1 00:00:03,320 --> 00:00:06,720 Speaker 1: Bloombo Business News twenty four hours a day. If Bloomberg 2 00:00:06,760 --> 00:00:09,399 Speaker 1: dot Com the radio plus Globil lact and on your 3 00:00:09,480 --> 00:00:14,280 Speaker 1: radio is a Bloomberg Business Flash from Bloomberg World Headquarters. 4 00:00:14,320 --> 00:00:16,919 Speaker 1: I'm Katherine Cowdery Bloomberg. Taking Stock is brought to you 5 00:00:16,960 --> 00:00:19,840 Speaker 1: by Sector Spider e t S. Why by a single 6 00:00:19,880 --> 00:00:22,639 Speaker 1: stock when you can invest in the entire sector, Visit 7 00:00:22,720 --> 00:00:26,000 Speaker 1: sector spdrs dot com or call one six six Sector 8 00:00:26,120 --> 00:00:29,640 Speaker 1: at f The stock market is stumbling into the fourth quarter, 9 00:00:29,720 --> 00:00:33,640 Speaker 1: weighed down by drugmakers and technology shares, lackluster growth, and 10 00:00:33,720 --> 00:00:36,760 Speaker 1: manufacturing is doing little to boost optimism in the economy. 11 00:00:37,080 --> 00:00:40,240 Speaker 1: A report today show manufacturing expanded at a modest pace 12 00:00:40,280 --> 00:00:44,519 Speaker 1: in September after unexpectedly shrinking a month earlier, underscoring limited 13 00:00:44,560 --> 00:00:47,720 Speaker 1: progress for the battered sector. Data on factory orders and 14 00:00:47,720 --> 00:00:50,240 Speaker 1: the monthly jobs report are do later this week. We 15 00:00:50,400 --> 00:00:52,559 Speaker 1: check in markets every fifteen minutes throughout the trading day 16 00:00:52,560 --> 00:00:55,560 Speaker 1: on Bloomberg Radio Down Industrial labrary is down seventy five 17 00:00:55,560 --> 00:00:58,480 Speaker 1: points four tents of a percent, trading at eighteen thousand, 18 00:00:58,480 --> 00:01:01,760 Speaker 1: two hundred thirty two. SMP five funded down ten points 19 00:01:01,760 --> 00:01:05,600 Speaker 1: half a percent at seven nastack down twenty two points 20 00:01:05,600 --> 00:01:08,479 Speaker 1: for tens of a percent, trading at fifty nine less. 21 00:01:08,480 --> 00:01:11,080 Speaker 1: Texas Intermedia Crude oil up forty five cents of barrel, 22 00:01:11,160 --> 00:01:14,199 Speaker 1: nine tents of a percent at sixty eight. About gold 23 00:01:14,200 --> 00:01:17,600 Speaker 1: down three dollars twenty cents anounced at thirteen nine. Ten 24 00:01:17,680 --> 00:01:19,840 Speaker 1: year treasury down eight thirty seconds with the yield of 25 00:01:19,880 --> 00:01:26,080 Speaker 1: one point six And that's a Bloomberg Business flash. You're 26 00:01:26,120 --> 00:01:30,000 Speaker 1: listening to Taking Stock with Pim Box and Kathleen Mays 27 00:01:30,040 --> 00:01:34,520 Speaker 1: on Bloomberg Radio. We are gearing up for our very 28 00:01:34,560 --> 00:01:38,160 Speaker 1: special interview today with Loretta Mester. She is President of 29 00:01:38,200 --> 00:01:41,880 Speaker 1: the Federal Reserve Bank of Cleveland. There's so much focus 30 00:01:41,959 --> 00:01:44,720 Speaker 1: on FED Bank presidents, but you know, it's not just 31 00:01:44,840 --> 00:01:48,040 Speaker 1: a president, It is a whole staff. It is many, 32 00:01:48,040 --> 00:01:51,360 Speaker 1: many people each of the regional Fed banks. And we're 33 00:01:51,480 --> 00:01:54,480 Speaker 1: very happy to welcome now to the show to people 34 00:01:54,640 --> 00:01:58,160 Speaker 1: who are part of the local community, the local region, 35 00:01:58,200 --> 00:02:01,520 Speaker 1: the collegian Cleveland FEDS District UH to talk about what 36 00:02:01,600 --> 00:02:03,560 Speaker 1: they do, what they do with the Cleveland Fed, and 37 00:02:03,560 --> 00:02:06,160 Speaker 1: more broadly, what they see in the regional economy, because 38 00:02:06,160 --> 00:02:09,400 Speaker 1: certainly this is one of the aspects of what Loretta 39 00:02:09,480 --> 00:02:13,079 Speaker 1: Mester is watching as she helps formulate and guide policy. 40 00:02:13,480 --> 00:02:16,520 Speaker 1: Very happy. They welcome Todd Mason. He's president and CEO 41 00:02:16,680 --> 00:02:21,360 Speaker 1: of the First National Bank of Pandora in nearbort Via, Pandora, Ohio. 42 00:02:21,440 --> 00:02:24,200 Speaker 1: A community banker. He is on the Cleveland FED Board 43 00:02:24,240 --> 00:02:28,080 Speaker 1: of Directors, uh Dave Meganheart, executive director at United Labor 44 00:02:28,120 --> 00:02:31,280 Speaker 1: Agency right here in Cleveland, and on the Cleveland FEDS 45 00:02:31,320 --> 00:02:34,600 Speaker 1: Advisory Council. Gentlemen, I welcome you both. Thank you. I'm 46 00:02:34,639 --> 00:02:36,640 Speaker 1: sure you've been here many times. It's my first visit. 47 00:02:37,639 --> 00:02:40,120 Speaker 1: So Todd start by telling us a little bit about 48 00:02:40,720 --> 00:02:44,280 Speaker 1: the First National Bank of Pandora. You know, your your business, 49 00:02:44,320 --> 00:02:46,919 Speaker 1: community you serve, and how things look to you. First 50 00:02:47,000 --> 00:02:49,239 Speaker 1: National Bank of Pandora is a small community bank in 51 00:02:49,320 --> 00:02:52,160 Speaker 1: northwest Ohio. We're only a hundred and fifty million in assets, 52 00:02:52,200 --> 00:02:55,840 Speaker 1: so we are a true community bank. We have agriculture, 53 00:02:56,200 --> 00:02:59,800 Speaker 1: small businesses, and a lot of retail business. Okay, how 54 00:02:59,880 --> 00:03:03,360 Speaker 1: is business right now? Actually, business is improving. If we 55 00:03:03,400 --> 00:03:05,720 Speaker 1: take a look at what's going on in our community. 56 00:03:06,200 --> 00:03:11,400 Speaker 1: The house market is increasing, the prices are increasing, and 57 00:03:11,440 --> 00:03:13,280 Speaker 1: a few take a look at our homes right now, 58 00:03:13,320 --> 00:03:17,040 Speaker 1: if it's priced appropriately. Thirty days when will sell Okay? So, 59 00:03:17,440 --> 00:03:20,960 Speaker 1: Dave Meginhart as executive director of the United Labor Agency, 60 00:03:21,040 --> 00:03:24,840 Speaker 1: what does the United Labor Agency do? What do you do? Sure? UM, 61 00:03:24,919 --> 00:03:28,480 Speaker 1: We're a labor based nonprofit based in Cleveland, and we 62 00:03:28,520 --> 00:03:31,160 Speaker 1: specialize in workforce development. And we like to tell people 63 00:03:31,240 --> 00:03:34,520 Speaker 1: that we're the emergency room of the economy because we're 64 00:03:34,680 --> 00:03:38,440 Speaker 1: often working with companies that are closing or experiencing layoff 65 00:03:38,640 --> 00:03:41,640 Speaker 1: or companies that are hiring. So we're sort of had 66 00:03:41,680 --> 00:03:43,880 Speaker 1: the whole cycle, the whole life and death cycle of 67 00:03:44,040 --> 00:03:46,920 Speaker 1: any kind of business transaction. So what we do is 68 00:03:46,960 --> 00:03:52,080 Speaker 1: we find uh workers or human capital for those companies. UM. 69 00:03:52,160 --> 00:03:55,440 Speaker 1: And if they you're experiencing layoff, we try to find 70 00:03:55,440 --> 00:03:58,120 Speaker 1: your work for those workers. How how is the labor 71 00:03:58,160 --> 00:04:01,320 Speaker 1: market doing here? Is specific clee in Cleveland. I think 72 00:04:01,320 --> 00:04:03,680 Speaker 1: Ohio is a pretty diverse state, but in Cleveland, how 73 00:04:03,720 --> 00:04:06,200 Speaker 1: do things look? UM? It has been It's really improved 74 00:04:06,240 --> 00:04:07,840 Speaker 1: over the past couple of years. There's a lot of 75 00:04:07,840 --> 00:04:12,280 Speaker 1: activity in the hospitality sector. There's a lot of manufacturing. 76 00:04:12,280 --> 00:04:16,440 Speaker 1: There's an uptick with that. Transportation. Commercial transportation is always 77 00:04:16,440 --> 00:04:19,240 Speaker 1: really big. UM. We have a lot of job orders 78 00:04:19,279 --> 00:04:22,839 Speaker 1: that are coming from UM. From companies UH, goods and 79 00:04:22,880 --> 00:04:26,160 Speaker 1: services UH and healthcare. Of course, as Toby cross Grove 80 00:04:26,200 --> 00:04:29,480 Speaker 1: said earlier, you know that's always a driver in Cleveland. UM. 81 00:04:29,760 --> 00:04:31,719 Speaker 1: What the people that we work with are more of 82 00:04:31,720 --> 00:04:35,200 Speaker 1: the lower skilled workers. There's a huge demand for that. 83 00:04:35,279 --> 00:04:38,560 Speaker 1: I think as Ohio's population is aging, there's a lot 84 00:04:38,600 --> 00:04:41,520 Speaker 1: of health healthcare, there's a lot of state UM UH 85 00:04:41,680 --> 00:04:44,520 Speaker 1: nursing assistance, medical assistance that cand you know what we 86 00:04:44,520 --> 00:04:46,359 Speaker 1: look at that. We look at that for people that 87 00:04:46,440 --> 00:04:50,200 Speaker 1: can get into a career and come up a career ladder. 88 00:04:50,240 --> 00:04:53,359 Speaker 1: So it's a good first step for people. UM. Todd Mason, 89 00:04:53,600 --> 00:04:56,679 Speaker 1: President and CEO, First National Bank of Pandora. How long 90 00:04:56,760 --> 00:04:59,080 Speaker 1: have you been on the Cleveland FEDS board and what 91 00:04:59,160 --> 00:05:03,040 Speaker 1: exactly ta listeners? What does a director do at a 92 00:05:03,160 --> 00:05:06,279 Speaker 1: at a regional bank. I'm in my fifth year and 93 00:05:06,560 --> 00:05:09,240 Speaker 1: we run for a three year increments on a term 94 00:05:09,320 --> 00:05:12,000 Speaker 1: and there's two term limits. And at first at the 95 00:05:12,040 --> 00:05:14,159 Speaker 1: Cleveland FED we have two main things that we do. 96 00:05:14,320 --> 00:05:17,520 Speaker 1: Number One, just like any other director, we oversee the 97 00:05:17,560 --> 00:05:20,680 Speaker 1: operations of the bank. We look at UM strategic planning, 98 00:05:20,720 --> 00:05:23,040 Speaker 1: budgeting and all those type of items just like any 99 00:05:23,040 --> 00:05:25,800 Speaker 1: other director. On the other side. Our second main idea, 100 00:05:25,920 --> 00:05:29,000 Speaker 1: Our second main topic that we talk about is what's 101 00:05:29,040 --> 00:05:32,320 Speaker 1: going out in our regional community. Each board member has 102 00:05:32,360 --> 00:05:36,839 Speaker 1: a diverse background, different professional background, and we get that 103 00:05:36,920 --> 00:05:41,600 Speaker 1: information because the FED is data driven and sometimes that 104 00:05:41,720 --> 00:05:44,320 Speaker 1: data is a little bit slow to come. So all 105 00:05:44,360 --> 00:05:46,080 Speaker 1: the directors, one of the things that we do is 106 00:05:46,120 --> 00:05:48,920 Speaker 1: get that regional information, grab it, get it to our 107 00:05:48,960 --> 00:05:52,560 Speaker 1: meetings and help Loretta with her monetary discussion. So do 108 00:05:52,560 --> 00:05:55,599 Speaker 1: you have any influence over policy? You give Loretta Master 109 00:05:56,040 --> 00:05:58,320 Speaker 1: a snapshot of what you're seeing in your business in 110 00:05:58,360 --> 00:06:01,320 Speaker 1: your community. Are you allowed some input and will you know? 111 00:06:01,480 --> 00:06:03,240 Speaker 1: I think if you raise the key rate that be 112 00:06:03,240 --> 00:06:05,040 Speaker 1: pretty good. I'm a community banker. I could use a 113 00:06:05,040 --> 00:06:08,200 Speaker 1: little more net interest margin. We are all free to 114 00:06:08,320 --> 00:06:11,440 Speaker 1: give our opinions on what is going on in our 115 00:06:11,480 --> 00:06:15,560 Speaker 1: regional communities and how it is impacting us. Then Loretta 116 00:06:15,640 --> 00:06:19,680 Speaker 1: will make her decision on what she feels she should do. Okay, Well, similarly, 117 00:06:19,760 --> 00:06:23,440 Speaker 1: Dave Megan Hurt, your executive actor, United Labor Agency. You're 118 00:06:23,480 --> 00:06:27,880 Speaker 1: on the Cleveland Fence Advisory Council. So how does that work. 119 00:06:27,960 --> 00:06:29,800 Speaker 1: I know there's been a lot of people and there's 120 00:06:29,800 --> 00:06:33,720 Speaker 1: more and more focus on the fed around diversity. Do 121 00:06:33,800 --> 00:06:36,400 Speaker 1: they pay enough attention to the community. Are they paying 122 00:06:36,480 --> 00:06:38,800 Speaker 1: enough attention to the labor market when they consider raising 123 00:06:38,839 --> 00:06:42,520 Speaker 1: interest rates? Again? Sure? So the Business Advisory Council we 124 00:06:42,560 --> 00:06:45,440 Speaker 1: meet twice a year, uh and it's a you know, 125 00:06:45,440 --> 00:06:47,839 Speaker 1: it's made up of small businesses from it could be 126 00:06:47,839 --> 00:06:53,599 Speaker 1: anything from UH tech startups to more of established manufacturing 127 00:06:54,400 --> 00:06:57,520 Speaker 1: businesses and people like me, which are you know, we're 128 00:06:57,560 --> 00:07:00,839 Speaker 1: from labor. Um. We work obviously with you know again 129 00:07:01,160 --> 00:07:06,200 Speaker 1: with people that are experiencing displacement or looking for work. 130 00:07:06,640 --> 00:07:10,000 Speaker 1: We A'm very tight in with the local area unions. UM. 131 00:07:10,040 --> 00:07:12,440 Speaker 1: You know, our job is to take all this information 132 00:07:12,440 --> 00:07:14,120 Speaker 1: about what we see on the street and bring it 133 00:07:14,160 --> 00:07:17,440 Speaker 1: to UH Loretta and also bring it to our staff. 134 00:07:17,880 --> 00:07:19,440 Speaker 1: They listen to us, they want to they want to 135 00:07:19,480 --> 00:07:21,160 Speaker 1: know that. I think it. I think it really helps 136 00:07:21,560 --> 00:07:25,800 Speaker 1: to hear what we're experiencing every day. UM. I think 137 00:07:25,840 --> 00:07:29,080 Speaker 1: they have nine of these Business Advisory councils across the 138 00:07:29,120 --> 00:07:34,360 Speaker 1: district in all the major cities throughout Ohio, West Virginia, Pennsylvania, 139 00:07:34,360 --> 00:07:37,520 Speaker 1: and Kentucky, parts of all those states, all of Ohio 140 00:07:37,560 --> 00:07:39,720 Speaker 1: and parts of the other states. UM. So, I think 141 00:07:39,760 --> 00:07:42,600 Speaker 1: that if you think about all of that information, all 142 00:07:42,640 --> 00:07:45,920 Speaker 1: of those different businesses and labor leaders and community leaders, 143 00:07:46,040 --> 00:07:48,040 Speaker 1: and you know you can aggregate that. I think that 144 00:07:48,160 --> 00:07:50,960 Speaker 1: helps then bring it up into the president. Okay, well, 145 00:07:51,120 --> 00:07:56,080 Speaker 1: uh something aside from monetary policy. The FED Reserve oversees 146 00:07:56,120 --> 00:07:59,280 Speaker 1: lots of banks. At a regional bank, you are involved 147 00:07:59,280 --> 00:08:02,360 Speaker 1: in exam examinations, all that kind of thing for a 148 00:08:02,360 --> 00:08:06,800 Speaker 1: community banker though, Todd Dodd Frank. We have a lot 149 00:08:06,840 --> 00:08:10,120 Speaker 1: of community makers on our show depending on what's in 150 00:08:10,160 --> 00:08:12,600 Speaker 1: the news and what they're doing, and they say over 151 00:08:12,640 --> 00:08:16,480 Speaker 1: and over it's Dodd Frank, is is put uh made 152 00:08:16,480 --> 00:08:20,400 Speaker 1: a very heavy compliance burden. It's raised costs. Community banks 153 00:08:20,400 --> 00:08:23,600 Speaker 1: didn't cause the Great Recession or the Great Financial crisis. 154 00:08:23,800 --> 00:08:25,760 Speaker 1: How is it affecting you? And is this something that 155 00:08:25,680 --> 00:08:28,280 Speaker 1: the Fed and other people oversee banks need to be 156 00:08:28,360 --> 00:08:30,360 Speaker 1: more mindful of shoreviews and changes made in Dodd Frank 157 00:08:30,400 --> 00:08:35,720 Speaker 1: for example, a great point, Dodd Frank. The regulators that 158 00:08:35,760 --> 00:08:39,440 Speaker 1: are writing the rules over ten thousand pages now and 159 00:08:39,679 --> 00:08:41,920 Speaker 1: it's not completed yet after seven years. I know in 160 00:08:42,000 --> 00:08:44,760 Speaker 1: our small community bank, what we're seeing is we've had 161 00:08:44,760 --> 00:08:49,559 Speaker 1: to go higher. A compliance officer, compliance consultant, yet a 162 00:08:49,880 --> 00:08:52,920 Speaker 1: third party vendor to come check our double checkers, higher 163 00:08:52,960 --> 00:08:56,600 Speaker 1: software and do more things. Everything that Dodd Frank touches 164 00:08:56,640 --> 00:08:59,720 Speaker 1: in our small bank, it's now more paper, more time 165 00:08:59,760 --> 00:09:03,199 Speaker 1: cons atarter of fact, we're doing research right now taking 166 00:09:03,200 --> 00:09:06,200 Speaker 1: our two thousand and seven income statement compared to two 167 00:09:06,240 --> 00:09:09,360 Speaker 1: thousand fifty, trying to say what kind of impact does 168 00:09:09,400 --> 00:09:11,840 Speaker 1: it have. It looked like God Frank is going to 169 00:09:11,920 --> 00:09:15,640 Speaker 1: take a brown ten percent of our net income away 170 00:09:15,679 --> 00:09:19,200 Speaker 1: when you compare that time frame. So as a community banker, UM, 171 00:09:19,320 --> 00:09:21,400 Speaker 1: we are not a fan of God Frank. Well, we 172 00:09:21,440 --> 00:09:23,680 Speaker 1: know that the FED is itching two or some people. 173 00:09:23,720 --> 00:09:25,719 Speaker 1: The FED it seemed to be itching to raise the 174 00:09:25,800 --> 00:09:29,599 Speaker 1: key rate at least once more this year. Now, Ohio 175 00:09:29,960 --> 00:09:32,120 Speaker 1: and this whole region in the several states that the 176 00:09:32,120 --> 00:09:35,600 Speaker 1: Cleveland Fed encompasses a lot of manufacturing here, Starker dollar 177 00:09:35,679 --> 00:09:39,640 Speaker 1: hurts manufacturing. Would you prefer not to see Dave Um 178 00:09:39,720 --> 00:09:42,120 Speaker 1: the U FED make a move like this. If it 179 00:09:42,120 --> 00:09:44,040 Speaker 1: makes the dollars Tragle will hurt you the workers here 180 00:09:44,040 --> 00:09:45,920 Speaker 1: in this area. I think it will. I think that 181 00:09:46,240 --> 00:09:49,120 Speaker 1: Um we're on the rebound. I think it's been a long, 182 00:09:49,240 --> 00:09:54,679 Speaker 1: hard slog from the Great Recession. I think there's uh. 183 00:09:54,720 --> 00:09:56,720 Speaker 1: You know, for the first time in many years, the 184 00:09:56,800 --> 00:10:00,440 Speaker 1: poverty rate has gone down in h in Cleveland, so 185 00:10:00,520 --> 00:10:03,240 Speaker 1: we've seen traction. And I'd hate to have anything that 186 00:10:03,360 --> 00:10:09,520 Speaker 1: could influence jobs and productivity and profit. Well, Todd Mason, 187 00:10:09,520 --> 00:10:11,839 Speaker 1: it may be inevitable. Whatever people want or don't want 188 00:10:11,880 --> 00:10:14,800 Speaker 1: to see, uh, in terms of the region you serve, 189 00:10:15,160 --> 00:10:17,600 Speaker 1: in terms of the bank, would an interest rate increase 190 00:10:17,679 --> 00:10:19,480 Speaker 1: help you because of your profits or hurt you because 191 00:10:19,480 --> 00:10:21,400 Speaker 1: it's going to slow down business. I think it's a 192 00:10:21,400 --> 00:10:23,360 Speaker 1: little bigger than just profits. We have to take a 193 00:10:23,360 --> 00:10:26,959 Speaker 1: look at our retired individuals that's in our community. They 194 00:10:27,000 --> 00:10:29,240 Speaker 1: have had a very low rate of return for his 195 00:10:29,320 --> 00:10:31,959 Speaker 1: long time, and with this low interest rate they're starting 196 00:10:32,000 --> 00:10:35,520 Speaker 1: to reach out and do investments. That's probably not as wise. 197 00:10:36,120 --> 00:10:39,640 Speaker 1: And I'm telling you that in our community there anybody 198 00:10:39,679 --> 00:10:42,360 Speaker 1: that wants a job has a job, and our houses 199 00:10:42,360 --> 00:10:45,120 Speaker 1: are going up and the economy is improving. We really 200 00:10:45,280 --> 00:10:47,800 Speaker 1: in our community bank point of view, see, there's no 201 00:10:47,880 --> 00:10:50,160 Speaker 1: reason to keep rates at a at a stressed level. 202 00:10:50,280 --> 00:10:52,480 Speaker 1: What a trade groundtable, gentlemen, thank you so very much 203 00:10:52,520 --> 00:10:54,880 Speaker 1: for joining us. That was Todd Mason, he's president CEO 204 00:10:54,920 --> 00:10:57,480 Speaker 1: of the First National Bank of Pandora and p Door, Ohio. 205 00:10:57,559 --> 00:11:02,880 Speaker 1: David Meganheart, Executive Director, Unitedly Agency in Cleveland. Davis on 206 00:11:02,920 --> 00:11:06,040 Speaker 1: the Cleveland FEDS Advisory Council, Todds on the Border Directors 207 00:11:06,080 --> 00:11:08,559 Speaker 1: coming up, Loretta Messer, President of the Cleveland FED. I'm 208 00:11:08,679 --> 00:11:14,719 Speaker 1: Kathleen his and this is Bloomberg M