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Speaker 1: Ten US Global Business news twenty four hours a day

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Speaker 1: at Bloomberg dot Com, the Radio plus mobile last and

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Speaker 1: on your radio. This is a Bloomberg Business Flash and

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Speaker 1: I'm Karen Moscow. US dock Indix futures are lower this morning.

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Speaker 1: Let's go to the First Word Breaking news desk for

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Speaker 1: today's morning call, and here's Bill Maloney. Good morning Bill,

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Speaker 1: Good morning Karen. That's right. US futures remain under pressure today.

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Speaker 1: Down futures currently lowered by seventy one point says he

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Speaker 1: dropped ten and as a future is lower by thirteen

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Speaker 1: DUS ten yel at one point nine three percent, and

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Speaker 1: Europa markets are also lower, led by gray than one

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Speaker 1: percent declines in Spain and Italy. On the US Economic

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Speaker 1: Frinday thirty retail sales pp I and Empire Manufacturing and

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Speaker 1: at ten o'clock housing Market Index and business inventories. Regarding

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Speaker 1: earnings this morning, HD supply beat and Valiant lower forecast

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Speaker 1: shares her down sixteen percent. Pre market and other news,

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Speaker 1: Morgan Stanley says Apple March Corps or iPhone demand tracking

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Speaker 1: well and Meet Johnson rises six percent. Play market and

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Speaker 1: they report company is said to be working with Lazard Finally,

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Speaker 1: some of your early Wallstreet upgrades and downgrades. Tiffany cut

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Speaker 1: the neutral over at City Group, At Goldman Sachs, hid

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Speaker 1: A Sports and Sanderson Farms both cut to sell at

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Speaker 1: JPE Morgan three D Systems cut to underweight and Walpole

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Speaker 1: raised to overweight. Also Reticenter raised to strung by over

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Speaker 1: at Raymond James live on the first Breaking News deskm

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Speaker 1: Bill Maloney Karen all right, thanks Melan to hear live

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Speaker 1: breaking news. If you're a Bloomberg type, squawk go and

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Speaker 1: your terminal, that's squ that's squ a wuk go, and

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Speaker 1: that's a Bloomberg business flash. Tom and Mike Karen, thanks

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Speaker 1: so much. In the middle of three days of Central

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Speaker 1: Bank meetings, Bloomberg Surveillance brought you by Investco looking for

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Speaker 1: investment views. Experienced experts are just to click away. Go

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Speaker 1: to investco dot com, slash us to subscribe to the

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Speaker 1: investco blog, and follow at investco US on Twitter. Thank

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Speaker 1: you and besco for your support this morning. Mike, it's

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Speaker 1: just does this ever happen before? Back to back to

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Speaker 1: back Central Bank means it's enough to make Alan Ruskin

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Speaker 1: set up straight and smile. Well, it's not just the

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Speaker 1: Big three. In the minutes of the Bank of Australia

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Speaker 1: meeting just out UH. The the Norwegian Central Bank is

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Speaker 1: meeting this week, the South African Central Bank. Awful lot

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Speaker 1: going on and for the most part, central banks continuing

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Speaker 1: with a stimulus. One of the questions that comes up, though,

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Speaker 1: alan is UH what effect it has? The Bank of

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Speaker 1: Japan went to negative interest rates and saw the end

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Speaker 1: strengthen instead of weekend. We note the story on the

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Speaker 1: Bloomberg this morning that bank lending has UH gained less

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Speaker 1: than bank deposits in Japan, completely opposite of what the

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Speaker 1: bank UH is UH trying for. UH does it work anymore? Well?

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Speaker 1: The bank lending program that that senior dragging introduced actually

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Speaker 1: work in Europe? Well, I think you know there are

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Speaker 1: lots of different elements in UH that the e CBS

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Speaker 1: trying in terms of this large reserve additions to the

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Speaker 1: through the l t R O s and the corporate

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Speaker 1: bond purchases. UM. Look at the end of the day

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Speaker 1: and you you asked me earlier about what would drive

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Speaker 1: euro and what would drive euro dollar down? And I

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Speaker 1: think what the central banks are facing is that they

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Speaker 1: don't want to admit it, But the exchange rate channel

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Speaker 1: is a powerful channel and they need it. Um and um.

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Speaker 1: It's harder and harder to manipulate exchange rates lower in

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Speaker 1: part because you know, some of the adjustment has already occurred. So,

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Speaker 1: for example, in terms of negative rates in Europe, moving

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Speaker 1: to more negative rates doesn't have quite the same exchange

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Speaker 1: rate effect because um, you know a lot of the

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Speaker 1: accounts that would have already sold you rose in the

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Speaker 1: back of negative rates will have done so a year

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Speaker 1: or also a go So um. You know what you're

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Speaker 1: seeing the world over, I think is unorthodox policies can

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Speaker 1: be used. Now q E one works more than q

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Speaker 1: E two, which works more than QV three. There's definitely

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Speaker 1: diminishing returns to unorthodox policies. Well, what's your bet with

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Speaker 1: THECB and the bank lending program? But I think we

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Speaker 1: will get some adjustment. You know, the benchmarks in terms

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Speaker 1: of the amount of lending that's needed to trigger very

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Speaker 1: low or negative borrowing from banks is not you know

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Speaker 1: that that that benchmark is not very high really, so

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Speaker 1: there's plenty of incentives to go borrow at negative rates.

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Speaker 1: And you know, I think from a funding standpoint, from

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Speaker 1: a point of view, of supporting the banking system. Their

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Speaker 1: actions are you know, considerable whether the credit channel itself

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Speaker 1: is part colead powerful is another all together? Yeah, that's right.

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Speaker 1: Where I wanted to go. Is this you know the

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Speaker 1: word I'm hearing now, Ellen's transmission or diffusement, which I

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Speaker 1: used to hear a lot from Mr Triche. The idea

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Speaker 1: that you can diffuse well intentioned economic theory through a

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Speaker 1: system is really open to questions, isn't it. Yes, I

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Speaker 1: mean I think of being a particularly in terms of

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Speaker 1: the credit channel. You've got obviously got a demand side

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Speaker 1: and you've got a supply side, so you're facilitating supply. Um,

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Speaker 1: you know, are you necessary driving demands? You know, traditionally

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Speaker 1: supply does not create its own demand really, so you know,

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Speaker 1: that's one of the problems I think you're faced one

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Speaker 1: faces with the credit channels. As I mentioned earlier time,

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Speaker 1: I think the channel we know tends to work is

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Speaker 1: the exchange rate channel. But of course that tends to

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Speaker 1: get into beg of our neighbor type policies and everyone

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Speaker 1: consoled the same policy, which is part of the problem.

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Speaker 1: And I think one of the problems we face from

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Speaker 1: the global economy standpoint is the fat has been the

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Speaker 1: only guys on the other side. They're willing to tolerate

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Speaker 1: a stronger currency, but the stronger dollar has become disruptive

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Speaker 1: as well. Uh, you know, through weakening the equity markets,

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Speaker 1: weakening commodity prices. So um, you know, there's there's no

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Speaker 1: simple gain here from a global macro standpoint. Ellen Ruskin,

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Speaker 1: thank you so much. Just really really interesting conversation, folks,

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Speaker 1: given the squirreling Mike. To me, it goes back to

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Speaker 1: orphans and the toolbox. We're using things in the toolbox.

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Speaker 1: They we didn't know they were there. They were like

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Speaker 1: down below, you know, where you have the hacks all

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Speaker 1: you use for one project eight years ago. While they're

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Speaker 1: rooting around. Uh, they're getting getting close to the the

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Speaker 1: end of what they have as tools. But the question

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Speaker 1: is do the tools that even we're getting to now work. Uh.

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Speaker 1: As I said, interesting story on the Bloomberg today about

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Speaker 1: how bank lending, which is what the Bank of Japan

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Speaker 1: wants to stimulate, it's up a little bit. But bank deposits,

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Speaker 1: the banks there are paying one thousandths of one percent,

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Speaker 1: they're paying less, they're paying attent of a basis point

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Speaker 1: and people are rushing to put money into bank accounts

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Speaker 1: UH and the banks can't let it out fast enough.

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Speaker 1: And it is completely working the opposite of what the

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Speaker 1: Bank of Japan want. And with great respect for the

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Speaker 1: theory out there, none of this is in the textbooks. Well,

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Speaker 1: that's why it is theory, and it hasn't been tried.

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Speaker 1: We will know a lot more. I think somehow will

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Speaker 1: keep us unemployed through two thousand sixteen. That's a good thing.

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Speaker 1: Futures negative eleven down, futures negative seventy, important economic data,

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Speaker 1: the pulse of the American consumer. We will do that next.

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Speaker 1: This is Bloomberg's surveillance coming up there, with all due respect,

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