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Speaker 1: Bloomberg Audio Studios, Podcasts, Radio News.

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Speaker 2: Single best idea on YouTube podcasts, Apple Podcasts. Good morning

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Speaker 2: to you, doing this very quickly today. It's a huge

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Speaker 2: day here with his FED meeting. Our goal this morning

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Speaker 2: was to get away from a twenty five to fifty

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Speaker 2: basis point frenzy and actually talk about some of the

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Speaker 2: underlying themes in There was a real set of rich

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Speaker 2: conversations today. Alicia Levine was just outstanding on the quality

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Speaker 2: of the market. Greg Boutele at BMP Perry Bat saying

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Speaker 2: he really has caution on the market but looks to

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Speaker 2: the volatility to be substantial. So we did a whole

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Speaker 2: derivatives option vamp there as well, So joining us Gina

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Speaker 2: Martin Adams with Bloomberg Intelligence to talk to her about

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Speaker 2: her enthusiasm about corporate earnings and you know what the

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Speaker 2: Fed's going to do. Geno Marn't and Adams to the

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Speaker 2: next and the next after that, and the next after

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Speaker 2: the next, after the next, after that FED meeting.

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Speaker 3: There is this perception that ray cuts have really elevated

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Speaker 3: earnings growth, and the most direct way that ray cuts

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Speaker 3: would have elevated earning growth over the last cycle would

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Speaker 3: have been through an improvement in ebitdah Right, you see

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Speaker 3: interest expense decline, you ultimately see better earnings growth. Are

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Speaker 3: we actually getting there or not is a big question.

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Speaker 3: We actually find that the impact of lower interest rates

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Speaker 3: on interest expense was deminimus even through the last cycle

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Speaker 3: because you saw this larger de leveraging experience. So the

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Speaker 3: stronger impact is not in between revenue and earnings. It's

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Speaker 3: actually on the revenue line. It is the FED cuts

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Speaker 3: ultimately result in stronger economic conditions or borrowing by the

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Speaker 3: private sector, which ultimately feeds through to strong revenue growth.

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Speaker 3: For the S and P five hundred, it's not that

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Speaker 3: rates are going down so they can borrow cheaper. It's

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Speaker 3: actually rates are going down so that their customers can

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Speaker 3: borrow cheaper to fuel their revenue line.

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Speaker 2: Gina Martin Adams just brilliant today combining inner technical analysis

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Speaker 2: with fundamental analysis over to this path that the FED

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Speaker 2: is on. It was wonderful to talk to Jason Furman

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Speaker 2: of Harvard that can be a three hour conversation. He

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Speaker 2: has done a great job of taking two, three, four, five,

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Speaker 2: six inflation series annualizing them out to I think it's

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Speaker 2: a sum to Excel spreadsheet of twenty one data points

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Speaker 2: to try to figure out where the vector is. We

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Speaker 2: didn't do that. We talked a little bit about the FED.

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Speaker 2: I thought he was brilliant about inertial force and the

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Speaker 2: tailor rule. That's a lot of physics envy, but basically,

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Speaker 2: once you get on a path, you stay on. The

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Speaker 2: path is the inertial part of it, and you know,

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Speaker 2: think about the weights gliding down the you know, remember

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Speaker 2: physics f equals NA remember that a lot of you know,

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Speaker 2: physics equations.

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Speaker 4: There.

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Speaker 2: It was physics envy with Jason Furman, but we finished

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Speaker 2: strong on where he is on public policy at Harvard.

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Speaker 2: Jason Furman, the candidates and tariffs.

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Speaker 4: It's just crazy that we're actually contemplating putting a twenty

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Speaker 4: percent tariff on every country in the world, on every

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Speaker 4: single thing they make. That will raise prices for American consumers.

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Speaker 4: It'll raise inflation if the FED doesn't look through it.

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Speaker 4: It will also result in higher interest rates. It won't

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Speaker 4: reduce our trade deficit at all, because a combination of

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Speaker 4: exchange rate changes and or foreign retaliation will happen, which

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Speaker 4: means instead we'll just get less imports and also less

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Speaker 4: exports and all the jobs supported by exports, all with

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Speaker 4: no negotiating theory at all. What are we trying to

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Speaker 4: get from Australia? Are we trying to bring the ballpoint

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Speaker 4: pendent industry back to America? You know, it just makes

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Speaker 4: no sense at all.

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Speaker 2: There's a clinic from Jason Furman. I would mention on

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Speaker 2: those two outcomes. The idea of foreign retaliation, that's what

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Speaker 2: everybody looks at. But there has to be humility, particularly

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Speaker 2: from those younger, huge humility about our pseudo economics. And

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Speaker 2: if it could break the dollar trend, which has been

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Speaker 2: dollar resiliency and dollar strengths, we forget totally in America

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Speaker 2: what a vector of sustained dollar weakness looks like. And

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Speaker 2: that would be really really interesting. As mentioned by alluded to,

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Speaker 2: I should say, by Jason Firman, there our special coverage

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Speaker 2: today at the FED. We'll do it the FED decides.

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Speaker 2: Thank you for those of you that tune in on

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Speaker 2: our many different platforms for the show. The audience for

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Speaker 2: that is just ginormous. That's a fancy term. I got

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Speaker 2: that from Nielsen or one of the Ginormous is a

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Speaker 2: very big term. We're on YouTube. Subscribe to Bloomberg podcasts

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