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Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.

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Speaker 2: This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along

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Speaker 2: with Lisa Bromwitz and Amrie Hordern. Join us each day

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Speaker 2: for insight from the best in markets, economics, and geopolitics

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Speaker 2: from our global headquarters in New York City. We are

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Speaker 2: live on Bloomberg Television weekday mornings from six to nine

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Speaker 2: am Eastern. Subscribe to the podcast on Apple, Spotify or

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Speaker 2: anywhere else you listen, and as always on the Bloomberg

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Speaker 2: Terminal and the Bloomberg Business Airly I'm happy to say

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Speaker 2: is with us now where I want to go straight

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Speaker 2: to that inflation call and go back to what you

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Speaker 2: told us at the stand of the year, where essentially

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Speaker 2: what you were looking for was inflation to come down

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Speaker 2: a little bit more then pick back up towards the

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Speaker 2: end of the year. Are we seeing that pickup? Maybe

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Speaker 2: ahead of schedule?

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Speaker 1: That's possible, But I would note that the true consecutive

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Speaker 1: month of inflation upside surprises came on different sources. So

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Speaker 1: the general Bunker print was mostly because of course service,

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Speaker 1: and the February print was driven by quarter than expected goods.

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Speaker 1: Inflationary pressure so I think the jury is still out

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Speaker 1: there in terms of if we are seeing the twelve

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Speaker 1: of this inflation roller coaster. Our view is that actually

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Speaker 1: there is room for goods deflation to bring inflation down further.

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Speaker 1: But when that runs its course, which is more likely

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Speaker 1: later this year rather than now, service starts to dominate,

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Speaker 1: and that's when wage pressure pushes inflation higher, and ultimately

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Speaker 1: we're looking at the trend settling around three percent rather

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Speaker 1: than two percent. But that roller coaster is for later

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Speaker 1: this year rather than right now, and right now, I

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Speaker 1: think the bar is pretty high for markets to abandon

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Speaker 1: this narrative of immaculate this inflation, which is why we'll

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Speaker 1: positive on risk sentiment and what both them on us appuy.

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Speaker 2: That is moment before we get deeper into recording markets. Way,

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Speaker 2: how do you think that's going to influence the thinking

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Speaker 2: of chairman Power in today's news conference.

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Speaker 1: Well, it's likely going to be a very balanced press

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Speaker 1: conference and very balanced pot and C. They will emphasize

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Speaker 1: data dependency, They will try to strike a balanced tone.

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Speaker 1: You know, the last meeting they talked about a sticky

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Speaker 1: last mile. So I am very curious in terms of

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Speaker 1: how they speak to the recent outside surprises in inflation prints.

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Speaker 1: I'm also curious in terms of if they're going to

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Speaker 1: revise growth higher, inflation higher, they're going to start discussing

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Speaker 1: the balance sheet round off, maybe trimming that a little bit.

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Speaker 1: So lots of things at play, but more broadly speaking,

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Speaker 1: we are expecting dot median to stay at three cards

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Speaker 1: for this year, which is in line with our expectation

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Speaker 1: at the beginning of the year. So now markets finally

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Speaker 1: will being closer to that.

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Speaker 3: Before shifting the stocks, what duration of bonds do you

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Speaker 3: feels most vulnerable given what pricing is and give and

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Speaker 3: you expect to transpire with inflation later this year.

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Speaker 1: While we have a preference for short end of the

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Speaker 1: curve and also the value of the curve, so implicitly

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Speaker 1: there is a stiffening view over the longer term, and

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Speaker 1: that is more over a fiscal story, right, So if

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Speaker 1: you look at the fiscal deficits in the US late

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Speaker 1: twenty twenty two, we're looking at three point five percent

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Speaker 1: and now we're getting to eight percent, and that servicing

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Speaker 1: cost is increasing, expected to increase even more the higher

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Speaker 1: rates for longer and turn premium needing to come back.

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Speaker 1: So all of that points to higher rates, especially for

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Speaker 1: long end of the curve. But when that kicks in,

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Speaker 1: when that repricing because of concern around fiscal dynamics, and

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Speaker 1: that's servisibility, that's key, which is why our conviction on

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Speaker 1: the long end of the curve yields moving higher is more.

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Speaker 1: It's stronger over a strategic horizon than over a tactical

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Speaker 1: horizon of six six to twelve one.

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Speaker 3: Are stocks vulnerable to a hawkish surprise from the FED

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Speaker 3: or are they operating according to a different set of

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Speaker 3: rules that really hinge on very different factors than FED

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Speaker 3: set rates.

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Speaker 1: But you ask the question Javis Jensen's, I think that's

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Speaker 1: what stock markets are trying to figure out as well.

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Speaker 1: But if year today is anything to go by, we

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Speaker 1: have had hawkish repricing of the FED like seven cuts

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Speaker 1: at the beginning of the year to now just three cuts,

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Speaker 1: and yet markets are very resilient. SMP is up close

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Speaker 1: to nine percent, equal way to the SMP close to

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Speaker 1: five percent, right, So this is not a market that

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Speaker 1: are caving in under hokish repricing pressure. And the bridging factor,

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Speaker 1: the reconciliatory factor here is the strong earnings and a

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Speaker 1: lot of the earnings are being heavy lifted by the AI,

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Speaker 1: which is why we are positive on USM market because

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Speaker 1: erniers are coming in strong and stronger, beating expectation, and

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Speaker 1: we lean into AI because that's where actually most of

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Speaker 1: the earnings momentum is coming from.

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Speaker 3: Given that way, do you think that calls for some

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Speaker 3: sort of broadening out in the rally are premature just

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Speaker 3: simply because the games still are concentrated, not just with

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Speaker 3: Magnificent four three or two or whatever people have got

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Speaker 3: whittled it down to, but also only the companies that

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Speaker 3: are most leveraged to immediate benefits from some of this technology.

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Speaker 1: Well, I think there is room for SMP to broaden

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Speaker 1: out from the very concentrated leadership that we saw foremost

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Speaker 1: part of last year, but that can also be thanks

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Speaker 1: to AI. So as we think about sectors like healthcare,

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Speaker 1: sectors like industrials starting to adopt AI to a greater scale,

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Speaker 1: the leaders within those sets likely able to broaden the

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Speaker 1: gap versus the rest of the piers within the sceptor

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Speaker 1: because they have economy of scale, they have a lot

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Speaker 1: of data to play with, so we can see actually

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Speaker 1: AI driving broadening out of the rally. Concentrated intact so far.

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Speaker 1: So that's one way that it can broaden out. Another

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Speaker 1: way that it can broaden out can be a wild

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Speaker 1: swing of rate repricing. Right, so we're talking about three

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Speaker 1: cuts now, and remember at the peak hawkish moment of October,

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Speaker 1: markets were still looking at two cuts. But we have

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Speaker 1: really single wide range of rate repricing, which is also

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Speaker 1: evidence in the very high elevated rate volutility the move index.

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Speaker 1: So there's no telling if we could see swim back

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Speaker 1: of this rate repricing, and when that kind of tactical

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Speaker 1: momentum plays out, that could benefit the broader market beyond

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Speaker 1: the AI concentrated in But that's so short term. Because

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Speaker 1: we have seen wild swing within short periods of time,

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Speaker 1: that's not something that we're positioning our investment views around.

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Speaker 1: But we acknowledged that this can swing within this short

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Speaker 1: period of time.

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Speaker 2: So wait, I know you're overweight US secularies, but also

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Speaker 2: a sprinkle of Japanese stocks.

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Speaker 4: Can we finish there?

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Speaker 2: The NIKT twenty five is up by almost twenty percent

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Speaker 2: yere today. It's been quite a run. Can you tell

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Speaker 2: me how the Bank of Japan in any way, shape

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Speaker 2: or form is relevant to that decision.

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Speaker 1: Well, it's the prerequisite on which the micro story can

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Speaker 1: play out, which is our expectation and rationale behind our

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Speaker 1: Japanese agriplet. So we upgraded Japan twice last year, and

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Speaker 1: we continue to like it at this juncture, even as

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Speaker 1: it crossed the all time I last made in nineteen

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Speaker 1: eighty nine. So yesterday was a key was a key

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Speaker 1: event was to watch. So if they are very kind

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Speaker 1: of pokushed viewing inflation as a problem, I would be

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Speaker 1: and what concerned with our Japan call. But frankly, yes,

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Speaker 1: they hide rates for the first time in seventeen years,

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Speaker 1: but they hiked it in the most dovish way possible. Right,

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Speaker 1: So for example, they normally dropped the yield curve control,

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Speaker 1: but they're still saying in case of a rapid rise

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Speaker 1: in long term youths, they would make nimble responses adjustments.

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Speaker 1: So if that's not the definition of YCC, I don't

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Speaker 1: know what is. So they really kind of verre is

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Speaker 1: the body of an accommodated still and that paves the

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Speaker 1: way for micro positive developments to continue to be reflected

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Speaker 1: in Japanese applet price.

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Speaker 2: Well, that trade is working out a black rock white,

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Speaker 2: Thank you, State Major. So let's round a table State

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Speaker 2: good monitor. Well and John, can we start with that

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Speaker 2: mildly bullish story for treasuries. Why mildly bullish in the

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Speaker 2: face of a bit of a set off we've seen

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Speaker 2: so far this year.

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Speaker 4: Well, Maldi, polish is not all in. All in is

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Speaker 4: full on bullish.

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Speaker 5: And that's why Europe is ranked above the US in

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Speaker 5: terms of possible easing and performance from duration. But we

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Speaker 5: can't let go of this view that yields are going

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Speaker 5: to be lower, not higher by year end. And I

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Speaker 5: get they've been sliding up the last week or so,

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Speaker 5: and I mean the context is important. We've come a

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Speaker 5: long way from the peak in yields in October. The

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Speaker 5: inflation peaked in June twenty twenty two, the market changed

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Speaker 5: its directional viewer rates in October twenty three, the Fed

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Speaker 5: pivoted a couple of months later.

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Speaker 4: It seems to me that they're not going to change

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Speaker 4: their mind.

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Speaker 5: The next move is down, and in the meantime we

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Speaker 5: know it's either unchanged or down for policy rates.

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Speaker 4: And therefore the trade is sit in the belly of

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Speaker 4: the curve.

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Speaker 5: If not treasuries, you take ig credit and if you

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Speaker 5: can't take those, then you what's it called and chill?

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Speaker 4: Is that what they say over that's bills and chill.

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Speaker 4: I've been here long enough now to go.

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Speaker 2: Let's go further right along the curve, get away from

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Speaker 2: the belly, and go out to the ten years. Say yeah,

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Speaker 2: what backs up this call at the moment? That years

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Speaker 2: at the end of the year will be love and

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Speaker 2: not higher.

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Speaker 5: So if you took the most hawkish individual in the

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Speaker 5: December dot plot, you get a longer run equilibrium rate

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Speaker 5: just below four and you get very little rate cuts

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Speaker 5: in the next year or so. So if you just

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Speaker 5: took that as a path for rates, it's difficult to

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Speaker 5: get the ten year yield much above four and a

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Speaker 5: half on our calculation, and you'd be really going some

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Speaker 5: to get to five.

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Speaker 4: So, just knowing that that right hand tale of.

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Speaker 5: The distribution is sort of in at four and a

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Speaker 5: half and change, I quite like the idea of being

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Speaker 5: long now. It's very difficult to time this, and that's

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Speaker 5: why the best trade, which I think everyone seems to

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Speaker 5: be doing, is owning the corporates, taking all the new

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Speaker 5: issues they can, and complementing a position in ig credit

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Speaker 5: with tea bills that generates a total yield of between

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Speaker 5: five and six that competes with equities, and on a

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Speaker 5: risk adjusted basis, it's superb So I think that's what's

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Speaker 5: going on. If you're in T bulls and they're maturing,

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Speaker 5: you've got the option to roll them again or go

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Speaker 5: and buy something else. Now, the thing is, we're buying

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Speaker 5: the ten year treasury. You drop one hundred basis points

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Speaker 5: in yield, but at least if you go to IG

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Speaker 5: credit you can sit and wait. And I think that

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Speaker 5: explains the type credit spreads. I don't think we can

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Speaker 5: infer too much reason in the credit spread as to

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Speaker 5: say something about default probability. I think it's all in

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Speaker 5: yield that people like they can't get enough.

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Speaker 3: I was so very excited to speak with you today

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Speaker 3: because for so many years I remember all of the

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Speaker 3: people who are calling for some huge sell off and treasuries,

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Speaker 3: and I'd get the major letter and it would come

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Speaker 3: out and say, you're all wrong. Yield are going lower

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Speaker 3: because basically we're looking at a low inflation, low growth

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Speaker 3: reality that was before the pandemic. A little bit after

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Speaker 3: the pandemic. It sounds like you're thinking has shifted somewhat

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Speaker 3: given the fact that you're not aggressively bullish in treasuries.

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Speaker 3: Has it has the neutral rate shifted? Has something about

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Speaker 3: your view of the world changed.

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Speaker 5: The quote that John lifted is for our march asset allocation,

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Speaker 5: so it's the monthly right, so that the view hasn't changed.

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Speaker 5: Our year end forecast is three point zero. That seems

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Speaker 5: a long way from here, but believe me, once they

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Speaker 5: start cutting, the market's going to move quickly. And this

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Speaker 5: is the issue that people have is that it's very

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Speaker 5: dangerous to be short of treasuries.

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Speaker 4: Here. You've got to have a.

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Speaker 5: Very interesting narrative to justify being being short of treasuries.

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Speaker 5: So the minimum you can be is neutral and small.

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Speaker 5: Long I think that the growth narrative has been the

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Speaker 5: biggest challenged. And if I put together what explains us exceptionalism,

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Speaker 5: it's the fiscal population growth, maybe even some productivity, who knows.

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Speaker 5: But the thing is that explains what's happened in the

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Speaker 5: last year or so. It doesn't tell you the next

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Speaker 5: the next ten The ten year treasury yield should reflect

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Speaker 5: the average over that period. Does anyone really think that

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Speaker 5: three percent real GDP is going to be the case

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Speaker 5: for the next ten years, because it looks to me

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Speaker 5: that that's very unlikely.

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Speaker 4: But maybe not.

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Speaker 3: Maybe the growth story isn't going to be there, but

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Speaker 3: there is an argument for the inflation story to be there,

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Speaker 3: especially given the election, especially given more protectionist policies, especially

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Speaker 3: given some of the issues that are not going away

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Speaker 3: with respect to wages and just the fiscal money that

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Speaker 3: has been procyclical, which is sort of counterintuitive.

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Speaker 4: How do you dismiss all of that.

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Speaker 5: I don't want to dismiss it, And you're right, the

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Speaker 5: last bit on inflation has been sticky, but the big

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Speaker 5: picture where we've come from since June twenty twenty two,

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Speaker 5: it looks like a symmetrical reversal.

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Speaker 4: So it went up and it came down.

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Speaker 5: We're not quite on the target rates yet, but they

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Speaker 5: don't have to arrive at the target before they cut

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Speaker 5: rates that they would be almost irresponsible to wait until

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Speaker 5: after they've hit the target.

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Speaker 4: I can't dismiss what you're saying.

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Speaker 5: I don't dismiss it because to me, it's about abilities

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Speaker 5: and scenarios. So there's sort of no landing scenario whereby

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Speaker 5: inflation stays sticky and high growth ticks along that says

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Speaker 5: there's no rate cuts this year, in which case two

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Speaker 5: year yields should be five and a quarter five and

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Speaker 5: a half, I get it. Ten should be four and

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Speaker 5: a half four seventy five. That that's sort of where

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Speaker 5: they would land with no landing. But soft landing is

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Speaker 5: where we are today, and we've got this risk on

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Speaker 5: the left hand side of the distribution here of a

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Speaker 5: hard landing. Has it really gone away? This time last

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Speaker 5: year people were canceling meetings, canceling meetings with me.

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Speaker 4: That's an easy thing to do anyway, but.

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Speaker 5: Because it was the regional bank stress and people say

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Speaker 5: to me, what does a hard landing look like? Well,

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Speaker 5: the first thing is this interview doesn't happen, So it's

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Speaker 5: people have forgotten.

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Speaker 4: A year ago.

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Speaker 5: For a good few weeks we had the smell and

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Speaker 5: the look of a hard landing. Two year yields were

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Speaker 5: screaming down towards three percent, right, So not saying that

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Speaker 5: I know anything that's going to bring that back, but

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Speaker 5: it's just about probabilities. It seems to me that we're

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Speaker 5: leaning a bit towards no landing, soft landing stagflation, that's

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Speaker 5: what it's all leaning towards, and to me, bonds protect

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Speaker 5: you in case that's wrong when you go back the

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Speaker 5: other way.

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Speaker 4: So that's the explanation leads.

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Speaker 5: I can't let go of the fact that I think

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Speaker 5: rates are going to be coming down, and when they

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Speaker 5: come down, the market with price more and that's how

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Speaker 5: the bondis get down to a lower level.

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Speaker 2: So that was Q one last year. Agan, it's Q two,

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Speaker 2: and then Q three we printed something like five percent

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Speaker 2: on GDP stateside, which is kind of wild. And then

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Speaker 2: we were seeing the heighs of the year on a

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Speaker 2: ten year and on the two year in October of

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Speaker 2: last year, as you mentioned, and I remember something you

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Speaker 2: said about supply and some reflections you had at the

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Speaker 2: time about whether supply matters or not. And now the

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Speaker 2: answer is it depends. Can we talk about what it

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Speaker 2: depends on? And the fact of the matter, at Lisa's point,

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Speaker 2: that we've got this sort of pro cyclical fiscal policy

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Speaker 2: in the US now where definits a massive with unemployments

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Speaker 2: south the four percent does that matter to the old call.

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Speaker 5: I was here this time last year and we discussed it,

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Speaker 5: and yields were pushing towards five for the tense and

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Speaker 5: it was on the supply demand imbalance. Looking back with hindsight,

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Speaker 5: maybe the Treasury made a misstep with the amount of

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Speaker 5: coupons issued at that time, given the GDP, the downgrade,

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Speaker 5: the inverted curve. I mean, it's easy for me to

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Speaker 5: sit here and say so afterwards, but it looked like

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Speaker 5: that was a misstep and it was addressed in the

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Speaker 5: November refunding. Now I think that on the whole, supply

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Speaker 5: should not matter to your yield forecast. It can matter

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Speaker 5: to your near term tactical view if there's an auction

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Speaker 5: coming up or there's some kind of thing, but you know,

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Speaker 5: the supply impacts term premium when there's a surprise and

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Speaker 5: there's an imbalance. In the longer run, I think the

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Speaker 5: stock of debt the huge stock, and let's remember it's

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Speaker 5: virtually doubled in the last two administrations. Under both of

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Speaker 5: the last two presidents worked close to twenty seven trillion

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Speaker 5: dollars of marketable securities. That's double early twenty sixteen, So

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Speaker 5: that weighs on future growth, pause the r star down

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Speaker 5: everything else. The way that happens is through debt servicing.

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Speaker 5: So the way that bonds supply deficits feed into the

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Speaker 5: way the bond market behaves.

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Speaker 4: It's two different things.

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Speaker 5: There's the imbalance, which can hit the term premium lifted

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Speaker 5: up short term, and there's the longer term what it

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Speaker 5: does to the equilibrium policy rate. And I think there's

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Speaker 5: an unambiguous evidence that the stock of debt weighs down,

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Speaker 5: so it opposes the positivity of the population growth and

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Speaker 5: the near term impulses that might come from.

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Speaker 4: AI, etc. But there's the debt stock weighs the other way.

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Speaker 3: Yesterday, just to put a bow on all this, Marc

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Speaker 3: Obanner of Bank of America was saying that maybe bonds

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Speaker 3: should take a message from stocks that keep flying, and

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Speaker 3: that it shouldn't be stocks taking a message from bonds.

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Speaker 4: What do you push back?

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Speaker 3: Do you saying that actually starts seem to be listening

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Speaker 3: to a risk that's getting baked into bonds, which is

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Speaker 3: why yields are not even higher.

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Speaker 5: So that's a great debate. It's an interesting insight.

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Speaker 4: Why not.

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Speaker 5: We'll always looking at new ways of valuing bonds. But

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Speaker 5: it seems to me that the yield on the two

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Speaker 5: year treasury you can see quite robustly and justify it

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Speaker 5: based on the path of the short rate and So

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Speaker 5: if it's four seventy ish, it's reflecting a FED that

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Speaker 5: cuts a couple or three times this year, continues next year.

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Speaker 4: That's basically what it's part.

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Speaker 5: Now that's an important number because it affects the fives

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Speaker 5: and it affects the tens. Now, I think equities seem

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Speaker 5: to be taking the positivity from what the bonds are

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Speaker 5: telling them, so that rates are coming down. I think

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Speaker 5: bonds are purely priced off of the short rate and

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Speaker 5: its path, So I don't think that they're priced due

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Speaker 5: to equities at all. But it's an interesting debate. I mean,

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Speaker 5: I'd like to see how we could use equity risk

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Speaker 5: premium to influence our evaluation on bonds.

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Speaker 4: I don't think we can.

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Speaker 5: It strikes me that goes the other way unambiguously, it's

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Speaker 5: bonds to equities.

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Speaker 2: I think on further hike, Steve Major's with US at HSBC,

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Speaker 2: with US here in New York State, we've got to

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Speaker 2: talk about this first move from the boj first hike

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Speaker 2: since seven and proven not to be so consequential. The

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Speaker 2: yen moving in the other direction, how do you read

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Speaker 2: in developments in Japan?

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Speaker 5: Maybe it is consequential because maybe it opens the door

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Speaker 5: up for the next step, the next move, because if

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Speaker 5: you if you were scenario playing, your role playing before

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Speaker 5: this event, you would have said, imagine a scenario where

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Speaker 5: they went all in, where they'd rate hikes and the

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Speaker 5: your curve control and this and the other really hawkish

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Speaker 5: and dollar.

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Speaker 4: Yen went up.

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Speaker 5: And actually that seems to be what's happened. So to me,

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Speaker 5: the totality of the decision and the outcome in the

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Speaker 5: asset markets is the measure of is the measure of success.

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Speaker 5: So you have to look at all the different details

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Speaker 5: in what they did and then how all the asset

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Speaker 5: markets play out. And they're watching this closely, I would

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Speaker 5: say that net net, it looks like there's room maybe

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Speaker 5: to do some more of something. Now from a JGB perspective,

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Speaker 5: maybe it means yields can keep going a bit higher.

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Speaker 5: Dollar yen is that's probably not what they want to see.

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Speaker 2: Sort of designed success. I need to understand whatere the

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Speaker 2: object diff was. Yeah, it's shure if the objective wasn't

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Speaker 2: to see a weaker Japanese Yet off the back of this, the.

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Speaker 5: Key performance indicators for this one would be not to

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Speaker 5: break anything or make any mess It's like any big

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Speaker 5: decision from any central bank. First first, first stop is

390
00:20:15,640 --> 00:20:18,560
Speaker 5: don't make a mess of anything. So in that regard,

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Speaker 5: it's okay, But it just seems to me that it's

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Speaker 5: not really over. There's much more that could be done.

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Speaker 5: The fair value for jgb's with this rate move and

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Speaker 5: the changes on the YD curve control could be nearer

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Speaker 5: to one hundred.

396
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Speaker 4: And it's interesting that it's the currency that moves, and that.

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Speaker 5: Tells you that maybe investors are putting their their views

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Speaker 5: through the FX markets more than they are through the

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Speaker 5: bonds at the moment.

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Speaker 3: So a lot of people are saying that the Bank

401
00:20:43,359 --> 00:20:45,800
Speaker 3: of Japan is not going to be bothered necessarily by

402
00:20:45,880 --> 00:20:48,080
Speaker 3: this move in the end, do you disagree?

403
00:20:48,760 --> 00:20:50,479
Speaker 5: I think they'll be delighted just to have got rid

404
00:20:50,480 --> 00:20:52,840
Speaker 5: of negative rates, So in that in that sense, I

405
00:20:53,040 --> 00:20:56,919
Speaker 5: totally agree they're not bothered at all, because they if

406
00:20:56,960 --> 00:20:59,680
Speaker 5: their objective was to get the rate up without making

407
00:20:59,720 --> 00:21:03,800
Speaker 5: an anything, than they've achieved it. But I think it's

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Speaker 5: the totality of the asset class response that matters, and

409
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Speaker 5: that takes time to look through. It's taken them how

410
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Speaker 5: many years, seventeen years to get the thing to get here,

411
00:21:15,960 --> 00:21:20,040
Speaker 5: and it's step by step, so I think it's conditionally

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00:21:20,119 --> 00:21:23,440
Speaker 5: so I think that their analysis will'll be ongoing and

413
00:21:23,480 --> 00:21:25,399
Speaker 5: they'll be looking at what's happened to dolli en and

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00:21:25,480 --> 00:21:27,880
Speaker 5: to the equity market and to bonds, and that will

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Speaker 5: help frame what they do next.

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Speaker 3: What was interesting to me is a lot of people

417
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Speaker 3: were saying that maybe if the Bank of Japan ended

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Speaker 3: negative rate policies and actually tightened more significantly, all of

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Speaker 3: the Japanese investors who had been pouring their cash into

420
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Speaker 3: US credit markets, into European markets would come home and

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Speaker 3: that buyer base would not be there in the same level.

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Speaker 3: Do you see that as a potential likelihood? Is what

423
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Speaker 3: we're seeing. What we're getting, which is essentially the dynamic

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Speaker 3: is kind of the same.

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Speaker 5: I think that the Japanese investors are still very happy

426
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Speaker 5: to hold dollars and there's such a big yield gap

427
00:22:02,640 --> 00:22:05,200
Speaker 5: between the two that that's the thing for there to

428
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Speaker 5: be a change in the direction of the end. Clearly

429
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Speaker 5: more has to happen. If you told me today that

430
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Speaker 5: policy was being shifted in a way that dollar yen

431
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Speaker 5: would head back towards one forty, then that changes everything.

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Speaker 5: It changes all the hedging strategies, and but obviously they

433
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Speaker 5: haven't done enough to change the direction. So I'm not

434
00:22:25,920 --> 00:22:28,760
Speaker 5: saying this for sure, but it strikes me that the

435
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Speaker 5: outcome of this could be that there might be more

436
00:22:31,280 --> 00:22:35,159
Speaker 5: moves and more iterative steps, especially on the on the

437
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Speaker 5: JGB side.

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Speaker 3: Which is this question about the threshold for today's third

439
00:22:38,720 --> 00:22:41,800
Speaker 3: meeting and how harksh for SG power would have to

440
00:22:41,880 --> 00:22:43,960
Speaker 3: be before you see a move in the end that

441
00:22:43,960 --> 00:22:46,400
Speaker 3: would actually cause the Bank of Japan to say, wait

442
00:22:46,440 --> 00:22:48,240
Speaker 3: a second, maybe we need a second step.

443
00:22:49,000 --> 00:22:53,320
Speaker 5: Yeah, I think that that's unlikely. But given what we've

444
00:22:53,440 --> 00:22:57,800
Speaker 5: just seen, why not though, if we sat head, if

445
00:22:57,840 --> 00:23:00,560
Speaker 5: we'd set if we'd sat here last week and called

446
00:23:00,640 --> 00:23:02,879
Speaker 5: higher dollary and on the on the basis of what

447
00:23:02,920 --> 00:23:05,080
Speaker 5: we've just seeing, it would have been an outlier.

448
00:23:05,160 --> 00:23:06,600
Speaker 4: So why not let's go with it?

449
00:23:06,840 --> 00:23:06,959
Speaker 3: Right?

450
00:23:07,400 --> 00:23:11,320
Speaker 4: So Chairpoe goes hawkish again and says it was a

451
00:23:11,400 --> 00:23:14,360
Speaker 4: mistake what I said before. He's not going to say

452
00:23:14,440 --> 00:23:18,560
Speaker 4: that one thing you can say for sure you know

453
00:23:18,800 --> 00:23:24,680
Speaker 4: that was capable. He's not going to say not like that.

454
00:23:25,560 --> 00:23:28,000
Speaker 4: We can we can guarantee that's not going to be said.

455
00:23:28,280 --> 00:23:34,080
Speaker 2: Right, could reflect on the previous decade or so in

456
00:23:34,200 --> 00:23:36,520
Speaker 2: this fixed income market. I was in Europe, we were

457
00:23:36,520 --> 00:23:38,800
Speaker 2: there together. We have to talk about negative bond yields

458
00:23:38,840 --> 00:23:41,080
Speaker 2: and Lisa, what do we get up to twenty trillion,

459
00:23:41,480 --> 00:23:45,160
Speaker 2: some ridiculous number of negative yielding assets? What was that period?

460
00:23:45,200 --> 00:23:47,520
Speaker 2: How would you describe that period? And for those that

461
00:23:47,640 --> 00:23:50,720
Speaker 2: maybe have just joining the industry and weren't living it,

462
00:23:51,480 --> 00:23:53,040
Speaker 2: how would you describe that period to them?

463
00:23:53,520 --> 00:23:57,879
Speaker 5: Well, it was an experiment in monetary policy, and it

464
00:23:58,080 --> 00:24:02,360
Speaker 5: was obviously a scary time because the policies were there

465
00:24:02,440 --> 00:24:06,800
Speaker 5: to address the risk of deflation, the counterfactuals. We don't

466
00:24:06,840 --> 00:24:08,840
Speaker 5: know what would have happened without some of these policies.

467
00:24:08,880 --> 00:24:11,240
Speaker 5: I think I think they get a bad rap negative rates.

468
00:24:11,520 --> 00:24:13,720
Speaker 5: Not saying I'm a fan or anything, but it's just

469
00:24:13,800 --> 00:24:15,879
Speaker 5: that they get a bad rap. And what else were

470
00:24:15,920 --> 00:24:17,000
Speaker 5: central bank's supposed to do?

471
00:24:17,840 --> 00:24:21,280
Speaker 4: Honestly, So I look back at that.

472
00:24:21,359 --> 00:24:23,520
Speaker 5: And I think it was an experiment and it might

473
00:24:23,600 --> 00:24:28,760
Speaker 5: have had some quite serious unintended consequences, because it shouldn't

474
00:24:28,760 --> 00:24:30,840
Speaker 5: have been a surprise that asset prices went up so

475
00:24:31,000 --> 00:24:31,840
Speaker 5: much on the back of this.

476
00:24:32,240 --> 00:24:34,800
Speaker 2: Would you judge the success though of them?

477
00:24:35,240 --> 00:24:35,320
Speaker 3: Well?

478
00:24:35,359 --> 00:24:38,200
Speaker 5: As I say, it's the counterfactuals, So how many people

479
00:24:38,240 --> 00:24:41,480
Speaker 5: would have lost their jobs without this? And there's been

480
00:24:41,520 --> 00:24:44,680
Speaker 5: analysis on this from the Bundesbank and from parts of

481
00:24:44,720 --> 00:24:45,240
Speaker 5: the dc B.

482
00:24:46,000 --> 00:24:46,919
Speaker 4: I mean, this is the thing.

483
00:24:47,240 --> 00:24:50,479
Speaker 5: Did negative rates actually keep the unemployment rate lower than

484
00:24:50,480 --> 00:24:52,760
Speaker 5: it would have been otherwise? And that's a really important thing.

485
00:24:52,880 --> 00:24:55,920
Speaker 5: You can't measure just how important it is for society.

486
00:24:56,480 --> 00:24:58,600
Speaker 5: So if we used to just look at negative rates

487
00:24:58,640 --> 00:25:00,560
Speaker 5: and say, oh, look what they did. They created all

488
00:25:00,600 --> 00:25:03,920
Speaker 5: of this asset price bubble and all this that that's

489
00:25:03,960 --> 00:25:06,520
Speaker 5: not the food analysis is going to look at the

490
00:25:06,600 --> 00:25:09,880
Speaker 5: real economy and especially employment.

491
00:25:09,840 --> 00:25:11,720
Speaker 2: And how much worse it could have been. Steve, Yeah, exactly,

492
00:25:11,880 --> 00:25:14,920
Speaker 2: fantastic to see you. It's going to catch up st HSBC.

493
00:25:15,119 --> 00:25:18,080
Speaker 2: Just remind me that price target tenure yield. It's the

494
00:25:18,160 --> 00:25:21,080
Speaker 2: yield target year end on a tenure. Okay, it looks

495
00:25:21,240 --> 00:25:23,520
Speaker 2: slightly impain you're going to join us before year end.

496
00:25:24,040 --> 00:25:27,640
Speaker 4: I'm going to if you'll have me. Of course, always.

497
00:25:37,640 --> 00:25:40,159
Speaker 2: Jan Hatzius and the team at Goldman Sachs falling in

498
00:25:40,240 --> 00:25:42,800
Speaker 2: live with the broad consensus expecting three FED rate cuts

499
00:25:42,840 --> 00:25:46,280
Speaker 2: this year. Hatsiest right in this inflation has been firmer

500
00:25:46,359 --> 00:25:48,119
Speaker 2: in recent months, but we think it is still on

501
00:25:48,200 --> 00:25:50,000
Speaker 2: track to fall enough by the June meeting for a

502
00:25:50,080 --> 00:25:52,919
Speaker 2: first cut. This has become less obvious, though, and our

503
00:25:52,960 --> 00:25:54,919
Speaker 2: inflation path for the rest of the year is now

504
00:25:54,960 --> 00:25:58,879
Speaker 2: at a range where small surprises could have large consequences.

505
00:25:59,240 --> 00:26:01,520
Speaker 2: And Police of Sai in a studio in New York, Yanke,

506
00:26:01,520 --> 00:26:03,880
Speaker 2: good morning to you. Great to be here, fantastically catch

507
00:26:03,960 --> 00:26:05,680
Speaker 2: up with you, sir. I remember the outlook to start

508
00:26:05,720 --> 00:26:07,280
Speaker 2: this year, and we talked about it a lot on

509
00:26:07,320 --> 00:26:10,920
Speaker 2: this program. The hard part was over. It's almost easy

510
00:26:11,000 --> 00:26:13,200
Speaker 2: from here. Do you still think that's the case based

511
00:26:13,200 --> 00:26:14,600
Speaker 2: on the days we've had so far this year.

512
00:26:15,280 --> 00:26:17,840
Speaker 6: Yeah, it's more of a question because of the stronger

513
00:26:17,920 --> 00:26:21,520
Speaker 6: inflation numbers, but I think if you look at the trends,

514
00:26:21,720 --> 00:26:26,080
Speaker 6: we're still on track to get down to the two

515
00:26:26,160 --> 00:26:30,760
Speaker 6: point four percent range or so for core PC inflation.

516
00:26:30,480 --> 00:26:31,399
Speaker 4: By the fourth quarter.

517
00:26:31,520 --> 00:26:33,000
Speaker 6: And now at the start of the year, we thought

518
00:26:33,040 --> 00:26:35,440
Speaker 6: that was going to be two point two percent, so

519
00:26:36,080 --> 00:26:39,520
Speaker 6: that's been a little bit higher. We've basically gone back

520
00:26:39,600 --> 00:26:42,679
Speaker 6: to the forecast that we had last fall, but two

521
00:26:42,720 --> 00:26:46,800
Speaker 6: point four percent is still pretty good progress, and by

522
00:26:46,880 --> 00:26:51,240
Speaker 6: twenty twenty five, I think will be at two. If

523
00:26:51,280 --> 00:26:54,760
Speaker 6: you look at the drivers of inflation, whether it's on

524
00:26:54,920 --> 00:26:58,280
Speaker 6: the good side or on the rent side, or in

525
00:26:58,359 --> 00:27:02,320
Speaker 6: the labor market, I think the trends there still look encouraging,

526
00:27:02,480 --> 00:27:04,920
Speaker 6: but of course the prints have been higher, so there's

527
00:27:04,960 --> 00:27:07,359
Speaker 6: more of a debate about it, and the FED is

528
00:27:07,400 --> 00:27:10,639
Speaker 6: going to be responsive to kind of near drums and prizes.

529
00:27:10,680 --> 00:27:12,639
Speaker 2: Well, let's talk about how responsive they might be today.

530
00:27:12,760 --> 00:27:14,560
Speaker 2: As we know, clear and obvious risk factor is in

531
00:27:14,600 --> 00:27:17,240
Speaker 2: the dot plot, whether that medium dots shifts from three cuts,

532
00:27:17,240 --> 00:27:18,880
Speaker 2: say to two, and as we all know, it only

533
00:27:18,920 --> 00:27:21,320
Speaker 2: takes two officials to move in that direction. Do you

534
00:27:21,359 --> 00:27:23,480
Speaker 2: think that's something that happens today. Is that a base

535
00:27:23,560 --> 00:27:24,760
Speaker 2: case in today's meeting.

536
00:27:25,359 --> 00:27:27,439
Speaker 6: It's not a base case for me, but it certainly

537
00:27:27,600 --> 00:27:30,480
Speaker 6: is a possibility because not that much has to change

538
00:27:30,600 --> 00:27:34,680
Speaker 6: in terms of the projections. If you go back to

539
00:27:35,280 --> 00:27:38,600
Speaker 6: two weeks ago when Shair Powell testified in Congress, he

540
00:27:38,720 --> 00:27:42,399
Speaker 6: said they were pretty close to having enough confidence, So

541
00:27:42,520 --> 00:27:46,679
Speaker 6: that sounded like a cut no later than June if

542
00:27:46,720 --> 00:27:51,400
Speaker 6: you take the statements there. We've had higher inflation numbers

543
00:27:51,520 --> 00:27:53,600
Speaker 6: in the past week, So all the question is has

544
00:27:53,720 --> 00:27:58,120
Speaker 6: that changed this view, my expectation is null, but we'll

545
00:27:58,160 --> 00:27:59,720
Speaker 6: find out two PM.

546
00:28:00,080 --> 00:28:01,800
Speaker 3: All things being equal, it seems to have changed your

547
00:28:01,840 --> 00:28:04,040
Speaker 3: view on the margins. You shifted down to three rate

548
00:28:04,119 --> 00:28:07,320
Speaker 3: cuts expected for this year from four earlier in a

549
00:28:07,400 --> 00:28:09,360
Speaker 3: report in the past couple of weeks, and you'd said

550
00:28:09,400 --> 00:28:13,680
Speaker 3: this line that John noted small surprises could have large consequences.

551
00:28:14,040 --> 00:28:16,680
Speaker 6: What do you mean, Well, if you have a few

552
00:28:16,960 --> 00:28:20,080
Speaker 6: additional tenths of inflation by the end of the year,

553
00:28:20,200 --> 00:28:23,480
Speaker 6: even if it doesn't really change the overall trend in

554
00:28:23,480 --> 00:28:26,720
Speaker 6: twenty twenty four is still lower than twenty twenty three,

555
00:28:27,160 --> 00:28:31,880
Speaker 6: but they would deliver less cuts. So in that sense, yeah,

556
00:28:31,920 --> 00:28:35,120
Speaker 6: I think it'd be a continuation of what we've seen

557
00:28:35,280 --> 00:28:38,680
Speaker 6: in the last several months, where in the early part

558
00:28:38,760 --> 00:28:41,920
Speaker 6: of the year, with an expectation of inflation coming down

559
00:28:42,000 --> 00:28:44,680
Speaker 6: to very close to two, you know, I think they

560
00:28:44,720 --> 00:28:48,680
Speaker 6: would have done more. But now it seems like the

561
00:28:49,320 --> 00:28:54,120
Speaker 6: December dot plot and the December inflation forecast looks pretty

562
00:28:54,120 --> 00:28:54,800
Speaker 6: reasonable to us.

563
00:28:54,960 --> 00:28:58,360
Speaker 3: It seems like people are split on their views based

564
00:28:58,400 --> 00:29:00,320
Speaker 3: on whether they think that the neutral rate hit shifted

565
00:29:00,400 --> 00:29:02,680
Speaker 3: materially or not. You believe that the neutral rate is

566
00:29:02,720 --> 00:29:04,959
Speaker 3: still going to be around your previous projections at three

567
00:29:05,000 --> 00:29:07,600
Speaker 3: and a quarter to three and a half percent. How

568
00:29:07,640 --> 00:29:09,520
Speaker 3: do you push back against people who say it's actually

569
00:29:09,600 --> 00:29:12,640
Speaker 3: four percent or higher, like Elslinus of RBC Capital.

570
00:29:14,480 --> 00:29:17,800
Speaker 6: I think we don't know, and I would certainly I

571
00:29:17,840 --> 00:29:21,040
Speaker 6: wouldn't push back very hard because the confidence interval around

572
00:29:21,080 --> 00:29:24,800
Speaker 6: any of these estimates is quite high. Four percent, though,

573
00:29:25,040 --> 00:29:28,440
Speaker 6: is still well south of five and three eighths. And

574
00:29:29,640 --> 00:29:33,560
Speaker 6: I am pretty confident that at current levels we're in

575
00:29:33,720 --> 00:29:38,240
Speaker 6: restrictive territory by a significant amount. But whether the right number,

576
00:29:38,640 --> 00:29:40,920
Speaker 6: you know, is four or three and a half or

577
00:29:41,000 --> 00:29:44,200
Speaker 6: three you know, that's harder to know. I do think

578
00:29:44,320 --> 00:29:47,680
Speaker 6: that the FMC projection two and a half percent, if

579
00:29:47,720 --> 00:29:50,600
Speaker 6: you take the median, that looks pretty stale, and I

580
00:29:50,640 --> 00:29:54,280
Speaker 6: think that is going to drift up over time, probably

581
00:29:54,600 --> 00:29:57,880
Speaker 6: by a little bit today, although we've been waiting for

582
00:29:58,000 --> 00:29:59,840
Speaker 6: this for a while and so far it hasn't happened

583
00:30:00,200 --> 00:30:01,560
Speaker 6: as far as the medium it's concerned.

584
00:30:01,640 --> 00:30:04,000
Speaker 2: You're a precise man and very careful with your words

585
00:30:04,040 --> 00:30:06,840
Speaker 2: when you say we're in restrictive and significantly so what

586
00:30:07,000 --> 00:30:08,320
Speaker 2: guides that? Where does that come from?

587
00:30:09,880 --> 00:30:14,080
Speaker 6: I think all models of neutral rates and they're all

588
00:30:14,240 --> 00:30:16,280
Speaker 6: pretty imprecise.

589
00:30:16,680 --> 00:30:18,320
Speaker 4: This is not precise.

590
00:30:18,400 --> 00:30:20,840
Speaker 6: There are many different models, each of them has a

591
00:30:20,920 --> 00:30:23,960
Speaker 6: significant amount of error. But you're going to be hard

592
00:30:24,080 --> 00:30:29,040
Speaker 6: pressed finding a model that says three percent plus on

593
00:30:29,640 --> 00:30:34,320
Speaker 6: the real rate on the real funds rate is neutral.

594
00:30:34,560 --> 00:30:38,640
Speaker 6: So it's really guided by a variety of different models,

595
00:30:39,480 --> 00:30:42,600
Speaker 6: some developed at the FED, some developed elsewhere. That's say,

596
00:30:43,040 --> 00:30:46,840
Speaker 6: we're right now, we're outside that range of uncertainty.

597
00:30:46,920 --> 00:30:48,440
Speaker 4: Can I ask you this question then?

598
00:30:48,760 --> 00:30:50,920
Speaker 2: If I was a first year intern at government Sachs,

599
00:30:50,960 --> 00:30:52,960
Speaker 2: I'd create a model really quickly and I'd say, yeah,

600
00:30:53,280 --> 00:30:55,920
Speaker 2: unemployment sat to four percent, equities real time highs, and

601
00:30:56,240 --> 00:30:58,080
Speaker 2: credits threads are super tight. Why is that a bad

602
00:30:58,200 --> 00:30:59,920
Speaker 2: model to sit here and say that, maybe we're not

603
00:31:00,160 --> 00:31:01,320
Speaker 2: restrictive at all.

604
00:31:01,840 --> 00:31:05,600
Speaker 6: Well, in the so this kind of short run and

605
00:31:06,040 --> 00:31:09,120
Speaker 6: long run So I don't think that the current level

606
00:31:09,920 --> 00:31:13,800
Speaker 6: is very problematic in terms of meia term growth. And

607
00:31:14,160 --> 00:31:18,600
Speaker 6: as you know, all forecast on growth is well above

608
00:31:18,640 --> 00:31:23,560
Speaker 6: the consensus and you know continues to be. But over time,

609
00:31:24,280 --> 00:31:28,720
Speaker 6: once the kind of short term moves in financial conditions,

610
00:31:28,800 --> 00:31:32,680
Speaker 6: short term moves in fiscal policy, and other forces play

611
00:31:32,720 --> 00:31:36,680
Speaker 6: themselves out, I think it's pretty clear that the current

612
00:31:36,840 --> 00:31:42,080
Speaker 6: level is above normal kind of neutral levels, and so

613
00:31:42,480 --> 00:31:46,680
Speaker 6: over the medium term, it's very likely that we will

614
00:31:46,760 --> 00:31:50,760
Speaker 6: see declines and rates, but the time path is going

615
00:31:50,800 --> 00:31:51,840
Speaker 6: to be hided by the data.

616
00:31:51,960 --> 00:31:53,640
Speaker 3: So you don't think it'll be important for j. Powell

617
00:31:53,720 --> 00:31:56,720
Speaker 3: to push back against some of the record highs on

618
00:31:56,880 --> 00:31:59,320
Speaker 3: stocks and some of the tightening and credit spreads.

619
00:32:00,400 --> 00:32:04,520
Speaker 6: Well, you would never comment on, you know, near to

620
00:32:04,560 --> 00:32:06,280
Speaker 6: our market moves, of course.

621
00:32:06,560 --> 00:32:09,080
Speaker 2: So you say that, But actually I remember that meeting

622
00:32:09,280 --> 00:32:12,520
Speaker 2: where that journalist and this an honest mistake said to

623
00:32:12,640 --> 00:32:15,600
Speaker 2: Power that markets were rallying, and I remember his response

624
00:32:15,640 --> 00:32:17,600
Speaker 2: to it in the news conference, and we'll talk to

625
00:32:17,800 --> 00:32:19,840
Speaker 2: I think it was Jim Bianco Pianca Research that called

626
00:32:19,840 --> 00:32:22,560
Speaker 2: it POW's hawkish hits. He just came out, and the

627
00:32:22,680 --> 00:32:25,040
Speaker 2: hawkish tone that he used once he thought that markets

628
00:32:25,080 --> 00:32:26,960
Speaker 2: were going against what the Federal Reserve was trying to

629
00:32:26,960 --> 00:32:29,600
Speaker 2: guide them to. I think it was pretty stark, strong,

630
00:32:29,720 --> 00:32:33,840
Speaker 2: maybe profound. Why isn't that an option he could take

631
00:32:33,880 --> 00:32:37,000
Speaker 2: today in the face of CPR is coming in pretty hot,

632
00:32:37,360 --> 00:32:39,160
Speaker 2: we've taken out cuts and this market's off to the

633
00:32:39,240 --> 00:32:42,240
Speaker 2: racist Why wouldn't that be something he'd be concerned by I.

634
00:32:42,240 --> 00:32:44,320
Speaker 6: Don't think it's the problem because he's not. I don't

635
00:32:44,360 --> 00:32:49,200
Speaker 6: think he's trying to slough things slow things down significantly.

636
00:32:49,400 --> 00:32:54,240
Speaker 6: I mean, the unemployment rate has drifted up somewhat. You know,

637
00:32:54,360 --> 00:32:58,400
Speaker 6: we're still seeing rebalancing and job openings. The quits rates

638
00:32:58,480 --> 00:33:02,280
Speaker 6: coming down in FLEA is going down the Yeah, the

639
00:33:02,360 --> 00:33:04,640
Speaker 6: sequential numbers have been a little higher, but the year

640
00:33:04,680 --> 00:33:07,600
Speaker 6: on year rate has continued to come down. I don't

641
00:33:07,600 --> 00:33:10,720
Speaker 6: think he's going to be particularly worried about having to

642
00:33:11,400 --> 00:33:16,280
Speaker 6: squeeze the economy. He can respond to surprise us by

643
00:33:16,680 --> 00:33:19,680
Speaker 6: delivering cuts a little bit later, delivering cuts a little

644
00:33:19,720 --> 00:33:23,600
Speaker 6: bit earlier. But I don't think he's he's it's in

645
00:33:23,640 --> 00:33:27,440
Speaker 6: a very different situation from where we were a year ago.

646
00:33:27,840 --> 00:33:31,200
Speaker 2: Certain identified too, and it's implicit in your forecast. And

647
00:33:31,280 --> 00:33:33,120
Speaker 2: you're right to point out that your growth forecasts have

648
00:33:33,200 --> 00:33:34,920
Speaker 2: been above the street ever since you came out with

649
00:33:34,960 --> 00:33:37,200
Speaker 2: your round. Look, strong growth doesn't appear to be a

650
00:33:37,240 --> 00:33:38,640
Speaker 2: problem to the Federal Reserve.

651
00:33:38,800 --> 00:33:39,240
Speaker 4: Why is that?

652
00:33:39,320 --> 00:33:41,000
Speaker 2: What is different about this moment?

653
00:33:41,760 --> 00:33:45,680
Speaker 6: Well, because I think inflation is much lower and it's

654
00:33:46,840 --> 00:33:49,800
Speaker 6: heading down, and the year on year rate is still

655
00:33:49,840 --> 00:33:53,840
Speaker 6: heading down. The labor market is much closer to balance.

656
00:33:54,360 --> 00:33:59,200
Speaker 6: So the you know, inflation expectations have continued.

657
00:33:58,800 --> 00:34:01,080
Speaker 4: To come down. They've now originally normalized.

658
00:34:01,520 --> 00:34:04,760
Speaker 6: So all the things that fed officials who were very

659
00:34:04,800 --> 00:34:07,840
Speaker 6: worried about a year and a half ago that you'd

660
00:34:07,920 --> 00:34:11,040
Speaker 6: get un anchoring up inflation expectations, you'd get a wage

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00:34:11,080 --> 00:34:13,719
Speaker 6: price spiral. I think a lot of those things have

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00:34:13,920 --> 00:34:17,440
Speaker 6: moved into the rearview mirror, and so therefore they are

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00:34:17,600 --> 00:34:22,759
Speaker 6: much less concerned about easier financial conditions. They'll still be

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00:34:22,880 --> 00:34:26,160
Speaker 6: relevant for setting policy, but they're going to be much

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00:34:26,280 --> 00:34:29,920
Speaker 6: less of a concern than maybe in this episode that

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00:34:30,280 --> 00:34:30,800
Speaker 6: you mentioned.

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00:34:30,920 --> 00:34:32,920
Speaker 2: Yeah, and this was great, So it's fantastic catch up.

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00:34:32,960 --> 00:34:34,320
Speaker 2: So it's been too long. It's going to see you.

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00:34:34,480 --> 00:34:34,759
Speaker 4: Thank you.

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00:34:34,880 --> 00:34:37,680
Speaker 2: Jan Haasis there of government sex, breaking down his outlook

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00:34:37,680 --> 00:34:40,680
Speaker 2: for the Federal Reserve, and this economy. This is the

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00:34:40,760 --> 00:34:44,960
Speaker 2: Bloomberg Sevenants podcast, bringing you the best in markets, economics,

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00:34:45,000 --> 00:34:47,960
Speaker 2: angio politics. You can watch the show live on Bloomberg

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00:34:48,000 --> 00:34:51,120
Speaker 2: TV weekday mornings from six am to nine am Eastern.

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00:34:51,480 --> 00:34:54,799
Speaker 2: Subscribe to the podcast on Apple, Spotify or anywhere else

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00:34:54,840 --> 00:34:57,480
Speaker 2: you listen, and as always on the Bloomberg Terminal and

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00:34:57,560 --> 00:34:58,719
Speaker 2: the Bloomberg Business app