acclaimed as 0:21:10.160 --> 0:21:14.240 a student of what we're living in crypto in bitcoin. 0:21:14.760 --> 0:21:21.520 Do you have confidence that system can move forward? I do, Tom. 0:21:21.560 --> 0:21:26.320 You know, a year ago we were talking about crypto 0:21:26.400 --> 0:21:30.679 and there were approximately nineteen thousand coins, to which my 0:21:30.840 --> 0:21:34.800 comment was, this is mostly crap and there's going to 0:21:34.840 --> 0:21:38.200 be a washout and and just like the Internet bubble, Uh, 0:21:38.240 --> 0:21:41.560 you know, we will have survivors. And uh, you know, 0:21:41.800 --> 0:21:47.600 the digitalization of currency UH is just in its infancy 0:21:47.840 --> 0:21:52.320 and uh you know how this evolves now UH is 0:21:52.359 --> 0:21:56.800 going to require, you know, a regulatory framework to legitimize it. 0:21:57.160 --> 0:21:59.600 And I think we will move forward and I think 0:21:59.680 --> 0:22:04.320 this will be transformative to the general economy. Lisa would 0:22:04.359 --> 0:22:06.359 like to weigh in here, Mr No, I don't want 0:22:06.359 --> 0:22:08.760 to weigh in this per se, but there is a 0:22:08.840 --> 0:22:12.879 question of whether the whole FTX phenomenon really was born 0:22:13.000 --> 0:22:15.600 out of the easy money policies, and whether there are 0:22:15.640 --> 0:22:18.080 a lot more shoes to drop in the financial stability 0:22:18.119 --> 0:22:20.280 aspect of this. As everyone talks soft landing and as 0:22:20.280 --> 0:22:23.040 we talk about disinflation, how much less of a chance 0:22:23.160 --> 0:22:24.760 is there of that outcome which I know you've been 0:22:24.800 --> 0:22:30.800 talking a lot about in terms of the collapse. Yes, 0:22:30.920 --> 0:22:34.119 some sort of you know, more financial disruptions, shakeouts that 0:22:34.280 --> 0:22:36.440 things going to zero that were overnight that we're worth 0:22:36.760 --> 0:22:39.399