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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the.

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Speaker 3: Bloomberg Daybacurate Podcastketborning. It's Monday, the fourth of August. I'm

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Speaker 3: Caline Hepkea and.

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Speaker 4: I'm Stephen Carroll. Coming up today.

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Speaker 5: Donald Trump says he'll pick a new FED governor and

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Speaker 5: data chief within days to key positions for his economic agenda.

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Speaker 3: The worst US labor data revision in seven years sparks

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Speaker 3: a dramatic reversal of market perceptions of the strength of

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Speaker 3: the American economy.

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Speaker 5: Plus, can Europe still be an ev contender? A look

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Speaker 5: at BMW's plans to challenge Tesla.

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Speaker 2: Let's start with a roundup of our top stories.

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Speaker 5: US President Donald Trump says he will announce a new

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Speaker 5: FED governor in the coming days. One of the seven governors,

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Speaker 5: Adrianna Kugler, said on Friday that she intends to step

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Speaker 5: down early from her position. The US President has been

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Speaker 5: putting the Central Bank under unprecedented public and vocal pressure

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Speaker 5: to cut interest rates. He told reporters he would be

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Speaker 5: filling Couglar's seat soon.

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Speaker 4: Now I have a couple of people in mind.

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Speaker 6: I'll be announcing somebody for the filling of the person

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Speaker 6: that left. A woman left, as you know, who is

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Speaker 6: a I guess a Biden appointment, either Biden or Obama,

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Speaker 6: but I think a Biden appointment. And she left early,

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Speaker 6: and I think she left because she agreed with me

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Speaker 6: on interest rates, and yet they were on the other

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Speaker 6: side of the ballpark, right, So I'll be announcing that

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Speaker 6: probably over the next couple of days.

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Speaker 5: Trump's claimed that Kugler agreed with him on the path

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Speaker 5: of interest rate doesn't chime with her past public comments

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Speaker 5: on the issue. With Cougler's departure, the President has the

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Speaker 5: opportunity to appoint a governor who more closely aligns with

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Speaker 5: his preference for lower interest rates. Any replacement is seen

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Speaker 5: as likely to take over Jerome Palell's job running the

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Speaker 5: Central Bank when his term ends in May of next year.

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Speaker 3: Now, the changes on the Fed Board would come as

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Speaker 3: a major negative. Revision to job data has upended views

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Speaker 3: on the weakness of the US labor market. The revised

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Speaker 3: figures make the past three months the worse for job

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Speaker 3: creation in the US since the pandemic. After the report,

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Speaker 3: the White House fired the Bureau of Labor Statistics boss

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Speaker 3: Erica Macentarfa. The White House National Economic Advisor Kevin Hassett

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Speaker 3: told Meet the Press on Sunday the firing was because

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Speaker 3: the revision was poorly explained.

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Speaker 7: The President wants has owned people there so that when

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Speaker 7: we see the numbers, they're more transparent and more reliable.

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Speaker 7: And if there are big changes in big revisions, we

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Speaker 7: expect more big revisions for the job data in September,

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Speaker 7: for example, then we want to know why.

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Speaker 4: We want people to.

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Speaker 3: Explain it to us, Kevin Hasset. They're speaking to NBC.

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Speaker 3: The Shock revision caused a rush into treasuries. The ten

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Speaker 3: year US yield dropped sixteen basis points on Friday, the

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Speaker 3: two year yield fell twenty.

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Speaker 2: Eight basis points.

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Speaker 3: Those moves reflected heightened anticipation of the Federal Reserve cutting

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Speaker 3: interest rates in September.

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Speaker 5: Wall Street banks are losing ground in Europe as US

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Speaker 5: tariffs of spooked clients. According to Bloomberg Data, companies across

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Speaker 5: the continent are diversifying their banking relationships away from US

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Speaker 5: firms due to the levies. European banks are taking advantage

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Speaker 5: of the extra business. So far in twenty twenty five,

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Speaker 5: roughly half of eurobond deals from non US companies did

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Speaker 5: not involve any of the five biggest US banks. That's

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Speaker 5: up from five percent last year. In sterling bonds, Wall

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Speaker 5: Street banks didn't participate in almost half of the deals,

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Speaker 5: compared with sixty four percent of them this year.

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Speaker 3: Saudi Arabia and its partners will hike output by five

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Speaker 3: hundred and forty seven thousand bowels a day in a

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Speaker 3: bid to reclaim market share in the oil market. OPEC

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Speaker 3: Plus agreed to sharply increase production in September as part

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Speaker 3: of its latest effort to reverse supply cuts. It marks

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Speaker 3: the latest shift of the cartel's strategy from defending prices

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Speaker 3: to opening the taps. Here is the view of Vandana Harry,

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Speaker 3: founder of Vandana Insights.

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Speaker 1: What the market looks like starting the fourth quarter of

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Speaker 1: this year and going into next year. I think that's

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Speaker 1: where right now, the expectations are for a little bit

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Speaker 1: of a swing back indoor a supply.

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Speaker 3: Vandana Insights founder Vandana Harry, speaking there to Bloomberg As

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Speaker 3: the International Energy Agency for cast a surplus of two

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Speaker 3: million bows of all per day in the fourth quarter

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Speaker 3: due to swelling supplies across the US.

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Speaker 5: The UK's Financial Conduct Authority is to consultant a scheme

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Speaker 5: guiding firms on how to compensate customers on missold car loans.

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Speaker 5: The news comes after a court ruling that will see

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Speaker 5: firms avoid enormous payouts over ruling a previous judgment. Bloombergs

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Speaker 5: two at a Bio has more.

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Speaker 8: Supreme Court ruling awarded lender is a major reprieve in

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Speaker 8: the pivotal UK car finance case, but firms could still

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Speaker 8: be on the hook for at least nine billion pounds.

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Speaker 8: The FCA is set to consult on a redress scheme

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Speaker 8: to determine the payments, which they say could plausibly be

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Speaker 8: as high as eighteen billion pounds, though a lower figure

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Speaker 8: is more likely. The news comes after the UK's top

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Speaker 8: court handed a big boost to banks on Friday with

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Speaker 8: its judgment. Various lenders, including Lloyd's and Santander, have already

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Speaker 8: taken a hit of about two billion pounds for potential

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Speaker 8: losses relating to the loans in London. Tiwa Adabaio Bloomberg Radio.

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Speaker 3: Democratic lawmakers in Texas say that they have left the

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Speaker 3: state in order to block Republicans from redrawing congressional maps

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Speaker 3: in an effort to thwart the redistricting initiative encouraged by

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Speaker 3: President Donald Trump. Their departure leaves Texas short of the

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Speaker 3: minimum number of lawmakers required to hold votes. They have

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Speaker 3: left the state for the Democrat held strongholds of Chicago,

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Speaker 3: New York, and Boston. Gene Wu, the Democratic leader in

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Speaker 3: tech Exus's lower House, has said they are quote not

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Speaker 3: walking out on our responsibilities, but walking out on a

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Speaker 3: rigged system that refuses to listen to the people we represent.

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Speaker 3: Eric Holder, chair of the National Democratic Redistricting Committee, says

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Speaker 3: that Republican efforts to redraw the state were authoritarian.

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Speaker 9: We have to understand that the nature of the threat

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Speaker 9: that has been put upon the country through what they're

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Speaker 9: trying to do in Texas has really increased the danger

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Speaker 9: to our democracy, and as a result of that, we've

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Speaker 9: got to do things that perhaps in the past I

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Speaker 9: would not have supported.

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Speaker 3: Eric Holder speaking that as the Texas Governor, Greg Abbott,

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Speaker 3: said that they may have committed felonies by departing. According

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Speaker 3: to the state's attorney general, the district court may decide

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Speaker 3: if it amounts to an abandonment or forfeiture of elected office.

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Speaker 4: Those are your top stories on the markets.

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Speaker 5: The mscirishpecific index up six tens of one percent put

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Speaker 5: a made weakness on stock market, or rather amid the

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Speaker 5: selloff that we had on stock markets both earlier in

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Speaker 5: trading and in the Friday session as well after the

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Speaker 5: US jobs report. Now you eurostocks fifty futures are currently

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Speaker 5: up by half of one percent, although we did see

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Speaker 5: a sharp slump on European equities on.

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Speaker 4: Friday on the back of the jobs data as well.

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Speaker 5: We do see a bit of a bents and yields

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Speaker 5: as well after the big move lower, and yields too,

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Speaker 5: so the ten year treasury yield up three basis points

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Speaker 5: this morning at four point two four percent. The two

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Speaker 5: year yield, sort's biggest one day drop since December of

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Speaker 5: twenty twenty three, is up two basis points this morning

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Speaker 5: at three point seven percent. The Bloomberg Dollars Spot Index

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Speaker 5: a tenth of one percent week, or the euro starting

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Speaker 5: the week at one fifteen eighty two.

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Speaker 3: Now, in a moment, we'll bring you more on President

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Speaker 3: Trump naming two new key officials who could shape his

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Speaker 3: economic agenda and BMW's faster rollout of its new electric vehicles.

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Speaker 3: But another story is caught our eye this morning, and

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Speaker 3: it's quite optimistic when it comes to trying to age well.

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Speaker 3: It's from Bloomberg opinions Jarvis.

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Speaker 5: So this was another twist on the idea of if

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Speaker 5: you just live a healthier lifestyle in general, it will

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Speaker 5: you'll live better longer. But it's particularly focusing on brain

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Speaker 5: aging and the risk of dementia and all of the

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Speaker 5: things that you can do to try and lower that.

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Speaker 5: And this is based on a new study that has

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Speaker 5: looked at two thousand participants in their sixties and seventies,

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Speaker 5: all of whom were at risk of dementia, split them

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Speaker 5: into two groups, ones at their own priorities, where the

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Speaker 5: others were given a highly structured program that involved regular exercise,

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Speaker 5: specific diet at computer based brain games, and lots of

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Speaker 5: social activities in particular. Now, both groups did see significant

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Speaker 5: improvements in their cognitive health, but the group that had

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Speaker 5: the intervention were able to set back their aging clock

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Speaker 5: by much more. Really interesting to see. Particularly the community

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Speaker 5: alative element of this has been particularly important that was

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Speaker 5: seen as having the most benefit for the group that

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Speaker 5: did get involved in it. The question, of course, is

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Speaker 5: how much an intensive program that would cost are the

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Speaker 5: results over the long term sustainable enough that merit the

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Speaker 5: cost of an invest in a program like this. But

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Speaker 5: it's something that the American and Alzheimer's Association has been

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Speaker 5: looking at providing that sort of community support in inten

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Speaker 5: cities across the US to try and see what sort

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Speaker 5: of effects that can have over the longer term.

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Speaker 2: I think it is so interesting, is it.

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Speaker 3: I mean, you said right at the beginning, if you

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Speaker 3: just do I mean, we know, don't we a lot

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Speaker 3: of the things that are good for us that we

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Speaker 3: must you know, eat a healthy done and you know,

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Speaker 3: get out of That's the thing. Lifestyle changes are so tough.

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Speaker 3: I really think that this study is so important to

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Speaker 3: understand what tools you need to do it to put

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Speaker 3: people around you, puts you in touch with people who

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Speaker 3: help you on that kind of healthier journey.

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Speaker 2: Anyway, I thought it was a really interesting piece.

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Speaker 4: We'll put a link to it on our podcast show

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Speaker 4: notes as well.

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Speaker 3: Well.

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Speaker 5: Let's bring you more now on those two key appointments

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Speaker 5: Donald Trump says he'll make in the coming days his

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Speaker 5: choices for the FED governor position vacated by Adrana Kugler

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Speaker 5: and the head of the Bureau of labor statistics may

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Speaker 5: shape his economic agenda. Our senior editor Bill Ferries joins

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Speaker 5: us Now for more Bill Donald Trump fired the beer

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Speaker 5: of libor Cystics chief Erica meccinto fire last week's after

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Speaker 5: last week's week job jobs report and the revisions to

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Speaker 5: the data as well. And the head of the BLS

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Speaker 5: is not normally a politicized role, but is this a

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Speaker 5: sign that that could be changing.

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Speaker 10: Yeah, I mean, I think anything is possible. But listen,

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Speaker 10: the BLS is not one of the you know, really

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Speaker 10: more high profile agencies. It is, let's just be honest,

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Speaker 10: it's somewhat of a nerdy place. It is full of

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Speaker 10: people who have you know, degrees and statistics, economics, and

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Speaker 10: they're really kind of hardcore math and data folks. So

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Speaker 10: it's I think there would be some serious questions in

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Speaker 10: the markets if someone who is really there for or

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Speaker 10: seen as being there for a political purpose is put

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Speaker 10: in place the US. The BLS data has long been

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Speaker 10: kind of a gold standard even internationally, so I think

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Speaker 10: any damage to that will probably rebound and perhaps hurt

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Speaker 10: the administration more than it would help.

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Speaker 3: Yeah, in terms of the FED, then there's also major

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Speaker 3: change potentially there because there is now an open governor seat,

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Speaker 3: and that person could well be the next FED chair.

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Speaker 10: Yeah, absolutely. I mean Adriana Kugler's resignation kind of accelerates

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Speaker 10: the thinking that was taking place at the White House.

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Speaker 10: She was due to leave in January, so that was

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Speaker 10: already on the radar, and I think the expectation is that, yes,

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Speaker 10: someone who will come in and is more sympathetic to

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Speaker 10: Donald Trump's focus on lowering rates is likely to get

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Speaker 10: that job and could become the next FED chair. So

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Speaker 10: you have to think about people like Kevin Hassett, who's

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Speaker 10: a National Economic Council director. You have to think about

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Speaker 10: people a former FED governor Kevin Walsh, who might only

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Speaker 10: want to go back to the job if he knows

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Speaker 10: that he's going to become the FED share. So those

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Speaker 10: would be two key names coming up, and I do

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Speaker 10: think that's between those two jobs that's going to be

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Speaker 10: the priority one for the administration to focus on.

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Speaker 5: This, of course, is coming at a time when the

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Speaker 5: job's date on Friday gave a bit of a wake

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Speaker 5: up call, certainly to market. It's about the outlook for

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Speaker 5: the US economy and how it's adapting to Donald Trump's

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Speaker 5: policies on the data. These were very stark revisions in particular.

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Speaker 5: What did we learn from them?

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Speaker 10: Yeah, I mean the number the change was huge. So

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Speaker 10: if you look at May, it was revised down by

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Speaker 10: one hundred and twenty five thousand jobs. So you had

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Speaker 10: initially reported one hundred and forty four thousand increase. At

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Speaker 10: the end it was just an increase of nineteen thousand.

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Speaker 10: It was roughly similar for June. There's been a problem

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Speaker 10: with declining participation in some of these surveys, and so

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Speaker 10: when there's a lot of change going on in the economy,

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Speaker 10: the data keeps rolling in after that initial report, and

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Speaker 10: you know, we don't know much more from the BLS

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Speaker 10: other than they said this was larger than normal. But

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Speaker 10: it is a big warning shot across the bow of

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Speaker 10: the Trump economy. Now he's been in office for over

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Speaker 10: six months, he's got tariffs in place. He just put

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Speaker 10: a whole new set of tariffs in place. Well, he

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Speaker 10: announced them last week. They come into effect this week.

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Speaker 10: That's going to affect the economy. So I think it

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Speaker 10: is a warning shot about what may lie ahead.

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Speaker 3: Yeah, very interesting. Thank you so much Bill for being

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Speaker 3: with us. I've seen it. Editor Bill Ferries. Do you

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Speaker 3: think it's worth noting though, that the former BLS head

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Speaker 3: William Beach, was very critical, saying that it was damaging

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Speaker 3: to the viewer of labor statistics to have this situation

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Speaker 3: where the head was far and that he didn't think

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Speaker 3: that there was any grounds at all for the firing

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Speaker 3: in his words. But another layer to this story around

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Speaker 3: the statistics and the job stata in the US.

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Speaker 5: Well to BMW now, which is unveiling a range of

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Speaker 5: new electric vehicles which its CEO says will be the

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Speaker 5: benchmar of the industry, to big bet by the German

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Speaker 5: carmaker in a sector that's been dominated by Tesla and

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Speaker 5: Chinese brands. Bloomberg's Stephanicola, who leads our team covering the

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Speaker 5: European auto industry, joins us now for more.

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Speaker 4: Stephan, good morning.

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Speaker 5: Tell us then about the IX three and why is

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Speaker 5: it such a big deal for BMW?

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Speaker 11: Yeah, good morning. So, yeah, it is indeed a really

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Speaker 11: big deal for BMW, and that's because it's the first

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Speaker 11: of a new range of electric cars that are really

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Speaker 11: meant to sort of change the conversation in the competition

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Speaker 11: against Tesla, but also these Chinese brands that are coming

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Speaker 11: up byd Shaomi, and it's an SUV that has been

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Speaker 11: developed for the past few years and it has technology

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Speaker 11: that you know, within two years is supposed to be

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Speaker 11: in all of BMW's models.

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Speaker 2: So this is really the.

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Speaker 11: First of a wave of new electric cars that are

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Speaker 11: really trying to change the competitive conversation in Europe, in

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Speaker 11: the US, but also in China.

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Speaker 6: Yeah.

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Speaker 3: So so as the big question is whether BMW can

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Speaker 3: compete with Tesla and all the big Chinese brands. I

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Speaker 3: mean in terms of not just what it looks like

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Speaker 3: and the kind of computing power inside the car, the price,

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Speaker 3: I mean, lots of things to think about when it

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Speaker 3: comes to whether BMW can compete.

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Speaker 11: Absolutely, yes, the benchmark the CEO did tell us in

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Speaker 11: an interview. We went to Munich and we looked at

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Speaker 11: a camouflaged car and we talked to the BMWC all

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Speaker 11: of us sipsy. He did say, this is going to

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Speaker 11: be the benchmark. The car has a range of eight

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Speaker 11: hundred kilometers with a single charge. That's more than Tesla's

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Speaker 11: longest range model Y and it also charges faster. So

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Speaker 11: on that side, you know, they have some good arguments.

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Speaker 11: The key question will be you know, will the customer

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Speaker 11: be convinced? Will it have the kind of sexiness that

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Speaker 11: you have to have with new cars. You know, you

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Speaker 11: have to have the best software, you have to have

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Speaker 11: really slick, slick interior, slick design, and of course, you know,

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Speaker 11: the BMW CEO says that it has all that, but

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Speaker 11: in the end, it depends if the customer agrees.

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Speaker 5: Stephan is not a terrible time to be launching a

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Speaker 5: new car and and making such a big bet into

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Speaker 5: electric vehicles given the trade tensions with the US and

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Speaker 5: with China as well.

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Speaker 11: Yes, and no, absolutely, trade tensions are a drag on

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Speaker 11: most major car makers. BMW has a factory in the US,

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Speaker 11: it also has a factory in China, or several factories

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Speaker 11: in China. These factors don't just produce for the local market,

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Speaker 11: but they also export, so Terras is hitting BMW. However,

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Speaker 11: it's also kind of an interesting time because Tesla is

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Speaker 11: weaker than it's been in a while. You know, Elon's

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Speaker 11: Elon Musk's politics have sort of turned away a lot

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Speaker 11: of customers in Europe, and you know they haven't Tesla

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Speaker 11: hasn't issued a new car in quite a while, So yeah,

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Speaker 11: it's it's also kind of an interesting moment and maybe

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Speaker 11: there are some some customers up for grabs here that

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Speaker 11: maybe weren't two years ago.

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Speaker 3: What do you think is going to be the biggest

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Speaker 3: test then for the car? I mean it's going to

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Speaker 3: be unveiled and everything to the public.

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Speaker 11: Yeah, BMW is going to unveil this in September at

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Speaker 11: the Munich Auto Show. The biggest one of the biggest tests,

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Speaker 11: if not the biggest test, will be whether this car

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Speaker 11: can also convince people in China. You know, China the

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Speaker 11: world's biggest auto market, and the German luxury brands used

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Speaker 11: to dominate there and combustion engine cars. Now the local

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Speaker 11: brands dominate on evs. So the biggest test is, you know,

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Speaker 11: can this car change the conversation that the Western brands

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Speaker 11: are behind on batteries and software and can compete also

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Speaker 11: on price, right because you know Tesla, but also the

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Speaker 11: Chinese local brands are offering their electric cars at really

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Speaker 11: cutthroat prices, and you know BMW does still want to

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Speaker 11: make margins and make profits. So it's it's going to

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Speaker 11: be an interesting conversation and interesting effect to see how

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Speaker 11: much that car will cost and will be able to

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Speaker 11: convince Chinese buyers.

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