WEBVTT - Traders Eye 2026 Fed Outlook; Trump Insists Smart People Back Tariffs

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>Good morning, I'm Nathan Hager and I'm Karen Moscow. Here

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<v Speaker 2>are the stories we're following today.

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<v Speaker 3>Well, Karen.

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<v Speaker 4>Global bond yields have risen to high's last scene in

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<v Speaker 4>two thousand and nine. Ahead of the Federal Reserves the

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<v Speaker 4>final policy meeting of the year. There is concern interest

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<v Speaker 4>rate cutting cycles may be ending soon, but as for today,

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<v Speaker 4>traders are all about certain a rate cut is on

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<v Speaker 4>the way, as Bloomberg's Michael McKee reports, though that is

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<v Speaker 4>not the only thing investors will be focused on.

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<v Speaker 5>The markets have priced in a quarter point cut, and

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<v Speaker 5>the Fed doesn't like to disappoint, But the real questions

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<v Speaker 5>revolve around descents, the dot plot and their twenty twenty

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<v Speaker 5>six outlook. We may have three policymakers vote against the

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<v Speaker 5>decision for the first time since twenty nineteen. Investors are

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<v Speaker 5>also focused on what comes next. In September, FED officials

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<v Speaker 5>saw just one rate cut for next year. At the moment,

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<v Speaker 5>the markets are pricing in three. How many they see

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<v Speaker 5>now will depend on their forecasts for unemployment and inflation

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<v Speaker 5>in twenty twenty six. They forecast improvement in both. Back

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<v Speaker 5>in September, but have the risks changed. Michael McKee, Bloomberg Radio.

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<v Speaker 4>Okay, Mike, thank you for full coverage of the FED

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<v Speaker 4>decision and remarks from Chairman J Powell. Tune into a

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<v Speaker 4>special edition of Bloomberg Surveillance the FED decides. It kicks

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<v Speaker 4>off this afternoon at one thirty Wall Street time on

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<v Speaker 4>Bloomberg Radio, Bloomberg Television, and the Bloomberg Podcast channel on YouTube.

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<v Speaker 2>Well ahead of the Fed's last policy decision of the year, Nathan,

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<v Speaker 2>President Trump once again took aim at Feder Reserve Chairman J.

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<v Speaker 5>Powell.

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<v Speaker 2>The President spoke at a rally in Pennsylvania.

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<v Speaker 6>Well, checking this, you know, we have a bad head

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<v Speaker 6>of the FED bed We're going to be making a change.

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<v Speaker 6>Fortunately this guy soo.

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<v Speaker 2>And President Trump says he has a quote pretty good

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<v Speaker 2>idea on who he wants to run the FED. The

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<v Speaker 2>President says he may wait until early next year to

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<v Speaker 2>publicly reveal the name.

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<v Speaker 4>The economy was front and center at the President's rally.

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<v Speaker 4>He was out to address voters' concerns about the high

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<v Speaker 4>cost of living, telling the Mount Pocono crowd, people are

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<v Speaker 4>starting to see the benefits of tariffs.

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<v Speaker 6>It's amazing. It's the smart people understand it. Other people

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<v Speaker 6>are starting to learn, but the smart people really understand it.

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<v Speaker 4>The President says tariffs have allowed him to provide aid

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<v Speaker 4>to farmers and have forced manufacturers to build plants and

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<v Speaker 4>data centers in the US, And he says he inherited

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<v Speaker 4>high prices from the Biden administration.

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<v Speaker 6>They say affordability, and everyone says, oh, that must mean

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<v Speaker 6>Trump has high prices. Now, our prices are coming down tremendously.

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<v Speaker 4>And at one point during the rally, President Trump suggested

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<v Speaker 4>he could try to remove some FED governors if former

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<v Speaker 4>President Biden signed their commissions with an auto pen. President

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<v Speaker 4>Trump has criticized Biden's use of automatic signatures before presidents

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<v Speaker 4>have used them since at least the nineteen forties.

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<v Speaker 2>Let's stick with politics here in Nathan. History has been

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<v Speaker 2>made in Miami. Eileen Higgins won the city may oral runoff.

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<v Speaker 2>She becomes the first woman ever and the first Democrat

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<v Speaker 2>in nearly three decades to lead Miami. Higin's peed a

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<v Speaker 2>Republican endorsed by President Trump. Higgin's victory adds to a

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<v Speaker 2>recent stretch of Democratic gains, including last month's wins in

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<v Speaker 2>New Jersey, and Virginia and zo orun Mom Donnie's victory

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<v Speaker 2>as New York mayor.

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<v Speaker 4>In the nation's capital, kar and Senate Republicans are set

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<v Speaker 4>to vote on a plan this week to counter Democrats

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<v Speaker 4>push to extend expiring Affordable Care Act subsidies. We get

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<v Speaker 4>more from Bloomberg Zamy Morris.

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<v Speaker 7>In Washington, Senate majority leader John Thunne promised Democrats a

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<v Speaker 7>vote to extend Obamacare premium tax credits in exchange for

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<v Speaker 7>reopening the government last month, but Republicans don't want to

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<v Speaker 7>vote against the extension without an alternative plan. This proposal

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<v Speaker 7>would offer people in some Affordable Care Act health plans

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<v Speaker 7>up to fifteen hundred dollars in health savings accounts, but

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<v Speaker 7>it also includes restrictions that could ruin Democratic support. Neither

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<v Speaker 7>the Republican nor Democratic plans are expected to get the

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<v Speaker 7>sixty votes needed for Senate passage, and healthcare costs for

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<v Speaker 7>more than twenty million people are set despite January first.

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<v Speaker 7>In Washington, Amy Morris Bloomberg Radio, All.

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<v Speaker 2>Right, Amy, thank you now. We want to get the

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<v Speaker 2>latest on the war in Ukraine. President Trump is saying

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<v Speaker 2>Russia is in a stronger military position in the war

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<v Speaker 2>he took aim at European leaders for what he sees

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<v Speaker 2>as excessive dialogue that's produced few results. And here's part

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<v Speaker 2>of Donald Trump's exchange with Politico's Dasher Burns.

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<v Speaker 6>They're not doing a good job. Europe is not doing

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<v Speaker 6>a good job. In many ways, they're not doing a

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<v Speaker 6>good job. I want to They talk too much and

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<v Speaker 6>they're not producing. We're talking about Ukraine. They talk, but

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<v Speaker 6>they don't produce, and the war just keeps going on

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<v Speaker 6>and on.

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<v Speaker 2>Almost four years since Putin's full scale invasion of Ukraine,

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<v Speaker 2>the war has come at a huge cost for both sides,

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<v Speaker 2>more than one and a half million troops killed or wounded,

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<v Speaker 2>according to Western estimates.

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<v Speaker 4>Well, now we want to turn care into a Bloomberg

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<v Speaker 4>News exclusive. A trove of emails reviewed by Bloomberg reveals

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<v Speaker 4>Jeffrey Epstein's financial ties on and off Wall Street were

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<v Speaker 4>broader than previously known. Let's get the details from Bloomberg's

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<v Speaker 4>John Tucker, Good Morning John.

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<v Speaker 8>And Nathan akash At. More than eighteen thousand emails sent

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<v Speaker 8>to in front Epstein's private Yahoo account shows, even after

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<v Speaker 8>stories of Epstein's teenage victims spilled into the open Wall

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<v Speaker 8>Street continued to stay in touch. Some helped keep his

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<v Speaker 8>money machine turning. He had access to prestigious names in

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<v Speaker 8>global finance, including legendary Renaissance Technologies and the investment firm

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<v Speaker 8>a billionaire Carl ICoD. Just week samter Epstein was charged

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<v Speaker 8>with soliciting prostitution. For example, he received a coveted invitation

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<v Speaker 8>from wealth manager Greg Hirsch to invest with Renaissance. Epstein

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<v Speaker 8>jumped to the chance. Hersh who now runs his own office,

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<v Speaker 8>said through a spokesperson his interactions were solely professional and

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<v Speaker 8>ended in two thousand and seven.

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<v Speaker 6>Well.

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<v Speaker 8>Epstein even fielded requests for investments until his last week

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<v Speaker 8>of freedom in New York. I'm John Tucker Bloomberg Radio.

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<v Speaker 2>All right, John, thank you. Well, there are some companies

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<v Speaker 2>in the news this morning, Paramount's guide and said Netflix,

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<v Speaker 2>the entertainment heavyweights so logging in a bidding war for

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<v Speaker 2>Warner Brothers Discovery are bracing for a battle that could

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<v Speaker 2>last months. Warner Brothers board is not planning to cancel

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<v Speaker 2>its merger agreement with Netflix, which would require a two

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<v Speaker 2>point eight billion dollar termination fee. And let's say that

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<v Speaker 2>now puts the onus on Paramount to make the next move. Meanwhile,

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<v Speaker 2>money manager Mariogabelli says it's quote highly likely he will

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<v Speaker 2>tender his client's Warner Brothers shares to paramount and an

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<v Speaker 2>effort to spark a bidding war for the film and

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<v Speaker 2>TV company.

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<v Speaker 4>We're watching shares a JP Morgan chase this morning, Karen.

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<v Speaker 4>They're up about a tenth percent, but that followed a

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<v Speaker 4>drop yesterday at four point seven percent after the bank's

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<v Speaker 4>Maryann Lake said JP Morgan anticipates spending one hundred and

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<v Speaker 4>five billion dollars next year. That outlook was more than

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<v Speaker 4>analysts we're looking for.

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<v Speaker 2>And SpaceX Nathan's moving ahead with plans for an initial

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<v Speaker 2>public offer a now would seek to ray significantly more

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<v Speaker 2>than thirty billion dollars. Sources say the Elon muss Lad

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<v Speaker 2>company is targeting a valuation of about one and a

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<v Speaker 2>half trillion for SpaceX, and Bloomberg Tech host ed Ludlow

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<v Speaker 2>has more.

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<v Speaker 9>They do need capital, you know, Elon Musk has posted

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<v Speaker 9>a lot recently about their cash flow position why they

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<v Speaker 9>don't need cash. But what I understand from sources is

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<v Speaker 9>the reason they're targeting a arrays of more than thirty

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<v Speaker 9>billion dollars, significantly more than thirty billion dollars, is that,

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<v Speaker 9>alongside all of SpaceX's other long term goals with Starship

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<v Speaker 9>in particular, they are looking at the market potential of

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<v Speaker 9>space or constellation based data center satellites that act in

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<v Speaker 9>consolation and aggregate as data centers where SpaceX needs a

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<v Speaker 9>capital to buy the semiconductors by the Chips.

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<v Speaker 2>And bloomberg Ed Ludlow says SpaceX is pursuing a listing

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<v Speaker 2>as soon as mid to late twenty twenty six. Time

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<v Speaker 2>now some of the other stories making news in New

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<v Speaker 2>York and around the world, and for that we're joined

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<v Speaker 2>by Bloomberg's and Michael Barr Michael good Morning.

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<v Speaker 3>Good Morning, Karen. Accused United Healthcare CEO killer Luigi Mangione

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<v Speaker 3>was back in the Manhattan court Tuesday for pre trial

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<v Speaker 3>hearings on evidence taken when he was arrested in an Altoona, Pennsylvania,

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<v Speaker 3>fast food restaurant last year. The court saw body camera

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<v Speaker 3>video of his arrest from a year ago. Mangione's attorneys

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<v Speaker 3>claimed that police searched him illegally and are fighting to

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<v Speaker 3>get key evidence seized from him thrown out. New York

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<v Speaker 3>City Mayor elect Zoron Mamdani met with real estate leaders

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<v Speaker 3>and members of the Partnership for New York City to

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<v Speaker 3>tackle the city's issue of housing the homeless. Mamdannie says

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<v Speaker 3>they discussed how to remove roadblocks that make building new

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<v Speaker 3>units difficult and secure more federal aid for development.

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<v Speaker 5>The question, however, is whether we will be satisfied by

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<v Speaker 5>just shuttling those New Yorkers to another equally cold place

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<v Speaker 5>in our city, or whether we want to connect them

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<v Speaker 5>to housing.

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<v Speaker 3>One New York Subway Writers says many homeless end up

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<v Speaker 3>on trains. Get these people into proper facilities, not the subway.

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<v Speaker 3>It's dangerous to have actions.

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<v Speaker 5>They could fall in the tracks, tents on the subway

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<v Speaker 5>with traffic rush.

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<v Speaker 9>How is that going to work?

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<v Speaker 3>Mayor electmam Donne sparked some controversy after his comments last

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<v Speaker 3>week saying that he would stop the NYPD from cracking

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<v Speaker 3>down on homeless encampments. A suspect is in constaday after

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<v Speaker 3>his shooting at Kentucky State University in Frankfort. Police say

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<v Speaker 3>Jacob Lee Bard of Evansville, Indiana is not a student

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<v Speaker 3>if already say Barred allegedly shot two students near a

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<v Speaker 3>residence hall. Scott Tracy is the assistant chief of the

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<v Speaker 3>Frankfort Police Department.

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<v Speaker 10>They were quickly transported to a local hospital for treatment

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<v Speaker 10>by Frankfort Fire and EMS. Tragically, one has passed away

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<v Speaker 10>from injuries, the other remains in critical condition.

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<v Speaker 3>Assistant Chief Tracy did not release a motive, except to

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<v Speaker 3>say it stemmed from a personal dispute. Global News twenty

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<v Speaker 3>four hours a day and whenever you want it with

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<v Speaker 3>Bloomberg News Now. I'm Michael laarm and this is Bloomberg Karen.

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<v Speaker 5>Thanks Michael.

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<v Speaker 2>Time now for our Bloomberg Sports Update, and for that

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<v Speaker 2>we bring in John stash Hour.

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<v Speaker 11>Thanks Karen Orlando, and the next advance of the semifinals

0:10:17.240 --> 0:10:19.240
<v Speaker 11>of the NBA Cup. The Magic beat the Heat one

0:10:19.320 --> 0:10:21.679
<v Speaker 11>seventeen one oh eight. The Knicks one in Toronto won

0:10:21.760 --> 0:10:24.160
<v Speaker 11>seventeen one oh one. Jalen Brunton scare thirty five e

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<v Speaker 11>at twenty in the first quarter. Two big news items

0:10:27.120 --> 0:10:29.760
<v Speaker 11>for the baseball winner Meetium is Kyle Schwarber is staying

0:10:29.760 --> 0:10:31.640
<v Speaker 11>with the Phillies a five year deal for one hundred

0:10:31.679 --> 0:10:34.000
<v Speaker 11>and fifty million. It hit fifty six on ONNS last season,

0:10:34.320 --> 0:10:37.400
<v Speaker 11>and closer Edwin Diaz leaving the Mets to sign with

0:10:37.440 --> 0:10:40.360
<v Speaker 11>the world champion Dodgers. Forty four year old Philip Rivers

0:10:40.520 --> 0:10:42.959
<v Speaker 11>coming out of retirement to sign with the Colts. That's

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<v Speaker 11>to Bloomberg Sports Update.

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<v Speaker 2>Stay with us more from Bloomberg day Break coming up

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<v Speaker 2>after this.

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<v Speaker 1>Coast to coast on Bloomberg Radio, nationwide on Sirius XM,

0:10:57.800 --> 0:11:00.520
<v Speaker 1>and around the world on Bloomberg dot Com, home and

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<v Speaker 1>the Bloomberg Business app. This is Bloomberg day Break.

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<v Speaker 4>Good morning, I'm Nathan Hager on the morning before the

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<v Speaker 4>final Federal reserve rate decision of twenty twenty five. Last

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<v Speaker 4>time we heard from FED Chair J Powell at the

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<v Speaker 4>October meeting, he was already talking about December. A further

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<v Speaker 4>reduction in the policy rate at the December meeting is

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<v Speaker 4>not a foregone conclusion.

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<v Speaker 8>Far from it.

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<v Speaker 4>Fast forward to today, markets do seem to think a

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<v Speaker 4>cut is a foregone conclusion. The question now is what next?

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<v Speaker 4>Joining us for more on this Bloomberg Markets reporter Valerie Titel,

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<v Speaker 4>And that really is the question, isn't at Valerie? So

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<v Speaker 4>many diverging views on what the Fed should be doing

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<v Speaker 4>into twenty twenty six.

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<v Speaker 12>Good morning, Yeah, Good morning, Nathan, And just how will

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<v Speaker 12>Powell do. How will he succeed on managing a consensus

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<v Speaker 12>along this fractured committee. It is an unusually divided Fed

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<v Speaker 12>that we have at the moment. We have Stephen Myron

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<v Speaker 12>on one side clamoring for a faster pace of rate

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<v Speaker 12>cuts likely to dissent a larger jumbo fifty basis point

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<v Speaker 12>rate reduction today, and then on the more hawkish side,

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<v Speaker 12>we've had many regional FED presidents five in total who

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<v Speaker 12>have voiced some unnies about eight cutting rates here in December,

0:12:13.480 --> 0:12:16.520
<v Speaker 12>so we could be up for many of descents if

0:12:16.520 --> 0:12:19.040
<v Speaker 12>we get more than four, Nathan. That's something we've really

0:12:19.080 --> 0:12:22.120
<v Speaker 12>not seen in modern FED history. But Powell has done

0:12:22.400 --> 0:12:24.920
<v Speaker 12>a very good job as his tenure of FED chair

0:12:25.280 --> 0:12:28.679
<v Speaker 12>at managing a consensus, but today he'll really be put

0:12:28.720 --> 0:12:31.400
<v Speaker 12>to the test on that. To add to all of this,

0:12:31.520 --> 0:12:34.160
<v Speaker 12>there is still the division that has been exacerbated by

0:12:34.160 --> 0:12:37.720
<v Speaker 12>the lack of fresh economic data. The market and the

0:12:37.760 --> 0:12:41.960
<v Speaker 12>FED is still waiting for November CPI November non farm payrolls.

0:12:42.000 --> 0:12:44.079
<v Speaker 12>Really the last big set of data that they have

0:12:44.600 --> 0:12:47.319
<v Speaker 12>is all the way back in September before the government

0:12:47.320 --> 0:12:50.880
<v Speaker 12>shut down. So just how will he manage a consensus

0:12:50.920 --> 0:12:53.240
<v Speaker 12>around the fact that we are still in a data

0:12:53.280 --> 0:12:55.920
<v Speaker 12>fog that is unlikely to clear for another two weeks.

0:12:56.160 --> 0:12:58.840
<v Speaker 4>So then what kind of message can we expect from

0:12:58.960 --> 0:13:02.000
<v Speaker 4>Chairman Powell when it signaling what the path for policy

0:13:02.000 --> 0:13:04.839
<v Speaker 4>could be into next year given that kind of fog.

0:13:05.400 --> 0:13:07.480
<v Speaker 12>So I think the market is expecting him to sound

0:13:07.760 --> 0:13:10.600
<v Speaker 12>a little bit hawkish on next year. And the way

0:13:10.640 --> 0:13:12.920
<v Speaker 12>he could possibly do that in a very subtle way,

0:13:13.040 --> 0:13:16.800
<v Speaker 12>Nathan is by saying that, look, the last two FED

0:13:16.840 --> 0:13:20.600
<v Speaker 12>cuts were a risk management exercise, and now that risk

0:13:20.679 --> 0:13:23.640
<v Speaker 12>management exercise is coming to an end and we should

0:13:23.679 --> 0:13:25.760
<v Speaker 12>slow down our pace of rate cuts. He very much

0:13:25.800 --> 0:13:28.640
<v Speaker 12>framed the last two cuts in that way. It was

0:13:28.679 --> 0:13:32.720
<v Speaker 12>a risk management exercise to protect the labor market aside

0:13:32.840 --> 0:13:36.440
<v Speaker 12>from inflation being above target at that time. Perhaps he

0:13:36.480 --> 0:13:38.880
<v Speaker 12>will say that, you know, the risks to labor market

0:13:38.880 --> 0:13:41.160
<v Speaker 12>and the risk to inflation are more balanced at this decision,

0:13:41.440 --> 0:13:43.200
<v Speaker 12>and we need to slow down and wait for further

0:13:43.280 --> 0:13:45.400
<v Speaker 12>clarity on the data. That could be kind of a

0:13:45.480 --> 0:13:49.160
<v Speaker 12>hawkish hint to the market. But note, Nathan, the market

0:13:49.200 --> 0:13:52.000
<v Speaker 12>is already really they've already really priced in a more

0:13:52.000 --> 0:13:55.800
<v Speaker 12>hawkish FED today. If we look at how the money

0:13:55.840 --> 0:13:59.400
<v Speaker 12>markets are pricing in rate cuts for twenty twenty six.

0:14:00.120 --> 0:14:02.120
<v Speaker 12>Heard it back by quite a lot in the month

0:14:02.120 --> 0:14:05.520
<v Speaker 12>of December. We're only pricing in fifty basis points of

0:14:05.600 --> 0:14:08.720
<v Speaker 12>rate reductions in twenty twenty six. At the beginning of

0:14:08.760 --> 0:14:11.800
<v Speaker 12>December that number was closer to eighty basis points. We

0:14:11.840 --> 0:14:14.480
<v Speaker 12>have seen a decent pairback in what traders thinks the

0:14:14.520 --> 0:14:15.439
<v Speaker 12>Fed will do next year.

0:14:16.760 --> 0:14:19.720
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<v Speaker 4>And I'm Nathan Hager. Join us again tomorrow morning for

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<v Speaker 3>Dabraey