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Speaker 1: Global business news twenty four hours a day. If Bloomberg

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Speaker 1: dot com, the radio plus mobile app and on your radio.

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Speaker 1: This is a Bloomberg Business Flash and I'm Karen Moscow.

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Speaker 1: This updates brought to you by Sector Spider A t

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Speaker 1: f so I buy a single stock when you can

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Speaker 1: invest in the entire sector. Visits sector s P d

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Speaker 1: R S dot Com are called one six six Sector

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Speaker 1: e t f U S stock index futures are higher,

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Speaker 1: and education stocks will trim their first weekly drop in four,

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Speaker 1: mirroring a global equity rally as investors reassess stimulus measures.

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Speaker 1: In Europe. We check the markets every fifteen minutes throughout

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Speaker 1: the trading day. On Bloomberg SNP EVENI futures up eighteen points,

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Speaker 1: Dow EVENI futures of one hundred forty one, NASA DOAC

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Speaker 1: eveny futures of forty eight. The docks in Germany is

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Speaker 1: up three percent now Canck in Paris up two point

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Speaker 1: nine percent. In the FT one d one and a

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Speaker 1: half percent ten, Your treasury down five thirty seconds, the

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Speaker 1: yield one point nine five percent yield on the two

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Speaker 1: year point nine four percent, NIMEX screwed oil up two

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Speaker 1: point one percent, or eighty cents to thirty sixty three.

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Speaker 1: A barrel comes Gold is down six cents per cent

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Speaker 1: or seven dollars seventy cents at twelve sixty five. Ten

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Speaker 1: announced the euro a dollar ten ninety four the end

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Speaker 1: one thirteen point seven seven. Banks and technology shares, which

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Speaker 1: have led the recent rebound inequities, are higher in early trading.

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Speaker 1: Morgan Stanley and Goldman Sachs Group are both up more

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Speaker 1: than one point eight percent, while Netflix is up two

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Speaker 1: point six percent this morning and Amazon dot Com is

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Speaker 1: up more than one percent. That's a Bloomberg business flash.

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Speaker 1: Tom and Mike Karen, thank you very much. Well, we

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Speaker 1: are a radio station TOIME. We don't ordinarily take requests

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Speaker 1: and dedications. But Muhammad from Newport Beach wrote in uh

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Speaker 1: and he wanted to hear UM the latest hit UH

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Speaker 1: music from the country music recording star merle Hazard uh

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Speaker 1: and and I listened to the song and we have

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Speaker 1: to play this how the question this was a it's

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Speaker 1: a it's an actual music video. You can think about

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Speaker 1: Muhammad Ahlarian's Twitter feed and get the link to it.

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Speaker 1: UM put together by the folks at the PBS station

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Speaker 1: in Nashville. It is absolutely hilarious. UM and Muhammad I

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Speaker 1: were talking this morning and he noted that you don't

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Speaker 1: need his book, You don't need anything else. You listen

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Speaker 1: to a song and it raises all the questions that

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Speaker 1: the average person wants it and and hits and as

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Speaker 1: he put it, that they are much smarter about the

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Speaker 1: economy than the people who are running for president. A

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Speaker 1: brilliant question. So we've got the Federal Reserve meeting next week,

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Speaker 1: and we've got the average Americans. Who was the singer?

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Speaker 1: Uh it's a country singer named Merl Hazard, not Merl Haggard,

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Speaker 1: but you know Mr Haggard if you're listening this morning.

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Speaker 1: Merle Haggard aged seventy eight. He founded the baker That

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Speaker 1: Can you play it again? Please? It does not sound

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Speaker 1: like the Bakersfield sound. I mean, ken, did we lose

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Speaker 1: that rate? That's the question. How it seems like if

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Speaker 1: they're going up and they're going I mean Richard Clarida

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Speaker 1: has a band, maybe it's Richard Clarida. It's definitely the

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Speaker 1: the grand Old Opry sounded it does. You're not old,

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Speaker 1: you're seasoned, but you remember he haf the old Yes

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Speaker 1: TV show and it does seemed late. Roy Clark, Yeah,

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Speaker 1: there are a few jokes out there. John Shane is

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Speaker 1: Merle Hazard's real name, and he has done a number

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Speaker 1: of other uh financial market parody songs. Yeah. Dr Demento

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Speaker 1: comes to economics, financial investment and that, Mike, let's get

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Speaker 1: a grip on what happened yesterday. We were all smart,

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Speaker 1: we all had our sets of outcomes, and as Yakum

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Speaker 1: Fell's magisterially said, it was extraordinary, extraordinary what occurred yesterday,

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Speaker 1: Well we had it was so broad and uh and

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Speaker 1: so much was done that it seems to have taken

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Speaker 1: markets twenty four hours to figure out what they really

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Speaker 1: think about it. The initial reaction was this is great,

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Speaker 1: and then all of a sudden while he said, no

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Speaker 1: more interest rate cuts. So that means the hero is

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Speaker 1: gonna be stronger, and that's terrible. I mean, they seem

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Speaker 1: now to have voted on the idea that this is

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Speaker 1: going to be a bank lending channel easing rather than

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Speaker 1: a currency channel exactly. And Catherine man of o E C. D.

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Speaker 1: Exprandise with her magister at work on international trade and

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Speaker 1: codependency and dysfunction between nations including China the United States.

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Speaker 1: She said exactly that, Michael. She said that the public

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Speaker 1: is so weaned on rate change and currency change and

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Speaker 1: that that flows getting the way And am I right, Michael?

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Speaker 1: This is monetary a set of monetary exercises to try

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Speaker 1: to flow money to the public. Haven't we tried that

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Speaker 1: before and it sort of didn't work out well? There

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Speaker 1: are interesting questions about what this will do, whether or

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Speaker 1: not the The idea behind the lending program to banks

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Speaker 1: that t l t r OH is that banks can

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Speaker 1: get a lower rate if they lend more of the

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Speaker 1: money out into the markets. So UM that that that

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Speaker 1: may help. The question is um doesn't help enough? Is

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Speaker 1: there enough demand out there? Jane Hooley, we've been speaking

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Speaker 1: to really across all of Bloomberg. It seems like she's

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Speaker 1: with us about every three hours, which is appropriate given

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Speaker 1: the whims. Jane, I'm gonna call it weak hero boom,

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Speaker 1: strong euro and we've dampened pretty much back to pre dry.

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Speaker 1: What does it symbolize? Was this just an exercise in

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Speaker 1: confusion or short or long covering, or is this something

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Speaker 1: that you can rationalize. I think there is some confusion

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Speaker 1: out there. I think we would certainly have to get

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Speaker 1: that straight. But I think in terms of positioning, one

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Speaker 1: thing that we can say was that the market wasn't

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Speaker 1: as short euros as it was last December, and of

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Speaker 1: course we need to try and work out why that is.

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Speaker 1: And the reason perhaps is because the euro does have

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Speaker 1: this safe haven behaviors. Now I'm reluctant to call it

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Speaker 1: a safe haven, but the euro Zone does have a

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Speaker 1: strong current account surplus, meaning there is a surface of favors,

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Speaker 1: and many of those favors right now are reluctant to

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Speaker 1: invest in risky assets, so they would rather hold Euros

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Speaker 1: and then move into some other markets. Given the large

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Speaker 1: amount of volatility that we've had this year, the question therefore,

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Speaker 1: was was dragging always going to be able to get

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Speaker 1: the the euro down if investors were going to be

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Speaker 1: reluctant to to short it given the current environment. But

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Speaker 1: I think we know the answer to that. It means

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Speaker 1: it was going to be difficult to get the euro lower.

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Speaker 1: That's said, I think it wasn't so much necessarily positioning

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Speaker 1: that that really made EURI dollar go higher. So it

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Speaker 1: was that comment from Drug indicating that he was reluctant

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Speaker 1: to cut interest rates further that move the money market

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Speaker 1: and therefore it pushed up the value of euro dollar.

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Speaker 1: The euro strengthened, And of course this raises the question

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Speaker 1: of is the easy to be going to cut interustrates again,

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Speaker 1: and that there's a question mark over that. And the

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Speaker 1: yesterday's announcement from the ECB suggests that rather than use

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Speaker 1: negative interest rates, and of course there's been a lot

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Speaker 1: of negative press about negative interest rates recently, rather than

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Speaker 1: go down that route, maybe instead they're going to go

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Speaker 1: to try and inject more money into the real economy

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Speaker 1: through these teltros for new teltros in June, and there

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Speaker 1: will be a bonus given to banks who who lend more.

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Speaker 1: So from that point of view, maybe there's going to

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Speaker 1: be less focused on negative indust rates and currency and

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Speaker 1: more economy. And Michael, this is what we heard from

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Speaker 1: Peter Hooper of Judge, some real tangible initiatives to move

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Speaker 1: money in. Yeah. Well, the Fox Rebbel banker on your

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Speaker 1: credit side have some real questions about how well this

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Speaker 1: will work, particularly the corporate bond buying that they announced. Yeah,

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Speaker 1: this is exactly right. Even though you could stand back

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Speaker 1: and say, well, surely this is the right thing for

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Speaker 1: center back to do, to try and focus on the

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Speaker 1: real economy push money through into the real economy. Through

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Speaker 1: those means, you've got to be skeptical as to whether

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Speaker 1: or not it really can work. And you know, one

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Speaker 1: of the primary reasons to be skeptical is that a

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Speaker 1: lot of the investment graded corporates don't actually need the money,

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Speaker 1: So even though the banks might get an extra bonus

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Speaker 1: by lending to them, they don't need it. Since from

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Speaker 1: that point of view, you've really got to question whether

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Speaker 1: or not that this measure can be successful. But there's

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Speaker 1: certainly part of it. But for the for the global economy,

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Speaker 1: I think you can look back at the ECB and

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Speaker 1: say it has been a significant perpetrator really off currency wars.

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Speaker 1: If we go back to the middle of two thousand

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Speaker 1: and fourteen, we look at that negative discount rate back

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Speaker 1: then and see what that triggered. It triggered quite a

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Speaker 1: big number of ripples in the currency war, and maybe

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Speaker 1: it easy to be finally putting away from that because

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Speaker 1: after all, we all know that currency war was a

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Speaker 1: zero sum game and negative interest rates are all very

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Speaker 1: concerned about that too, So in a way, maybe they've

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Speaker 1: done the right thing and moving away from from negative

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Speaker 1: rates currency wars, but yeah, you've got to be skeptical

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Speaker 1: as to whether or not this policy we can work. Jane,

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Speaker 1: thank you so much for the update. Thank you so

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Speaker 1: much for your contribution to the show and across all

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Speaker 1: of Bloomberg. MS fully is with rabble Bank. I love

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Speaker 1: the idea, Michael, that she's writing smart research off of

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Speaker 1: a trading platform, off if she's in the trenches they're

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Speaker 1: actually worried about year old of four and six digits

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Speaker 1: one ten ninety two right now. And of course, let

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Speaker 1: me get the chart out and your a dollar to

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Speaker 1: Bloomberg Radio plus. I think that's I'm gonna do a

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Speaker 1: three day chart, folks. This is before, during and how

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Speaker 1: we've rolled a over and come in after. We're still

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Speaker 1: a bit away from where we were eight yesterday morning,

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Speaker 1: but we're getting there. Is okay over there, Okay, I'm

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Speaker 1: listening to your excellent market summaries. What's going on? No,

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Speaker 1: I think I think it's been a fascinating week. And

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Speaker 1: you know, again, as we said at the end of

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Speaker 1: the show yesterday, massive shout out to everybody that's helped

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Speaker 1: us work in real time before Draggy and uh during

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Speaker 1: the press conference, which was truly extraordinary speed of news

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Speaker 1: that was going on, and of course is people trying

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Speaker 1: to figure out where do we go from here and

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Speaker 1: most particularly what it means is a follow on to

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Speaker 1: other central banks. Part of that will be March sixteen,

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Speaker 1: Where are you, Mike? For our FED show? March sixte

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Speaker 1: Are you here? I think they're sitting next to you.

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Speaker 1: This is a very good thing, spending two hours with

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Speaker 1: scarlet food, which is no downside to analyze what the

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Speaker 1: Fed probably wouldn't do, but what they're gonna say to

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Speaker 1: be really important. It will be interesting to see the

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Speaker 1: guidance that Cherry Yellen gives after the history made yesterday.

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Speaker 1: Stay with this worldwide on economics, finance, investment, and international relations.

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Speaker 1: Bloomberg Surveillance