Speaker 1: Live from the Bloomberg Interacted Berger's Studios. This is Bloomberg
Speaker 1: day Break for Thursday, March twenty third. Coming up today,
Speaker 1: Calm returns to markets following yesterday's FED decision. Fancier J.
Speaker 1: Powell says more rate hikes are in store if inflation persists,
Speaker 1: but the bond market has a different take, predicting rate
Speaker 1: cuts instead. And now it's the Bank of England's turn
Speaker 1: to make a policy decision. A grand jury in New
Speaker 1: York City could hear from one more witness today at
Speaker 1: Donald Trump's case, plus a standoff at the Manhattan High Runs.
Speaker 1: I'm Michael barn More ahead, I'm John's fish awon sports.
Speaker 1: That Nicks lost in Miami wide receiver moves made by
Speaker 1: the Jets of the NCAA tournament resumes tonight at Big Garden.
Speaker 1: Thanks all, straight ahead on Bloomberg day Break, The business
Speaker 1: news you need disturn your day, and just one fifteen
Speaker 1: minute podcast each pointing on Apple's Spotify. The Bloomberg Business
Speaker 1: Appen everywhere you get your podcasts. Good morning, I'm Nathan
Speaker 1: Hagar and I'm kieron Moscow. Here are the stories we're
Speaker 1: following today. The lift in futures. This morning comes on
Speaker 1: the heels of an equity sell off. Stocks sank yesterday
Speaker 1: after a ninth straight rate hike from the Federal Reserve
Speaker 1: and signals from Chair J Powell that more could be coming.
Speaker 1: We need to raise rates higher. We will, I think
Speaker 1: for now, though we as I've mentioned, we see the
Speaker 1: likelihood of credit tightening. We know that that can have
Speaker 1: a you know, an effect on the macroeconomy, on demand,
Speaker 1: on labor market, on inflation, and we're we're going to
Speaker 1: be watching to see what that is. Well. Critics are
Speaker 1: weighing in on those remarks from J. Pale Farmer FED
Speaker 1: Vice chair Alan Blinder says he should have taken a
Speaker 1: different approach. I think very much that the right decision
Speaker 1: today would have been a pause with words saying we're
Speaker 1: waiting to see if the dust clears and how it clears,
Speaker 1: and we may be going up higher depending if you know,
Speaker 1: if this crisis doesn't look too serious. Alan blinders can
Speaker 1: daring the Fed could be underestimating the extent of the
Speaker 1: current banking crisis. Well, Nathan, the markets are not buying J.
Speaker 1: Powell's message about more rate hikes. In fact, they're pricing
Speaker 1: in rate cuts instead, and we get that storway from
Speaker 1: Bloomberg's John Tucker, who joins US Live. John, Good morning,
Speaker 1: my Karen. Treasury's rallied yesterday after the Fed decision, and
Speaker 1: traders have ramped up best the central Bank is soon
Speaker 1: going to reverse course and start cutting rates. They seem
Speaker 1: convinced the Fed will make in about face, probably in September.
Speaker 1: The market view contrasts with the FED guidance, which calls
Speaker 1: for at least one more hike at Cher. Powell did
Speaker 1: push back on that market center and saying rate cuts
Speaker 1: are not our base case. Investors think tighter Fed policy
Speaker 1: is leading to cracks in the economy will likely tip
Speaker 1: the United States into recession. Live in New York. I'm
Speaker 1: John Tucker, Bloomberg Daybreak, John. Thanks. The Swiss National Bank
Speaker 1: is also on the move this morning. Turmoil at Credit
Speaker 1: Suiss is not stopping that central bank from tightening policy.
Speaker 1: The SNB's hiked rates by fifty basis points, taking its
Speaker 1: policy rate to one and a half percent. Now, Nathan,
Speaker 1: it's the Bank of England's turn. We get a rate
Speaker 1: decision across the pond at eight am Eastern today and
Speaker 1: Bloomberg's Lizzie Burden is at the BOE and has a preview.
Speaker 1: There had been economists wondering at the start of the
Speaker 1: week whether all the recent banking stress meant that financial
Speaker 1: conditions have titan so much that the leg work has
Speaker 1: been done for the Bank of England, that another hike
Speaker 1: would be deflationary, or that it would undermine the already
Speaker 1: weak economy. But now the consensus is for a quarter
Speaker 1: point hike, which would take rates to four point two
Speaker 1: five percent, to be the highest level since two thousand
Speaker 1: and eight, and Bloomberg's Lizzie Burden points out the pound
Speaker 1: is trading near a two month high ahead of the
Speaker 1: BOE decision. Now we continue Karen to follow the latest
Speaker 1: developments on the banking crisis and the response from Washington.
Speaker 1: Treasury Secretary Janet Yellen says the US is not considering
Speaker 1: blanket deposit insurance without first working with Congress. It's important
Speaker 1: to be clear shareholders and deadholders of the field banks
Speaker 1: are not being protected by the government, and no losses
Speaker 1: from the resolution of these banks are being borne by
Speaker 1: the taxpayer. Deposit protection is provided by the Deposit Insurance Fund,
Speaker 1: which is funded by fees on insured banks. My Treasury
Speaker 1: Secretary Yellen says executives responsible for bank collapses should not
Speaker 1: be profiting when stockholders and investors take losses. Well, Jane
Speaker 1: Fraser is weighing in on the banking turmoil. Nathan, the
Speaker 1: CEO of City Group, says the ability to move millions
Speaker 1: of dollars, which just a few clicks, is a sea
Speaker 1: change moment for the risk of bank runs. There were
Speaker 1: a couple of tweets and then this thing went down
Speaker 1: much faster than as appened in history, and greatly. I
Speaker 1: think the regulators did a good job in responding very quickly,
Speaker 1: because normally have longer to respond to this. City Group
Speaker 1: CEO Jane Fraser made the comments in an interview at
Speaker 1: David Rubinstein. Stay tuned for more of that conversation coming
Speaker 1: up surely on Bloomberg Daybreak, and we continue to watch
Speaker 1: First Republic Bank this morning. Karen. The shares are up
Speaker 1: three point six percent, but it's not all good news
Speaker 1: for the bank, and we get more live from Bloomberg.
Speaker 1: Steve Rappaport, Steve, Good morning, Nathan and Karen. The San
Speaker 1: Francisco lender was hit with a ratings down grade for
Speaker 1: the second time in less than a week, Fitch lowered
Speaker 1: First Republic's long term issuer default rating from B to
Speaker 1: double B. The bank received the cash infusion of thirty
Speaker 1: billion dollars from a group of major firms. Fitch analysts
Speaker 1: view the funding as the primary ratings constraint. Meanwhile, First Republic,
Speaker 1: in a regulatory filing, says top Brass agreed to forego
Speaker 1: bonuses and other compensation this year. Live in New York,
Speaker 1: I'm Steve Rappaport, Bloomberg Daybreak. All right, Steve, Thanks, And
Speaker 1: in politics today, TikTok is front and center on Capitol Hail.
Speaker 1: The company CEO tries to convince the lawmakers today that
Speaker 1: China has no influence over the apps data. Amy Morris
Speaker 1: has details from our Bloomberg ninety nine one newsroom in
Speaker 1: Washington show Two plans to tell Congress the TikTok app
Speaker 1: does more to protect young users than other social media rivals.
Speaker 1: Two will appear before the House Energy and Commerce Committee,
Speaker 1: where he will be grilled on teen's safety and the
Speaker 1: app's impact on mental health, but he'll also face questions
Speaker 1: about national security. In prepared comments reviewed by Bloomberg News,
Speaker 1: too will tell lawmakers they would never share information demanded
Speaker 1: by the Communist Party as TikTok tries to convince lawmakers
Speaker 1: the companies should be allowed to continue operating in the US.
Speaker 1: In Washington, I'm may Me Maris Bloomberg. Daybreak. It's forty
Speaker 1: eight degrees in New York's apatchee fog this morning, but
Speaker 1: it's gonna be cloudy, breezy, with some passing showers this afternoon,
Speaker 1: heading to the low sixties. Showers end this evening. We'll
Speaker 1: get down to the upper forties. Second look at some
Speaker 1: of the other stories making news in New York and
Speaker 1: around the world with Bloomberg's Michael Bark. Good morning, Mike, Call,
Speaker 1: Good morning Nathan. The grand jury in the Manhattan DA's
Speaker 1: probe into Donald Trump was delayed, and we'll reconvene later today.
Speaker 1: Trump is accused of paying hush money in twenty sixteen
Speaker 1: to an adult film star. Jurors were informed at least
Speaker 1: one additional witness may be called to testify before they
Speaker 1: decide whether to indict the former president. Outside the courthouse
Speaker 1: in Lower Manhattan, woman supports Trump. Look, he's not perfect
Speaker 1: or any of us perfect, but he loves our country
Speaker 1: and they put him through so much and He's still
Speaker 1: gonna do it again and we're gonna win. Meanwhile, this
Speaker 1: man says he wants to see a mug shot of him. Yes,
Speaker 1: I mean, I don't know about this crime, but multiple
Speaker 1: other crimes. I mean January sixth alone, he should be
Speaker 1: in prison. New York is still bracing for protests. The
Speaker 1: former president also lost a court battle to keep legal
Speaker 1: details secret from the Justice Department about his alleged mishandling
Speaker 1: of classified information after he left the White House. It
Speaker 1: appears to clear the way for Special Consul Jack Smith
Speaker 1: to force one of Trump's private lawyers to testify before
Speaker 1: a grand jury. Approval of President Joe Biden has dipped,
Speaker 1: nearing the lowest point of his presidency. According to the
Speaker 1: Associated Press North Pole, the president notched an approval rating
Speaker 1: of just thirty eight percent. The U asked questions China's
Speaker 1: message to Russia about how to end the war in
Speaker 1: Ukraine Bloomberg's ad Baxter report. The US is basing that
Speaker 1: on the fact that the day after the Shee Putin's summit,
Speaker 1: Russia launched a barrage of missiles. NFC spokesman John Kirby,
Speaker 1: If China really wants to be helpful in that regard,
Speaker 1: they should be urging President Putin to get out of Ukraine.
Speaker 1: Here we are the day after, and mister Putin is
Speaker 1: launching more drones and missiles into Ukraine. So I don't
Speaker 1: know President she delivered that message, but if he did,
Speaker 1: mister Putin ignored it. Kirby says. The other possibility as
Speaker 1: if Vladimir Putin doesn't support China's peace plan. In San Francisco,
Speaker 1: I'm at Baxter Bloomberg day Break, A dramatic standoff played
Speaker 1: out thirty floors above a Manhattan street yesterday. It all
Speaker 1: began when the FBI tried to execute an arrest warrant
Speaker 1: at a luxury high rise just steps away from Carnegie Hall.
Speaker 1: The man barricaded himself inside the apartment and then was
Speaker 1: purged on the ledge of the window, threatening to jump.
Speaker 1: An NYPD officer finally repelled down from the floor above
Speaker 1: and was able to get the suspect inside. Global News
Speaker 1: twenty four hours a day, powered by more than twenty
Speaker 1: seven hundred journalists and analysts in over one hundred twenty countries.
Speaker 1: I'm Michael bar This is Bloomberg, Nathan. Thanks Michael of
Speaker 1: the Bloomberg Sports Update brought you by Trice State. Out
Speaker 1: of you, here's John Stashower all right. Nathan Nicks had
Speaker 1: beaten the Heat twice this season, both nail biting games
Speaker 1: not decided until the end. This time in Miami, Knicks
Speaker 1: fell short at one twenty seven to one twenty. Jimmy
Speaker 1: Butler thirty seven points for the Heat. RJ. Barrett had
Speaker 1: twenty six for the Knicks. Jalen Brunson twenty five, but
Speaker 1: Julius Randall went from fifty seven points the other night
Speaker 1: down to fifteen. Same two teams will play next week
Speaker 1: at the Garden. Nicks are trying to hold on to
Speaker 1: fifth place in the East. They lead Miami and Brooklyn
Speaker 1: by two games. The Nets play tonight at Cleveland at
Speaker 1: the Garden. It's the start of the NCAA Tournament Sweet
Speaker 1: sixteen and up first it's Kansas State against Michigan State,
Speaker 1: and both teams have top scorers who are New York natives.
Speaker 1: Case States Marquisnoles from Harlem. The Spartans Tyson Walker is
Speaker 1: from Long Island. As coach is tom Izzo. He does
Speaker 1: have that that swagger about him, you know, his is
Speaker 1: a little more I think sometimes the New York swagger
Speaker 1: is a very cocky swagger, and sometimes that's good. You
Speaker 1: got to be He's kind of had the happy medium,
Speaker 1: you know, he's got enough cockiness to be confident, and
Speaker 1: yet he's an unbelievable Kidizzo in his twenty eight season
Speaker 1: in Michigan State the Kansas State coach Jerome Tanks in
Speaker 1: his first season. Later, it's Tennessee versus Florida Atlantic. Also
Speaker 1: a doubleheader in Vegas, Yukon against Arkansas, UCLA meets Gonzaga.
Speaker 1: That Jets drafted wide receiver Elijah More in the second
Speaker 1: round two years ago. Good rookie season, not as good
Speaker 1: this past year. Midway through, he demanded the trade. The
Speaker 1: Jets traded More to Cleveland. They got a second round
Speaker 1: draft pick back, and the Jets signed a free agent
Speaker 1: white out Mcole Hardman spent the last four seasons of
Speaker 1: Kansas City, went two Super Bowls. John stash Allard Bloomberg
Speaker 1: Sports Live from coast to coast, from New York to
Speaker 1: San Francisco, Boston to Washington, DC, nationwide on Sirius Exam,
Speaker 1: the Bloomberg Business app, and Bloomberg dot Com. This is
Speaker 1: Bloomberg Daybreak. Good morning. I'm Nathan Hagard in Jay the
Speaker 1: Markets Trust. Those are the words from City Group CEO
Speaker 1: Jane Frasier, who says she supports Chairman Powell's efforts to
Speaker 1: fight inflation and appreciates how clearly he has stated that
Speaker 1: crushing inflation is the Fed's number one goal. Jane Fraser
Speaker 1: sat down with Bloomberg's David Rubinstein and an event at
Speaker 1: the Economic Club in Washington. They discussed the FED and
Speaker 1: the recent string of bank failures and what it all
Speaker 1: means for the US economy. Here is part of that conversation. Now,
Speaker 1: the feds job number one is fighting inflation, and we
Speaker 1: want the FED to be very dependable in fighting inflation,
Speaker 1: and that should be their most important priority. There are
Speaker 1: ramifications of it, but there are certain banks which say
Speaker 1: are an isolated few that have really been impacted very negatively,
Speaker 1: that didn't necessarily manage their balance sheets that well, and
Speaker 1: think that was the right decision to protect only the
Speaker 1: depositors and say goodbye to the shareholders and goodbye to
Speaker 1: the creditors. I think it's very important to protect the
Speaker 1: depositors right now. The banking system everywhere around the world
Speaker 1: depends on confidence and that confidence has to be in
Speaker 1: the safety and security of deposits. So in terms of
Speaker 1: the most important job here they did the most important job,
Speaker 1: which is making sure the depositors will whole. So in
Speaker 1: the old days and there were bank runs, used to
Speaker 1: see people lined up outside the street and get their
Speaker 1: money out. Now you're just on your iPhone or whatever
Speaker 1: phone you have, you can take your money out. So
Speaker 1: money moves so quickly was at a factor as well.
Speaker 1: And having the money get out of a bank so
Speaker 1: quickly on the weight line, you can just do it
Speaker 1: over it. It's a complete game changer from what we've
Speaker 1: seen before. David, you're absolutely right. There were a couple
Speaker 1: of tweets and then this thing went down much faster
Speaker 1: than as a and in history, and greatly. I think
Speaker 1: the regulators did a good job in responding very quickly,
Speaker 1: because normally you have longer to respond to this, so
Speaker 1: they acted with quite a lot of speak even how
Speaker 1: quickly this happened. So some people say you have a
Speaker 1: moral hazard when you protect people. So by protecting all
Speaker 1: the depositors in Silicon Valley Bank, the implication was that
Speaker 1: if somebody else has a problem, will protect them, and
Speaker 1: so forth, and so the two hundred and fifty thousand
Speaker 1: dollars limit is meaningless more or less? Or do you
Speaker 1: think the federals are and the Secondary Treasurer saying we're
Speaker 1: not going to protect every depositor, or we're going to
Speaker 1: protect certain depositors. I don't think they need to go
Speaker 1: out right now, because the banking system is pretty sound,
Speaker 1: and we're talking about a few banks. We had it
Speaker 1: from the gym and pal. This is not something that
Speaker 1: is spread across the entire banking system. Isn't like it
Speaker 1: was last time. This is not a credit crisis. This
Speaker 1: is a situation where it's a few banks that have
Speaker 1: some problems and it's better to make sure that we
Speaker 1: nip that in the bud. As we talk today, the
Speaker 1: Federal Reserve has announced that it's going to increase the
Speaker 1: federal discount rate by another twenty five basis points, which
Speaker 1: was probably not a surprise in the market. Do you
Speaker 1: think that was the right decision now? I think it
Speaker 1: was a tough decision. Was Jake and a pause? Was
Speaker 1: he going to increase it by the twenty five bits
Speaker 1: or more? I think what he said was apparently jolly sensible.
Speaker 1: If you'll pardon the British expression, I do that occasionally.
Speaker 1: He said, we don't know how much credit tightening is
Speaker 1: going to come from what's gone on in the last
Speaker 1: couple of weeks. We don't quite know what's going to
Speaker 1: happen there. So we do know that inflation is a
Speaker 1: real problem. It's persistent, it's starting to come off. But
Speaker 1: he has to tackle this and in Jay the market's
Speaker 1: trust and many of us do that they're going to
Speaker 1: tackle inflation hard. But let's also see where the data is.
Speaker 1: Do you see any evidence in the information data that
Speaker 1: city has that we are heading for a recession? If so,
Speaker 1: when might you think we would see the evidence of that? Yeah,
Speaker 1: I mean, we've certainly been expecting that a recession could
Speaker 1: well be could well be happening in the second half
Speaker 1: of the year. If one does occur, we don't think
Speaker 1: it will be that heavy because normally, when you're heading
Speaker 1: into some tougher times, you know, the consumers not in
Speaker 1: such good health, the companies aren't, the banks aren't, whereas
Speaker 1: that's not the case right now. The consumer is in
Speaker 1: good health, the corporate balance sheets are strong, and the
Speaker 1: banks are strong. So the factors that typically amplify a
Speaker 1: recession and not in these not in play at the moment,
Speaker 1: So we have to make sure there's nothing crazy happens
Speaker 1: in the duo political world that would change it. But
Speaker 1: we could well have a mild recession. The last couple
Speaker 1: of weeks could make that a bit more likely. It
Speaker 1: doesn't feel like it's going to be a tough one,
Speaker 1: and the US economy is likely to pull out a
Speaker 1: bit pretty quickly. This is Bloomberg Daybreak Today, your morning
Speaker 1: brief on the stories making news from Wall Street to
Speaker 1: Washington and beyond. Look for us on your podcast feed
Speaker 1: at six am Eastern each morning, on Apple, Spotify, and
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Speaker 1: And I'm Karen Moscow. Join us again tomorrow morning for
Speaker 1: all the news you need to start your day, right
Speaker 1: here on Bloomberg Daybreak