WEBVTT - Bloomberg Daybreak: November 10, 2022 - Hour 2 (Radio) 0:00:02.400 --> 0:00:05.880 Live from the Bloomberg Interactive Brooker Studios. This is Bloomberg 0:00:05.960 --> 0:00:10.680 Daybreak for Thursday, November two. Coming up this shower investors 0:00:10.720 --> 0:00:14.200 price for this morning's inflation report, The Justice Department looks 0:00:14.200 --> 0:00:17.599 into the turmoil surrounding the crypto exchange f t X. 0:00:17.880 --> 0:00:21.000 Control of the Senate comes down to three states, and 0:00:21.120 --> 0:00:24.960 Elon must tells Twitter workers to prepare for difficult times ahead. 0:00:25.239 --> 0:00:28.480 Hurricane Nicole as at the east coast of Florida. Plus 0:00:28.520 --> 0:00:31.160 the U says about a hundred thousand Russian soldiers have 0:00:31.240 --> 0:00:34.240 been killed in Ukraine. I'm Michael Barr more a half. 0:00:34.280 --> 0:00:36.880 I'm on Stash Shower and Sports than Nets. After naming 0:00:36.920 --> 0:00:40.520 shop Vader Permanent coach blew out, the next local hockey 0:00:40.560 --> 0:00:44.800 teams all played tonight. That's all straight Ahead on Bloomberg 0:00:44.880 --> 0:00:50.000 Daybreak on Bloomberg Eliving, Freeo, New York, Bloomberg one, Washington, 0:00:50.120 --> 0:00:53.640 d C, Bloomberg one oh six one, Boston, Bloomberg nine, 0:00:53.760 --> 0:00:58.240 San Francisco, Sirius x M one nineteen and around the 0:00:58.280 --> 0:01:01.640 world on Bloomberg Radio Dot Come and via the Bloomberg 0:01:01.680 --> 0:01:10.160 Business at Good Morning. I'm Nathan Hagar and I'm Karen Moscow, 0:01:10.280 --> 0:01:12.600 US not Getnecks future is on the rise this morning. 0:01:12.600 --> 0:01:14.400 We're coming up to six oh one on Well Street, 0:01:14.400 --> 0:01:16.480 and we check the markets every fifteen minutes throughout the 0:01:16.520 --> 0:01:20.279 trading day. On bloomberg SMP futures up, Abody points, Stout 0:01:20.319 --> 0:01:23.520 futures at forty two, Nastack futures at thirty two, and 0:01:23.560 --> 0:01:26.240 a ten year treasury down four thirty seconds. He held 0:01:26.280 --> 0:01:28.759 four point one zero percent. They yield on the two 0:01:28.840 --> 0:01:32.160 year four point six one per cent. Nathan Karen us 0:01:32.240 --> 0:01:36.240 futures are gaining after yesterday's sell off. Several factors contributed 0:01:36.280 --> 0:01:39.680 to the losses, including weak earnings from Disney, a crypto meltdown, 0:01:40.080 --> 0:01:43.080 and Republicans failing to sweep the mid terms. Jimmy Lee, 0:01:43.120 --> 0:01:46.560 as CEO at Wealth Consulting Group, the selloff that we're 0:01:46.560 --> 0:01:49.280 getting from the mid terms I think creates more opportunity. 0:01:49.520 --> 0:01:51.160 I mean, the bottom line is we're gonna get gridlock 0:01:51.240 --> 0:01:53.120 for another couple of years, which is what we knew 0:01:53.160 --> 0:01:56.360 was going to happen anyways, and so I don't think 0:01:56.360 --> 0:02:00.400 it changes a ton of different things in terms of, 0:02:01.080 --> 0:02:03.560 you know, what legislation would have been or wouldn't have 0:02:03.560 --> 0:02:05.320 been over the next two years, and I think the 0:02:05.360 --> 0:02:08.320 focus will be then on the presidential election. Wealth consulting groups. 0:02:08.360 --> 0:02:10.880 Jimmy Lee says he's still optimistic the Fed delivers a 0:02:11.000 --> 0:02:15.400 soft landing for the economy. Meantime, Nathan cryptocurrencies are bouncing 0:02:15.400 --> 0:02:18.320 back a bit this morning. Right now, Bitcoin is up 0:02:18.480 --> 0:02:21.959 more than three percent at sixteen thousand, two hundred sixty dollars. 0:02:22.160 --> 0:02:24.840 The digital currency hit the lowest levels in two years 0:02:24.880 --> 0:02:27.440 after Binance walked away from its plan takeover of f 0:02:27.560 --> 0:02:30.880 t x dot Com. Now the Justice Department is investigating 0:02:30.919 --> 0:02:34.520 turmoil at ft X. Bloomberg's Doug Krisner has the story 0:02:35.040 --> 0:02:38.079 a liquidity crisis has pushed f t X to the brink. 0:02:38.240 --> 0:02:41.680 The firm's founder and CEO, Sam Bankman Freed told investors 0:02:41.840 --> 0:02:44.519 without a cash injection, the company would need to file 0:02:44.560 --> 0:02:47.920 for bankruptcy. Our sources say he said the short follows 0:02:48.000 --> 0:02:51.120 up to eight billion dollars and f t X needs 0:02:51.120 --> 0:02:54.320 four billion to remain solvent. And now we're told officials 0:02:54.320 --> 0:02:56.480 from the d o J are working with attorneys at 0:02:56.480 --> 0:03:01.240 the SEC in investigating. Regulators are already investigating whether ft 0:03:01.480 --> 0:03:04.799 X mishandled customer funds, and they're looking into the firm's 0:03:04.840 --> 0:03:08.840 relationships with other parts of bank Man Freed's crypto empire 0:03:09.240 --> 0:03:12.120 in New York. I'm Doug Prisoner Bloomberg Daybreak. All right, Doug. Thanks. 0:03:12.160 --> 0:03:14.840 Investors and officials are calling for tighter regulation of the 0:03:14.840 --> 0:03:18.040 crypto markets, especially after this recent meltdown. We caught up 0:03:18.040 --> 0:03:21.520 with the Commissioner of the Commodity Futures Trading Commission, Caroline Fam, 0:03:21.760 --> 0:03:24.000 and many people are saying, is this a Lehman moment? 0:03:24.000 --> 0:03:26.440 Are we looking at two thousand and eight? And frankly, 0:03:26.480 --> 0:03:28.200 that was one of the things that happened after two 0:03:28.200 --> 0:03:31.320 thousand and eight was that through strong regulation and through 0:03:31.360 --> 0:03:34.720 strong risk management, firms had to rebuild that kind of trust. 0:03:34.800 --> 0:03:36.840 And so I think that's something that the crypto sector 0:03:36.920 --> 0:03:37.960 is going to have to look at. It's going to 0:03:38.000 --> 0:03:40.280 have to figure out how to tackle that. CFTC Commissioner 0:03:40.360 --> 0:03:42.800 Caroline Fam says there needs to be strong standards to 0:03:42.800 --> 0:03:46.200 prevent crypto contagion hitting the broader financial system. Well, the 0:03:46.280 --> 0:03:48.440 drama at ft X could drive bit going down to 0:03:48.520 --> 0:03:51.640 thirteen thousand dollars nathan As. According to strategists at JP 0:03:51.760 --> 0:03:54.840 Morgan Chase, they say the entire crypto market faces a 0:03:54.920 --> 0:03:58.800 cascade of margin calls and weeks of deleveraging up next year, 0:03:58.840 --> 0:04:03.000 and attention this morning turns to inflation. The widely anticipated 0:04:03.000 --> 0:04:05.640 Consumer Price in next for October comes out at eight 0:04:05.680 --> 0:04:08.120 thirty a m. Wall Street Time. Let's get a preview 0:04:08.120 --> 0:04:11.440 from Bloomberg's Michael McKee. The inflation battle isn't going to 0:04:11.480 --> 0:04:14.000 be one quickly, but the Fed is looking for little 0:04:14.080 --> 0:04:17.719 victories today. Supply chains are normalizing and the increase in 0:04:17.800 --> 0:04:22.039 goods prices has been leveling off. Apparel prices, used cars, 0:04:22.240 --> 0:04:27.200 some construction materials should see relatively smaller moves. Services is 0:04:27.240 --> 0:04:30.760 the real question a statistical quirk, and the fading pandemic 0:04:30.800 --> 0:04:34.480 should mean big drops for healthcare costs, but it takes 0:04:34.480 --> 0:04:37.080 time for rent and home prices to fade. In the CPI, 0:04:37.400 --> 0:04:40.360 they will continue to increase and keep the core elevated. 0:04:40.760 --> 0:04:43.760 As for the headline figures, we know gasoline and food 0:04:43.800 --> 0:04:46.159 have gone up, so Wall Street and the Fed will 0:04:46.240 --> 0:04:50.640 largely discount those. Michael McKee, Bloomberg Daybreak. All right, Michael, 0:04:50.680 --> 0:04:52.800 thank you. The fan will be paying close attention to 0:04:52.839 --> 0:04:56.359 that inflation report. But Minneapolis Spent President Neil Cash Cary 0:04:56.480 --> 0:04:59.960 says calls for a pivot and policy right now are misplayed. 0:05:00.440 --> 0:05:03.640 We are a long, long, long way away from that 0:05:03.839 --> 0:05:06.240 right now, so that's why any talk of a pivot 0:05:06.320 --> 0:05:09.680 is entirely premature right now. Minneapolis Fed President Neil cash 0:05:09.720 --> 0:05:13.200 Gary says a central bank remains a laser focused on inflation. 0:05:13.360 --> 0:05:15.720 All right, let's pivot to politics now. Karen get the 0:05:15.800 --> 0:05:18.400 latest on the mid terms. Control the Senate now boils 0:05:18.400 --> 0:05:22.359 down to three races in Georgia, Nevada, and Arizona. This 0:05:22.600 --> 0:05:25.240 as President Biden claims the best mid term performance for 0:05:25.240 --> 0:05:28.680 an incumbent president's party in twenty years. Amy Morris has 0:05:28.680 --> 0:05:32.359 details from our Bloomberg newsroom in Washington. Democrats had a 0:05:32.400 --> 0:05:36.040 stronger night than expected, but Republicans are poised to control 0:05:36.120 --> 0:05:39.280 the House. The President acknowledged that voters made it clear 0:05:39.360 --> 0:05:43.839 their concerns about inflation and crime, issues on which Republicans campaigned, 0:05:44.040 --> 0:05:46.920 but he says young people voted in record numbers with 0:05:47.040 --> 0:05:50.240 additional concerns, and they found a clear and unmistakable message 0:05:50.240 --> 0:05:53.880 if they want to preserve our democracy and protect the 0:05:53.960 --> 0:05:57.159 right to choose, Republicans have won two hundred six House seats. 0:05:57.200 --> 0:06:00.320 Democrats hold one eighty three, and it could take days 0:06:00.360 --> 0:06:02.839 to know the balance of power as dozens of close 0:06:02.920 --> 0:06:05.680 races are still being counted. Some could wind up and 0:06:05.760 --> 0:06:09.520 recounts runoffs, or in court. In Washington, I'm Aymy Moore 0:06:09.560 --> 0:06:11.880 as Bloomberg Daybreak, All right, Amy, thank you. When it 0:06:11.880 --> 0:06:14.680 comes to geo politics, US China relations are back on 0:06:14.720 --> 0:06:17.400 the front burner. President Biden said he will aim to 0:06:17.400 --> 0:06:20.160 avoid any concessions to President Shi Jin Ping when they 0:06:20.160 --> 0:06:22.920 meet at the G twenty and Bloomberg said Baxter has 0:06:22.960 --> 0:06:25.520 the story. At his news conference, Biden was asked by 0:06:25.520 --> 0:06:28.839 Bloomberg's Jenny Leonard about his trip to Asia and what 0:06:29.000 --> 0:06:32.640 his stamps will be regarding Taiwan. Taiwan doctrine has not 0:06:32.839 --> 0:06:36.799 changed at all from the very beginning, the very beginning, 0:06:36.880 --> 0:06:39.760 So I'm sure we'll discuss Taiwan. I'm sure we'll discuss 0:06:39.800 --> 0:06:43.359 a number of other issues, including fair trade. Biden repeated 0:06:43.440 --> 0:06:48.040 he wants competition, not conflict. In San Francisco, I'm at 0:06:48.080 --> 0:06:51.280 Baxter Bloomberg Daybreak, and thanks and incorporate news this morning. 0:06:51.320 --> 0:06:54.039 It is all about Twitter again. Elon Musk has emailed 0:06:54.080 --> 0:06:56.200 the company's staff for the first time, telling them to 0:06:56.240 --> 0:06:59.960 prepare for quote difficult times ahead. According to the email 0:07:00.040 --> 0:07:02.800 reviewed by Bloomberg News, Musk says remote work will no 0:07:02.880 --> 0:07:05.600 longer be allowed. Employees will be expected to be in 0:07:05.680 --> 0:07:09.520 the office at least forty hours per week. SMP futures 0:07:09.520 --> 0:07:12.040 are higher now by eight point. Stout futures up forty two. 0:07:12.120 --> 0:07:15.400 Nastack futures a gain of forty points. Straight ahead, your 0:07:15.440 --> 0:07:18.840 latest local headlines and a check of sports. This is 0:07:18.880 --> 0:07:25.320 Bloomberg man. It's now six oh seven on Wall Street 0:07:25.320 --> 0:07:27.640 where at forty degrees in Central parkheaded to the low 0:07:27.720 --> 0:07:30.680 sixties today, still dealing with a crash westbound Jackie Robinson 0:07:30.720 --> 0:07:33.400 Parkway at Metropolitan Avenue. Michael Barr is here with what 0:07:33.440 --> 0:07:35.520 else is going on in New York and around the world. Michael, 0:07:35.560 --> 0:07:37.800 thank you very much. Nathan. It is a rare November 0:07:37.920 --> 0:07:42.360 hurricane for Florida. Hurricane the Coal arrived overnight, slamming Florida's 0:07:42.360 --> 0:07:45.520 East coast with heavy rain and wind gusts topping seventy 0:07:45.520 --> 0:07:50.160 five miles per hour. Homeowners describe their backyards disappearing as 0:07:50.360 --> 0:07:54.480 massive waves lashed the Dayton of Beach area, already battered 0:07:54.520 --> 0:07:57.720 by Hurricane E and six weeks ago, Florida's Governor Rond 0:07:57.720 --> 0:08:01.480 de Santis. There is a lot of acturated ground, and 0:08:01.560 --> 0:08:04.120 that means the trees that normally wouldn't go over in 0:08:04.160 --> 0:08:08.040 a storm like this will likely go over because the 0:08:08.120 --> 0:08:12.280 ground is so wet and saturated. Nicole Now a tropical 0:08:12.320 --> 0:08:15.480 storm has knocked out power to about fifty five people. 0:08:15.960 --> 0:08:19.120 Jury deliberations start today in New York in a civil 0:08:19.200 --> 0:08:23.400 case against filmmaker Paul Haggis is accused of publicist Hailey 0:08:23.480 --> 0:08:27.640 Briest says in she reluctantly agreed to a drink at 0:08:27.640 --> 0:08:31.840 the screenwriter's apartment, then was subjected to unbalcom kisses, forced 0:08:31.840 --> 0:08:36.600 to perform oral sex, and raped as she repeatedly refused. 0:08:36.920 --> 0:08:41.000 Briest's lawyers say that this is a horror film by 0:08:41.040 --> 0:08:45.480 Paul Haggis. Haggis says it was a consensual encounter. General 0:08:45.520 --> 0:08:48.320 Mark Milly, the chairman of the US Joint Chiefs of Staff, 0:08:48.400 --> 0:08:51.360 says that more than one hundred thousand Russians and probably 0:08:51.400 --> 0:08:54.599 forty thousand Ukrainian civilians have been killed or wounded in 0:08:54.640 --> 0:08:58.040 the war. Meanwhile, Russia ordered its troops to withdraw from 0:08:58.040 --> 0:09:01.880 the southern Ukrainian city of Curson after Kievs troops pressed 0:09:01.920 --> 0:09:05.760 forward with a counter offensive. Retired Colonel Jeff mcconslin says 0:09:05.880 --> 0:09:09.200 withdrawal as a major embarrassment to Vladimir Putin. There have 0:09:09.240 --> 0:09:12.000 been reports for an extent period of time the Russian 0:09:12.000 --> 0:09:15.520 military leadership has urged Putin to allow them to withdraw 0:09:15.600 --> 0:09:19.559 in order to avoid a potential military disaster. Intelligence reports 0:09:19.600 --> 0:09:22.880 suggest that Putin has forbidden them to do so, and 0:09:23.000 --> 0:09:25.319 rather order them to defend the city at all costs. 0:09:25.840 --> 0:09:29.600 Retired Colonel mcconslin spoke to CBS at the UN Climate 0:09:29.640 --> 0:09:32.319 Summon in Egypt. The UK's new Prime Minister, Rishi soon 0:09:32.360 --> 0:09:34.960 Act says that the war in Ukraine has shown the 0:09:34.960 --> 0:09:38.559 West that they must turn to new forms of energy Putins, 0:09:38.559 --> 0:09:41.880 a born war in Ukraine and rising energy prices across 0:09:41.920 --> 0:09:45.400 the world are not a reason to go slow on 0:09:45.520 --> 0:09:48.760 climate change. Prime Minister soon Next comments come as President 0:09:48.800 --> 0:09:51.760 Biden will head the cop Global He was twenty four 0:09:51.800 --> 0:09:54.600 hours a day on air and on Bloomberg Quicktake, powered 0:09:54.600 --> 0:09:57.520 by more than twenty seven hundred journalists analysts in more 0:09:57.559 --> 0:09:59.959 than a hundred twenty countries. Michael mar this is bloom 0:10:00.559 --> 0:10:07.120 Thanks Michael almost sixth ten on Wall Street, time for 0:10:07.120 --> 0:10:09.160 the Bloomberg Sports Update, brought to you by try stayed 0:10:09.160 --> 0:10:11.320 out here. Here's John stan Shower. All right, Nathan. After 0:10:11.360 --> 0:10:14.000 the departure of Steve Nash as Nets coach to stop 0:10:14.080 --> 0:10:16.559 assistant Jacque Vaughn took over on an interim base, but 0:10:16.679 --> 0:10:18.520 the team has played well since then on the Nets 0:10:18.679 --> 0:10:22.320 have removed the interim tag. They have signed Vaughan through 0:10:22.400 --> 0:10:24.920 next season. The Nets general manager John marks there's a 0:10:25.000 --> 0:10:28.160 number of factors, you know why j V was the 0:10:28.240 --> 0:10:30.440 right fit. I mean, obviously I've known JV for a 0:10:30.440 --> 0:10:32.600 long time and all of us have. And then he's 0:10:32.600 --> 0:10:34.240 been a part of this culture. He's been a part 0:10:34.280 --> 0:10:38.480 of what we've been building here over the years. UM. 0:10:38.520 --> 0:10:40.800 And we look at the person he is, we look 0:10:40.840 --> 0:10:44.319 at his connection with players. UM. I obviously look at 0:10:44.320 --> 0:10:47.080 what's happened over the last sort of four games and 0:10:47.160 --> 0:10:49.200 make it five because after the announcement came an easy 0:10:49.240 --> 0:10:50.760 win for the Nets in their first meeting of the 0:10:50.800 --> 0:10:53.719 season with the nixt blowout in Brookelyn one twelve to 0:10:53.800 --> 0:10:57.280 eighty five. Kevin Durant twenty nine points, twelve rebounds, twelve. 0:10:57.360 --> 0:11:00.480 That's this stef Curry now healthy, twenty three points in 0:11:00.559 --> 0:11:03.800 twenty three minutes. Julius Randall eleven next with Nick shot. 0:11:05.160 --> 0:11:07.800 They're now five and six the Nets or five and seven. 0:11:07.800 --> 0:11:11.079 Milwaukee is ten and one, double overtime win at Oklahoma 0:11:11.160 --> 0:11:13.040 City and a night where the Bucks didn't use you 0:11:13.160 --> 0:11:15.079 on his son to the compo you talk ten and 0:11:15.240 --> 0:11:17.559 three where the win over Atlanta. The feeling was the 0:11:17.640 --> 0:11:20.120 Jazz we're gonna tank this season. They traded away the 0:11:20.320 --> 0:11:22.800 two best players. Lakers are just two and nine, even 0:11:22.840 --> 0:11:24.880 with Lebron, James still pointed at a high level. They 0:11:24.880 --> 0:11:27.280 lost to the Clippers and Lebron left the game with 0:11:27.360 --> 0:11:29.520 a broin injury. Rangers looked at end a three game 0:11:29.559 --> 0:11:32.079 losing streak that included a home loss to the Red Wings. 0:11:32.080 --> 0:11:35.760 They visit Detroit tonight, the Islanders host Arizona and the 0:11:35.800 --> 0:11:38.199 Devil's host Ottawa. The Devils are going for an eighth 0:11:38.240 --> 0:11:40.439 win in a row. Aaron Judge won the Hank Garon 0:11:40.520 --> 0:11:44.000 Awards for the American League's top offensive player. Judge should 0:11:44.000 --> 0:11:47.560 add the m v P next week. John Stashward Bloomberg Sports, Nathan, 0:11:47.760 --> 0:11:51.480 thank you John. Right now, SNP futures are moving higher 0:11:51.840 --> 0:11:54.760 by nine points South futures of fifty two Nestact futures 0:11:54.760 --> 0:11:58.280 of forty five points October consumer prices add at eight 0:11:58.360 --> 0:12:01.600 thirty Wall Street time. We preview the data for the 0:12:01.679 --> 0:12:07.560 data dependent fed Next with Bloomberg's Michael McKee and Bloomberg 0:12:07.600 --> 0:12:09.480 Sports was brought to you by Audie. Don't let someone 0:12:09.520 --> 0:12:11.720 else drive off in the Autie model you've always wanted. 0:12:11.800 --> 0:12:14.040 Visit your local price state Audie Dealer to get behind 0:12:14.080 --> 0:12:16.640 the wheel of yours today, or visit Audie Offers dot 0:12:16.679 --> 0:12:24.440 com for more information, markets, headlines and breaking news twenty 0:12:24.440 --> 0:12:26.679 four hours a day. At Bloomberg dot com for the the 0:12:26.760 --> 0:12:30.199 Bloomberg Business apt and at Bloomberg Quick Tape. This is 0:12:30.200 --> 0:12:39.800 a Bloomberg Business Flash and I'm Karen Moscow. This update 0:12:39.840 --> 0:12:41.800 is brought to you by B and Y Millon's Perishing 0:12:41.880 --> 0:12:44.920 Learned why the world's most sophisticated wealth management and institutional 0:12:44.960 --> 0:12:48.840 firms rely on Perishing to help them improve profitability, create efficiency, 0:12:49.120 --> 0:12:53.000 attract talent and manage risk. At Pershing dot com, US 0:12:53.080 --> 0:12:56.079 dot Index futures on the rise this morning. Treasuries are 0:12:56.120 --> 0:12:59.920 slipping as investors remain on edge before a report showing 0:13:00.360 --> 0:13:03.720 that could show inflation and the world's largest economy moderated 0:13:03.760 --> 0:13:06.520 for a fourth consecutive month. And we checked the markets 0:13:06.559 --> 0:13:09.320 every fifteen minutes throughout the trading day on Bloomberg Guess 0:13:09.360 --> 0:13:11.360 and p Future is up ten points this morning. Down 0:13:11.400 --> 0:13:14.240 Future is up fifty four nasdack futures up forty six. 0:13:14.559 --> 0:13:17.400 The decks in Germany little change. Ten year treasury down 0:13:17.440 --> 0:13:20.320 four thirty seconds. He had four point one percent yield 0:13:20.320 --> 0:13:23.000 on the two year four point six one percent. Nine 0:13:23.000 --> 0:13:25.319 mex screwed oil is down about nine tenths percent, or 0:13:25.360 --> 0:13:27.520 seventy three cents and eighty five dollars ten cents of 0:13:27.559 --> 0:13:30.360 barrel comexs go down at quarter percent or four dollars 0:13:30.360 --> 0:13:33.520 at seventeen o nine seventy ounce. The euro point nine 0:13:33.600 --> 0:13:36.040 nine four three against the dollar British found one point 0:13:36.040 --> 0:13:38.360 one three eight eight and the yen one forty six 0:13:38.400 --> 0:13:41.800 point four six. And bitcoin is up almost three percent 0:13:41.880 --> 0:13:46.040 at sixteen thousand, eighty dollars. That's a Bloomberg Business flash. 0:13:46.040 --> 0:13:48.200 Now here's Michael Barr with more on what's going on 0:13:48.240 --> 0:13:51.000 around the world. Michael, thank you very much. Karen. Hurricane 0:13:51.080 --> 0:13:54.920 Nicole made landfall early this morning along Florida's east coast, 0:13:55.120 --> 0:13:58.760 just south of Vero Beach Nicole. Now a tropical storm 0:13:58.800 --> 0:14:01.440 battered a large area of the storm we restate with 0:14:01.480 --> 0:14:06.600 strong winds, dangerous storm surges, and heavy rain. President Biden 0:14:06.679 --> 0:14:09.959 says that he expects an official call early next year 0:14:10.520 --> 0:14:12.960 on whether he will seek re election for another four 0:14:13.040 --> 0:14:16.680 year term. Meanwhile, the struggle for control of the U. S. 0:14:16.679 --> 0:14:21.360 Senate boils down to three uncalled races Georgia, Nevada, and Arizona, 0:14:21.600 --> 0:14:24.520 with each party needing to win two of those states 0:14:24.560 --> 0:14:27.640 to secure a majority in the NBA. The nets rolled 0:14:27.680 --> 0:14:30.520 over the next one twelve eighty five, the Celtics one 0:14:30.680 --> 0:14:34.400 in hockey. The Capital's Lost Week ten begins in the NFL. Tonight, 0:14:34.440 --> 0:14:37.480 the Falcons play at the Panthers. Global News twenty four 0:14:37.520 --> 0:14:41.040 hours a day on air and on Bloomberg Quickdake, powered 0:14:41.080 --> 0:14:43.680 by more than twenty seven hundred journalists and analysts more 0:14:43.680 --> 0:14:46.280 than a hundred twenty countries. Michael Barn this is Bloomberg. 0:14:46.360 --> 0:14:48.280 Nathan all right, Michael, thanks for coming up to six 0:14:48.360 --> 0:14:52.080 twenty on Wall Street Live from the Bloomberg Interacted Brokers Studios. 0:14:52.120 --> 0:14:54.560 This is Bloomberg Daybreak, and we're coming up to the 0:14:54.640 --> 0:14:58.240 release of October consumer prices in just about two hours 0:14:58.240 --> 0:15:00.880 and ten minutes time. Out of that, we're joined by 0:15:00.880 --> 0:15:05.080 Bloomberg's Global Economics and Policy correspondent Michael mckeel be breaking 0:15:05.080 --> 0:15:08.600 down those numbers once they hit your Bloomberg terminal. Mike, 0:15:08.600 --> 0:15:11.920 good morning. Looking at the consensus from economists we've surveyed, 0:15:11.960 --> 0:15:14.400 it's gonna be another bump up in the month over 0:15:14.480 --> 0:15:17.360 month number and a tick down for year over year. 0:15:17.400 --> 0:15:21.480 It seems like inflation is taking a good long while 0:15:21.600 --> 0:15:24.720 to get back under control, and it's going to and 0:15:24.800 --> 0:15:27.880 that was expected by the Fed. Uh, it is an 0:15:27.920 --> 0:15:31.640 unusual time. Inflation went up faster than it normally does. 0:15:31.920 --> 0:15:34.440 And I don't know what you called normal anymore since 0:15:34.480 --> 0:15:38.440 it's so low for so long. But the Fed is 0:15:38.480 --> 0:15:41.360 expecting it to be a long term process, which is 0:15:41.400 --> 0:15:44.080 why J. Powell and company have said regularly they're going 0:15:44.120 --> 0:15:47.720 to raise the FED funds right to a restrictive level 0:15:47.720 --> 0:15:49.960 and leave it there for a long time, perhaps a year, 0:15:50.480 --> 0:15:54.600 to try to bring down inflation. Uh. The numbers you 0:15:54.720 --> 0:15:58.080 referenced were the headline, though, and the Fed is not 0:15:58.120 --> 0:16:00.600 really looking at that because the reason it will tick 0:16:00.720 --> 0:16:05.120 up as energy and possibly food and on a month 0:16:05.200 --> 0:16:07.560 to month basis, and and there's nothing that FED can 0:16:07.600 --> 0:16:09.800 do about that. They'll be looking at the core and 0:16:09.840 --> 0:16:12.520 they they've kind of got the opposite situation there where 0:16:12.800 --> 0:16:14.480 it may come in a bit lower on a month 0:16:14.520 --> 0:16:16.560 over month basis, a bit higher on a year over 0:16:16.640 --> 0:16:19.000 year basis, but the point would be more on the 0:16:19.040 --> 0:16:22.320 month to month uh the year over years obviously influenced 0:16:22.320 --> 0:16:25.280 by what happened twelve months ago. Whereas if you start 0:16:25.320 --> 0:16:28.560 to get a sequential decline for a few months in 0:16:28.600 --> 0:16:31.320 the core, then it might suggest that the FED is 0:16:31.360 --> 0:16:34.480 starting to win the battle. But this would be the 0:16:34.520 --> 0:16:38.360 first decline in a couple of months, So if it happens, 0:16:38.400 --> 0:16:42.720 it's only the start, right, And that raises the question 0:16:42.880 --> 0:16:47.200 still about whether the FED starts to slow down on 0:16:47.320 --> 0:16:50.040 interest rate hikes. You mentioned the FED is said that 0:16:50.160 --> 0:16:53.680 it is going to get the terminal rate higher, maybe 0:16:53.800 --> 0:16:57.240 around five or a little bit above five per cent. 0:16:57.600 --> 0:17:00.720 Could we see signs in the core that make the 0:17:00.720 --> 0:17:04.439 case for the FED to think about looking and seeing 0:17:04.440 --> 0:17:08.320 whether the rate hikes have started to have an effect. Well, 0:17:08.359 --> 0:17:11.200 the the thing you want to do is take things 0:17:11.240 --> 0:17:13.840 apart and look at take the take the report apart 0:17:13.880 --> 0:17:17.600 and look at specific categories that might be impacted. We 0:17:17.680 --> 0:17:20.600 know real estate has been hit hard, and real estate 0:17:20.800 --> 0:17:23.000 is an important sector of the economy. It's a third 0:17:23.040 --> 0:17:25.199 of the cp I. It's it's not as big a 0:17:25.280 --> 0:17:28.680 waiting in the pc which is the Fed's target indicator. 0:17:29.080 --> 0:17:33.520 But the FED will want to see if things that 0:17:33.640 --> 0:17:37.280 are influenced by the cost of borrowing have started to 0:17:37.720 --> 0:17:42.600 slow the rate of price increases in those areas. Uh. 0:17:42.640 --> 0:17:45.200 That's that's kind of what they'll be looking for out 0:17:45.200 --> 0:17:48.119 of this report. They have another report before the next meeting. 0:17:48.640 --> 0:17:52.200 They've got the PC index before this meeting, another jobs 0:17:52.200 --> 0:17:56.080 report before this next meeting. So this won't be decisive, 0:17:56.160 --> 0:17:58.240 but it will set the tone in the markets for 0:17:59.080 --> 0:18:02.240 the conversation stions the FED will have over the next 0:18:03.200 --> 0:18:05.600 five six weeks. Yeah, I think you alluded it to 0:18:05.720 --> 0:18:08.520 it somewhat there. I think something else that they're looking 0:18:08.640 --> 0:18:12.000 for is whether we're gonna start to see services inflation 0:18:12.119 --> 0:18:18.040 follow goods lower. That's the question, does services inflation start 0:18:18.119 --> 0:18:23.880 to slow down? Uh? The housing prices UH goes into 0:18:23.920 --> 0:18:27.840 the core um parts of that our services, and that's 0:18:28.359 --> 0:18:31.800 gonna be something to watch UH goods prices have started 0:18:31.840 --> 0:18:35.560 to decline because supply chains have started to normalize, but 0:18:35.640 --> 0:18:40.720 service prices increases have increased, have accelerated in the last 0:18:41.200 --> 0:18:44.320 six months or so. And that's the concern. Is the 0:18:44.400 --> 0:18:48.520 problem for services that they can't find workers, and therefore 0:18:49.040 --> 0:18:50.920 UH they've got to pay up for workers and raise 0:18:51.000 --> 0:18:54.840 their prices to come compensate for that. That's the question 0:18:54.880 --> 0:18:58.000 out there on the services side, and we'll start to 0:18:58.000 --> 0:19:00.640 get a picture of it today, but it's gonna take 0:19:00.680 --> 0:19:03.320 some time for that to level off as well. And 0:19:03.359 --> 0:19:05.840 in our last thirty seconds here, we've heard the FED 0:19:05.920 --> 0:19:11.479 also say that there more likely to go higher on 0:19:11.880 --> 0:19:15.680 rates than than trying to pull back and get into 0:19:15.800 --> 0:19:19.040 a soft landing territory. What could this cp I print 0:19:19.119 --> 0:19:23.879 mean for the more aggressive rate hikes. Probably means more 0:19:24.119 --> 0:19:27.080 for the markets than for the Fed, because they do 0:19:27.119 --> 0:19:29.119 have a number of indicators, as they suggested, that are 0:19:29.160 --> 0:19:32.959 yet to come. UH. Their view at this point seems 0:19:33.000 --> 0:19:36.000 to be that they want to slow down the pace 0:19:36.080 --> 0:19:40.399 of increases, not cut back UH rates, but slow down 0:19:40.440 --> 0:19:43.320 the pace of increases so that they can react more 0:19:43.400 --> 0:19:48.119 quickly if we start to see recessionary signs and so 0:19:49.040 --> 0:19:52.480 unless we get a really outsized number, probably fifty stays 0:19:52.520 --> 0:19:56.000 the basis case. Okay, Mike, thanks as always. Bloomberg's Michael 0:19:56.040 --> 0:19:58.919 McKee can be breaking down October CPI for us and 0:19:59.520 --> 0:20:02.000 just a little more than two hours eight thirty am 0:20:02.080 --> 0:20:08.440 Wall Street Time. This is Bloomberg Bloomberg day Breaks, brought 0:20:08.440 --> 0:20:10.840 to you by Jewish Communal Fund. For fifty years, philanthropists 0:20:10.840 --> 0:20:12.560 at all levels have turned to j c F Stone 0:20:12.560 --> 0:20:15.960 Advice Funds to streamline their charitable giving. Visit j c 0:20:16.200 --> 0:20:24.719 F and Y dot org. Broadcasting live from the Bloomberg 0:20:24.800 --> 0:20:29.280 Interactive Broker Studio in New York, Bloomberg Living Free to Washington, 0:20:29.359 --> 0:20:32.720 d C, Bloomberg ninety nine one to Boston, Bloomberg one 0:20:32.760 --> 0:20:35.879 O six one to San Francisco, Bloomberg nine sixty to 0:20:35.960 --> 0:20:39.600 the country, Sirius XM chto one nineteen and around the globe, 0:20:39.640 --> 0:20:43.280 the Bloomberg Business app and Bloomberg Radio dot Com. This 0:20:43.600 --> 0:20:51.639 is Bloomberg day Break and it's six thirty on Wall Street. 0:20:51.640 --> 0:20:54.720 Good morning. I'm Nathan Hagar and I'm Karen Moscow, and 0:20:54.760 --> 0:20:56.800 we're just about three hours away from the open of 0:20:56.880 --> 0:20:58.800 US trading time. Of the five things that you need 0:20:58.840 --> 0:21:02.000 to notice. Start your day out to you by Interactive Brokers. 0:21:02.040 --> 0:21:04.520 Interactive Broker's clients are an interest of up to three 0:21:04.560 --> 0:21:08.320 point three three on the idle cash and their brokerage accounts. 0:21:08.480 --> 0:21:11.000 Visit i vk are dot com slash interest rates to 0:21:11.080 --> 0:21:14.360 learn more. First, US future is steady this morning after 0:21:14.480 --> 0:21:17.840 yesterday sell off today, wey gear up for October's inflation report. 0:21:18.040 --> 0:21:21.600 Phil Palumbo with Palumbo Wealth Management says, as prices run hot, 0:21:21.800 --> 0:21:24.399 we're still waiting for a market bottom. When will the 0:21:24.440 --> 0:21:26.720 bottom be put in? The Keith answer to that question 0:21:26.800 --> 0:21:29.960 is going to be when the Fed pivots. So inflation 0:21:30.000 --> 0:21:31.639 continues to be a problem, which means if Fed not 0:21:31.680 --> 0:21:33.639 ready to pivot, which means the bottom is not in. 0:21:34.080 --> 0:21:37.600 Philip Palumbo with Palumbo Wealth says investors should not focus 0:21:37.680 --> 0:21:41.320 on when inflation has peaked, but should consider where it settles. Well. 0:21:41.359 --> 0:21:42.960 The Fed is going to be paying close attention to 0:21:43.000 --> 0:21:46.320 that CPI report Karen at eight three am Wall Street Time, 0:21:46.400 --> 0:21:49.520 But Minneapolis Fed President Neil cash Cary says, no matter 0:21:49.560 --> 0:21:52.000 how it shakes out, it is premature to consider a 0:21:52.000 --> 0:21:55.639 pivot in policy. Financial markets seem to believe that inflation 0:21:55.720 --> 0:21:58.840 should fall back down towards our two percent target over 0:21:58.880 --> 0:22:01.359 the next couple of years. I hope they're right. I 0:22:01.440 --> 0:22:02.879 know that we're gonna do what we need to do 0:22:02.920 --> 0:22:06.240 to bring inflation back down. Minneapolis President Neil cash Cary 0:22:06.280 --> 0:22:09.360