WEBVTT - Wall Street Set for Boost, Israel Rejects Cease-Fire Talks 0:00:00.080 --> 0:00:06.760 Bloomberg Audio Studios, Podcasts, radio News. 0:00:11.960 --> 0:00:15.560 This is the Bloomberg Surveillance Podcast. I'm Tom Keene along 0:00:15.600 --> 0:00:18.960 with Paul Sweeney. Join us each day for insight from 0:00:18.960 --> 0:00:22.800 the best in economics, finance, investment, and international relations. 0:00:23.040 --> 0:00:25.800 You can also watch the show live on YouTube. 0:00:26.120 --> 0:00:30.120 Visit the Bloomberg Podcast channel on YouTube to see the 0:00:30.200 --> 0:00:33.720 show weekday mornings from seven to ten am Eastern from 0:00:33.760 --> 0:00:37.199 our global headquarters in New York City. Subscribe to the 0:00:37.240 --> 0:00:41.159 podcast on Apple, Spotify, or anywhere else you listen and 0:00:41.320 --> 0:00:44.199 always I'm Bloomberg Radio, the Bloomberg. 0:00:43.800 --> 0:00:46.280 Terminal, and the Bloomberg Business App. 0:00:46.440 --> 0:00:48.720 It is one of the most coveted research notes on 0:00:48.720 --> 0:00:52.160 Wall Street. We protect the copyright of all our guests. 0:00:52.159 --> 0:00:55.360 Go to Data Trek Research to get the wisdom of 0:00:55.480 --> 0:00:58.400 Nick Kolis, where thrilled he could join us this morning. 0:00:58.480 --> 0:00:59.360 Nick, I like what you. 0:00:59.280 --> 0:01:02.920 Say in paragraph four. You've got a gross polarity between 0:01:03.000 --> 0:01:05.840 Nasdaq one hundred melt up right now, up one point 0:01:05.920 --> 0:01:10.960 four percent this morning and gold on GCA printing twenty 0:01:11.120 --> 0:01:15.200 seven zero five. How can gold be so different from 0:01:15.280 --> 0:01:16.560 Nasdaq one hundred. 0:01:17.160 --> 0:01:19.280 Yeah, fat, It's a fascinating topic. We kind of think 0:01:19.319 --> 0:01:23.399 of gold as a static valuable asset, and the NASDAK 0:01:23.520 --> 0:01:26.520 is the value of human ingenuity. And what's interesting is 0:01:26.560 --> 0:01:29.040 they're both kind of working right now, and usually it's 0:01:29.040 --> 0:01:31.560 one or the other, and we're getting both at the 0:01:31.600 --> 0:01:35.040 same time for different reasons than Nasdaq because human ingenuity 0:01:35.200 --> 0:01:39.160 is working, you know, the AI thing works and chip 0:01:39.160 --> 0:01:41.720 stocks are the center of it right now, and gold 0:01:41.800 --> 0:01:44.720 is working because central banks around the world viewed as 0:01:44.720 --> 0:01:47.840 a viable alternative to buying sovereign debt in terms of 0:01:47.880 --> 0:01:52.040 holding incremental reserve value. So you got both working. But 0:01:52.160 --> 0:01:53.920 it is very strange. 0:01:54.200 --> 0:01:56.920 You are going to write this morning on China going 0:01:56.920 --> 0:02:00.880 from monetary to fiscal stimulus and what's three days? 0:02:00.880 --> 0:02:01.840 Seventy two hours? 0:02:01.960 --> 0:02:05.320 I flunked it in seventy two hours, Nicolis, How do 0:02:05.360 --> 0:02:08.520 you fold China into the American equity market? 0:02:09.440 --> 0:02:13.280 Ooh, that is a great questions, So I'm going on. 0:02:15.040 --> 0:02:17.920 I was just looking at the five year chart of MCCHI, 0:02:18.040 --> 0:02:21.520 the MSCI China ATF and I'd say anybody who's in 0:02:21.520 --> 0:02:23.840 front of a terminal should do that right now because 0:02:24.200 --> 0:02:27.959 MCCHI is trading below where it was five years ago 0:02:28.040 --> 0:02:31.480 by a considerable margin. So people keep looking for this 0:02:31.600 --> 0:02:34.480 China trade to finally catch up. Maybe this is a 0:02:34.520 --> 0:02:37.520 stimulus that against to get us there. We're pretty skeptical 0:02:37.560 --> 0:02:39.880 at data trek, but I understand why people would want 0:02:39.880 --> 0:02:40.239 to believe. 0:02:40.280 --> 0:02:44.360 So where are we in the announcement of these monetary 0:02:44.560 --> 0:02:46.720 and fiscal policies. I think Tom and I both kind 0:02:46.720 --> 0:02:49.440 of godsmacked by how quickly this has been unrolled by 0:02:49.440 --> 0:02:52.000 the Chinese government. Are we a point at which this 0:02:52.080 --> 0:02:55.079 seems like something that is remotely investibule or is there 0:02:55.160 --> 0:02:57.200 still a moment here to kind of pause and wait 0:02:57.240 --> 0:02:59.520 to see what else might be coming from Beijing. 0:03:01.120 --> 0:03:03.400 You know, the central issue with these, with any of 0:03:03.440 --> 0:03:06.560 these attempts over the last couple of years by the 0:03:06.639 --> 0:03:09.600 Chinese government is you have a series of monetary and 0:03:09.639 --> 0:03:12.840 fiscal policy actions, but then you have this very different 0:03:12.840 --> 0:03:16.760 perspective from government regulators, where yes, they want the economy 0:03:16.800 --> 0:03:19.200 to improve, but they don't want to give too much 0:03:19.240 --> 0:03:22.680 power back to the very wealthy or to the corporations. 0:03:23.200 --> 0:03:27.160 And that tension has been really damaging for Chinese equity 0:03:27.240 --> 0:03:31.080 market investors sentiments and until you see the other side 0:03:31.120 --> 0:03:33.760 of the coin also begin to maybe pick its finger 0:03:33.840 --> 0:03:35.640 off the scale a little bit. It's going to be 0:03:35.680 --> 0:03:38.160 tough to bet too much on this term, but certainly 0:03:38.160 --> 0:03:41.240 you're right that thesepts have been very dramatically, very impressive. 0:03:41.680 --> 0:03:43.800 Michael Mobison was with us yesterday and we talked about 0:03:43.800 --> 0:03:46.320 this moment for small cap stocks. We talked a lot 0:03:46.360 --> 0:03:49.119 about through the Magnificent Seven and the run that they've had, 0:03:49.880 --> 0:03:52.440 the level of concentration that we've been experiencing over these 0:03:52.480 --> 0:03:54.760 last many months. I'd love your perspective on that as 0:03:54.760 --> 0:03:57.640 well as sort of how much opportunity there is, how 0:03:57.720 --> 0:04:00.000 much emphasis we should place on small cap company. 0:04:01.680 --> 0:04:03.880 Yeah, Mike, Mike. Mike's a great guy. Worked with him 0:04:03.880 --> 0:04:05.960 all through the nineteen nineties at the old First Boston, 0:04:06.040 --> 0:04:08.560 so have a lot of respect for him. My view 0:04:08.560 --> 0:04:11.560 on small caps is you need the stars to align 0:04:11.640 --> 0:04:14.600 pretty precisely to get the russell to work really well. 0:04:14.800 --> 0:04:17.000 And we've seen that twice now, just in the last 0:04:17.000 --> 0:04:18.880 three or four months. You had that big rip in 0:04:18.960 --> 0:04:21.880 July and then they fell apart again, and you're beginning 0:04:21.880 --> 0:04:24.560 to get that rip again now, but it's much more tentative, 0:04:24.960 --> 0:04:27.120 and what you need to see is a combination of 0:04:27.440 --> 0:04:31.760 lower interest rates, lower high yield spreads, and a lot 0:04:31.800 --> 0:04:35.000 of investor confidence in the US economy, and as great 0:04:35.000 --> 0:04:36.799 as it is to see the chip stops working again, 0:04:37.040 --> 0:04:38.840 it kind of tells me that the small caps are 0:04:38.839 --> 0:04:40.920 going to be on the back bench until we kind 0:04:40.960 --> 0:04:44.240 of hit maximum investor enthusiasm towards the end of the 0:04:44.279 --> 0:04:44.839 fourth quarter. 0:04:45.080 --> 0:04:48.040 Nick, we're on a street care. We had Michael Mobison yesterday, 0:04:48.040 --> 0:04:51.800 as David Gerra mentions in iconic credits like Mason on 0:04:52.000 --> 0:04:55.400 Morgan Stanley. We have Nick Cholis today. I mean, you 0:04:55.440 --> 0:05:00.000 can't do better than that. And tomorrow folks scheduled Nicholas 0:05:00.240 --> 0:05:04.440 not seeing teleeb who changed the world with full by randomness, Nick, 0:05:04.520 --> 0:05:08.600 I want to go to Tulleb's wonderful effort anti fragile. 0:05:09.040 --> 0:05:13.560 Anti fragility a property of systems in which they increase 0:05:13.600 --> 0:05:19.279 in capability to the result of stressors, shocks, volatility, noise, 0:05:19.920 --> 0:05:25.560 and un see football. Are we is America prospering, Nick Cholis, 0:05:26.040 --> 0:05:30.080 because we have Telebian anti fragility where we're not afraid 0:05:30.440 --> 0:05:33.520 of stressors and shocks and mistakes. 0:05:35.040 --> 0:05:40.000 I think that America by nature is psychologically anti fragile. 0:05:40.080 --> 0:05:44.080 Americans are very optimistic people. They don't worry about making mistakes. 0:05:44.279 --> 0:05:47.560 And they don't criticize people that fail, at least in business. 0:05:47.960 --> 0:05:49.839 You know, there are always second and third acts in 0:05:49.839 --> 0:05:52.680 the American society, and I think by nature we are 0:05:52.720 --> 0:05:55.240 anti fragile. The systems we create might not be, but 0:05:55.279 --> 0:05:58.159 I think our psychology is deeply in that direction. 0:05:58.520 --> 0:06:00.000 And I don't see that in China. 0:06:00.279 --> 0:06:03.480 Discuss do you see any of that within in Foreign 0:06:03.520 --> 0:06:07.880 Affairs magazine A brilliant essay here Rushier Sharma writing it 0:06:07.960 --> 0:06:11.600 up in others about a Marxist Leninist regime. I mean, 0:06:11.640 --> 0:06:15.280 that's that's Friedberg at Georgetown, I believe writing on that 0:06:15.680 --> 0:06:19.160 is Does China have any anti fragility? 0:06:20.120 --> 0:06:22.200 Surelie not to degree the US doesn't. I think the 0:06:22.279 --> 0:06:24.760 US is unique literally around the world. We talk about 0:06:24.760 --> 0:06:28.880 American exceptionalism as a concept. This is where America is exceptional. 0:06:28.960 --> 0:06:32.880 Our ability to keep bouncing back from mistakes, try again, 0:06:33.000 --> 0:06:35.520 try again, try again, until we get something right, whether 0:06:35.520 --> 0:06:38.320 it be in business or politics or anything else. And 0:06:38.400 --> 0:06:39.839 I think it's unique to our culture. 0:06:40.560 --> 0:06:43.719 Nicholas, thank you so much, greatly appreciated that. With data 0:06:43.800 --> 0:06:46.200 Track this morning, I got ghostb I got ducky bumps. 0:06:46.240 --> 0:06:49.840 I mean we got momas and Colas Taleb and Michael 0:06:49.880 --> 0:06:51.000 Barr All. 0:06:51.080 --> 0:06:55.320 For Michael Barr it's the smart one or no particular order. 0:06:55.680 --> 0:07:08.560 It's just too much. Nicolas, thank you so much. We 0:07:08.640 --> 0:07:10.640 need to get right to our guests. David and I 0:07:10.640 --> 0:07:13.080 can talk all day and monopolize you, forget about it. 0:07:13.360 --> 0:07:16.720 More important is Rob sank and tying all things together. 0:07:17.160 --> 0:07:20.040 It's City group. I want to go to China, and 0:07:20.080 --> 0:07:20.720 I thought I'd. 0:07:20.600 --> 0:07:22.800 Have to wait for at least two cups of tang 0:07:22.840 --> 0:07:25.400 and senka to get to fiscal support. 0:07:25.960 --> 0:07:28.080 It happened in twenty four hours, forty eight hours. 0:07:28.200 --> 0:07:30.840 The polit Bureau comes out today and says they will 0:07:31.040 --> 0:07:33.760 provide fiscal stimulus to China. 0:07:33.880 --> 0:07:34.720 What is that signal? 0:07:35.120 --> 0:07:36.840 Yeah, and I was like you as well. 0:07:36.880 --> 0:07:39.200 I thought this would be drip drip stimulus throughout the 0:07:39.280 --> 0:07:41.760 year and maybe we get some more in twenty twenty five. 0:07:42.160 --> 0:07:44.520 This shows that China can move on a dime. We 0:07:44.560 --> 0:07:47.640 saw that earlier in the cycle when they opened the 0:07:47.640 --> 0:07:50.960 floodgates a game rid of their zero COVID policy. Now 0:07:50.960 --> 0:07:53.680 what does it mean? You know, it's good news. It's 0:07:53.720 --> 0:07:56.240 more than I would have expected. But we'll have to 0:07:56.280 --> 0:07:59.360 see how the boots hit the ground and how the 0:07:59.400 --> 0:08:02.720 stimulus impacts the economy. Right now, we have a consumer 0:08:02.760 --> 0:08:06.400 there who's very unwilling to spend. Confidence is very low, 0:08:07.520 --> 0:08:10.600 and the economy has been mostly supported by the external sector. 0:08:10.640 --> 0:08:13.000 So we'll see if the stimulus is able to lift 0:08:13.040 --> 0:08:15.040 animal spirits. I think it's good news, but we'll have 0:08:15.080 --> 0:08:16.760 to wait see how effective it is. 0:08:16.920 --> 0:08:18.760 I go back to the conversation that we had in 0:08:18.800 --> 0:08:20.640 the lead up to the FED meeting last week, and 0:08:20.680 --> 0:08:22.440 there was the speculation that if the FED were to 0:08:22.480 --> 0:08:25.080 go big, that would showcase panic on the part of 0:08:25.120 --> 0:08:28.240 the Central Bank. Let's step back and look at these 0:08:28.280 --> 0:08:32.000 actions by the Chinese government, by the PBOC, explain to 0:08:32.080 --> 0:08:34.600 us sort of why they're moving on a dime, why 0:08:34.640 --> 0:08:36.600 they feel the need to do this, How urgent the 0:08:36.640 --> 0:08:38.880 situation is in the Chinese economy more broadly. 0:08:39.040 --> 0:08:41.559 Yeah, it's a great question, and I think probably they 0:08:41.559 --> 0:08:44.880 were looking at an economy, as we were, that was 0:08:44.920 --> 0:08:47.360 at real risk of falling short of their growth target. 0:08:47.559 --> 0:08:50.760 We recently marked down growth a bit more this year 0:08:50.800 --> 0:08:53.800 prior to these announcements and growth next year. I know 0:08:53.840 --> 0:08:56.520 others have been marking down growth as well, and we 0:08:56.600 --> 0:08:58.880 had seen risk still skewed to the downside and had 0:08:58.880 --> 0:09:01.080 not been expecting any type of large simmis. So I 0:09:01.120 --> 0:09:03.439 think they're seeing the data that's been coming over the 0:09:03.520 --> 0:09:06.480 last few months, which has been broadly softer than expected, 0:09:07.160 --> 0:09:09.760 and the soft data signaling even more softness. So I 0:09:09.760 --> 0:09:11.400 think they got spooked by the data. 0:09:11.480 --> 0:09:14.880 Andrew hollin Horst this morning is looking at Euroswissy, along 0:09:14.880 --> 0:09:18.280 with everybody else on Global Wall Street, the Swiss National Bank, 0:09:18.320 --> 0:09:21.560 as they did in twenty fifteen X they' say enough 0:09:21.600 --> 0:09:25.040 with Swiss Frank's strength, we're going to cut interest rates 0:09:25.240 --> 0:09:28.040 to protect our economy. How does that tie in for 0:09:28.120 --> 0:09:31.800 our American listeners and viewers to see smb C. 0:09:32.280 --> 0:09:37.360 Yeah, I think really what that signals is a that 0:09:37.440 --> 0:09:39.760 the exchange rate does play a role in a lot 0:09:39.800 --> 0:09:42.839 of how these central banks think, and as the FED 0:09:43.880 --> 0:09:46.840 is easing policy more broadly, we think that opens the 0:09:46.880 --> 0:09:48.800 door for other central banks to ease as well. 0:09:48.840 --> 0:09:49.400 They don't have to. 0:09:49.440 --> 0:09:50.880 Work's one big global rate cut. 0:09:50.920 --> 0:09:52.120 It's one big global rate cut. 0:09:52.480 --> 0:09:56.160 J Powell is Good Morning, Bill Rhodes, the Wonderful Bill Roads. 0:09:56.520 --> 0:09:58.680 J Powell is Central Banker to the World. 0:09:58.800 --> 0:10:01.000 Japallis Central Banker to the world, and I think this 0:10:01.160 --> 0:10:03.280 is going to open the door, especially of the FED, 0:10:04.120 --> 0:10:07.480 as Andrew's been writing, continues to go more aggressively. That's 0:10:07.520 --> 0:10:10.040 going to open up the door for these other central banks. 0:10:09.679 --> 0:10:11.720 Today they nailed the vector. I mean they nailed it 0:10:11.760 --> 0:10:13.480 going up. I'm this Hollimar's kid. 0:10:13.679 --> 0:10:15.520 First of all, he went to UCLA. 0:10:15.679 --> 0:10:18.840 David, what is Colline in Los Angeles? 0:10:18.920 --> 0:10:19.120 Well? 0:10:19.280 --> 0:10:20.520 Are you kissing a lucky man? 0:10:20.720 --> 0:10:22.319 I mean, he nailed it going up, and now he's 0:10:22.400 --> 0:10:24.360 nailing it going down with a lot of raid cuts 0:10:24.400 --> 0:10:24.960 to come. 0:10:25.000 --> 0:10:27.439 Ron, what are you listening for today? When we get 0:10:27.440 --> 0:10:29.920 this pre tape recording from the FED share This has 0:10:29.920 --> 0:10:32.480 been a week a cacophony of FED speakers. Now the 0:10:32.480 --> 0:10:34.400 big one comes out and gives what I guess we'll 0:10:34.440 --> 0:10:37.280 each the ten minutes remarks pre recorded as I say, 0:10:37.760 --> 0:10:40.079 what are you listening for? What it's going to give you? 0:10:40.120 --> 0:10:41.640 Any indication of sort of where we're headed from those 0:10:41.679 --> 0:10:42.280 remarks today? 0:10:42.520 --> 0:10:44.920 That's great question. I think for this one, I'm not 0:10:45.000 --> 0:10:47.080 looking for too much because I don't think we've gotten 0:10:47.160 --> 0:10:49.360 a lot of data that can really move the needle. 0:10:49.400 --> 0:10:51.520 So I think it's going to sound pretty similar to 0:10:51.559 --> 0:10:54.640 how the last decision sound and how he sounded during 0:10:54.640 --> 0:10:57.120 his press conference, But more broadly from the Fed, I'm 0:10:57.120 --> 0:11:00.840 really looking for, you know, how can earned are they 0:11:01.000 --> 0:11:03.000 about the dynamics in the labor market. I don't think 0:11:03.000 --> 0:11:05.520 it's about inflation that much for them anymore. They're not 0:11:05.559 --> 0:11:07.520 worried about the upside risk. They said, they're not going 0:11:07.600 --> 0:11:10.400 to deteriorate much more weakness in the labor market. They 0:11:10.400 --> 0:11:13.800 tell us the think we think that the labor you know, 0:11:13.840 --> 0:11:16.559 Andrew's team thinks that the labor market's going to continue 0:11:16.559 --> 0:11:18.760 to weakend they're gonna have to go fifty again. And 0:11:18.760 --> 0:11:20.800 they've very told us where that bar is. They sell 0:11:20.840 --> 0:11:22.840 it in their summary of economic projections. 0:11:24.120 --> 0:11:24.680 A little bit. 0:11:24.760 --> 0:11:28.679 Five point zero percent is like bigger than down ten thousand. 0:11:28.920 --> 0:11:31.120 Well, if you get that high, as as as our 0:11:31.120 --> 0:11:34.360 team expects, you're going to get a rapid rate cutting cycle. 0:11:34.760 --> 0:11:36.679 But you know, if the unemployment rate kind of stays 0:11:36.679 --> 0:11:39.440 near where it is and conditions stabilize, then you're gonna 0:11:39.440 --> 0:11:41.360 get a more gradual rate cutting cycle. So it really 0:11:41.360 --> 0:11:42.760 comes down to labor market conditions. 0:11:42.840 --> 0:11:43.439 Twenty seconds. 0:11:43.520 --> 0:11:45.520 You want to comment on why the yank the Yankees 0:11:45.559 --> 0:11:46.720 can't get it done. 0:11:47.400 --> 0:11:49.480 I've m a long term Mets fan. I don't know 0:11:49.480 --> 0:11:52.080 if that cancels me on the podcast and why. 0:11:52.000 --> 0:11:55.360 I saw walking into the stadium. Lennard's back is really bad. 0:11:55.559 --> 0:11:59.360 Yeah, yeah, absolutely, you know, I so on the Yankees and. 0:11:59.760 --> 0:12:01.679 That's people on here. That's what I was asking you. 0:12:02.120 --> 0:12:06.800 I was scared to say. Thursday, Rob Sock, and thank 0:12:06.840 --> 0:12:07.679 you so much. 0:12:12.200 --> 0:12:15.000 Another economic brief, and why are we doing this? We're 0:12:15.040 --> 0:12:19.680 doing this because all of this market hinges on the economy. 0:12:20.360 --> 0:12:23.360 She's lucky, she's a Bemo Capital market. So Jennifer Lee 0:12:23.480 --> 0:12:27.360 gets to throw things in Ian Lingen, who's just wonderful 0:12:27.360 --> 0:12:30.040 in the fixed income market. She's not on speaking terms 0:12:30.080 --> 0:12:32.240 with Brian Belski inequities. 0:12:32.400 --> 0:12:36.440 Jennifer Lee synthesize for me. You guys at Bemo Capital 0:12:36.520 --> 0:12:40.360 are just killing it. Lingoln looked for lower yields. Belski 0:12:40.440 --> 0:12:43.640 has been a confirmed bull. What are you telling them 0:12:44.040 --> 0:12:45.600 that makes this market move? 0:12:47.040 --> 0:12:48.840 So good morning, and thanks for having me on. By 0:12:48.840 --> 0:12:50.800 the way, I love Ian and I love Brian, who's 0:12:50.920 --> 0:12:58.520 chippy across. So I mean, obviously things have been not 0:12:58.559 --> 0:13:01.280 as bad as many econos had expected. You know, we 0:13:01.360 --> 0:13:05.280 are continuing to stay in that whole soft landing camp, 0:13:05.360 --> 0:13:07.439 you know, which is helping, which you know Brian is 0:13:07.480 --> 0:13:09.719 obviously online with as well, and hence he's been a 0:13:09.760 --> 0:13:13.880 lot more optimistic or still optimistic as well. But again 0:13:13.920 --> 0:13:15.640 things are just tapping on the brakes. As I say, 0:13:15.760 --> 0:13:18.080 month after month, you know, we're seeing slower economic data 0:13:18.120 --> 0:13:21.040 in general, but totally to be expected, but we're not 0:13:21.120 --> 0:13:23.000 certainly we're not slamming on the brakes. We've got some 0:13:23.000 --> 0:13:27.160 decent numbers this morning from on GDP on the UI claims, 0:13:27.200 --> 0:13:30.360 front durables were okay as well. So again, tapping on 0:13:30.400 --> 0:13:32.959 the brakes and that's what I guess that's the boat, 0:13:33.000 --> 0:13:35.040 the best that we can hope for at this point, Jennifer. 0:13:35.040 --> 0:13:38.080 For something that we talked about yesterday was how abnormal 0:13:38.240 --> 0:13:40.080 this moment is, how far we are from what we 0:13:40.080 --> 0:13:42.160 would consider to be normally when it comes to the 0:13:42.160 --> 0:13:45.080 economy and monetary policy. And I'd love your perspective on 0:13:45.120 --> 0:13:47.320 that as well, as you kind of chart out what 0:13:47.320 --> 0:13:50.359 the Fed may or may not do, how you acknowledge 0:13:50.360 --> 0:13:52.040 the kind of strangeness of where. 0:13:51.840 --> 0:13:56.120 We are, great question. So the strangeness is that after 0:13:56.600 --> 0:13:59.040 five and twenty five basis points of hikes. You know, 0:13:59.160 --> 0:14:01.800 the music on me still has to have to take 0:14:01.840 --> 0:14:05.800 a significant step back again, slowing, tapping on the brakes 0:14:05.800 --> 0:14:08.480 and all that. But you know, and I'll be quite 0:14:08.480 --> 0:14:10.640 honest here, I was not in the fifty basis point 0:14:10.800 --> 0:14:12.920 rate cut camp. I was actually excuming it was gonna 0:14:12.920 --> 0:14:15.080 be twenty five. So I won't tell you what words 0:14:15.080 --> 0:14:16.640 came out of my mouth when I saw the announcement, 0:14:16.920 --> 0:14:18.720 but I mean I understand, you know, he was saying 0:14:18.760 --> 0:14:21.280 to Fridcherpowloll, saying, the economy is still, you know, in 0:14:21.360 --> 0:14:23.960 decent shape. The US labor market is still also in 0:14:24.000 --> 0:14:26.480 decent shape, so let's just basically give them some It's 0:14:26.480 --> 0:14:27.840 almost like, I guess, you know, you're kind of on 0:14:27.880 --> 0:14:29.800 the way to being sick, but you're not really full 0:14:29.840 --> 0:14:31.760 on sick yet. So let's give you some medicine now 0:14:32.080 --> 0:14:34.080 to avoid that being full on sick, if you know 0:14:34.120 --> 0:14:34.560 what I mean. 0:14:34.800 --> 0:14:38.440 Jennifer, give us a clinic. I'm tomorrow at eight thirty. 0:14:38.840 --> 0:14:43.040 PCE is the Fed's favorite inflation indicator. I get it. 0:14:43.440 --> 0:14:46.160 But are we, like I'm thinking Laurence Summers, are we 0:14:46.240 --> 0:14:50.520 going to hear from PC tomorrow stagflation or some other 0:14:50.640 --> 0:14:51.400 grand theme. 0:14:53.080 --> 0:14:56.560 So that's another great question. So we're looking for roughly 0:14:56.640 --> 0:15:00.280 like steady ish reading on the deflator, just about a 0:15:00.320 --> 0:15:02.200 point two percent increased month to month, about two six 0:15:02.240 --> 0:15:02.920 two seven. 0:15:03.440 --> 0:15:04.080 Year of a year. 0:15:04.160 --> 0:15:06.600 You know, it's all going to be about focusing on 0:15:08.880 --> 0:15:10.840 normally I would say, spending, but also the wages and 0:15:10.880 --> 0:15:14.280 salaries component of consumers, workers that continue to see a 0:15:14.320 --> 0:15:16.520 steady rise in wages and salar which is I think 0:15:16.920 --> 0:15:19.480 the most important part of all this, because consumers need, 0:15:19.600 --> 0:15:21.960 you know, a job, they need steady wages, steady income, 0:15:22.440 --> 0:15:25.760 just that security to give them confidence for the future. 0:15:25.840 --> 0:15:27.960 I think that is what is critical. So looking at 0:15:28.040 --> 0:15:30.080 what people are making on a month to month basis, 0:15:30.840 --> 0:15:33.640 and of course what they're spending on. And the last 0:15:33.760 --> 0:15:36.440 report on retail sales, if I can remember, you know, 0:15:36.480 --> 0:15:39.320 it wasn't exactly broad based strength. You know, there was 0:15:39.320 --> 0:15:42.520 actually quite a few sectors that we're seeing that said 0:15:42.560 --> 0:15:45.240 decline in sales. But even the discussionary edements were a 0:15:45.240 --> 0:15:47.160 little bit. You know, we saw some up and some down. 0:15:47.240 --> 0:15:49.480 Dining out was a flat. So I still think we 0:15:49.520 --> 0:15:52.520 are still seeing some you know, consumers are still spending, 0:15:52.560 --> 0:15:54.680 they are still making a decent wage, but there were 0:15:54.720 --> 0:15:57.640 definitely definitely more cautious on what they are spending on. 0:15:58.480 --> 0:16:01.000 Jennifer, let me ask you about the effects of the 0:16:01.000 --> 0:16:04.240 decision from last week as we look at Switzerland today, 0:16:04.720 --> 0:16:06.680 perhaps we cast our right a Beijing as well, and 0:16:06.760 --> 0:16:09.600 what that bank is doing. You may not have gotten 0:16:09.600 --> 0:16:12.720 the fifty basis points right, I think your nine PhDs 0:16:12.760 --> 0:16:16.120 did from many hundreds of We'll forgive that, but is 0:16:16.160 --> 0:16:18.520 this playing out the way that you thought it would. 0:16:18.680 --> 0:16:20.960 Now that we're in this rate cutting cycle, we are 0:16:21.000 --> 0:16:25.520 seeing movement and change among other central banks around the world. 0:16:26.560 --> 0:16:28.280 So a lot of the central banks, I think, you know, 0:16:28.480 --> 0:16:31.160 because I think credibility is a huge factor for all 0:16:31.200 --> 0:16:33.280 central bankers. You may without it, you know, they got 0:16:33.320 --> 0:16:36.400 nothing right. So I think everyone has been very cautious 0:16:36.560 --> 0:16:39.840 on moving, especially the Federal Reserve. But now we're starting 0:16:39.880 --> 0:16:42.280 to see a little bit more I'm certain to thinking 0:16:42.320 --> 0:16:44.280 maybe a bit more anxiety, only because all of a 0:16:44.280 --> 0:16:47.600 sudden we're seeing these fifty basis point moves. I think 0:16:47.600 --> 0:16:49.400 it was yesterday, it was the Ricks Bank yesterday that 0:16:49.520 --> 0:16:52.000 said you know that you know they're going to you know, 0:16:52.040 --> 0:16:54.080 they cut twenty five, but then they said, then they 0:16:54.080 --> 0:16:56.000 gave lots of bord guidance. You know, we're going to 0:16:56.000 --> 0:16:58.120 be cutting for the next the other two meetings that 0:16:58.200 --> 0:16:59.880 remain for the rest of this year, and one of 0:16:59.880 --> 0:17:02.720 the could be a fifty basis pointer. So it seems 0:17:02.720 --> 0:17:05.360 like we're seeing more of that lately. So a bit 0:17:05.400 --> 0:17:08.439 more a tinge, more anxiety of perhaps just again to 0:17:08.640 --> 0:17:10.880 cut off the slow down, you know, before it gets 0:17:10.920 --> 0:17:12.760 off to too much. And then of course with China, 0:17:13.440 --> 0:17:16.880 the whole series of you know, they're acting almost every 0:17:16.960 --> 0:17:18.639 day this week, and of course this you know, I 0:17:18.640 --> 0:17:20.160 don't know how much it's going to help the Chinese 0:17:20.200 --> 0:17:23.480 economy overall, because it's all about households and consumer confidence 0:17:23.480 --> 0:17:26.320 and all that. But I think this morning's news gives 0:17:26.400 --> 0:17:28.119 us a little bit more hope that you know, that 0:17:28.160 --> 0:17:30.280 they are going to do whatever it takes, you know, 0:17:30.320 --> 0:17:33.320 to borrow from Mariod Reggi, you know, to be that 0:17:33.480 --> 0:17:35.240 to get to that about five percent growth target. 0:17:35.400 --> 0:17:36.119 Jennifer, Thank you. 0:17:36.160 --> 0:17:38.679 Jennifer le Vemo Capital Markets with us here looking at 0:17:38.680 --> 0:17:41.560 the economy and the clear message there for me folks, 0:17:41.600 --> 0:17:44.960 solid economy and you see it with domestic final sales 0:17:45.000 --> 0:17:45.240 in er. 0:17:45.280 --> 0:17:46.400 Vemo report. 0:17:56.359 --> 0:18:00.320 With all of his expertise on the Eastern Hemis fear 0:18:00.440 --> 0:18:04.520 is years in Moscow, and with Ethan Bronner Bloomberg, Israeli 0:18:04.600 --> 0:18:08.840 Bureau Chief with us as well, with his legacy of 0:18:09.359 --> 0:18:12.919 coverage an award for The New York Times. Mister Browner 0:18:13.040 --> 0:18:16.800 joins us this morning from a fractured Israel in Lebanon. 0:18:18.640 --> 0:18:21.800 Jamana Basacci in her interview with I'man Salaam of Lebanon, 0:18:22.480 --> 0:18:26.680 their economy minister. Here's the quote from your story Lebanon. 0:18:27.240 --> 0:18:30.280 We feel there is a lot of flexibility in the 0:18:30.320 --> 0:18:35.720 past twenty four hours from Hezbollah's side, discuss that Ethan, 0:18:36.160 --> 0:18:39.280 is there a Hesbollah that mister Natyaho can speak to. 0:18:39.760 --> 0:18:45.240 Hi Tom, I'm not sure, and I'm not sure in fact, 0:18:45.240 --> 0:18:48.360 I mean this is this bizarre relationship between the government 0:18:48.400 --> 0:18:51.879 in Lebanon and his Belah right, which is that in 0:18:51.920 --> 0:18:54.800 the country of Lebanon, the government is less powerful than 0:18:54.800 --> 0:18:56.120 the militia of his Belah. 0:18:56.600 --> 0:19:00.119 So while he says that we have also heard. 0:19:00.119 --> 0:19:04.679 Nothing official from his Beelah about desiring to move forward 0:19:04.680 --> 0:19:07.080 with this ceasefire. And there's another fact, of course, which 0:19:07.119 --> 0:19:09.960 is that for eight or nine days Israel has been 0:19:10.000 --> 0:19:15.960 pummeling Hasbollah first with those booby trapped pagers and walkie talkies, 0:19:16.000 --> 0:19:18.800 and then killing off a bunch of its top people, 0:19:18.880 --> 0:19:21.639 and then bombing the hell out of a lot of 0:19:21.640 --> 0:19:25.440 its launchers a couple of thousand spots. So it may 0:19:25.480 --> 0:19:28.040 be that his Belah is in the mood to talk, 0:19:28.240 --> 0:19:32.679 and conversely looks like Israel, feeling on the horse, is 0:19:32.720 --> 0:19:33.879 not in the mood to talk. 0:19:34.760 --> 0:19:37.000 Ethan, the Prime Minister of Israel is making his way 0:19:37.000 --> 0:19:38.879 to New York to address the UN tomorrow, and we 0:19:38.920 --> 0:19:40.879 can talk a bit about that and the postponement of 0:19:40.880 --> 0:19:42.919 that trip. But let me ask you first, if he 0:19:43.560 --> 0:19:45.800