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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: We begin with day four of the autoworkers' strike, with

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Speaker 3: no progress to report. This morning, the president of the

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Speaker 3: United Autoworkers Union says he is unmoved by a twenty

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Speaker 3: one percent pay raise offer from Stallantis. Sean Fain spoke

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Speaker 3: with CBS's Margaret Brennan.

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Speaker 4: You know, our demands are just We're asking for our

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Speaker 4: fair share in this economy and the fruits of our labor.

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Speaker 5: So twenty one percent is a no go for you.

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Speaker 6: It's definitely a no go, and we've made that very

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Speaker 6: clear of the companies.

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Speaker 3: Sean Fain made the comments on CBS's Face the Nation,

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Speaker 3: which you can hear every Sunday on Bloomberg Radio.

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Speaker 2: Well Nathan, former Vice president and Republican presidential candidate Mike Pence,

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Speaker 2: is laying the blame for the United auto Workers' strike

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Speaker 2: on President Joe Biden's economic policies. He says a transition

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Speaker 2: to electric vehicles is threatening jobs.

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Speaker 4: What I'm hearing around the country is that that auto

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Speaker 4: workers are very concerned about Joe Biden's Green Nude deal.

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Speaker 4: Heavy handed effort to use taxpayer dollars to drive these

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Speaker 4: automotive companies into electric vehicle production.

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Speaker 2: Mike Pence made the comments in an interview with The

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Speaker 2: Bloomberg's Joe matthew And and Marie hord Dern. Find the full

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Speaker 2: conversation on the Bloombergs Talks podcast, available wherever you download podcasts.

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Speaker 3: Turning to markets, Karen, this is a big week for

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Speaker 3: central bank decisions. The Fed, Bank of England and Bank

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Speaker 3: of Japan all make decisions this week, and we get

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Speaker 3: a Fed preview from Bloomberg's Michael McKay.

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Speaker 6: The Fed has made its meetings more interesting by not

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Speaker 6: telegraphing exactly what it will do this week. Policymakers are

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Speaker 6: forecast to hold the nation's benchmark interest rate in a

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Speaker 6: range between five and a quarter and five and a

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Speaker 6: half percent. They still have one more rate move to

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Speaker 6: go this year, at least according to their own outlook

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Speaker 6: published in June. Does that remain in the so called

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Speaker 6: dot plot and do they adjust their forecasts for growth, inflation,

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Speaker 6: and unemployment. The jobless rate is still well below where

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Speaker 6: they had predicted it would be. While it's unlikely this,

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Speaker 6: central bankers would surprise with the rate move, the adjustments

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Speaker 6: they make to their economic outlook, and what Chairman j

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Speaker 6: poul says about that will matter a lot to investors.

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Speaker 6: Michael McKee, Bloomberg Radio.

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Speaker 2: All right, Mike, thanks, so as we await those policy decisions.

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Speaker 2: Morgan Stanley investors see a tough twenty twenty four on

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Speaker 2: the horizon, the firm's equity strategist Mike Wilson says, after

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Speaker 2: a sharp stock rally this year on the back of

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Speaker 2: resilient economic growth, investors now have a more negative outlook

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Speaker 2: for risk assets in twenty twenty four. Wilson says there's

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Speaker 2: a growing debate among clients about whether a recession has

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Speaker 2: been avoided altogether or if it's just been delayed until

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Speaker 2: next year.

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Speaker 3: In Europe, this morning, shares of Associate General are down

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Speaker 3: seven and a half percent. The French bank strategic plan

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Speaker 3: is disappointing investors. The company's new CEO cut revenue and

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Speaker 3: profitability targets, surprising investors who'd hoped for a boost to

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Speaker 3: the underperforming stock.

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Speaker 2: Well, we turned to politics now, Nathan and House Speaker

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Speaker 2: Kevin McCarthy is proposing a deal to temporarily avert a

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Speaker 2: government shut down. His demands include an eight percent spending

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Speaker 2: cut for domestic agencies and a resumption of border wall construction,

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Speaker 2: as Bloomberg said, Baxter reports, McCarthy says a government shutdown

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Speaker 2: would be a self defeat for Republicans.

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Speaker 7: McCarthy says it would undermine his party's leverage and negotiations

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Speaker 7: over spending cuts sought by his party itself, because.

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Speaker 5: When you shut down, you give all your power to

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Speaker 5: the administration. But how are you going to win your

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Speaker 5: arguments to secure the border if the border agents don't

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Speaker 5: get paid. How are you going to win the arguments

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Speaker 5: to get wokeism out of the Department of Defense if

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Speaker 5: even our own troops won't be being paid.

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Speaker 7: McCarthy on Fox says this week he hopes to get

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Speaker 7: a short term funding bill out of the House the

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Speaker 7: Senate another issue. I'm at Baxter Bloomberg Radio, Okay, ed,

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Speaker 7: thank you.

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Speaker 3: Some scathing words from House Minority Leader Hakim Jeffries. He's

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Speaker 3: blaming Republicans for a possible shutdown and impeachment inquiry against

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Speaker 3: President Joe Biden.

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Speaker 8: House Republicans are in the middle of a civil war.

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Speaker 8: Civil war has the following attributes chaos, dysfunction and extremism.

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Speaker 8: The House Republican civil war is hurting hard working American

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Speaker 8: tax payers.

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Speaker 3: How Democratic leader Hakim Jeffries made those comments on ABC's

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Speaker 3: This Week. You can also catch that program Sundays on

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Speaker 3: Bloomberg Radio.

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Speaker 2: Well Nathan, former President Donald Trump, has given his first

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Speaker 2: interview to a major TV network since leaving office. The

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Speaker 2: runaway front runner for the Republican nomination in twenty twenty four,

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Speaker 2: had a wide ranging conversation with a new moderator of

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Speaker 2: NBC's Meet the Press, Kristin Welker.

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Speaker 9: If you were reelected, would you pardon yourself?

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Speaker 10: I could have pardoned myself.

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Speaker 2: Do you know what?

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Speaker 11: I was given an option to pardon myself.

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Speaker 10: I could have pardoned myself when I left.

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Speaker 2: And the former president also continued to insist that twenty

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Speaker 2: twenty election was rigged and it was his decision to

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Speaker 2: try to overturn it.

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Speaker 3: I watched that election, and I thought the election was

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Speaker 3: over at ten o'clock in the evening.

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Speaker 11: You were listening to your instincts.

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Speaker 10: My instincts are a big part of it. That's been

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Speaker 10: the thing that's gotten me to where I am. Int thanks,

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Speaker 10: but I also listen to people.

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Speaker 2: And you can hear Meet the Press every Sunday at

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Speaker 2: eleven a m. Wall Street Time right here on Bloomberg Radio.

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Speaker 3: Turning to geopolitics, Karen, we may have some progress on

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Speaker 3: US China relations. National Security Advisor Jake Sullivan and Chinese

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Speaker 3: Feign Minister Wangyie have met in Malta. A US official

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Speaker 3: says they discussed a potential leaders meeting and other issues

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Speaker 3: in the relationship. The talks come at a critical time

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Speaker 3: in US China relations. Wang is scheduled to visit Moscow

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Speaker 3: for talks with Russian Foreign Minister Sergei Lavrov this week.

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Speaker 3: Other world leaders are headed to New York for the

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Speaker 3: United Nations General Assembly.

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Speaker 2: Ray Nathan, thank you. It's time now for a look

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Speaker 2: at some of the other stories making news around the world.

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Speaker 2: For that, we're joined by Bloomberg's John Tucker.

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Speaker 1: John, good morning, and good morning to you, Karen.

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Speaker 6: Time and action.

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Speaker 12: World leaders gathering this week in New York for the

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Speaker 12: United Nations General Assembly, and on the streets have been

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Speaker 12: happened before the meeting, seventy five thousand protesters calling for

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Speaker 12: an end to fonsil fuels. They want President Biden to

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Speaker 12: stop approving new oil and gas projects and to declare

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Speaker 12: a climate emergency. Emma Bretta was among the organizers.

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Speaker 2: We're targeting Wyatt because he needs a completely reverse course.

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Speaker 2: He's not even showing up to the Climate official summit,

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Speaker 2: which is completely unacceptable.

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Speaker 12: Ukraine's President Zelenski will be there at the General Assembly

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Speaker 12: meeting Thursday and will address Congress and meet with President Biden.

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Speaker 12: On Friday. Ahead of the meeting of the UN General Assembly,

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Speaker 12: Elon Musk visited the Turkish President Ertawan in New York,

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Speaker 12: spending about forty five minutes discussing artificial intelligence at a

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Speaker 12: potential factory. According to Erduwan's office, he invited Musk to

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Speaker 12: open a Tesla factory in Turkey. A deal broker by

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Speaker 12: the Biden administration the Free Americans and Iran's custody includes

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Speaker 12: unfreezing six billion dollars in Iranian oil revenue and the

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Speaker 12: release of five Iranian nationals in US custody. The exchange

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Speaker 12: has drawn criticism from both parties. On Capitol Hill, the

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Speaker 12: head of the Senate Intelligence Committee, Mark Werner, is expressing

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Speaker 12: concern about what Iran may do with that six billion dollars.

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Speaker 12: He wants more details and the constraints being placed on

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Speaker 12: the money. China's military sent one hundred three warplanes toward

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Speaker 12: Taiwan in a twenty four hour period and what the

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Speaker 12: island's defense ministry calls a recent new high. China, which

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Speaker 12: claims Taiwan as part of its territory, has conducted increasingly

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Speaker 12: large military drills in air and waters around Taiwan. They

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Speaker 12: turned back at the last minute. A two hundred and

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Speaker 12: fifty thousand dollars reward has been offered for the capture

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Speaker 12: the suspects responsible for the deadly ambush of an La

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Speaker 12: County Deputy sheriff of the weekend. He was shot and

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Speaker 12: killed in an apparent ambush at a red light. The

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Speaker 12: La County Sheriff, Robert Lunaz, asking the public for its help.

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Speaker 9: And we need you now more than ever. We come

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Speaker 9: out and help everybody twenty four to seven, and we

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Speaker 9: need you now to help us. We need you to

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Speaker 9: help us capture the coward that committed this murder.

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Speaker 12: Global News twenty four hours, Power Bludd, more than twenty

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Speaker 12: seven other journalist and analysts, and more than one hundred

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Speaker 12: twenty countries. I'm John Tucker. They see is Bloomberg.

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Speaker 2: Karen All right, John, Thank you, and now get the

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Speaker 2: latest news whenever you wanted with the Bloomberg News Now.

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Speaker 2: It's the top stories from our global team of reporters

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Speaker 2: at the click of a button. Get Bloomberg News Now

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Speaker 2: on the Bloomberg Business App, Bloomberg dot com, and anywhere

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Speaker 2: you get your podcasts. Time now for the Bloomberg Sports Update,

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Speaker 2: and here's John stash Hour John Karen's.

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Speaker 10: Some teams off to surprising two and oh starts in

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Speaker 10: the NFL, like the Tampa Bay Buccaneers, who needs Tom

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Speaker 10: Brady Baker Mayfield and the Box Beach Chicago twenty seven

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Speaker 10: to seventeen. Atlanta is two and oh down twelve in

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Speaker 10: the fourth quarter. The Falcons rally the top Green Bay

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Speaker 10: twenty five to twenty four. Even bigger comeback by the Giants,

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Speaker 10: who killed by three touchdowns third quarter at Arizona and

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Speaker 10: one thirty one to twenty eight. They lost last week

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Speaker 10: to Dallas forty to nothing, and the Cowboys beat the

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Speaker 10: Jets thirty to so two wins over the New York

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Speaker 10: teams by combined score of seventy to ten. Last night

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Speaker 10: in New England, Miami won twenty four to seventeen. The

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Speaker 10: Dolphins are two and oh. The Patriots are row and two.

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Speaker 10: Forty nine ers off to a two and oh start.

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Speaker 10: They beat the Rams thirty to twenty three, and the

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Speaker 10: Ravens are two and oh a twenty seven to twenty

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Speaker 10: four win at Cincinnati, Bengals a zero and two in

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Speaker 10: their quarterback Joe Burrow tweaked the CAF injury that bothered

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Speaker 10: him in the preseason baseball. The Orioles tied the game

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Speaker 10: and the ninth and tenth innings and then beat the

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Speaker 10: Rays five to four and eleven. They leaked Tampa by two.

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Speaker 10: In the Al East, both teams of Clint's playoff bers.

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Speaker 10: Nashvill's won and eleven innings in Milwaukee. Red sox fourth

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Speaker 10: straight loss was three two at Toronto, the Giants won

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Speaker 10: a wild win a Colorado eleven to ten. Alabama had

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Speaker 10: a narrow win Saturday at South four after losing to Texas,

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Speaker 10: and the Crimson Tide now out of the top ten

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Speaker 10: in the rankings for the first time since twenty fifteen.

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Speaker 10: They had been in the top ten one hundred and

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Speaker 10: twenty eight.

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Speaker 1: Poles in a row.

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Speaker 10: John Stanshawerd Bloomberg's four.

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Speaker 7: From Coast to Coast from New York to San.

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Speaker 2: Francisco, Boston to Washington, DC.

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Speaker 7: Nationwide on Syrias Exam, the Bloomberg Business app and Bloomberg

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Speaker 7: dot Com. This is Bloomberg Daybreak.

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Speaker 3: Good morning, I'm Nathan Hager. We are getting set for

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Speaker 3: a trading week that will be dominated by central bank decisions,

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Speaker 3: not the least of which is the Federal Reserve coming

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Speaker 3: out with its latest policy decision on Wednesday, before the

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Speaker 3: Bank of England and Bank of Japan follow What is

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Speaker 3: the trajectory for the market before the Fed gives investors

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Speaker 3: its latest signal on the path for interest rates. For more,

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Speaker 3: we're joined by Lori Calvacina, head of US Equity Strategy

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Speaker 3: at RBC Capital Markets. Laurie, great to speak with you,

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Speaker 3: as always. What is going to drive the market reaction

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Speaker 3: when we finally do hear from Jpollin Company on Wednesday?

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Speaker 11: Well, well, thanks for having me as always, and obviously

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Speaker 11: the central banks are the big story of the week,

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Speaker 11: you know. Unfortunately, our race strategy team thinks that this

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Speaker 11: is going to probably be another fairly boring said meeting.

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Speaker 11: They see basically no risk that we're going to get

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Speaker 11: a hike coming up. They don't expect anything particularly interesting

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Speaker 11: coming out of the commentary. They think the FED really

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Speaker 11: likes how the data has been progressing. You know, I

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Speaker 11: think they have talked a little bit about how there

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Speaker 11: might be some focus on the twenty twenty four PC

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Speaker 11: numbers coming up, and that's something you know that markets

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Speaker 11: on the equity side could definitely be paying attention to

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Speaker 11: and digest. But in general, you know, we expect things

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Speaker 11: to sort of soldier on after this meeting.

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Speaker 3: Yeah, it's interesting how the market has managed to soldier

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Speaker 3: on despite the elevated interest rates, the dramatic rise in

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Speaker 3: interest rates we've seen for more than a year now.

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Speaker 3: How do you explain the rally that we've seen despite

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Speaker 3: elevated interest rates.

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Speaker 11: Well, I think the simplest explanation, and I'll be honest

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Speaker 11: with you, this has been coming up a lot in

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Speaker 11: our conversations with client space in the US since June.

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Speaker 11: I'm not sure quite why that it really started then,

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Speaker 11: but in general, we think that companies in particular as

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Speaker 11: well as consumers have really continued to benefit from the

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Speaker 11: era of low interest rates this year. And what I

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Speaker 11: mean by that is, if you look at the mortgage

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Speaker 11: rate or the effective interest rate, on mortgage debt outstanding,

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Speaker 11: so you know, not just where people are getting their

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Speaker 11: rates today, but what they've got locked in based on

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Speaker 11: all the activity of the last few years. It ended

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Speaker 11: two Q about three point six percent. That's really a

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Speaker 11: mind boggling statistic. Think about it from a public company perspective.

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Speaker 11: I've actually crunched the data three different ways for the

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Speaker 11: S and P five hundred to make sure I was

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Speaker 11: getting the right numbers. The lowest number I came up

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Speaker 11: with for two Q was one point seven percent and

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Speaker 11: the highest I came up with was three point one percent,

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Speaker 11: which is looking at a median of the S and P.

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Speaker 11: And we think that's really happened because companies, you know,

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Speaker 11: they sort of listened to investors in recent years and

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Speaker 11: went out and locked in long term debt at low

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Speaker 11: rates and really you know, took down their variable rate

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Speaker 11: dead and short term debt. So the plunchline here is

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Speaker 11: they just really haven't felt the dight of these interest

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Speaker 11: rates yet.

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Speaker 3: That raises the question of whether we're going to start

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Speaker 3: to feel that bite in twenty twenty four. What's your

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Speaker 3: view on that?

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Speaker 11: So you are starting to see both of those statistics

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Speaker 11: I mentioned creep up. I will tell you I wasn't

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Speaker 11: actually at our industrial conference last week, but the reports

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Speaker 11: from the field that I heard were that one of

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Speaker 11: the big topics was deleveraging. It seemed to come up

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Speaker 11: in just about every conference company recap that I read

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Speaker 11: from the team that was on the ground there, And

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Speaker 11: we actually took a look at the statistics around de

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Speaker 11: leveraging and how often companies are mentioning this across not

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Speaker 11: just the S and P or the industrials, but across

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Speaker 11: the whole Russell three thousand and we found it's been

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Speaker 11: quite elevated over the last few years. So I think

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Speaker 11: one of the ways that companies are preparing, you know,

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Speaker 11: for potentially the need to free sentance at higher levels

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Speaker 11: is simply to pay down debt. We know that most

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Speaker 11: S and P companies have average weighted maturities of five

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Speaker 11: years or more. There is a decent amount, you think

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Speaker 11: about twenty five percent have average weighted maturities in the

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Speaker 11: next two to five years. So if the FED does

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Speaker 11: start cutting next year as anticipated, even the debt that

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Speaker 11: does need refinancing is going to get a little bit

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Speaker 11: of relief. So I do think this is you know,

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Speaker 11: kind of a headwind for companies in future years. It's

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Speaker 11: something that seems like it's been very well managed so far.

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Speaker 11: I think companies have enough runway they can manage around it.

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Speaker 11: That doesn't mean that we're not going to see some impacts,

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Speaker 11: but it feels like a headwind as we're ascending a

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Speaker 11: mountain as opposed to a cliff that we're about to

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Speaker 11: fall off of.

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Speaker 3: One thing that we have started to see more of

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Speaker 3: in recent weeks is inflows into US stocks. As we

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Speaker 3: think about where this market could go for the rest

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Speaker 3: of this year, in our last minute, what impact could

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Speaker 3: that have on valuations for the stock market. Is there

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Speaker 3: a risk that the US market starts to get overbought

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Speaker 3: with these inflows coming in.

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Speaker 11: So we've started to see sentiment deteriorate. Whether you're looking

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Speaker 11: at the CFTC data, it's come in just a little

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Speaker 11: bit or the AAII data has come in quite a

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Speaker 11: bit since hitting our peak over the summer. But the

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Speaker 11: enflows are starting to come back, and there's starting to

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Speaker 11: come back to the growth part of the market in

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Speaker 11: a big way. A lot of this is passive driven

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Speaker 11: based on the analysis that we've put together, so it

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Speaker 11: does generate from upside risk heading into the end of

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Speaker 11: the year.

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