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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. Good morning, I'm Nathan

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Speaker 1: Hager and I'm Karen Moscow. Here are the stories we're

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Speaker 1: following today.

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Speaker 2: Karen, we begin with a health scare at McDonald's and

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Speaker 2: a plunge in shares of the fast food giant. For

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Speaker 2: the latest, let's bring in Bloomberg's John Tucker, John and Nathan.

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Speaker 3: The CDC says forty nine people from ten states have

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Speaker 3: contracted E coli traced to ingredients in McDonald's quarter pounders.

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Speaker 3: Ten people have been hospitalized. An elderly person in Colorado

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Speaker 3: has died. Every patient interviewed by the CDC said they

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Speaker 3: ate at McDonald's before falling ill. Most of the eight

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Speaker 3: quarter pounder hamburger specifically, McDonald's USA president is Joe Erlinger.

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Speaker 4: This is a temporary change as the investigation continues, and

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Speaker 4: we are working quickly to return our full menu in

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Speaker 4: these states as soon as possible.

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Speaker 3: Well, the company thinks it could be the youngions that

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Speaker 3: going to quarter pounders. Apparently the quarter pounders are the

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Speaker 3: only sandwiches that routinely take these particular onions. The true

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Speaker 3: number of people, in fact, it likely much higher than

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Speaker 3: is currently known, and may involve additional states. According to

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Speaker 3: the CDC, McDonald's is a member of the DELL also

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Speaker 3: has the thirty fifth biggest waiting of the S and

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Speaker 3: P five hundred. A major outbreak is going to haunt

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Speaker 3: restaurant chains for years. You'll recall back in twenty fifteen,

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Speaker 3: an E. Colian neurovirus outbreak across Chipotle locations in multiple

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Speaker 3: states led to a drastic drop in sales there. McDonald's

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Speaker 3: shares down six percent pre market in New York. I'm

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Speaker 3: John Tucker, Bloomberg Radio.

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Speaker 1: All right, John, thank you. Now we want to turn

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Speaker 1: to geopolitics and the latest from the Middle East. Secretary

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Speaker 1: of State Anony blenk In is on his way to

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Speaker 1: Saudi Arabia after a meeting with Israeli Prime Minister Benjamin

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Speaker 1: nettan Yahoo in Jerusalem. He says they both agree that

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Speaker 1: the killing of Hamas leader Yaya Sinwar has opened new

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Speaker 1: possibilities for ending the war in Gaza.

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Speaker 5: You're resolute in our defense of Israel when it comes

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Speaker 5: to a tax it's receiving from Iran, from Iran's proxies,

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Speaker 5: and we stand with Israel, and we'll always stand with

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Speaker 5: Israel in its defense. It's also very important that Israel

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Speaker 5: respond in ways that do not create greater escalation and

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Speaker 5: do not risk breading the conflict.

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Speaker 1: Anthony Blenkin is on his eleventh trip to the Middle

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Speaker 1: East since the October seventh Hamas attack that sparked the

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Speaker 1: Gaza conflict. Overnight, Israel said it confirm the death of

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Speaker 1: cleric Haschem Safadin at an airstrike in Lebanon three weeks ago.

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Speaker 1: He was widely expected to become the next leader of

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Speaker 1: Hesbola after the killing of Hassan ISRAELA.

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Speaker 2: Now, Karen, let's head back to the US and get

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Speaker 2: the latest from the campaign trail. Kamala Harris says she

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Speaker 2: would work with Congress to raise the federal minimum wage

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Speaker 2: to at least fifteen dollars an hour if elected. The

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Speaker 2: Vice president discussed your economic proposals in an interview with

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Speaker 2: NBC News.

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Speaker 6: My plans are focused on working people, the middle class,

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Speaker 6: and what we must do is strengthen hardworking people to

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Speaker 6: be able to to do what they dream and aspire

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Speaker 6: to be able to do. His plans are about giving

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Speaker 6: tax cuts, massive tax cuts to billionaires in big corporations.

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Speaker 2: Vice President Harris has called for raising the minimum wage before,

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Speaker 2: but hasn't specified a dollar amount. Former President Trump sidestepped

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Speaker 2: a question about the issue during a campaign stop at

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Speaker 2: a McDonald's in Pennsylvania over the weekend.

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Speaker 1: Well Nathan Donald Trump was back in North Carolina last night,

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Speaker 1: outing his pledge to make it easier to buy a car.

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Speaker 4: I will make interest on car loans fully tax deductible,

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Speaker 4: because affording a car is essential to restoring the American.

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Speaker 1: At a rally in Greensboro, North Carolina, the former president

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Speaker 1: said the tax break would only apply to cars made

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Speaker 1: in the US. He did not say whether his plan

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Speaker 1: would apply to foreign owned automakers that manufacture in the US,

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Speaker 1: like Volkswagen, Toyota, and Hyundai.

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Speaker 2: Well Karen Donald Trump's views on monetary policymakers in global

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Speaker 2: trade are being challenged by Christine Legard. In an interview

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Speaker 2: with Bloomberg, the European Central Bank president invited the Republican

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Speaker 2: nominee to ec he's headquarters in Frankfurt.

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Speaker 7: He should come and visit us, And you know I

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Speaker 7: have I have thousands of hard working people, economists, jurists,

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Speaker 7: a computer scientists, and I can assure you that they

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Speaker 7: work super hard every day, not just once a month.

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Speaker 2: ECB President Christine Legard made the comments to Bloomberg's Francine Lockwa.

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Speaker 2: Donald Trump told Bloomberg earlier this month, the FED share

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Speaker 2: has the greatest job in government. In his words, you

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Speaker 2: show up to the office once a month.

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Speaker 1: Well, turning to the markets now, Nathan, bonds are extending

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Speaker 1: to clients this morning. They have sold off significantly since

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Speaker 1: the Fed started cutting interest rates. Two year treasury yields

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Speaker 1: have climbed thirty four basis points in September. That's a

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Speaker 1: move not seen since nineteen ninety five. Bank of America

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Speaker 1: CEO Brian moyna has has urged Federal Reserve policymakers to

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Speaker 1: be measured.

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Speaker 4: We've got to get back in line. And so they're

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Speaker 4: on that path. They're late to the game. They've got

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Speaker 4: to make sure they don't go too hard now. And

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Speaker 4: that's what they are all trying to figure out. Watching

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Speaker 4: the data.

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Speaker 1: Brian moynihan tells Bloomberg he expects the FED to cut

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Speaker 1: rates by fifty basis points by the end of the year.

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Speaker 2: Well, that differs Karen from the view of Apollo Management

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Speaker 2: chief economist Torsten Slock. He says the chances are rising

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Speaker 2: the Fed doesn't cut at all next month.

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Speaker 1: I mean, you really do begin to ask the question,

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Speaker 1: where is the slowdown?

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Speaker 2: And as we've been debating before, so it's monetary policy

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Speaker 2: really restrictive.

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Speaker 1: If it is so restrictive, why is the economy.

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Speaker 3: Still doing so well?

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Speaker 2: Apollo Management chief economists Torsten Slocks says tailwinds from looser

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Speaker 2: financial conditions, higher government spending, and elevated stocks and GDP

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Speaker 2: growth are building well.

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Speaker 1: Nathan, is a busy day on the earnings front, with

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Speaker 1: nearly three dozen companies in the SNP five hundred reporting.

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Speaker 1: We'll hear from Coca Cola, IBM, and AT and T today.

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Speaker 1: We also have a couple of big reports out of Europe.

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Speaker 1: This morning, we go to London and get the latest

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Speaker 1: from Bloomberg's Ewen Paus. Good morning, Ewen.

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Speaker 8: Karla Nathan Deeutsche Bank kaz apport today. Forty two percent

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Speaker 8: increase in profits in the third quarter are help by

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Speaker 8: gains at the investment bank, but Germany's biggest lender also

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Speaker 8: sounding a note of course and setting aside more money

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Speaker 8: to cover bad debt. Over at Heineken, it was bad

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Speaker 8: weather in Europe and slow consumer spending in the US

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Speaker 8: that saw bier volumes misestimates, but the Dutch brewer says

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Speaker 8: higher pricing means it will still hit its profit target

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Speaker 8: for the year and over at the world's biggest beauty company.

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Speaker 8: Another sales decline in China, the fifth straight quarter of

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Speaker 8: lower sales there for Laurel investors today asking if the

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Speaker 8: shares are still worth it? In London, I'm you Imports

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Speaker 8: Bloomberg Radio.

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Speaker 2: Thanks you, and Apple CEO Tim Cook is in China,

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Speaker 2: promising to keep investing in the country during a meeting

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Speaker 2: with Beijing's top technology official. China is the world's largest

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Speaker 2: smartphone market and remains Apple's most important market outside the US.

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Speaker 2: This is Tim Cook's second visit to the country this year.

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Speaker 1: And finally, Nathan, what would you like to hear about

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Speaker 1: on Bloomberg Radio? Help make shures like ours even better

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Speaker 1: by taking our Bloomberg Audience survey. Visit YouTube dot com

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Speaker 1: slash Bloomberg podcast and click the link in our profile

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Speaker 1: or community section to take this survey, which is hosted

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Speaker 1: by our partner's Material. Fill it out now at YouTube

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Speaker 1: dot com slash Bloomberg Podcasts. Time now for look at

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Speaker 1: some of the other stories making news in New York

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Speaker 1: and around the world, and for that we're joined by

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Speaker 1: Bloomberg's Michael Barr. Michael, good morning, Good.

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Speaker 9: Morning, Karen. The Georgia Supreme Court rejected a last minute

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Speaker 9: push by the Republican Party to reinstate a set of

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Speaker 9: new election rules that included, among other things, a requirement

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Speaker 9: that ballots be handcounted in the upcoming US presidential vote.

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Speaker 9: The Republican National Committee challenged a lower court's decision last

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Speaker 9: week to strike down the rules as unlawful. Scott Turner,

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Speaker 9: founder of the nonprofit Eternal Vigilance.

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Speaker 2: Action, that collective sigh of relief you heard was from

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Speaker 2: our election officials around the state.

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Speaker 9: The court's decision means the rules will remain blocked at

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Speaker 9: least heading into the November fifth election. Two Georgia election

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Speaker 9: workers to fame by former Trump attorney rudyja Gi are

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Speaker 9: getting some of his prized possessions. The ruling comes from

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Speaker 9: a federal judge, as Ruby Freeman and Shay Moss have

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Speaker 9: been trying to collect on a one hundred and forty

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Speaker 9: six million dollar defamation judgment. The possessions include his nineteen

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Speaker 9: eighty Mercedes Benz, signed photos of Yankees' legends, some luxury watches,

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Speaker 9: and his New York City apartment. We're learning more about

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Speaker 9: the arrest of the former CEO of Abercrombie and Fitch.

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Speaker 9: Michael Jeffries, along with two other co defendants, have been

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Speaker 9: indicted for allegedly running an international prostitution and sex trafficking

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Speaker 9: ring for decades. According to the Eastern District of New York,

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Speaker 9: they forced male models into participating in lude acts. US

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Speaker 9: Attorney Brion Peace to anyone who thinks they can exploit

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Speaker 9: and coerce others by using the so called casting couch system,

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Speaker 9: this case is served as a warning Jeffrey's attorney. He

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Speaker 9: says that they will respond in court, not in the media.

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Speaker 9: Los Angeles County District Attorney George Gasson says that he'll

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Speaker 9: have an announcement soon on his decision regarding a possible

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Speaker 9: re sentencing of the Menendez brothers.

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Speaker 1: As I said about it ten days ago, I said

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Speaker 1: I would make a decision within ten days or so.

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Speaker 3: I planned to have a decision by the end of

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Speaker 3: this week.

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Speaker 9: Lyell and Eric Menendez were sentenced to life in prison

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Speaker 9: for the nineteen eighty nine murders of their parents. Their

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Speaker 9: defense team says there is new evidence supporting the brothers

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Speaker 9: claims of sexual and physical abuse by their parents. New

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Speaker 9: York's MTA may face a six hundred and fifty two

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Speaker 9: million dollars budget shortfall in twenty twenty eight, as higher

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Speaker 9: overtime costs and lower fare box collections threatened to strain

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Speaker 9: the transit agency's finances. New York State Comptrollert Thomas Denopoli

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Speaker 9: warned in a report that about two hundred million dollars

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Speaker 9: larger than the MTA's own production projections for its budget

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Speaker 9: gap in twenty twenty eight. Global News twenty four hours

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Speaker 9: Day and Whenever you want it with Bloomberg News Now.

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Speaker 9: Michael Barbs is Bloomberg hereing.

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Speaker 1: Sorry Michael Barr, thank you time now for the Bloomberg

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Speaker 1: Sports update. Bron to you by try State Outie. Here's

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Speaker 1: John Stashauer, John, good morning.

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Speaker 10: Good morning, Karen. The Knicks made a couple of big

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Speaker 10: offseason moves in hopes of catching the Celtics to the

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Speaker 10: Eastern Conference. They added Karl Anthony Towns and Mchal Bridges

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Speaker 10: for one night. Anyway, those moves didn't help open the

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Speaker 10: night in Boston, so the Celtics Oyster the championship ender

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Speaker 10: and then took a twenty four point lead in the

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Speaker 10: first half. Boston won won thirty two to one.

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Speaker 9: On nine.

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Speaker 10: Jason Tatum scored thirty seven. He made eight of the

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Speaker 10: Celtics twenty nine three pointers. Twenty nine threes ties the

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Speaker 10: NBA record. Then some NBA history in La Lebron James

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Speaker 10: sharing the court with his son Bronni. You only played

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Speaker 10: three minutes. The Lakers beat Minnesota. Good start for the Rangers,

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Speaker 10: good start to their season. They're five oho to one

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Speaker 10: in Montreal, two goals in the first two minutes. Rangers

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Speaker 10: won seven to two. Devils lost to Tampa Bay eight

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Speaker 10: to five. The Islanders lost to a t That's right,

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Speaker 10: one nothing. Capitol's won four one in Philadelphia. The Bruins

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Speaker 10: shut out in Nashville for nothing. No lack of star

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Speaker 10: power for the World Series against Friday in LA. But

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Speaker 10: there's no doubt who the biggest headliners are. And here's

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Speaker 10: Aaron Judge on shoe Hey Otani.

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Speaker 11: It's for average, it's for power, the speed, you know,

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Speaker 11: doing what he did this year with the fifty stolen bases.

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Speaker 11: That's it got talked about a lot I don't think

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Speaker 11: it got talked about enough. It's just he's an impressive,

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Speaker 11: impressive athlete, you know, the best player in the game

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Speaker 11: and order to ambassador for the sport.

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Speaker 10: Speaking of out Tony, the ball he hit for his

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Speaker 10: fiftieth home run was sold a option for four point

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Speaker 10: four million. Meanwhile, Dodger legend has passed away. Fernando Alezuela

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Speaker 10: was sixty three, had been ill, came from Mexico, burst

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Speaker 10: onto the scene as a twenty year old. In nineteen

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Speaker 10: eighty one, Fernando Mania was born. He won the Rookie

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Speaker 10: of the Year and the say Young John Stashey, We're

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Speaker 10: Bloomberg Sports Karen Ethan.

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Speaker 12: Coast to coast on Bloomberg Radio, nationwide on Sirius XM,

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Speaker 12: and around the world on Bloomberg and the Bloomberg Business app.

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Speaker 12: This is Bloomberg Daybreak.

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Speaker 2: Good morning. I'm Nathan Hager bringing you an exclusive conversation

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Speaker 2: with Bank of America's CEO Brian moynihan. Speaking with Bloomberg's

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Speaker 2: Heidi Stroud Watts in Sydney. They talked about interest rates,

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Speaker 2: his warning for the FED, and what the election could

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Speaker 2: mean for America's fiscal situation. Let's listen.

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Speaker 4: In you think about the US economy, you have great

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Speaker 4: insight on what's going on. If you look at that

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Speaker 4: consumer spending this year, the month of October so far

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Speaker 4: versus last year, or third quarter versus last year's third quarter,

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Speaker 4: it's up in a four to five percent range, which

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Speaker 4: is consistent with a low inflation, low growth economy. That's

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Speaker 4: across about a trillion and a quarter dollars to twenty

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Speaker 4: and a half dollars spent in a quarter, so it's

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Speaker 4: a big sample and the people moving around they spend

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Speaker 4: it each quarter on all different things, but generally growing

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Speaker 4: consistent where we were pre pandemic, when you had fed

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Speaker 4: funds rate at the two percent level, two and a

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Speaker 4: half percent level, you had inflation and control, and you

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Speaker 4: had growth in the two percent level. So that gives

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Speaker 4: us confidence that our experts to do all analysis are

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Speaker 4: backed up by the data we see our client, and

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Speaker 4: that's what we see for the consumer.

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Speaker 13: Is there of a degree of bifurcation the demographically.

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Speaker 4: It's less about bifurcation because I'd assume that the sort

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Speaker 4: of too it's look inflation hits people in the lower

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Speaker 4: brackets more than it does others. Because but the good

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Speaker 4: news is gas prices come down, food prices are tipped

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Speaker 4: over inflations, and controls down in the three percent range

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Speaker 4: as opposed it was running pretty hot, and so that helps.

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Speaker 4: But if you have auto debt, that debt and you

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Speaker 4: want to get a new car, that debt is higher.

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Speaker 4: If you have mortgage debt and you already had a

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Speaker 4: mortgage loan, it's very low. And so it really depends

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Speaker 4: on the consumer and really where they are. But the

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Speaker 4: average American consumer has more money than they did before

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Speaker 4: the pandemic, is in better credit quality before the pandemic,

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Speaker 4: still has the money and accounts from some of this

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Speaker 4: stimulus in the pandemic and is spending money. And that's

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Speaker 4: all good stuff for the US economy because we're such

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Speaker 4: a consumer. That's the unique thing about it's a consumer

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Speaker 4: driven economy. It's a consumer lot economy.

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Speaker 13: Are you thinking about making allocations or allowances with stress

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Speaker 13: at this point?

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Speaker 4: We always do that. So every quarter we run stressed

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Speaker 4: has thousands of them. Every day we run them into

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Speaker 4: market's business stuff. We always look at it and so

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Speaker 4: what's the case if it turns out the wrong way.

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Speaker 4: So even how we set our reserves. We have a

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Speaker 4: modeled series of cases we put in, so it's not

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Speaker 4: all base case based cases about half and the rest

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Speaker 4: are stress cases and the atom all together. We're actually

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Speaker 4: set our reserves as if unemployment was going to be

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Speaker 4: a five percent at the end of next year, not

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Speaker 4: what the market predicts at four point three. So there's

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Speaker 4: a conservatism built in to that, and then we look

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Speaker 4: beyond that.

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Speaker 13: Those those are some potential complications for the FED depending

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Speaker 13: on what happens in just under two weeks time. Right

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Speaker 13: does the fiscal scenario, particularly under another Trump administration, but

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Speaker 13: also certainly there are risks when it comes to the

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Speaker 13: Harris camp as well. Is that something that you're thinking about.

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Speaker 4: I would separate a very near term question of the

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Speaker 4: FED getting the trajectory. Our experts have them cutting again

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Speaker 4: a couple more times this year, one hundred basis points

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Speaker 4: this year, and another one hundred basis points more evenly

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Speaker 4: spread a quarter each quarter next year. It gets to

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Speaker 4: three to three point twenty five as a terminal rate,

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Speaker 4: and an inflation comes down to the two two point

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Speaker 4: three percent is a move in the twenty five and

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Speaker 4: the twenty six, and so that is a well engineered

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Speaker 4: fed change, and so the dangers that data or they

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Speaker 4: go too fast or too slow, and that risk is

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Speaker 4: higher now than it was six months ago. And so

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Speaker 4: as they move, everybody's going to watch them. And you

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Speaker 4: see the self in territories one day and you see

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Speaker 4: the rally the other day. Everybody's going to watch all that.

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Speaker 4: That is completely different from and I don't think that

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Speaker 4: will be impacted by the elections. All the fiscal problem

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Speaker 4: in the United States, And to give you the sound bite,

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Speaker 4: the US just finished the fiscal year. The budget deficit

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Speaker 4: for that year was equal to the entire economy of

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Speaker 4: the country of Australia one point eight trillion dollars. So

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Speaker 4: think about the size of that, and we've got to

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Speaker 4: get back in line. These are good times and we

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Speaker 4: should be managing more carefully. And frankly, we need to

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Speaker 4: have the politicians too, set those budgets, fund those budgets,

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Speaker 4: and run tax policy against those budgets to figure out

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Speaker 4: how to make this work. It's probably gonna be raising

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Speaker 4: revenue and cutting expense or some combination. It's not a

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Speaker 4: new problem. That's one we got to start to wrestle with.

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Speaker 4: Not that it's critical tomorrow morning, that it'll be critical

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Speaker 4: over the next few years.

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Speaker 13: But given that risk, do you think the FED went

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Speaker 13: too big too soon.

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Speaker 4: No, they were late to the game and they admit that.

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Speaker 4: So it's nothing that we're saying. It's they were late

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Speaker 4: and they had to move fast because inflation got ahead

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Speaker 4: of them and they and they've done a good job

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Speaker 4: of bringing it back down from probably a double digit

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Speaker 4: rate down to about three percent last quarter three and

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Speaker 4: a quarters. They're getting close to it. And it's never

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Speaker 4: the inflation average from if one of my teammates tolling

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Speaker 4: from nineteen ninety to twenty twenty four was two and

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Speaker 4: a half percent, the inflation average from nineteen from two

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Speaker 4: thousand twenty two and a half percent. It's four and

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Speaker 4: a half percent just in the last twenty twenty to

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Speaker 4: twenty four, and so we've got to get back in line.

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Speaker 4: And so they're on that path. They were late to

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Speaker 4: the game. They got to make sure they don't go

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Speaker 4: too hard now, and that's what they are all trying

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Speaker 4: to figure out watching the data. But whether it's it's

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Speaker 4: a terminal rate that's the key, and that we think

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Speaker 4: is around three percent, that's a whole different indust rate

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Speaker 4: environment in the US and other markets than it's been

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Speaker 4: in the last fifteen years or so.

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