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Speaker 1: Good morning.

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Speaker 2: I'm Nathan Hager and I'm Karen Moscow. Here are the

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Speaker 2: stories we're following today.

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Speaker 3: The S and P five hundred begins the day at

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Speaker 3: its highest level since April of twenty twenty two. A

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Speaker 3: slow down in inflation is bolstering speculation the Fed is

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Speaker 3: close to ending raid hikes. The consumer Price index rose

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Speaker 3: three percent in June from a year ago. The core

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Speaker 3: measures at its lowest level since twenty twenty one. Former

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Speaker 3: New York Fed President William Dudley thinks the Fed is

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Speaker 3: almost done.

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Speaker 4: They won't move at the meeting after July. They'll take

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Speaker 4: a break, just like they did this last time, and

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Speaker 4: then we're going to get to November first. What was

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Speaker 4: a long time between now and November first. I can

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Speaker 4: imagine by that point it's possible that they'll see enough

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Speaker 4: news that makes some confident that they've done enough. So

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Speaker 4: I think November rate hike is really up for grabs

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Speaker 4: at this point.

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Speaker 3: Former New York Fed President William Dudley and investors have

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Speaker 3: another inflation report to watch this morning, the Producer Price

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Speaker 3: Index for June.

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Speaker 1: Well, one of j.

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Speaker 2: Powell's harshest critics is calling for the FED to stop

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Speaker 2: raising rates. Nathan. We spoke yesterday after the CPI report

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Speaker 2: with the Massachusetts Democratic Senator Elizabeth Warren.

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Speaker 5: We have great news today that inflation has been cut

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Speaker 5: by two thirds. So my message is take yes for

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Speaker 5: an answer, Chair Pal, and let's stop with the rate increases.

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Speaker 6: Done.

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Speaker 2: And Senator Elizabeth Warren, who once called Powell a quote

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Speaker 2: dangerous man to be running the Fed, made the comments

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Speaker 2: on Bloomberg's balance of power here. More of that conversation

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Speaker 2: a little later in the program.

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Speaker 3: The economy is also in focus overseas. Karen UK's economy

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Speaker 3: shrank less than expected in May. Gross domestic product fell

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Speaker 3: a tenth of one percent after a two tenths percent

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Speaker 3: gain in April.

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Speaker 2: And in Asia, Nathan, China's exports fell for a second

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Speaker 2: straight month in June. Exports decline twelve point four percent

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Speaker 2: in dollar terms from a year earlier, while imports dropped

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Speaker 2: six point eight percent. Exports the US fell almost twenty

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Speaker 2: four percent. It's the eleventh straight month of declines.

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Speaker 3: Well, China's activity online, Karen could be more to more

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Speaker 3: pressure on relations with the US. Sources tell US Commerce

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Speaker 3: Secretary Gina Ramondo's had her emails breached in a hack

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Speaker 3: that came out of China. Amy Morris has the details

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Speaker 3: from our Bloomberg ninety nine one newsroom in Washington.

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Speaker 7: Officials E Commerce and the State Department were attacked. Described

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Speaker 7: as targeted, The hackers were able to remain undetected for

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Speaker 7: a month after gaining access to email data from around

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Speaker 7: twenty five organizations. In mid May, weeks before Secretary of

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Speaker 7: State Anthony Blincoln met with officials in China, Cyber Defense

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Speaker 7: Agency SISA and the FBI issued a joint advisory urging

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Speaker 7: organizations to harden their Microsoft three sixty five cloud environments.

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Speaker 7: A Commerce Department spokesman declined to comment nor confirm the

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Speaker 7: breach of Ramondo's emails, which was reported earlier by The

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Speaker 7: Washington Post In Washington, I Mammy Morris, Bloomberg Daybreak.

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Speaker 2: Amy, thank you. Still the two nations are taking steps

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Speaker 2: to improve relations. Later today in Jakarta, Secretary of State

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Speaker 2: Anthony Blincoln and China's top foreign policy official Wang Yee

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Speaker 2: will hold their second talks in a month.

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Speaker 3: Certain of corporate news Karen now Disney is extending the

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Speaker 3: contract of CEO Bob Iger for another two years to

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Speaker 3: twenty twenty six. Bloomberg's Ed Ludlow has more from sun Valley, Idaho,

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Speaker 3: where Iiger is attending Allen in Companies annual conference.

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Speaker 8: Iiger is the story of the Allen and Co. Conference

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Speaker 8: twenty twenty three. It was interesting because he's here with

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Speaker 8: Josh Tomorrow, who's Disney's parks chief, and Dana Walden, who's

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Speaker 8: the TV chief, and both of those names have been

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Speaker 8: touted as potential CEOs of Disney in the future. The

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Speaker 8: turnaround story at Disney, the focus on cost reduction. Iiger's

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Speaker 8: been at the heart of that, and there's been a

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Speaker 8: lot of discussion about what will happen. Actually in the

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Speaker 8: context of Hulu, Comcast retains a third of it but

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Speaker 8: has the right per the agreement, to require Disney to

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Speaker 8: buy out the rest of the stake. We haven't heard

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Speaker 8: anything about that, but there are a lot of questions

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Speaker 8: that people are asking Disney the main company this year

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Speaker 8: that's in focus. Ed Ludlow from Some Valley, Idaho for

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Speaker 8: Bloomberg News.

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Speaker 2: All right, Ed, thank you well, Bob Iger is staying

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Speaker 2: on the job. Hollywood actors might be about to walk

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Speaker 2: off theirs, the Actors' union contract with movie and TV

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Speaker 2: producers expired last night, now SAG after members will vote

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Speaker 2: later this morning on whether to strike. Hollywood writers have

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Speaker 2: been on the pick and line since May. If the

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Speaker 2: actors joined them, it would be the first industry wide

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Speaker 2: strike in Hollywood since nineteen sixty.

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Speaker 3: Finally, four years after Jeffrey Epstein's death in prison by suicide,

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Speaker 3: legal action against former banking executive Jess Staley is revealing

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Speaker 3: a profound relationship between the pair. Bloomberg's Uwan Pots reports.

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Speaker 9: I miss you. The world is a tough place hanging there.

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Speaker 9: That's what Jess Staley wrote to Jeffrey Epstein in June

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Speaker 9: two thousand and eight, a fortnight after Epstein was jailed

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Speaker 9: and charges of soliciting prostitution from someone under the age

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Speaker 9: of eighteen. A review of thousands of pages of documents

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Speaker 9: and emails suggests the relationship between Epstein and the former

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Speaker 9: JP Morgan executive went far beyond that of banker and clients.

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Speaker 9: It points to regular and repeated contact, including trips to

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Speaker 9: Epstein's properties and sharing tips on how to negotiate multimillion

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Speaker 9: dollar salaries. The findings he also shows Staley wanted to

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Speaker 9: keep Epstein's accounts at JP Morgan when other executives wanted

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Speaker 9: him gone. JP Morgan's top lawyer wrote in twenty eleven

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Speaker 9: that Epstein is not an nonall person in any way

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Speaker 9: he should not be a client. The lawsuit, which alleges

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Speaker 9: JP Morgan knowingly benefited from Epstein's sex trafficking, is scheduled

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Speaker 9: for trial in October in London. I'm Une Potspin, Big.

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Speaker 3: Day Break, thanks you, and in response to that story,

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Speaker 3: as spokeswoman for JP, Morgan told Bloomberg quote, any association

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Speaker 3: with Epstein was a mistaken in hindsight, we regret it,

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Speaker 3: but we did not help him commit his heinous crimes.

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Speaker 3: We would never have continued to do business with him

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Speaker 3: if we believed he was engaged in an ongoing sex

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Speaker 3: trafficking operation.

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Speaker 10: End quote.

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Speaker 3: Jess Staley's previously denied wrongdoing and knowledge of Epstein's sexual crimes.

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Speaker 3: His lawyer declined to comment on this report. This is

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Speaker 3: Bloomberg Time now for a look at some of the

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Speaker 3: other stories making news in New York and around the world,

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Speaker 3: and for that were joined by Bloomberg's Michael bar Good morning.

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Speaker 11: Michael, Good morning. Nathan. President Biden is in Finland, NATO's

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Speaker 11: newest member as he raps up his five day trip

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Speaker 11: to Europe. Biden, while in Lithuania for the NATO summit,

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Speaker 11: says now is the time that allies need to come together.

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Speaker 11: After Russia invaded Ukraine.

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Speaker 6: Today, our lines remains a bulwark of global security instability,

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Speaker 6: as has been for more than seven decades. NATO is stronger,

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Speaker 6: more energized, and yes, more united than ever in its history.

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Speaker 11: Meanwhile, Turkish President race of Tia Bertawan vowed to speed

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Speaker 11: up the ratification of Sweden's membership of NATO when his

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Speaker 11: country's parliament returns from a two month summer recess. Funeral

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Speaker 11: services take place today for one of the two Newark

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Speaker 11: firefighters killed in last week's cargo ship fire at Port Newark.

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Speaker 11: This morning's funeral for Augusto Akabub, who was forty five,

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Speaker 11: will be held at the Cathedral Basilica of the Sacred

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Speaker 11: Heart in Newark. Meanwhile, of viewing will be held at

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Speaker 11: the same church tonight for the other firefighter killed. The

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Speaker 11: funeral for Wayne Brooks Junior, who was forty nine, is tomorrow.

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Speaker 11: Several NATO swept through areas west of Chicago last night.

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Speaker 11: McCook Fire Chief David Delish, we have wires down throughout town.

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Speaker 11: Poll snapped.

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Speaker 1: We lost a couple structures as the roofer's bowling off

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Speaker 1: this building.

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Speaker 11: A tornado touchdown near Chicago's O'Hare International Airport, disrupting hundreds

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Speaker 11: of flights. There were no immediate reports of injuries. After

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Speaker 11: hearings on Capitol Hill, the FBI Agents Association issued a

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Speaker 11: statement in support of Director Christopher Ray, saying despite he

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Speaker 11: did political rhetoric, they will continue to handle themselves with

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Speaker 11: professionalism and integrity. Ray, who was appointed by Donald Trump,

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Speaker 11: test fight on Capitol Hill. He defended his agency against

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Speaker 11: Republican attacks.

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Speaker 12: Today's FBI leaders reflect the best of our organization, an

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Speaker 12: organization that's made up of thirty eight thousand men and

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Speaker 12: women who are patriots, professionals, and dedicated public servants.

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Speaker 11: And that is the real FBI House. Republicans criticized that

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Speaker 11: raise agency targets conservative Americans and was heavy handed in

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Speaker 11: the FBI raid at Trump's mower Lago estate. Global News

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Speaker 11: twenty four hours a day, powered by more than twenty

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Speaker 11: seven hundred journalists and analysts in over one hundred and

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Speaker 11: twenty countries. Michael Barr, This is Bloomberg, Nathan.

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Speaker 3: Thanks Michael, time now for our Bloomberg Sports update here

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Speaker 3: Sean Stshard, Thanks Dathan.

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Speaker 13: Moving closer to that deadline day for Saquon Barkley at

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Speaker 13: the Giants by four o'clock Monday, either Barkley has a

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Speaker 13: new long term deal or he'll be forced to either

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Speaker 13: plan on the franchise tag, make ten million or sit out,

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Speaker 13: and there was an ESPN report that he is considering

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Speaker 13: doing that at least for the start of the season.

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Speaker 13: Barkley said to be looking to make fourteen million a year.

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Speaker 13: That's what running backs Christian McCaffrey and Alvin Kamara earned,

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Speaker 13: but Giants could have concerns with Barkley's injuries. Last season

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Speaker 13: was his first healthy one since he was a rookie.

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Speaker 13: Upset at the Gold Cup Soccer and San Diego US

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Speaker 13: lost in the semifinals to Panama in penalty kicks, earliest

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Speaker 13: US defeat the this event since twenty fifteen. And Wimbledon

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Speaker 13: Women's semifinals. Today, two unseated players meet Alena Svidolina, she's

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Speaker 13: already beaten four previous Grand Slam winners, and Marquete Andrewsova.

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Speaker 13: She's beaten four seeded players she had never before advanced

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Speaker 13: past the second round. Arena Sabolenka, who's from Belarus, was

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Speaker 13: not allowed to play Wimbledon last year. She won the

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Speaker 13: Australian Open earlier. This year, she's only lost one set

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Speaker 13: so far, and today's Sabolenka takes on Tunisia's I'm Jeburg. Yesterday,

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Speaker 13: Carlos Alcaraz advance with Danil Medvedev. He took out the

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Speaker 13: American Chris Eubanks, who had a two set to one lead.

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Speaker 13: When the Yankees return of the field tomorrow at Colorado,

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Speaker 13: they'll have their new hitting coach, Sean Casey.

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Speaker 4: I was a player for twelve years. There's not one

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Speaker 4: moment where you don't think, men, I'd love to be

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Speaker 4: in the pinstripes, like the.

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Speaker 6: History, you know, the story franchise, all the players you

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Speaker 6: know have an opportunity to wear the pinch stripes is

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Speaker 6: just I think it's a dream for any player in

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Speaker 6: this industry.

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Speaker 13: Casey will try and improve the Yankees poultry team batty

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Speaker 13: average of two thirty one. John stash Ellen Bloomberg.

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Speaker 10: Sports from coast to coast, from New York to San Francisco,

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Speaker 10: Boston to Washington, DC, nationwide on siriusxam the Bloomberg Business

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Speaker 10: app in Bloomberg dot com.

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Speaker 3: This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. Elizabeth

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Speaker 3: Warren is making a plea to Powell halt the raid hikes.

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Speaker 3: The Democratic senator from Massachusetts joined our Joe Matthew and

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Speaker 3: Kaylee Lines on Bloomberg's Balance of Power for an exclusive conversation.

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Speaker 3: They covered an array of topics, including the Federal Reserve

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Speaker 3: Chief Jerome Powell, as well as big banks and the

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Speaker 3: Microsoft activision deal. Let's go to part of their conversation.

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Speaker 5: If he stops the extraordinary rate increases that he's been doing,

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Speaker 5: then we will have made it through this. We have

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Speaker 5: great news today that inflation has been caught by two thirds.

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Speaker 5: So my message is take yes for an answer, Chair Pal,

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Speaker 5: and let's stop with the rate increases. Done well well,

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Speaker 5: Senator Warren.

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Speaker 14: Of course, monetary policy is only one responsibility of the

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Speaker 14: federalers or the other is supervision. I know an issue

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Speaker 14: very near and dear to your art, especially in light

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Speaker 14: of the bank failures we have seen this year. The

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Speaker 14: Vice share of Supervision, Michael Barr, has recently laid out

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Speaker 14: proposals to strengthen capital requirements for the largest banks out there.

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Speaker 14: Most importantly, are you satisfied with his proposal? And do

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Speaker 14: you think he has the authority within the Federal Reserve

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Speaker 14: to see it through?

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Speaker 5: So let me invert those The answer is, he clearly

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Speaker 5: has the authority to be able to put in higher

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Speaker 5: standards and to be able to enforce those higher standards.

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Speaker 5: And the second part is bar is headed in the

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Speaker 5: right direction. Is it enough? No, we still have a

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Speaker 5: lot of problems. We have too much concentration in the

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Speaker 5: banking industry. We have more too big defailed banks than

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Speaker 5: we did back when the economy crashed in two thousand

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Speaker 5: and eight, and the two big defailed banks are bigger

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Speaker 5: than they were back then. So you know, we're not

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Speaker 5: out of the woods yet. But I feel a lot

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Speaker 5: better when I read Michael Barr talking about how we

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Speaker 5: need to tighten down on bank regulation.

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Speaker 15: Go Michael, Senator, you held a hearing on bank insolidation today.

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Speaker 15: Understanding your concerns about the big banks, as you just mentioned,

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Speaker 15: too big to fail? How about small and medium sized banks?

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Speaker 15: Should they be allowed to get married so they can

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Speaker 15: better compete?

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Speaker 5: So the problem that we have faced is of course,

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Speaker 5: more and more concentration at the top, and always keep

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Speaker 5: in mind the implications of that. One is obviously, too

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Speaker 5: big to fail puts our entire economy at risk. But

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Speaker 5: the other half is to remember that it is these

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Speaker 5: small banks that are the ones that actually do the

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Speaker 5: small business lending, and that drives our economy and it

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Speaker 5: also drives employment. That these small businesses are the engine

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Speaker 5: of our economy, and anything that wipes those banks out

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Speaker 5: is bad idea. Finding ways to keep those banks open

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Speaker 5: as independent or allied banks, I'm in favor of that.

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Speaker 5: But the problem we've got is the big banks are

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Speaker 5: the ones who come in snap up the little banks. Oh,

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Speaker 5: they make a handful of promises about how nothing will change,

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Speaker 5: and then those banks disappear, so that we now end up,

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Speaker 5: for example, in a third of all rural counties in America,

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Speaker 5: there is no small independent bank. There's nobody there who

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Speaker 5: actually understands the local economy and who is willing to

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Speaker 5: get to know the business that wants to borrow that

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Speaker 5: money and sees that as their job in banking. That's

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Speaker 5: not where the giants are. They don't do the small

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Speaker 5: business lending. And that's the concern that I have about concentration.

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Speaker 14: So we know you have concerns about concentration and concerns

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Speaker 14: about some other issues that we do want to get

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Speaker 14: with you. Senator first though, if I could ask you

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Speaker 14: about a hearing you in prior to today. You have

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Speaker 14: some concerns about Senator Tommy Tubberville in the blockade he

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Speaker 14: has put on the promotions of members of the military.

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Speaker 14: Given those concerns about how that affects military readiness in

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Speaker 14: the US military families, what do you think you can

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Speaker 14: do to blunt that impact? What workarounds do you see?

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Speaker 5: So this is the problem we've got right now. You know,

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Speaker 5: I am the chair of the Subcommittee on Personnel on

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Speaker 5: the Senate Armed Services Committee, so I'm there on front

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Speaker 5: lines hearing from the families who now are in a

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Speaker 5: position saying where do we register our kids for school.

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Speaker 5: I've heard from families who say, we've already sold our

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Speaker 5: house because we thought we were moving this summer so

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Speaker 5: that our active duty service member was going to be

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Speaker 5: deployed somewhere else around the country or around the world.

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Speaker 5: Profound impact on families, profound impact on our military readiness.

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Speaker 5: Are former Secretaries of Defense, our current Secretary of Defense.

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Speaker 5: Our former secretaries of Defense who are Republican appointees have

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Speaker 5: all said this undermines military readiness. But here's the problem.

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Speaker 5: The Democrats can't stop Tommy Tuberville from what he's doing.

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Speaker 5: It is the Republicans who need to do this. The

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Speaker 5: Republicans need to say, you are a member of our party,

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Speaker 5: you are putting national security at risk, You are insulting

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Speaker 5: and undermining military families in this country. Cut it out,

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Speaker 5: because that's the only way we can unlock this hold

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Speaker 5: and actually move through what is now literally hundreds of

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Speaker 5: military promotions and assignments that are just dead in the

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Speaker 5: water at this point.

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Speaker 15: Yeah, we'd like to stay in touch with you on

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Speaker 15: that story, Senator, with regard to your committee position, it's

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Speaker 15: important to us and our viewers and listeners. I do

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Speaker 15: want to ask you about something and some news that

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Speaker 15: you and your colleagues are making today, releasing a report

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Speaker 15: and calling on federal officials to investigate tech giants and

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Speaker 15: namely Meta, the company behind Facebook, for somehow colluding. Maybe

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Speaker 15: you can be more specific than I with the major

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Speaker 15: tax preparers like H and R Block taking millions of

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Speaker 15: people's personal and private information and giving it to Facebook,

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Speaker 15: presumably to sell ads. If this is true, Senator, this

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Speaker 15: is outrageous. Who's going to go to jail for this?

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Speaker 5: So you ask exactly the right question. People went to

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Speaker 5: tax preparers and, by the way, paid them to prepare

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Speaker 5: their taxes, and then it turns around that the tax

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Speaker 5: preparers gave access to all of this private information about

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Speaker 5: names and dependents and whether or not you had medical expenses,

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Speaker 5: all kinds of information to companies like Meta. Now we

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Speaker 5: did the independent investigation. I did this with other Senators,

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Speaker 5: and we send it over to the Department of Justice

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Speaker 5: because there's federal law on this that no one is

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Speaker 5: permitted to share tax information without the permission of the taxpayer,

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Speaker 5: and I feel pretty clear that these tax companies did

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Speaker 5: not get that permission. But I want to take this

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Speaker 5: one more turn if I can. These are the same

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Speaker 5: tax preparers who right now are lobbying right here in

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Speaker 5: Washington trying to make sure that the IRS program to

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Speaker 5: permit free filing, to let people just go to the IRS,

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Speaker 5: go to a website, and if you've got pretty simple taxes,

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Speaker 5: fill it out on the website and instantaneously you're done.

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Speaker 5: Letting people do that. The tax preparers are trying to

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Speaker 5: block the irs from doing that. Why because they break

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Speaker 5: in the money every time somebody has to spend two

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Speaker 5: hundred bucks or four hundred bucks or six hundred bucks

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Speaker 5: to get one of them to prepare the taxes. You know,

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Speaker 5: this really is back to that fundamental question whose side

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Speaker 5: is government on and the taxpayers want government on their side.

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Speaker 5: We're trying to get the government on the side of

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Speaker 5: the taxpayers so they can do free filing and not

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Speaker 5: have to worry about these companies that are giving their

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Speaker 5: data a way to outfits like Meta.

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Speaker 14: Well, as we talk about these companies, these large technology companies,

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Speaker 14: other news came this week and that Lina CON's FTC

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Speaker 14: was Delta blow in court on the Microsoft Activision Blizzard deal.

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Speaker 14: Are you concerned, Senator, that the courts are going to

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Speaker 14: steiny the efforts of competition regulators in the US.

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Speaker 1: Look, I think.

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Speaker 5: This is a bad decision. At the end of the day,

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Speaker 5: the judge believed of Meta when they said, you know,

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Speaker 5: we're going to do just fine and made a bunch

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Speaker 5: of promises down the line for what they're going to do.

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Speaker 5: That doesn't change the fact that the merger itself is

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Speaker 5: not legal we have an opinion from the judge. I

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Speaker 5: want to commend the FTC for taking on hard cases,

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Speaker 5: taking on big companies, taking on cases that in the

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Speaker 5: past often.

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Speaker 7: Just slid through.

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Speaker 5: Look at our clear violations of the law. I applaud

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Speaker 5: what the FTC has done, and I say stay after it.

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Speaker 5: Their job is to get out there and enforce the laws.

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Speaker 5: And if sometimes a court just wants to head in

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Speaker 5: a different direction, it doesn't change the fact that the

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Speaker 5: FTC is right to promote competition and to enforce the

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Speaker 5: law as it is written.

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Speaker 4: Well.

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Speaker 15: Lastly, then Senator, maybe we'll take it another step even

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Speaker 15: further from there. As we talk about the idea of

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Speaker 15: tech companies combining, or any companies for that matter, whether

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Speaker 15: it's in the defense space or anywhere else that you

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Speaker 15: have expressed concerns about. Is anyone talking about breaking up

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Speaker 15: big tech if they are also too big to fail,

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Speaker 15: whether it's Google or another company that you might have

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Speaker 15: in mind. We've been down this road before with the

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Speaker 15: aforementioned Microsoft.

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Speaker 5: Yeah, you know, I think that talking about breaking up

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Speaker 5: these companies is right, and particularly breaking off pieces of

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Speaker 5: this company. You know, my favorite example here is Amazon.

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Speaker 5: Look at what Amazon does. It runs the platform on

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Speaker 5: which buyers and sellers come together, collects all that information,

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Speaker 5: and then becomes a competitor on the platform that runs

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Speaker 5: its own Amazon businesses, sometimes under the Amazon label and

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Speaker 5: sometimes under labels that nobody would ever figure out that

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Speaker 5: that's Amazon. To me, it's kind of like you could

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Speaker 5: be an umpire in baseball, or you can have a team,

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Speaker 5: but you don't get to do both at the same time.

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Speaker 5: And so there's an example for me, those two should

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Speaker 5: be broken apart. Concentration in industry after industry after industry

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Speaker 5: is a threat to our economy. It is a threat

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Speaker 5: to innovation and ultimately often leads to price gouging, whether

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Speaker 5: it's consumers or the government. You mentioned the defense industry.

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Speaker 5: Over the space of twenty years in America, we've gone

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Speaker 5: from having fifty five competitors for those defense contracts down

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Speaker 5: to five. And you know what they're looking for, even

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Speaker 5: more consolidation. When a little business starts up, they do

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Speaker 5: one of two things. They either smash it or they

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Speaker 5: buy it up and put it into one of the

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Speaker 5: big ones. And that's how it is that the United

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Speaker 5: States government ends up paying three hundred and eighty five

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Speaker 5: dollars for some valve that costs fifteen dollars off the shelf.

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Speaker 5: We pay, and we pay through the nose. For concentration

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Speaker 5: in the defense industry, in the banking industry, in big tech,

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Speaker 5: in big pharma, and seeing the FTC, the DOJ Antitrust Division,

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Speaker 5: and what we should be doing here in Congress is

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Speaker 5: promoting competition. I believe in markets. I believe in the

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Speaker 5: power of markets, but they only work if we enforce

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Speaker 5: the rules that cape competitors going rather than monopolists.

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