Speaker 1: From the Bloomberg Interactive Burgers Studios. This is Bloomberg Daybreak
Speaker 1: for Friday, May twenty six.
Speaker 2: Coming up today, with less than a week till potential default,
Speaker 2: signs of compromise are forming on the debt ceiling.
Speaker 1: A Nobel Prize winning economists Warren's budget cuts will harm
Speaker 1: the country's future.
Speaker 2: Bets grow over another FED rate hike this summer.
Speaker 1: And on prominent investor dumpson video shares before a record rally.
Speaker 3: I'm Amy Morris. New York City is opening new respid
Speaker 3: sites for migrants. And Connecticut lawmakers have passed an amended
Speaker 3: version of the governor's gun safety bill.
Speaker 4: John Staves Sharon's Ward's easy win for the Mets. The
Speaker 4: Yankees lost NBA Playoffs. The Celtics against stayed alive. They
Speaker 4: beat the heat.
Speaker 5: That's all straight ahead on Bloomberg day Break, The Business
Speaker 5: News You need to starn your day in just one
Speaker 5: fifteen minute podcast each morning on Apples, Spotify, The Bloomberg
Speaker 5: Business Appen everywhere you get your podcasts.
Speaker 6: Good morning, I'm Nathan.
Speaker 1: Hager and I'm Karen Moscow. Here are the stories we're
Speaker 1: following today.
Speaker 2: We now have less than a week until the US
Speaker 2: could begin to default on its debts, and White House
Speaker 2: and Republican negotiators are still trying to reach an agreement
Speaker 2: on the debt ceiling. President Biden says progress is being made.
Speaker 7: Speaker McCarthy and I have had several productive conversations, and
Speaker 7: our staff continue to meet as we speak, as a
Speaker 7: matter of fact, and they're making progress.
Speaker 2: And House Speaker Kevin McCarthy is that going President Biden's sentiments, we.
Speaker 7: Know this would not be easy.
Speaker 6: It's hard, but we're working and we're going to continue
Speaker 6: to work till we get this done.
Speaker 2: When Speaker McCarthy says he'll work for the weekend to
Speaker 2: get a deal done, and now we're hearing the gap
Speaker 2: between both sides may be narrowing, sources tell Bloomberg a
Speaker 2: framework is emerging that would include a two year cap
Speaker 2: on federal spending while allowing defense spending to rise three
Speaker 2: percent next year. If a deal is announced soon, a
Speaker 2: vote in the House could come as early as Tuesday.
Speaker 7: Well.
Speaker 1: Meantime, Nathan, we have a warning from Paul Krugman on
Speaker 1: the dead crisis the Nobel Prize Economists as negotiators risk
Speaker 1: undermining the nation's prosperity by cutting spending on programs like
Speaker 1: education and child nutrition.
Speaker 8: What's happening right now is that in the effort to
Speaker 8: hold down headline spending right now, we're actually kind of
Speaker 8: disinvesting in the country's future. And that's that's pretty alarming.
Speaker 1: Paul Krugan made the comments in an interview with David
Speaker 1: Weston on Bloomberg's Wall Street. We catch the program today
Speaker 1: at six pm Eastern on Bloomberg Radio and Television.
Speaker 2: Okay, let's turn to the broader economy, Karen, because we're
Speaker 2: going to get an inflation report today that is closely
Speaker 2: watched by the Federal Reserve. That's as investors rethink the
Speaker 2: chances of a rate pause. Let's get the details now
Speaker 2: with Bloomberg's John Tucker, John.
Speaker 9: Hi, Nathan. The investors now betting we're going to see
Speaker 9: another rate increase in the next two months. As the
Speaker 9: view shared by ALTHEA. Spinozi of Saxo.
Speaker 10: Bank, we believe that there is one lost rate high
Speaker 10: that the filin that our server has to deliver is
Speaker 10: going to be that in June and July.
Speaker 9: She's looking at the latest data. It's resilient and suggests
Speaker 9: policymakers will have to keep their foot on the brakes
Speaker 9: to slow the economy further to battle inflation. The narrative
Speaker 9: hasn't been easy to follow. You have Fed shared Jerome
Speaker 9: pal saying just last week his team could afford to
Speaker 9: keep monitoring data that actually sounded a little dubvish and
Speaker 9: suggests a pause at the next meeting. Now we can
Speaker 9: throw into the mix of the Fed's preferred inflation measure,
Speaker 9: the PCE deflator will be out this morning. Bloomberg Economics
Speaker 9: says the data will probably show elevated inflation, if make
Speaker 9: the Fed's job that much more difficult in New York.
Speaker 9: I'm John Tucker, Bloomberg Day Break, All.
Speaker 1: Right, John, thank you well. Banks also remain in focus
Speaker 1: this morning. JP Morgan Cheese has notified about one thousand
Speaker 1: First Republic employees that they will not have jobs after
Speaker 1: its takeover of the failed lender. Sources say the biggest
Speaker 1: US bank offered full time or transitional roles to almost
Speaker 1: eighty five percent of the nearly seven thousand employees still
Speaker 1: working at First Republic when it collapsed. The rest have
Speaker 1: been told they will not get offers well.
Speaker 2: Meantime, another bank, Morgan Stanley is letting go of at
Speaker 2: least six managing directors Karen, including some Key China bankers.
Speaker 2: It's part of broader job cuts the bank has been
Speaker 2: making in Asia. Deal Making in the region has suffered
Speaker 2: due to growing tensions between the US and China, combined
Speaker 2: with tepid economic growth.
Speaker 1: Well Nathan two banks in New York are seeing less
Speaker 1: money coming in from this city. The New York City
Speaker 1: Banking Commission has voted to prohibit additional city deposits at
Speaker 1: Capital one Financial and Key Corpse Key Bank for up
Speaker 1: to two years. Then as if for the banks failed
Speaker 1: to submit plans demonstrating efforts to combat discrimination and we
Speaker 1: get the story from Bloomberg's Charlie Pellett.
Speaker 7: At its first ever public hearing, the Commission extended conditional
Speaker 7: designation to Capital One and Key Bank, which will allow
Speaker 7: them to service existing accounts for one year. The Commission
Speaker 7: also deemed twenty six banks eligible to hold the city's
Speaker 7: deposits and contract to provide banking services to city agencies
Speaker 7: for the next two years. To a statement from New
Speaker 7: York City Controller Brand Lander's office, as of the end
Speaker 7: of April, Capital One held seven point two million dollars
Speaker 7: in city deposits across one hundred eight accounts. Key Bank
Speaker 7: held ten million across three accounts in New York. Charlie Pellett,
Speaker 7: Bloomberg Daybreak.
Speaker 2: All right, Charlie, thank you.
Speaker 7: Turning to the markets.
Speaker 2: Now we're learning the one prominent investor missed out big
Speaker 2: on Nvidia's recent rally. Kathy Woods, flagship Exchange traded fund,
Speaker 2: closed out It's in Nvidia' steake in early January. Since then,
Speaker 2: the chip makers added around five hundred and sixty billion
Speaker 2: dollars in market cap, the last two hundred billion of
Speaker 2: which came on yesterday's AI related earnings surge. Although Wood
Speaker 2: holds in Vidia across several smaller funds, investors in her
Speaker 2: flagship Arc Innovation ETF have mostly been left out of
Speaker 2: this year's one hundred and sixty percent rally.
Speaker 1: Meantime, Nathan, another chip maker, is surging on the artificial
Speaker 1: intelligence craze. Shares of our Veil technology are up about
Speaker 1: sixteen and a half percent. The company said it expects
Speaker 1: revenue from AIDS this year. Marvel says sales of AI
Speaker 1: related products will at least double in its current fiscal year.
Speaker 1: Adjusted earnings for the first quarter also came in above
Speaker 1: analyst estimates.
Speaker 2: Outside Chips Careen shares of Gapper on the move this
Speaker 2: morning as well. They're rising about twelve percent in early trading.
Speaker 2: The retailer reported better than expected earnings, while margins improved
Speaker 2: in the first quarter. Gap has been reducing headcount and
Speaker 2: trimming expenses. Time and how to take a look at
Speaker 2: some of the other stories making news in New York
Speaker 2: and around the world. And for that, we're joined by
Speaker 2: Bloomberg's Amy Morris. Good morning, Amy, Good morning Nathan.
Speaker 3: New York City now opening respite sites for migrants. They
Speaker 3: serve as waiting rooms until the migrants can be placed
Speaker 3: somewhere more stable. One side is called Saint Bridget's. It's
Speaker 3: a shuttered Catholic school in the East Village. Say of
Speaker 3: Colina is a migrant from Venezuela and tells New York
Speaker 3: One through a translator that conditions are rough, but he
Speaker 3: is hopeful.
Speaker 7: The hardest part about being here is to be without work.
Speaker 7: We don't sleep well. Any of us. Those that have
Speaker 7: become citizens are lucky they're in a stable place.
Speaker 3: The Mayor's office says New York City is receiving hundreds
Speaker 3: of migrants each day, even though there is just no
Speaker 3: room left to house them. Connecticut lawmakers in the state
Speaker 3: House of Representatives signed off on an amended version of
Speaker 3: Governor Lamont's gun safety legislation. The bill includes a tighter
Speaker 3: definition of prohibited military style rifles, It reduces places where
Speaker 3: gun owners are allowed to carry their weapons in public.
Speaker 3: It includes safe storage requirements and limits permit holders to
Speaker 3: buying no more than three weapons each month. Representative Steve
Speaker 3: Stafstrom tells The Connecticut Post that the legislation is the
Speaker 3: most comprehensive gun safety measure since the twenty thirteen response
Speaker 3: to the Sandy Hook Elementary School massacre. Former Donald Trump
Speaker 3: campaign strategist Steve ben And will go on trial in
Speaker 3: New York next May on state charges that he defrauded
Speaker 3: contributors to a fund to build a wall on the
Speaker 3: US Mexico border. Ben In faces money laundering, fraud, and
Speaker 3: ND conspiracy charges. His trial will follow that of the
Speaker 3: former president on unrelated charges in quick succession and in
Speaker 3: the run up to next year's presidential election. New Jersey
Speaker 3: Assembly Speaker Craig Kauflin has introduced a proposal that would
Speaker 3: cut property taxes for most senior citizens in half, while
Speaker 3: also helping to pay for their health insurance. His proposal
Speaker 3: is called Stay and Jay. Its goal is to prevent
Speaker 3: seniors from moving out of New Jersey. The proposal would
Speaker 3: provide an income tax credit of fifty percent of the
Speaker 3: property tax bill for New Jersey residents. Governor Phil Murphy
Speaker 3: vows to veto what he calls an irresponsible bill if
Speaker 3: it reaches his desk. Global News twenty four hours a day,
Speaker 3: powered by more than twenty seven hundred journalists and analysts
Speaker 3: in over one hundred twenty countries. I'm Amy Morris, and
Speaker 3: this is Bloomberg Nathan.
Speaker 2: Thank you Amy. Time now for our Bloomberg Sports Update.
Speaker 2: For that we bring in John Stashaur.
Speaker 7: Thanks Beth.
Speaker 4: Things are getting very interested in this Celtics Heat East
Speaker 4: Final series because the Celtics are now halfway towards doing
Speaker 4: something no NBA team has done in one hundred and
Speaker 4: fifty attempts. Boston already has the only baseball team to
Speaker 4: win a series after trailing three to nothing, and now,
Speaker 4: nineteen years after the Red Sox comeback on the Yankees,
Speaker 4: the Celtics have won games four and five. It was
Speaker 4: easy in Boston one ten to ninety seven over Miami Celtics.
Speaker 4: Led by twenty four in the fourth quarter, they had
Speaker 4: four players score over twenty points, including Jalen Brown.
Speaker 11: I bet it's been against the wall.
Speaker 5: Obviously, we didn't imagine being in his position, being down
Speaker 5: three zero, But you know, university is you get to
Speaker 5: see why what a team.
Speaker 1: Is really made of, and I mean it couldn't get
Speaker 1: no worse than being down three.
Speaker 4: ZHO Game six tomorrow in Miami. Denver Nuggets await the winner.
Speaker 4: Dallas Stars also stayed alive a three two overtime win.
Speaker 4: Vegas still leads that Stanley Cup West Final series three
Speaker 4: to one, and that was the final at the Stadium,
Speaker 4: three to one, beating the Yankees. Kyle Gibson through seven
Speaker 4: scoreless innings. Clark Schmid pitched well but fell the two
Speaker 4: to five. Yanks are starting a rookie tonight against San
Speaker 4: Diego in the Bronx Randy Vesquez. The Mets will have
Speaker 4: Max Schurz are going tonight at Colorado. The Mets just
Speaker 4: salvaged one in Chicago, easy win over the Cubs ten
Speaker 4: to one, fifteen hits the night after getting only four
Speaker 4: one of the hits of Pee Alonzo home run his nineteenth.
Speaker 4: When we last saw Michael Block, the forty six year
Speaker 4: old had a hole in one, capping four terrific rounds
Speaker 4: at the PGA Championship, and that earned the club pro
Speaker 4: from California an invite to play the Colonial in Dallas.
Speaker 4: Back to reality yesterday, Block shot eighty one. He's in
Speaker 4: last place, already nineteen shots behind the leader, the brit
Speaker 4: Harry Hall, John Stashedward. Bloomberg Sports.
Speaker 11: From coast to coast, from New York to San Francisco,
Speaker 11: Boston to Washington, DC, nationwide on Syrias Exam, the Bloomberg
Speaker 11: Business Appen Bloomberg dot Com. This is Bloomberg Daybreak. Good morning.
Speaker 2: I'm Nathan Hager, and we are just days from a
Speaker 2: potential US default. As negotiators continue debating a debt limit deal,
Speaker 2: Congress is taking its scheduled Memorial Day recess. Michigan Congresswoman
Speaker 2: Debbie Dingle, for one, is not happy that lawmakers are
Speaker 2: leaving their posts with no agreement in place. Dingle says
Speaker 2: she won't attend a family event in Italy this weekend
Speaker 2: to ensure she is ready for a potential vote. Debbie
Speaker 2: Dingle discussed the negotiations and the risks of a US
Speaker 2: default with our Joe Matthew and Kaylee Lines on Bloomberg
Speaker 2: Sound on, let's bring you part of that discussion.
Speaker 5: Now.
Speaker 10: We can not default. We have no choice. Republicans have
Speaker 10: got to come to the table. We have to get
Speaker 10: this done. I'm sick of the drama that happens in
Speaker 10: this city, the showdowns that we always have, and i
Speaker 10: am just we have to get it done. We have
Speaker 10: no choice but to get this done. And we should
Speaker 10: be getting it done today. We should have gotten done
Speaker 10: long before this. But as your economists are telling you,
Speaker 10: businesses are telling you, my constituents who range from a
Speaker 10: whole lot of different my small businesses, my larger businesses, people,
Speaker 10: my retirees with savings accounts. We know all the people.
Speaker 10: They're going to be intected by this, people who are
Speaker 10: on Social Security. We cannot do this to the American people,
Speaker 10: to the American economy. We have to get this deal done.
Speaker 12: We spoke with Congressman Jim McGovern two days ago about this.
Speaker 12: He said he's a no vote if additional work requirements
Speaker 12: end up in the deal. Are you are you worried
Speaker 12: about what President Biden might agree to.
Speaker 10: I believe the President Biden is in touch with the
Speaker 10: Democrats in this caucus. He knows what matters. He is
Speaker 10: fighting for those values. I believe, no matter where you
Speaker 10: are in the spectum inside the Democratic Party, we share
Speaker 10: those same values. And I believe he is going to
Speaker 10: not agree to anything that the majority of our caucus
Speaker 10: cannot support, or that's what I am very hopeful of.
Speaker 10: He does know how our caucus feels. I know that
Speaker 10: he talks to us regularly.
Speaker 13: A congresswoman as he needs to compromise in theory to
Speaker 13: get to get a deal done. Are you willing to
Speaker 13: vote for whatever it is that the President does agree
Speaker 13: to to avoid a default.
Speaker 10: I will never say that I will vote for something
Speaker 10: I have not seen that is irresponsible for any elected official.
Speaker 10: I know how important it is not to default on
Speaker 10: the loan on our debt ceiling. I keep calling his
Speaker 10: loans that we cannot default. But I really do have
Speaker 10: to see what is in that film, what the impact
Speaker 10: is going to be in our people. And I think
Speaker 10: that it is very important that people understand right now
Speaker 10: that we cannot negotiate a package to appease the far
Speaker 10: right of the Republican Party who are never going to
Speaker 10: vote for this agreement anyway, to be negotiating a deal
Speaker 10: that helps the working men and women of this country
Speaker 10: across the country, that is what both parties need to
Speaker 10: be focused on, not to a very far group of
Speaker 10: people that are never going to vote for this bill ever.
Speaker 13: Congressman, are you worried that we could see another downgry
Speaker 13: What would would it be irresponsible of a credit readings agency,
Speaker 13: given the deadlock we are seeing in Washington on this
Speaker 13: issue at the moment, to say that our credit worthiness
Speaker 13: has been impaired.
Speaker 10: I want to say something to you all that and
Speaker 10: take a bigger picture. I think the political divide in
Speaker 10: this country. I think this lack of civility is a
Speaker 10: significant factor every day now in business decisions that are
Speaker 10: being made. People are looking at states that have more
Speaker 10: of the political division than other states that they're making
Speaker 10: decisions about where there are are locating plant I'm a cargirl,
Speaker 10: you know that decisions about where manufacturing facilities are going
Speaker 10: to be located, where people are opening their businesses. This
Speaker 10: is people that you look at the state of Florida
Speaker 10: and how bitterly divided that they are. I think we
Speaker 10: all need to understand. I'm an American first, I'm not
Speaker 10: a Democrat or and my friends on the other side
Speaker 10: of the all are Republicans. We're Americans and we need
Speaker 10: to be working together for the American people. This political
Speaker 10: divide is poisoning us, and it is hurting us in
Speaker 10: many ways.
Speaker 12: What are you going to do in the next couple
Speaker 12: of days while you wait for something to happen.
Speaker 10: I'm going to be sitting here in my office in Washington,
Speaker 10: d C. My godmother's daughter has promised me she's going
Speaker 10: to send me video live of what is happening. But
Speaker 10: we need to come together. We need to make sure
Speaker 10: we never get in this position again.
Speaker 6: This is Bloomberg day Break Today. Hey, your morning brief
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Speaker 1: here on Bloomberg Daybreak. He