WEBVTT - Bloomberg Daybreak: July 28, 2022 - Hour 2 (Radio) 0:00:02.120 --> 0:00:05.480 Live from the Bloomberg Interactive Broker Studios. This is Bloomberg 0:00:05.559 --> 0:00:10.280 Daybreak for Thursday, July two. Coming up the shower, Nastack 0:00:10.400 --> 0:00:14.240 Futures fall after yesterday's fed fueled rally. Facebook owner Meta 0:00:14.280 --> 0:00:18.760 Platforms drops following earnings, Amazon and Apple report. Today, President 0:00:18.840 --> 0:00:21.440 Biden and China's Shi Jin Pain gets set to speak, 0:00:21.600 --> 0:00:24.079 and Joe Manchin and Chuck Schumer strike a deal on 0:00:24.160 --> 0:00:27.000 a tax and energy policy. Bell there's an offer on 0:00:27.040 --> 0:00:28.640 the table to get w w n B, a star 0:00:28.680 --> 0:00:31.720 Britney Griner back from Russia, plus a new groundbreaking to 0:00:31.720 --> 0:00:34.320 bring the portable housing to New York City. I'm Michael 0:00:34.320 --> 0:00:37.000 barr more ahead, I'm time statue in sports, the Mets 0:00:37.040 --> 0:00:39.520 with a walk off, when to swape the Subway series. 0:00:39.560 --> 0:00:45.600 The Yankees have acquired a new outfield That's all Stradyhead 0:00:45.640 --> 0:00:49.240 on Bloomberg Daybreak on Bloomberg eleven, Free on New York, 0:00:49.440 --> 0:00:54.080 Bloomberg one, Washington, d C, Bloomberg one oh six one, Boston, 0:00:54.400 --> 0:00:59.000 Bloomberg nine sixties, San Francisco, Sirius x M one nine Team, 0:00:59.040 --> 0:01:01.920 and around the world on Bloomberg Radio dot Com and 0:01:02.120 --> 0:01:08.720 via the Bloomberg Business app. Good morning, I'm Nathan Hagar 0:01:09.000 --> 0:01:11.520 and I'm Karen Moscow, and US DOT Index futures are 0:01:11.600 --> 0:01:13.440 lower this morning. We are coming up for six o 0:01:13.560 --> 0:01:15.280 one on Wall Street, and we check the markets every 0:01:15.319 --> 0:01:17.920 fifteen minutes throughout the trading day. On Bloomberg, I guess 0:01:17.920 --> 0:01:20.919 and P futures down twelve points down, futures down forty 0:01:20.959 --> 0:01:24.200 five and nowasday futures down on the decks in Germany 0:01:24.280 --> 0:01:26.400 is litill. Change in the ten year treasury up three 0:01:26.440 --> 0:01:29.600 thirty seconds, yield two point seven seven percent, and the 0:01:29.680 --> 0:01:32.560 yield on the two year two point nine seven percent. 0:01:32.800 --> 0:01:35.480 Nathan Karen. The drop in futures comes after the biggest 0:01:35.480 --> 0:01:38.480 one day gain for tech stocks since November twenty twenty. 0:01:38.520 --> 0:01:42.000 The Nasdacks surged four point three percent yesterday following resilient 0:01:42.080 --> 0:01:45.400 earnings and the fed's press conference. Randy Watts, chief investment 0:01:45.480 --> 0:01:48.200 strategist at O'Neil Global Advisor, says, there's light at the 0:01:48.280 --> 0:01:50.840 end of the tunnel, so I think the minute the 0:01:50.880 --> 0:01:54.160 stock market can identify or see, we don't have to 0:01:54.160 --> 0:01:55.720 be there, but can see the end of the Fed 0:01:55.800 --> 0:01:58.919 titan cycle. I think stocks are headed up a lot higher. 0:01:59.000 --> 0:02:02.040 Randy wattson O'Neil Global Advisor's notes the SMP five hundreds 0:02:02.080 --> 0:02:04.520 on course for its biggest monthly gain since October of 0:02:04.600 --> 0:02:07.560 last year. Well Nathan reaction is still pouring in this 0:02:07.600 --> 0:02:10.880 morning to yesterday's FED decision. Share J Powell says moderate 0:02:10.960 --> 0:02:13.360 hikes are coming, but the pace will slow at some 0:02:13.480 --> 0:02:16.919 point as the stance of monetary policy titans further, it 0:02:17.120 --> 0:02:20.160 likely will become appropriate to slow the pace of increases 0:02:20.520 --> 0:02:24.040 while we assess how our cumulative policy adjustments are affecting 0:02:24.040 --> 0:02:26.840 the economy and inflation. At the same time, J. Powell 0:02:26.880 --> 0:02:29.640 and the FED are losing credibility. That's according to Scott Minor, 0:02:29.760 --> 0:02:33.919 the chief investment officer at Guggenheim. After this this run 0:02:34.000 --> 0:02:36.359 up we're getting in the in the stock market, in 0:02:36.919 --> 0:02:40.120 the bond market right now, that that by next week 0:02:40.160 --> 0:02:43.400 we're going to be sitting around and questioning, um, you know, 0:02:43.560 --> 0:02:47.240 and gee, you know, are they really being incredible? Cooggenheim. 0:02:47.280 --> 0:02:49.720 Scott Minor had said the economy may already be in 0:02:49.760 --> 0:02:54.120 a recession. Bloomberg Opinion columnist Muhammadhalarian says there's no good 0:02:54.120 --> 0:02:57.679 outcome in the FED waging inflation against slowing growth. It's 0:02:57.720 --> 0:03:03.200 the FED that needs to we anchor itself, but the 0:03:03.280 --> 0:03:07.240 weed economy is again running ahead of it. And both 0:03:07.320 --> 0:03:10.000 Muhammadalarian and Scott Miner made the comments on a special 0:03:10.120 --> 0:03:13.120 edition of Bloomberg Surveillance heard right here on Bloomberg Radio 0:03:13.160 --> 0:03:15.560 and Bloomberg Television. Well, next turn, we get a key 0:03:15.600 --> 0:03:18.720 reading on the US economy. Second quarter GDP comes out 0:03:18.720 --> 0:03:22.160 at eight thirty am. Wall Street Time economists expect annualized 0:03:22.160 --> 0:03:24.560 growth of a half percent. On the surface, that would 0:03:24.560 --> 0:03:26.920 be an improvement after a one point six percent drop 0:03:26.960 --> 0:03:29.519 in the first quarter. And we turn to earning. Now, Nathan, 0:03:29.520 --> 0:03:32.320 where tech is front end center? Shar's a Meta Platforms 0:03:32.360 --> 0:03:35.440 down five percent, the parent of Facebook and Instagram reporting 0:03:35.440 --> 0:03:39.280 its first ever quarterly sales decline. And here's CEO Mark Zuckerberg. 0:03:39.640 --> 0:03:43.200 We seem to have entered an economic downturn that will 0:03:43.240 --> 0:03:46.800 have a broad impact on the digital advertising business. It's 0:03:46.800 --> 0:03:49.080 always hard to predict how deep or how long these 0:03:49.080 --> 0:03:52.800 cycles will be, but I'd say that the situation seems 0:03:52.840 --> 0:03:55.080 worse than it did a quarter ago. The week resils 0:03:55.120 --> 0:03:58.480 from Zuckerberg's Meta Platforms is weighing on sentiment this morning 0:03:58.520 --> 0:04:01.720 after revenue forecast fell short of estimates. Well, next, can 0:04:01.760 --> 0:04:04.280 we into the busiest day of this earning season, highlighted 0:04:04.320 --> 0:04:07.680 by reports from Apple and Amazon. Bloomberg's Jeff Bealllinger has 0:04:07.720 --> 0:04:11.760 the details. Apple's quarterly profit may have declined. If it did, 0:04:11.840 --> 0:04:14.120 it would be the first drop in almost two years. 0:04:14.400 --> 0:04:18.159 Investors will be especially interested in hearing about iPhone sales, 0:04:18.360 --> 0:04:21.880 since the device typically accounts for half of Apple's revenue. 0:04:22.120 --> 0:04:25.560 Bloomberg Intelligence says we may hear that Amazon dot COM's 0:04:25.600 --> 0:04:29.200 online revenue, games and profit slowed, but there is strong 0:04:29.279 --> 0:04:33.400 potential for continued growth and cloud services, streaming and advertising. 0:04:33.800 --> 0:04:37.400 Walmart issued a profit warning this week, but Amazon is not. 0:04:37.560 --> 0:04:41.039 Walmart b I says its customer base is more affluent. 0:04:41.360 --> 0:04:44.400 Jeff Bellinger, Bloomberg day Break, Right, Jeff, thank you and 0:04:44.400 --> 0:04:46.400 the m and A. From this morning, we're learning that 0:04:46.480 --> 0:04:49.360 Jet Blue is close to an agreement to buy Spirit Airlines, 0:04:49.400 --> 0:04:52.159 and Bloomberg's Ready Young is here alive with more Good Morning, 0:04:52.160 --> 0:04:55.280 Ready to Good Morning, Karen. Bloomberg. Sources say Jet Blues 0:04:55.320 --> 0:04:57.880 deal to buy Spirit could come as soon as today. 0:04:58.320 --> 0:05:01.280 The airline swooped in just hours after Spirit ended a 0:05:01.400 --> 0:05:05.080 pending merger with Frontier Lines that deal fell apart on 0:05:05.120 --> 0:05:08.479 a lack of shareholder support. A Spirit acquisition would be 0:05:08.560 --> 0:05:12.000 Jet blues best shot to broaden its network quickly. It 0:05:12.000 --> 0:05:15.760 will also inject an infusion of pilots and aircraft orders, 0:05:15.800 --> 0:05:18.080 both of which are expected to be in short supply 0:05:18.200 --> 0:05:21.760 for several years. Live in New York, I'm Nita Young 0:05:21.760 --> 0:05:24.880 Bloomberg Daybreak, Rida thank you. Geo. Politics is also on 0:05:24.920 --> 0:05:27.000 the front burner this morning, and we're learning more about 0:05:27.000 --> 0:05:30.160 the agenda for today's call between Presidents Biden and Hijin 0:05:30.240 --> 0:05:32.520 Ping of China, and Amy Morris has details from our 0:05:32.520 --> 0:05:36.599 Bloomberg newsroom in Washington. The two world leaders will discuss 0:05:36.640 --> 0:05:40.040 Trump era tariffs, Russia's invasion of Ukraine, a price cap 0:05:40.080 --> 0:05:44.400 on Russian oil, climate change, and economic competition. National Security 0:05:44.440 --> 0:05:48.400 Council Communications strategy Coordinator John Kirby says he expects the 0:05:48.400 --> 0:05:52.320 President will also bring up China's increasingly aggressive actions in 0:05:52.360 --> 0:05:55.360 the South China Sea. I would fully expect that part 0:05:55.400 --> 0:05:58.640 of the President's conversation um tensions in the South China 0:05:58.680 --> 0:06:01.440 Cey World will come up. Today's call comes as tensions 0:06:01.440 --> 0:06:04.200 are rising over a possible visit to Taiwan by House 0:06:04.200 --> 0:06:08.680 Speaker Nancy Pelosi in Washington. I'm Amy Morris, Bloomberg Daybreak right, Amy, 0:06:08.680 --> 0:06:11.039 thank you meantime on Capitol Hill, and Energy and Tax 0:06:11.120 --> 0:06:13.480 bill may have just come back to life in the sun, 0:06:13.520 --> 0:06:16.080 as Senators Joe Mansion and Chuck Schumer have reached a 0:06:16.120 --> 0:06:18.760 deal on a seven hundred thirty nine billion dollar package 0:06:18.960 --> 0:06:21.960 that includes a fifteen percent corporate minimum tax, three hundred 0:06:21.960 --> 0:06:25.040 billion dollars in deficit reductions, and three hundred sixty nine 0:06:25.040 --> 0:06:29.120 billion for energy and climate change. Bloomberg Politics contributor Genie 0:06:29.120 --> 0:06:31.880 she and Zano says it's a win for Democrats. It's 0:06:31.960 --> 0:06:34.800 a big victory for what I call the Purple Dems. 0:06:34.839 --> 0:06:37.599 Those Democrats who have to go to these moderate districts 0:06:37.600 --> 0:06:40.479 with the president with approval ratings in the thirties, have 0:06:40.600 --> 0:06:43.280 been looking for something to take home. I don't think 0:06:43.320 --> 0:06:46.920 they ever suspected they would get both chips and reconciliation 0:06:47.240 --> 0:06:50.120 and Bloomberg contributor Gene she She and Zano spoke with 0:06:50.160 --> 0:06:53.280 our Washington corresponded Joe Matthew on Bloomberg Sound on Fetch 0:06:53.320 --> 0:06:55.960 The show weekdays at five pm Eastern on Bloomberg Radio 0:06:56.200 --> 0:06:58.080 and Bloomberg Daybreak is brought to you by B and 0:06:58.200 --> 0:07:01.080 Y Mellen's Pershing Learned Why the world's most sophisticated wealth 0:07:01.120 --> 0:07:04.240 management and institutional firms rely on Pershing to help them 0:07:04.240 --> 0:07:08.680 improve profitability, create efficiency, attract talent, and manage risk At 0:07:08.680 --> 0:07:13.120 pershing dot Com. Futures moving lower On this Thursday morning. 0:07:13.240 --> 0:07:15.760 Straight ahead, we'll have your latest local headlines and a 0:07:15.840 --> 0:07:23.840 check of sports. This is Bloomberg and it sounds six 0:07:23.840 --> 0:07:25.960 oh seven on Wall Street. Where's seventy four degrees in 0:07:26.040 --> 0:07:28.800 Central Park? Got an accident memaron X southbound New England 0:07:28.800 --> 0:07:31.720 through Way eggs at eighteen B. Details coming up in traffic. 0:07:32.080 --> 0:07:34.040 First Michael Barr with what else is going on in 0:07:34.040 --> 0:07:36.600 New York and around the world. Good morning, Michael, Good morning, Nathan. 0:07:36.680 --> 0:07:39.640 Secretary of State Anthony Lincoln says the US has made 0:07:39.640 --> 0:07:42.680 an offer for the release of w n B, A 0:07:42.800 --> 0:07:45.920 star Britney grinder and former US Marine Paul Wheeland from 0:07:45.920 --> 0:07:48.680 prison in Russia. B Lincoln said he plans to put 0:07:48.720 --> 0:07:51.880 the US proposal before Russian officials, and he plans to 0:07:51.920 --> 0:07:55.560 bring up grain shipments from Ukraine. I plan to raise 0:07:55.600 --> 0:07:59.080 an issue that's a top priority for US, the release 0:07:59.080 --> 0:08:02.520 of Americans Paul Owen and Brittany Griner who've been wrongfully 0:08:02.560 --> 0:08:06.080 detained and must be allowed to come home. Secretary Blankolin 0:08:06.280 --> 0:08:09.480 says he plans to speak with Russian Foreign Ministers Sergei 0:08:09.560 --> 0:08:12.200 Lavrov in the coming days. A person familiar with the 0:08:12.280 --> 0:08:16.000 offers said the US would swap them for imprisoned Russian 0:08:16.080 --> 0:08:19.400 arms dealer Victor Bood. However, Russia says no agreement has 0:08:19.440 --> 0:08:22.520 been announced yet. Vice President Kamala Harris will be in 0:08:22.560 --> 0:08:25.040 New York today. She will be in Brooklyn to meet 0:08:25.080 --> 0:08:28.960 with community leaders. They will discuss the Biden Administration's investment 0:08:29.080 --> 0:08:35.000 in underserved communities, financial institutions, and small businesses. Governor Caffey 0:08:35.080 --> 0:08:37.679 Hokel and New York City Mayor Eric Adams announced the 0:08:37.679 --> 0:08:41.280 groundbreaking on an affordable housing development in the Morris Heights 0:08:41.280 --> 0:08:44.840 section of the Bronx. HOCl says the one nine million 0:08:44.840 --> 0:08:48.520 dollar development will feature three hundred twenty six affordable apartments, 0:08:48.800 --> 0:08:54.800 including two hundred homes with supportive services for individuals experiencing homelessness. 0:08:55.400 --> 0:08:59.839 Right now, Bronx households are rent Burton. What does that mean? 0:08:59.840 --> 0:09:03.520 They spend more than their income on rent? Well, just 0:09:03.640 --> 0:09:05.520 earlier this week. I was talking about how people are 0:09:05.520 --> 0:09:10.880 spending income on childcare. So add that up. You're still 0:09:10.880 --> 0:09:13.120 on trying to pay for rent. You got a couple 0:09:13.120 --> 0:09:15.680 of kids. We need childcare because you need to have 0:09:15.679 --> 0:09:18.040 a job to pay for this. It doesn't add up. 0:09:18.160 --> 0:09:21.320 Governor Huck went on to say the development will provide safe, 0:09:21.320 --> 0:09:23.800 stable homes for more than three hundred residents of the 0:09:23.800 --> 0:09:27.240 Bronx and offer critical resources and amenities to support the 0:09:27.240 --> 0:09:30.520 neighborhood in the long term. North Korean leader Kim John 0:09:30.640 --> 0:09:34.839 UoN unleashed fiery rhetoric yesterday as they celebrated the sixty 0:09:34.920 --> 0:09:38.920 nine anniversary of the Korean War armistice. Kim warned that 0:09:39.000 --> 0:09:42.679 he's ready to use his nuclear weapons in potential military 0:09:42.760 --> 0:09:46.360 conflicts with the US and South Korea. Global News twenty 0:09:46.400 --> 0:09:49.000 four hours a day on the air and on Bloomberg Quicktake, 0:09:49.200 --> 0:09:52.560 powered by more than journalists and analysts more than a 0:09:52.600 --> 0:09:56.200 hundred twenty countries. Michael barn this is Bloomberg, Nathan. Thanks 0:09:56.240 --> 0:10:02.640 Michael six o nine on Wall Street. Time for the 0:10:02.640 --> 0:10:06.320 Bloomberg Sports Update. Here's John all right, Nathan bragging rights 0:10:06.320 --> 0:10:07.840 to the Mets. They got an early home run from 0:10:07.840 --> 0:10:10.200 Peter Alonso was twenties things they got brilliant pictured from 0:10:10.240 --> 0:10:13.160 Max Scherzer on his thirty eight birthday. Through seven scoreless 0:10:13.200 --> 0:10:16.080 instruct out Aaron Judge three times. Yankees did tie the 0:10:16.120 --> 0:10:18.400 game on a Glabor Torres two run homer eighth inning, 0:10:18.440 --> 0:10:22.240 but in the bottom of the ninth, Marte, we're all 0:10:22.360 --> 0:10:25.680 the deals slinging the line in the left face, put 0:10:25.760 --> 0:10:28.760 up a box, test the bar. He stores the one 0:10:28.840 --> 0:10:32.920 in run. Martey slams has helmet down at first swept 0:10:32.960 --> 0:10:35.679 the Yankees. They have defeated the three to two. The 0:10:35.840 --> 0:10:38.480 Mets poor out of the tongue out. They are bobbing 0:10:38.640 --> 0:10:42.280 Starling Marte of the light up second thing you see Calso. 0:10:42.400 --> 0:10:45.040 Two new Mets playing in their first Subway series, combined 0:10:45.080 --> 0:10:47.000 to win it. In the ninth, the Martte hit after 0:10:47.000 --> 0:10:50.000 a leadoff double by Edward o Escobar. Braves lost. The 0:10:50.080 --> 0:10:52.400 Mets are three games ahead. They're off tonight. The Yankees 0:10:52.440 --> 0:10:56.040 tonight host Kansas City, which means the yanks new outfielder 0:10:56.080 --> 0:10:58.360 will face the team that just traded him. A long 0:10:58.480 --> 0:11:02.480 rumor deal took place that Banks acquire All star Andrew Bennintendee, 0:11:02.720 --> 0:11:04.880 who was hit in three twenty for the Royals, who 0:11:04.920 --> 0:11:07.920 would get back three Mono league pictures. This presumably ends 0:11:07.960 --> 0:11:10.560 talk of the Yanks getting Juan Soto, but they are 0:11:10.640 --> 0:11:12.839 believed to still be looking at a starting pitcher. Two 0:11:12.920 --> 0:11:17.439 names mentioned often Cincinnati's Luis Castillo, Oakland's Frankie Montas the 0:11:17.600 --> 0:11:21.640 trade deadline next Tuesday, another big name golfer bolts the 0:11:21.679 --> 0:11:24.439 p g A for the new Live Tour. It's Bubba Watson. 0:11:24.480 --> 0:11:26.880 He's a two time Master's champion to lift tour starts 0:11:26.880 --> 0:11:31.000 a tournament tomorrow at Trump National Embedminster, New Jersey. Atlanta 0:11:31.040 --> 0:11:34.120 Falcons made an official they lost Matt Ryan. Now their 0:11:34.200 --> 0:11:37.679 new starting quarterback will be the recently acquired Marcus Mariota. 0:11:37.880 --> 0:11:41.280 John Stashar Bloomberg Sports Nathan Okay, John, thank you. SMP 0:11:41.400 --> 0:11:45.559 futures down down thirteen point, Staff futures down forty, NASAC 0:11:45.679 --> 0:11:49.280 futures down ninety three points. The tenure treasury is little 0:11:49.360 --> 0:11:52.680 changed right now. That yield two point yield on the 0:11:52.720 --> 0:11:55.680 two year two point nine seven percent. Just to head 0:11:55.720 --> 0:11:58.839 more on the FEDS policy decision from guy who was 0:11:58.880 --> 0:12:02.080 in the room with FED chair j Pal. Bloomberg's Michael 0:12:02.120 --> 0:12:08.120 McKee joins US next this is Bloomberg Bloomberg eleven three 0:12:08.120 --> 0:12:10.000 oh weather. Some passing showers and storms today with a 0:12:10.040 --> 0:12:12.480 higher ninety degrees. We have some more afternoon showers and 0:12:12.520 --> 0:12:15.120 storms send the week highs back near ninety mix of 0:12:15.160 --> 0:12:18.120 sun and cloud Saturday opper eighties right now seventy four 0:12:18.280 --> 0:12:24.839 in Central Park Markets. Headlines and breaking news twenty four 0:12:24.880 --> 0:12:27.920 hours a day at Bloomberg dot Com and Bloomberg Business 0:12:27.920 --> 0:12:31.120 at and at Bloomberg Quick Take. This is a Bloomberg 0:12:31.200 --> 0:12:39.600 Business flash and I'm Karen Moscow. I dip in u 0:12:39.600 --> 0:12:42.360 S Stock Index future, suggesting the US rally could stall 0:12:42.440 --> 0:12:45.080 with technology stocks set to pull back after their biggest 0:12:45.120 --> 0:12:48.200 jumps in November, with big tech to be in our 0:12:48.200 --> 0:12:51.560 particular focus today with results from Amazon dot Com, Apple, 0:12:51.640 --> 0:12:54.240 and Intel. We checked the markets every fifteen minutes throughout 0:12:54.280 --> 0:12:58.000 the trading day. On Bloomberg, SNP futures down thirteen points 0:12:58.040 --> 0:13:00.880 this morning, down features down fifty seven. Now's deck features 0:13:00.920 --> 0:13:03.800 down ninety three. The decks in Germany's down three tents 0:13:03.800 --> 0:13:06.120 of upper cent. The ten year treasury that'll change yield 0:13:06.120 --> 0:13:08.679 two point seven eight percent, yield on the two year 0:13:08.760 --> 0:13:11.800 two point nine seven percent, nine x screwed oil is 0:13:11.800 --> 0:13:13.959 at one point nine percent of a dollar eighties seven 0:13:13.960 --> 0:13:16.880 and ninety nine dollars, thirteen cents of barrel comex sculled 0:13:16.960 --> 0:13:19.280 up one point two percent, or twenty dollars sixty cents 0:13:19.280 --> 0:13:22.360 at seventeen fifty eight ten announced the euro one point 0:13:22.559 --> 0:13:25.000 one six one against the dollar, British pound one point 0:13:25.000 --> 0:13:27.040 two one to eight, and the en mon thirty five 0:13:27.080 --> 0:13:30.360 point five zero, and bitcoin is up seven tenths percent. 0:13:30.720 --> 0:13:34.520 Is at nine hundred forty dollars and Jack mob planning 0:13:34.559 --> 0:13:37.520 to seed control of a group that according to Dowd Jones, 0:13:37.679 --> 0:13:40.400 who cited people familiar with the matter, that's a Bloomberg 0:13:40.400 --> 0:13:42.880 business flash. Now here's Michael Barr with more on what's 0:13:42.920 --> 0:13:45.920 going on around the world. Michael, thank you very much, Karen. 0:13:45.960 --> 0:13:49.199 A possible prisoner swap with Russia could bring w n B, 0:13:49.280 --> 0:13:52.480 a star Britney grinder, and former US Marine Paul Wheeland 0:13:52.480 --> 0:13:55.280 back to the US. A person familiar with the offers 0:13:55.320 --> 0:13:58.040 said it would swap them for imprisoned Russian arms dealer 0:13:58.080 --> 0:14:01.120 Victor Boot. However, Russia says there was no agreement yet. 0:14:01.520 --> 0:14:04.680 Senator Joe Manchin and Majority Leader Chuck Schumer have struck 0:14:04.720 --> 0:14:08.600 a deal on attacks Energy and Climate bill. Excuse me, 0:14:08.640 --> 0:14:10.680 It breaks a deadlock on the Democrats and long sought 0:14:10.760 --> 0:14:15.000 legislation to enact major parts at President Biden's agenda. In baseball, 0:14:15.040 --> 0:14:18.360 the Mets beat the Yankees, the Guardians beat the Red Sox. 0:14:18.600 --> 0:14:22.960 The Nationals and Orioles also lost. The A's beat the Astros, 0:14:22.960 --> 0:14:26.160 the Diamondbacks beat the Giants. Global News twenty four hours 0:14:26.160 --> 0:14:28.800 a day on air and on Bloomberg Quickdig, powered by 0:14:28.800 --> 0:14:31.200 more than twenty seven hundred journalists and antalists more than 0:14:31.240 --> 0:14:34.080 a hundred twenty countries. Michael Barr and this is Bloomberg. 0:14:34.160 --> 0:14:36.680 Nathan Alright, Michael, thank you to six nineteen on Wall 0:14:36.720 --> 0:14:40.160 Street Live from the Bloomberg Interactive Broker Studios. This is 0:14:40.320 --> 0:14:44.520 Bloomberg Daybreak and Bloomberg Economics correspondent Michael McKee is back 0:14:44.560 --> 0:14:48.120 in the Interactive Broker's studio this morning after quick trip 0:14:48.200 --> 0:14:50.800 down to Washington, d C. To watch the Federal Reserve 0:14:51.280 --> 0:14:54.160 raise interest rates five seventy five basis points. Again, Michael, 0:14:54.240 --> 0:14:57.920 good morning. So we got the rate increase that the 0:14:57.960 --> 0:15:01.800 market was expecting. What did you make of the messaging 0:15:02.360 --> 0:15:06.880 on where rates may or may not go from here, Mike, Well, 0:15:06.920 --> 0:15:08.960 I think the way I put it yesterday is is 0:15:09.000 --> 0:15:11.160 the FED knows where it's going, it just doesn't know 0:15:11.200 --> 0:15:14.040 where it is. At this point, we don't have enough 0:15:14.120 --> 0:15:16.840 data to know if the FED has really put us 0:15:16.880 --> 0:15:21.120 on a sustainable path of lower inflation or if the 0:15:21.160 --> 0:15:24.520 FED has started us on a path to a recession. 0:15:25.200 --> 0:15:27.680 The problem is data or backward looking, and we don't 0:15:27.720 --> 0:15:30.720 have enough of it yet to really get the measure 0:15:30.800 --> 0:15:33.800 of the FEDS rate increases. But they know they want 0:15:33.800 --> 0:15:36.920 to get a little bit above neutral right now. When 0:15:36.960 --> 0:15:39.840 the FED funds future start trading today, they should be 0:15:39.840 --> 0:15:44.320 trading just at the bottom end of the FEDS neutral line. 0:15:44.440 --> 0:15:47.440 So they are going to raise rates above that. It's 0:15:47.480 --> 0:15:49.440 about two and a half to three percent, Nathan, and 0:15:49.480 --> 0:15:51.800 they're going to raise rates above it. But how quickly 0:15:51.840 --> 0:15:54.520 they do that and how far above it they go 0:15:54.800 --> 0:15:58.640 will depend on getting more data. Yeah, it's interesting that 0:15:58.720 --> 0:16:02.080 you term it as the FED not necessarily knowing where 0:16:02.080 --> 0:16:05.200 it is right now, particularly when we heard from the 0:16:05.280 --> 0:16:08.360 Chairman yesterday pretty much saying that they're going to get 0:16:08.360 --> 0:16:12.960 even more data dependent. That's a big risk, isn't it. 0:16:13.120 --> 0:16:17.840 When the data are back, we're looking and it makes 0:16:17.880 --> 0:16:20.560 them that much more difficult to tell whether policy is 0:16:20.560 --> 0:16:23.960 having the intended effect of bringing inflation back to back 0:16:23.960 --> 0:16:27.960 to bear. Yeah, you have to get the various measures 0:16:27.960 --> 0:16:31.120 of the economy and try to interpret for from those 0:16:31.720 --> 0:16:34.640 where the economy might be going. Today, we'll get the 0:16:34.680 --> 0:16:38.680 GDP numbers, and the Fed will be looking at not 0:16:38.840 --> 0:16:41.840 the headline so much as they'll be looking at consumer 0:16:41.920 --> 0:16:45.400 spending and business investment and then taking apart the various 0:16:45.440 --> 0:16:48.680 parts of consumer spending and business investment to see what's 0:16:48.680 --> 0:16:52.120 growing and what's not, and what might have been affected 0:16:52.160 --> 0:16:56.040 by interest rates and what just kind of kept on going. 0:16:56.600 --> 0:16:58.880 So they'll be doing that, and they'll look at the 0:16:58.880 --> 0:17:02.320 employment costs into which comes out tomorrow. Uh. It's sort 0:17:02.360 --> 0:17:05.879 of the best measure and detail of incomes, and they'll 0:17:05.880 --> 0:17:08.560 try to figure out who's making money and how they're 0:17:08.560 --> 0:17:10.560 making it. Is that the wage people is at the 0:17:10.600 --> 0:17:13.280 salary people, uh, is at the folks on Wall Street 0:17:13.320 --> 0:17:17.239 who you get paid uh uh fees and bonuses. So uh. 0:17:17.400 --> 0:17:22.199 A lot of of scientific work on data is going 0:17:22.280 --> 0:17:24.200 to be ahead for the feed. Yeah, and a lot 0:17:24.320 --> 0:17:26.919 to go before the next decision coming up. And what 0:17:27.600 --> 0:17:29.840 just about two months from now. I mean, that's gonna 0:17:29.840 --> 0:17:31.919 be a lot of data that the FED is going 0:17:31.960 --> 0:17:36.040 to have to digest from now until then. Give us 0:17:36.040 --> 0:17:40.520 an idea of where we could see the messaging going 0:17:40.720 --> 0:17:44.520 from here, given all the uncertainties that are just down 0:17:44.560 --> 0:17:47.360 the pike. Well after this week, the next big data 0:17:47.400 --> 0:17:49.800 point is a week from tomorrow when we get the 0:17:49.880 --> 0:17:53.440 July Jobs report. The FED has made a big deal 0:17:53.480 --> 0:17:56.560 out of how low unemployment is and that growth in 0:17:56.720 --> 0:18:00.240 jobs has been steady, and so if that slows all 0:18:00.320 --> 0:18:02.560 or if unemployment goes up at all them, that will 0:18:02.640 --> 0:18:05.480 raise growth fears on Wall Street. If it doesn't, then 0:18:05.520 --> 0:18:08.320 that could embolden the FED to raise rates at a 0:18:08.359 --> 0:18:11.879 faster pace to a higher level. Then we'll get on 0:18:11.960 --> 0:18:15.919 August tenth the CPI report for July, and obviously that 0:18:16.000 --> 0:18:18.760 will be very big as it was the last time. 0:18:18.800 --> 0:18:22.000 But before the FED meeting we get two CPI reports, 0:18:22.200 --> 0:18:27.679 two jobs reports, and the PC Inflation Indicator, which is 0:18:27.680 --> 0:18:30.399 the Fed's favorite. So, uh, they have a lot of 0:18:30.480 --> 0:18:33.679 data to look at. And you know, why take a 0:18:33.720 --> 0:18:35.720 stand on what you're gonna do right now when you 0:18:35.840 --> 0:18:38.080 might have to change your mind later in our last 0:18:38.080 --> 0:18:40.760 minute here, Mike, for those who missed the news conference. 0:18:40.840 --> 0:18:42.840 What did you ask the chairman and did you like 0:18:42.960 --> 0:18:47.040 the answer? I sort of asked him about this knowing 0:18:47.040 --> 0:18:50.160 where you are thing? You know, where does the FED 0:18:50.359 --> 0:18:52.760 think it is? And where does the FED think uh, 0:18:52.760 --> 0:18:56.520 it's it's policies have had an effect, And he didn't 0:18:56.520 --> 0:19:00.040 get a specific answer. But that's where I took the 0:19:00.160 --> 0:19:02.800 idea that they don't quite know where they are yet 0:19:02.920 --> 0:19:06.600 from UH. There wasn't a lot in this news coverage 0:19:06.640 --> 0:19:09.679 that was new. UH. They left out the idea of 0:19:10.240 --> 0:19:14.080 forward guidance. But beyond that, everything happened as expected. So 0:19:14.400 --> 0:19:16.720 not a lot of surprises this time. We just have 0:19:16.760 --> 0:19:18.600 to keep an eye on the data going forward. You 0:19:18.640 --> 0:19:21.480 have to tune into Bloomberg Radio on a regular basis 0:19:21.520 --> 0:19:24.960 to that information. Get the plug in. Thank you, Mike, 0:19:25.080 --> 0:19:28.320 always great having you on. Michael McKee are economics correspondent 0:19:28.720 --> 0:19:32.600 here on Bloomberg Radio, where we'll be parsing the data 0:19:33.000 --> 0:19:36.480 high frequency UH from now until the next meeting in 0:19:36.600 --> 0:19:41.000 late September. Right now, futures moving lower. We got SMP 0:19:41.080 --> 0:19:43.760 futures down about eleven points right now, DAL future is down, 0:19:44.800 --> 0:19:47.479 NAZAC futures are lower by eighty nine points ten. Your 0:19:47.520 --> 0:19:50.440 treasury is up one thirty second now the yield two 0:19:50.480 --> 0:19:53.240 point seven seven, almost two point seven eight percent on 0:19:53.280 --> 0:19:55.040 the ten year note, yield on the two year right 0:19:55.040 --> 0:19:59.520 now two point nine seven. And you are listening to 0:19:59.640 --> 0:20:08.080 bloom Burke day Break. Good, good morning, Bloomberg eleven three 0:20:08.080 --> 0:20:10.080 oh weather mix of sun and clouds and passing showers 0:20:10.119 --> 0:20:12.720 and storms upper eighties today, tomorrow and the next day. 0:20:12.720 --> 0:20:16.320 Actually when we'll see some more afternoon showers and storms 0:20:16.320 --> 0:20:19.040 tomorrow most likely right now seventy four in Central Park, 0:20:22.119 --> 0:20:26.640 broadcasting live from the Bloomberg Interactive Broker Studio in New York. 0:20:26.760 --> 0:20:29.840 Bloomberg e living free on to Washington, d C, Bloomberg 0:20:29.960 --> 0:20:33.200 nine one to Boston, Bloomberg one O six one to 0:20:33.320 --> 0:20:37.119 San Francisco, Bloomberg sixty to the country, Sirius XM h 0:20:37.160 --> 0:20:39.960 at A one ninet and around the globe the Bloomberg 0:20:39.960 --> 0:20:46.120 Business app and Bloomberg Radio dot Com. This is Bloomberg Daybreak. 0:20:50.359 --> 0:20:52.680 It's six thirty on Wall Street. Good morning. I'm Nathan 0:20:52.720 --> 0:20:55.639 Hager and I'm Karen Moscow, and we are just about 0:20:55.640 --> 0:20:58.280 three hours away from the open of US trading. Time 0:20:58.320 --> 0:20:59.919 for the Five Things that you need to notice. Our 0:21:00.040 --> 0:21:04.000 your day brought to you by Interactive Brokers. Interactive Brokers 0:21:04.040 --> 0:21:06.600 charges Martin loan rates from two point eight percent to 0:21:06.680 --> 0:21:09.600 three point eight percent, rates subject to change. Learn more 0:21:09.640 --> 0:21:12.960 at I b k R dot com slash compare up First, 0:21:13.040 --> 0:21:15.679 the US futures are slumping after the biggest game for 0:21:15.760 --> 0:21:19.920 tech stock since November of Yesterday's push higher came after 0:21:20.000 --> 0:21:23.680 resilient earnings in the Fed's press conference, but Victoria Green, 0:21:23.840 --> 0:21:27.760 chief investment officer at G squared Private Wealth, remains defensive. 0:21:28.119 --> 0:21:31.320 I think the Margaret Breeze side relief that really wasn't necessary, 0:21:31.359 --> 0:21:34.000 So I think we realized the earnings really aren't that strong. 0:21:34.200 --> 0:21:37.120 We're going into a hawkersh tightening cycle and a weakening 0:21:37.119 --> 0:21:39.520 economic cycle. And I always think it's funny if we're 0:21:39.600 --> 0:21:42.359 arguing about the definition of O sessions, we're probably in 0:21:42.440 --> 0:21:46.000 a refecca. Victoria Greenwich G Squared Private Wealth said, the 0:21:46.080 --> 0:21:49.680 FED is not being accommodative, but it is communicating well 0:21:49.840 --> 0:21:52.240 and reaction continues to pour in Karen to FED Chair 0:21:52.320 --> 0:21:55.480 J Powell's latest comments, the FED raised interest rate seventy 0:21:55.480 --> 0:21:58.359 five basis points and Powell signal more hikes coming, but 0:21:58.440 --> 0:22:01.840 ditched specific guidance. The pace of those increases will continue 0:22:01.880 --> 0:22:05.840 to depend on the incoming data and evolving outlook for 0:22:05.880 --> 0:22:08.959