WEBVTT - Bloomberg Daybreak: September 29, 2022 - Hour 1 (Radio) 0:00:01.120 --> 0:00:04.439 Fly from the Bloomberg Interactive Burger Studios. This is Bloomberg 0:00:04.519 --> 0:00:07.920 day Break for Thursday, September twenty nine two. Coming up 0:00:07.920 --> 0:00:11.119 this hour, Hurricane Ian rips across Florida as one of 0:00:11.119 --> 0:00:13.760 the strongest storms ever to hit the US mainland. The 0:00:13.800 --> 0:00:16.360 Pound resumes its fall as the UK holds firm on 0:00:16.400 --> 0:00:20.320 its fiscal plans, US future slide. Treasury yields rise following 0:00:20.400 --> 0:00:23.640 yesterday's Wall Street rally, and thousands of Amazon workers are 0:00:23.720 --> 0:00:26.560 getting races. The New York City Council is deciding whether 0:00:26.600 --> 0:00:29.920 the bands solitary confinement in jails. Plus, the US Senate 0:00:30.240 --> 0:00:32.040 is ready to pass the bill that will keep the 0:00:32.080 --> 0:00:35.320 government open. I'm Michael barn More Ahead, I'm John Stash 0:00:35.320 --> 0:00:38.280 Hour and sports Aaron Judge hit his record time sixty 0:00:38.400 --> 0:00:41.279 first abroad and Yankee went in Toronto, a big comeback 0:00:41.320 --> 0:00:46.480 win for the men. That's all trendy Ahead on Bloomberg 0:00:46.560 --> 0:00:50.080 Daybreak on Bloomberg E Live in Treo, New York, Bloomberg 0:00:50.800 --> 0:00:54.160 on Washington, d C, Bloomberg one oh six one, Boston, 0:00:54.480 --> 0:00:59.200 Bloomberg nine sixties and Francisco Syrius XM one nineteen and 0:00:59.280 --> 0:01:02.080 around the World Old on Bloomberg Radio dot Com and 0:01:02.200 --> 0:01:09.200 via the Bloomberg Business. Good morning, I'm Nathan Hagar and 0:01:09.240 --> 0:01:13.039 I'm pared Moscow. US Dock Index futures are lower this morning. 0:01:13.080 --> 0:01:15.039 We are coming up to five o one on Wall Street, 0:01:15.080 --> 0:01:17.200 and we checked the markets every fifteen minutes throughout the 0:01:17.200 --> 0:01:21.039 trading day. On Bloomberg. SNP futures down forty four points 0:01:21.040 --> 0:01:23.760 this morning, Down futures down three hundred twenty six and 0:01:23.880 --> 0:01:27.160 Nastack future is following one hundred sixty two decks in 0:01:27.240 --> 0:01:30.720 Germany's down one point seven percent. Ten year treasury down 0:01:31.240 --> 0:01:33.920 thirty seconds, yell three point eight four percent, and they 0:01:34.000 --> 0:01:36.800 yield on the two year four point two zero percent. Nathan, 0:01:36.920 --> 0:01:38.360 all right, Karen, we'll have one of the markets in 0:01:38.440 --> 0:01:39.840 a minute, but we want to get you the latest 0:01:39.880 --> 0:01:43.120 on Hurricane Ian. First, it crashed into Florida yesterday, bringing 0:01:43.280 --> 0:01:45.840 massive storm search and knocking out power to more than 0:01:45.920 --> 0:01:49.600 two million homes and businesses. President Biden says the federal 0:01:49.680 --> 0:01:53.400 government stands ready to help. That includes dis fashion hundreds 0:01:53.440 --> 0:01:57.520 of female personnel and activating thousands of National Guard members. 0:01:58.200 --> 0:02:00.840 I've also developed the searching risk the team and deploy 0:02:01.000 --> 0:02:04.560 them Mulbible federalisy season, and then they're already on the 0:02:04.600 --> 0:02:07.240 ground and ready to hillp President Biden is also urging 0:02:07.280 --> 0:02:10.760 Florida residents to follow all mornings from local officials. Ian 0:02:10.880 --> 0:02:13.639 has weakened since it hit landed is now a tropical 0:02:13.760 --> 0:02:16.800 storm with top wind speeds currently around sixty five miles 0:02:16.840 --> 0:02:18.959 per hour. Let's get more on the track now with 0:02:19.080 --> 0:02:22.840 Bloomberg meteorologist Robed Caroline, Nathan Karen and Ian now affecting 0:02:22.919 --> 0:02:25.959 central and northeastern Florida. It is moving off towards the 0:02:26.040 --> 0:02:27.960 north and east. This morning. It will bring wind gus 0:02:28.080 --> 0:02:31.800 over sixty miles an hour two portions of northeastern Florida. Now, 0:02:31.880 --> 0:02:34.160 the system is forecast to move out over the waters 0:02:34.200 --> 0:02:36.920 of the Atlantic and it may actually regain some strength 0:02:37.240 --> 0:02:40.639 before moving back inland over Georgia and the Carolinas in 0:02:40.720 --> 0:02:43.639 the next thirty six hours. Again, it continues to produce 0:02:43.680 --> 0:02:46.880 prodigious rainfall. We're expect anywhere from five to ten inches 0:02:46.880 --> 0:02:50.160 of rain north of the storm today, with additional rainfall 0:02:50.200 --> 0:02:53.600 into the weekend. Yesterday, it went ashore in southwestern Florida 0:02:53.680 --> 0:02:56.000 with winds of over a hundred and fifty miles an 0:02:56.040 --> 0:02:58.800 hour and a storm surge that costs some historic flooding 0:02:58.800 --> 0:03:01.239 in the Naples area. Also are around Fort Myers, Fort 0:03:01.320 --> 0:03:04.640 Myers Beach, Vanita Beach, all those areas for a significant flooding. 0:03:05.000 --> 0:03:07.079 Nathan and Karen, All right, grab, thank you, and of 0:03:07.160 --> 0:03:10.400 course I'll be checking in with Bloomberg meteorologists Robbed Caroline 0:03:10.440 --> 0:03:13.080 throughout the morning right here on Bloomberg Radio. And now 0:03:13.120 --> 0:03:15.880 back to the volatile markets. We're seeing the pound snap 0:03:16.000 --> 0:03:18.960 a two day gain following that historic bond buying program 0:03:19.000 --> 0:03:21.000 from the Bank of England. They get the very latest 0:03:21.080 --> 0:03:24.000 live from London with the Bloomberg's hun parts. Good morning, En, 0:03:24.320 --> 0:03:27.399 Good morning Karen, Nathan. After yesterday's central bank driven rally, 0:03:27.520 --> 0:03:31.400 UK stock, sovereign bonds and the pounds all lower this morning. 0:03:31.880 --> 0:03:36.640 Prominister Liz Trust today defending her government's huge fiscal stimulus package, 0:03:36.920 --> 0:03:40.480 blaming global economic pressures for the market fallout from her 0:03:40.520 --> 0:03:43.680 announcement last week. She says the tax cuts, the biggest 0:03:43.800 --> 0:03:47.040 in fifty years, are the right plan for the UK. 0:03:47.680 --> 0:03:50.080 Today's slide puts the pounds on track for its worst 0:03:50.160 --> 0:03:52.720 month since Britain voted to leave the European Union more 0:03:52.800 --> 0:03:55.400 than six years ago. In London. I'm you and part 0:03:55.440 --> 0:03:58.520 Sploomboo Daybreak, Are you and thank you? Former US Treasury 0:03:58.600 --> 0:04:01.720 Secretary Larry Summers the weighing in on the turmoil and markets. 0:04:01.960 --> 0:04:04.720 He's welcoming intervention from the Bank of England, but says 0:04:04.760 --> 0:04:07.920 the UK is still facing serious issues. I think it 0:04:08.040 --> 0:04:11.360 was the right thing to do given the technical factors 0:04:11.480 --> 0:04:15.400 that are that had arisen UH in the market, and 0:04:15.480 --> 0:04:20.320 it's obviously brought some important stability to the guilt market. 0:04:21.080 --> 0:04:26.680 It does not resolve any of the fundamental contradictions in 0:04:27.279 --> 0:04:31.560 UH British policy. Former Treasury Secretary Larry Summer spoke with 0:04:31.600 --> 0:04:35.120 Bloomberg hours after the Bank of England pledged unlimited purchases 0:04:35.160 --> 0:04:38.160 of long dated government bonds. Well, Nathan back here in 0:04:38.200 --> 0:04:40.719 the US, the White House is alarmed over the market 0:04:40.800 --> 0:04:44.039 turmoil triggered by the new UK Now it's encouraging Prime 0:04:44.080 --> 0:04:47.320 Minister list Trust to dial back or economic plans to 0:04:47.400 --> 0:04:50.280 get details now from Bloomberg's Amy Morris from our ninety 0:04:50.360 --> 0:04:54.160 nine one newsroom in Washington. The plunge in UK assets 0:04:54.240 --> 0:04:57.720 earlier this week contributed to declines in US treasuries, sources 0:04:57.800 --> 0:05:01.720 tell Bloomberg News. Treasury officials are concerned at the volatility 0:05:01.800 --> 0:05:04.120 in the markets, and they're working through the I m 0:05:04.200 --> 0:05:07.640 F to put more pressure on Trust's government. Treasury Secretary 0:05:07.720 --> 0:05:11.719 Janet Yellen downplay the turbulence, but Commerce Secretary Gina Raimondo 0:05:11.960 --> 0:05:16.040 called Trust's approach of cutting taxes while increasing spending misguided. 0:05:16.360 --> 0:05:20.039 Trust's government argues it's program will boost long term growth 0:05:20.279 --> 0:05:23.160 in Washington, I'm maybe more as Bloomberg day break, Okamy, 0:05:23.240 --> 0:05:25.799 thank you. We have some personnel news coming out of Washington. 0:05:25.960 --> 0:05:28.960 Sources say Treasury Secretary Janet Yellen has told the White 0:05:29.000 --> 0:05:32.560 House she will stay past the November elections. Her desire 0:05:32.600 --> 0:05:35.440 to stay comes as the Biden administration prepares for potential 0:05:35.520 --> 0:05:39.559 cabinet and other senior personnel changes. Those decisions may depend 0:05:39.600 --> 0:05:43.520 on how well or poorly Democrats do in the elections. Meantime, 0:05:43.680 --> 0:05:47.280 a House proposal to restrict stock trading by government officials 0:05:47.360 --> 0:05:50.000 has hit a snag. Nathan the bill Woodker tail stock 0:05:50.040 --> 0:05:53.719 ownership and trading by members of Congress, the president, vice president, 0:05:53.960 --> 0:05:57.280 Supreme Court justices, and other high ranking officials, but it's 0:05:57.320 --> 0:06:00.400 currently being held up by Democratic in fighting. The bill's 0:06:00.400 --> 0:06:04.719 sponsors introduced the legislation yesterday, but multiple House officials familiar 0:06:04.760 --> 0:06:07.840 with discussions said any floor action on the measure has 0:06:07.920 --> 0:06:10.680 been shelved, at least for now. Lawmakers are scheduled to 0:06:10.760 --> 0:06:13.800 leave Washington this week until after the November election. Now, 0:06:13.880 --> 0:06:16.680 let's turn to geopolitics, now, Karen, the US wants to 0:06:16.800 --> 0:06:20.360 resume talks with China. Ambassador Nicholas Burns is calling on 0:06:20.440 --> 0:06:22.960 the nation to reopen discussions that were halted after how 0:06:23.040 --> 0:06:26.640 Speaker Nancy Pelosi's visit to Taiwan. We do not seek conflict, 0:06:26.760 --> 0:06:30.720 and we're gonna try to compete with China vigorously and 0:06:30.800 --> 0:06:32.719 then work with China where we can, and we hope 0:06:32.720 --> 0:06:35.880 the Chinese will reciprocate. They've frozen a lot of our 0:06:35.960 --> 0:06:40.640 dialogues since Speaker Pelosi's visit. Our message to the Chinese is, 0:06:40.839 --> 0:06:44.680 let's talk, open these dialogues and let's move forward. Ambassador 0:06:44.760 --> 0:06:47.680 Nicholas burn spoke of the Bilking Institute Asia Summit in Singapore. 0:06:47.720 --> 0:06:49.760 He says the US needs store to China on issues 0:06:49.800 --> 0:06:53.440 like climate change, in health, and incorporate news. Nathan. Amazon 0:06:53.600 --> 0:06:56.320 is boosting pay for hourly workers in the US. The 0:06:56.400 --> 0:06:59.239 online retailing giants said the move O raised the average 0:06:59.279 --> 0:07:03.160 starting wage for most frontline employees and warehousing and transportation 0:07:03.440 --> 0:07:06.080 to nineteen dollars an hour. Bloomberg Day Breaks brought to 0:07:06.120 --> 0:07:08.680 you by SEI Asset managers don't get results that are 0:07:08.720 --> 0:07:10.600 off the charts when their solutions are off the shelf. 0:07:10.720 --> 0:07:13.720 Learned how SEI is operating platform can turn infrastructure into 0:07:13.760 --> 0:07:17.520 a competitive advantage at se i C, dot Com, slash Tech. 0:07:18.120 --> 0:07:24.640 This is Bloomberg and it's now five oh seven on 0:07:24.800 --> 0:07:26.760 Wall Street. We're see twenty minute delays on the New 0:07:26.840 --> 0:07:29.920 Jersey Transit Northeast Quarter and it's fifty five degrees in 0:07:30.080 --> 0:07:32.720 Central Park. Michael Barr has more on what's going on 0:07:32.800 --> 0:07:34.680 in New York and around the world. Good morning, Michael, 0:07:34.760 --> 0:07:37.560 Good morning Nathan. The New York City Council is deciding 0:07:37.600 --> 0:07:42.120 whether the band solitary confinement in jails. Demonstrators on both 0:07:42.240 --> 0:07:44.880 sides clashed on the steps of City Hall ahead of 0:07:44.920 --> 0:07:48.120 a hearing on the bill. Any Bosco of the Correction 0:07:48.160 --> 0:07:52.600 Officers Benevolent Association says the notion that we're torturing individuals 0:07:52.640 --> 0:07:55.920 in our system is not the case. However, Democratic City 0:07:55.920 --> 0:07:59.080 Council member Tiffany Common argued we need to know what 0:07:59.280 --> 0:08:02.080 is the route of the violence. A New Jersey bank 0:08:02.120 --> 0:08:05.120 agreed to pay thirteen million dollars to resolve claims of 0:08:05.200 --> 0:08:10.119 discriminatory lending practices. Lakeland Bank has been ranked best bank 0:08:10.160 --> 0:08:13.080 in New Jersey, but U S Attorney Phillips so Lingers 0:08:13.160 --> 0:08:15.400 says that's not the case for people of color and 0:08:15.520 --> 0:08:18.120 at least three counties. If you lived in a black 0:08:18.240 --> 0:08:22.160 or Hispanic neighborhood in these counties, you likely have little 0:08:22.240 --> 0:08:26.680 opportunity to apply for, let alone obtain a mortgage from 0:08:26.800 --> 0:08:30.600 Lakeland Bank. U S Attorney Phillips Lingers said Lakeland Bank 0:08:30.920 --> 0:08:35.040 red line these neighborhoods refused to service them in violation 0:08:35.120 --> 0:08:37.480 of the Fair Housing Act. The U. S. Senate is 0:08:37.520 --> 0:08:39.600 ready to pass the bill that will keep the government 0:08:39.679 --> 0:08:42.880 open and spending until that least the middle of December. 0:08:43.280 --> 0:08:47.880 Democratic Representative Jim mcgovernor of Massachusetts, thinks the government funding 0:08:47.960 --> 0:08:50.559 bill will pass by tomorrow. We're gonna do everything we 0:08:50.640 --> 0:08:52.600 can to make sure we don't have a government shutdown. 0:08:52.679 --> 0:08:54.439 Remember the last time we had a government shutdown, the 0:08:54.480 --> 0:08:56.760 Republicans controlled the White House, the House, and the Senate. 0:08:57.000 --> 0:08:59.480 I mean that was irresponsible. We would we would We 0:08:59.520 --> 0:09:01.560 would not do that. And the fact of the matter 0:09:01.679 --> 0:09:03.160 is there's a lot of stuff that we I would 0:09:03.200 --> 0:09:05.080 like to see in a cr and there's a lot 0:09:05.120 --> 0:09:07.599 of stuff, you know, that I would like to add on, 0:09:07.880 --> 0:09:09.520 and I know I can't get it best to Senate. 0:09:09.800 --> 0:09:12.000 So we have to do the best we can working 0:09:12.040 --> 0:09:14.160 with the people that we we have to deal with. 0:09:14.640 --> 0:09:18.280 Representative McGovern spoke on sound On, which airs at five 0:09:18.360 --> 0:09:22.040 pm weekdays on Bloomberg. Both parties agreed to a temporary 0:09:22.200 --> 0:09:26.079 continuing spending bill that will include disaster raid for whether 0:09:26.240 --> 0:09:30.080 batter to Kentucky, Alabama, Texas, Alaska, and Puerto Rico. Vice 0:09:30.160 --> 0:09:33.319 President Kamala Harris is in South Korea. Harris met with 0:09:33.400 --> 0:09:37.000 the South Korean president to reinforce the US South Korean Alliance. 0:09:37.400 --> 0:09:40.679 For seven decades, the alliance between the United States and 0:09:40.800 --> 0:09:44.240 the Republic of Korea has been a lynchpin of security 0:09:44.320 --> 0:09:48.839 and prosperity. Vice President Harris later traveled to the demilitarized 0:09:49.080 --> 0:09:52.680 zone that separates North and South Korea. Global News twenty 0:09:52.720 --> 0:09:55.199 four hours a day on air and on Bloomberg Quicktake, 0:09:55.440 --> 0:09:58.560 powered by more than dred journalists and analysts. More than 0:09:58.600 --> 0:10:02.080 a hundred twenty countries. Michael barn This is Bloomberg Nather. 0:10:02.280 --> 0:10:09.160 Thanks Michael. Up to five ten on All Street Time 0:10:09.160 --> 0:10:11.520 for the Bloomberg Sports Update. Good morning, John stash Our, 0:10:11.559 --> 0:10:14.120 Good Marrian Nathan. Perhaps you've heard Aaron Judge has been 0:10:14.160 --> 0:10:16.079 trying to hit his sixty feet over run of the 0:10:16.120 --> 0:10:19.599 season seven straight games where networks broke into programming. The 0:10:19.679 --> 0:10:22.800 show is that Fats his mother and Roger Marris's son 0:10:22.960 --> 0:10:26.640 crossed borders to watch his at bats and in Toronto 0:10:26.760 --> 0:10:30.079 seventh any Tim masa on the mound? John Stirling w 0:10:30.320 --> 0:10:33.720 F there goes did he loved to a time? Till 0:10:33.800 --> 0:10:39.199 Us far Good has gone number sixty one. He times 0:10:39.480 --> 0:10:44.520 Roger Maris for the American League single season record, who 0:10:44.559 --> 0:10:48.720 with sixty one home run hits a two run Judge 0:10:48.920 --> 0:10:51.480 and Black Yankee and American League record. Of course, the 0:10:51.600 --> 0:10:53.719 reason this has gotten so much attention it's the so 0:10:53.880 --> 0:10:56.439 called clean record. The only ones that hit more in 0:10:56.520 --> 0:10:59.719 the season Barry Bonds, Bark McGuire, Sammy Sosa, all of 0:10:59.800 --> 0:11:03.560 their seasons tainted by steroid youth. Judge has seven games 0:11:03.640 --> 0:11:05.719 left try and hit his sixty second. The outcome the 0:11:05.760 --> 0:11:08.839 game fairly meaningless. That's why Aaron Brune had Anthony Rizzo 0:11:08.960 --> 0:11:11.600 managed the game. Yankees beat the Blue Jays eight to three. Meanwhile, 0:11:11.640 --> 0:11:14.239 want to win for the Mets, this game very meaningful 0:11:14.320 --> 0:11:16.079 as the Mets try to win the nl East. That 0:11:16.160 --> 0:11:19.480 means to buy avoiding the Dodgers until the NLCS. They 0:11:19.559 --> 0:11:23.520 trailed Miami for nothing seventh any Edwardo Escobar to the 0:11:23.679 --> 0:11:26.440 rescue two run omer, seventh any game time two run 0:11:26.520 --> 0:11:28.599 single on the eighth game winning rb I hit in 0:11:28.640 --> 0:11:31.800 the tenth Mets won five four, just as Atlanta lost 0:11:31.880 --> 0:11:34.679 in Tennings and Washington. So the three game series that 0:11:34.760 --> 0:11:37.720 begins tomorrow in Atlanta starts with the Mets one game ahead. 0:11:37.760 --> 0:11:39.840 Whether it could be a real issue for the series Saturday, 0:11:39.960 --> 0:11:43.280 especially jetsonated officials. Zach Wilson will return from his knee 0:11:43.280 --> 0:11:45.840 injury and starts Sunday in Pittsburgh. John Scash at whar 0:11:45.920 --> 0:11:49.120 Bloomberg Sports, Nathan, thank you, john S andp futures are 0:11:49.160 --> 0:11:52.000 down thirty four point Stouth futures down two undred forty seven, 0:11:52.080 --> 0:11:54.319 nest At futures down a hundred twenty eight points. The 0:11:54.720 --> 0:11:58.600 pound at one point zero eight to one against the dollar. 0:11:58.679 --> 0:12:01.920 We look at the market volatile city Next with Patrick Armstrong, 0:12:02.360 --> 0:12:08.400 chief investment Officer at Gloury Mewell. Bloomberg day Break is 0:12:08.400 --> 0:12:10.280 brought to you by the New York Community Trust. Your 0:12:10.360 --> 0:12:12.120 name will live on as a champion of the causes 0:12:12.160 --> 0:12:14.319 you care about for years to come through a charitable 0:12:14.360 --> 0:12:16.680 bequest to the New York Community Trust. Learn more at 0:12:16.720 --> 0:12:24.240 Philanthropists dot n y C. Markets headlines and breaking news 0:12:24.400 --> 0:12:26.920 twenty four hours a day at Bloomberg dot Com, the 0:12:27.040 --> 0:12:30.559 Bloomberg Business Out and at Bloomberg Quick Take, He's a 0:12:30.600 --> 0:12:39.920 Bloomberg Business Lash and I'm Carrod Moscow and risk off. 0:12:40.040 --> 0:12:43.240 Sentiment is returning to markets as concerns about inflation and 0:12:43.280 --> 0:12:45.520 the risk of the global recession over shadows the Bank 0:12:45.559 --> 0:12:48.160 of Englet's move to restore calm. You check the markets 0:12:48.200 --> 0:12:51.200 every fifteen minutes throughout the trading day on Bloomberg Right 0:12:51.200 --> 0:12:54.120 NEWSNP future is down thirty one points down, futures down 0:12:54.160 --> 0:12:57.800 two twenty four, nasty, futures down one hundred seventeen, and 0:12:57.880 --> 0:13:00.640 the decks in Germany's down one point to first at ten. 0:13:00.679 --> 0:13:03.400 Your treasury down twenty thirty seconds, You three point eight 0:13:03.480 --> 0:13:05.600 five percent. They yield on the two year four point 0:13:05.679 --> 0:13:08.680 to zero percent. Nimex screwed oil is down a quarter 0:13:08.760 --> 0:13:11.960 percent or twenty one cents at eighty one cents of barrel. 0:13:12.200 --> 0:13:14.600 Comex school down nine tenths per cent or fifteen dollars 0:13:14.640 --> 0:13:17.839 twenty cents at sixteen fifty four eight announce the euro 0:13:18.000 --> 0:13:21.360 point zero against the dollar, British pound one point zero 0:13:21.440 --> 0:13:23.839 eight three one, and the yen at one forty four 0:13:23.920 --> 0:13:26.640 point seven zero. Looking at bitcoin, it's down seven tenths 0:13:26.679 --> 0:13:29.520 percent at nineteen thousand, four hundred dollars. And as a 0:13:29.559 --> 0:13:32.240 Bloomberg business flash, now here's Michael Barr with more. I'm 0:13:32.280 --> 0:13:35.640 what's going on around the world, Muddle, good morning, Good morning, Karen. 0:13:35.840 --> 0:13:39.559 Hurricane Ian has left the path of destruction in southwest Florida, 0:13:39.920 --> 0:13:42.880 trapping people and flooded homes, damaging the roof of a 0:13:43.000 --> 0:13:46.720 hospital intensive care unit, and knocking out power to about 0:13:46.800 --> 0:13:50.280 two million people. I now a tropical storm is now 0:13:50.400 --> 0:13:54.319 aiming for the Atlantic coast. The Biden administration blasted Russia's 0:13:54.320 --> 0:13:58.360 attempt to legitimize its control of Ukrainian territories through what 0:13:58.559 --> 0:14:01.400 they're calling a stay age vote to appear as if 0:14:01.559 --> 0:14:05.000 there is Russian loyalty in these towns. In baseball, the 0:14:05.120 --> 0:14:08.880 Yankees beat the Blue Jays eight three, but more importantly, 0:14:09.040 --> 0:14:12.480 Aaron Judge hit his sixty first home run, tying Roger 0:14:12.600 --> 0:14:15.920 Merris for the a L record. The Mets, Nationals and 0:14:16.000 --> 0:14:18.920 Giants one. The Red Sox beat the Orioles three one. 0:14:19.080 --> 0:14:22.040 The A's lost. Global news twenty four hours a day 0:14:22.160 --> 0:14:25.000 on here and on Bloomberg Quick Tank, powered by more 0:14:25.080 --> 0:14:27.480 than twenty seven hundred journalist and analysts more than a 0:14:27.560 --> 0:14:32.360 hundred twenty countries. Michael Barr and this is Bloomberg. Nathan alright, Michael, 0:14:32.440 --> 0:14:35.040 thank you. It is five nineteen on Wall Street Live 0:14:35.080 --> 0:14:39.080 from the Bloomberg Interactive Broker Studios. This is Bloomberg Daybreak, 0:14:39.120 --> 0:14:42.680 and we're joined this morning by Patrick Armstrong, chief investment 0:14:42.760 --> 0:14:45.840 officer at PLUIMI Wealth. As we see a risk off 0:14:45.960 --> 0:14:50.600 mood return to this market, particularly given the crisis happening 0:14:50.720 --> 0:14:53.800 in the u K. How deep is this crisis of 0:14:53.920 --> 0:14:59.120 confidence in Liz Trust's financial plan, Patrick, um, I think 0:14:59.200 --> 0:15:01.040 you've seen it in the currency. You've seen it in 0:15:01.080 --> 0:15:06.280 the guilt market and populous policies, which are basically promising 0:15:06.360 --> 0:15:08.920 things that you can't afford. Worked very well when interest 0:15:09.040 --> 0:15:11.920 rates were zero. Um, we're getting into an environment now 0:15:12.000 --> 0:15:14.280 where the Bank of England is going to be probably 0:15:14.360 --> 0:15:18.800 up to five three. So promising unfunded tax cuts and 0:15:18.880 --> 0:15:22.520 promising spending, Um, it just doesn't make sense anymore, and 0:15:22.920 --> 0:15:25.920 the markets reacting to that. So there's absolutely no confidence 0:15:25.960 --> 0:15:29.040 in these policies right now. Is there contagion risk for 0:15:29.440 --> 0:15:32.240 the broader economy? Is there contagious risk for the US 0:15:32.320 --> 0:15:36.960 market with what's happening in the UK? Limited? Um, there's some, 0:15:37.200 --> 0:15:40.600 but I don't think it's significant for the U S economy. Um. 0:15:40.680 --> 0:15:43.720 The US market is impacted by the overall global interest 0:15:43.800 --> 0:15:46.760 rate environment and the Bank of England basically buying longer 0:15:46.840 --> 0:15:50.520 duration guilt seemed to push down treasury yields even yesterday 0:15:50.560 --> 0:15:53.960 a little bit. So, Um, what the UK does, it's 0:15:54.360 --> 0:15:58.440 pretty much it's bailing out its pension systems that basically 0:15:58.520 --> 0:16:01.400 have a lot of liabilities they match with long duration guilt, 0:16:01.480 --> 0:16:04.240 and some of those guilts fell thirty to fifty in 0:16:04.280 --> 0:16:07.160 the last few days as a higher long term interest 0:16:07.280 --> 0:16:10.080 rates are now discounted in their prices. Now we're seeing 0:16:10.080 --> 0:16:13.840 a lot of selling in benchmark and long dated US 0:16:13.960 --> 0:16:18.600 treasuries this morning what's driving that? Do you think, Um, well, 0:16:18.640 --> 0:16:22.920 you've got persistent inflation, you've got big debts, you've got deficits, 0:16:23.160 --> 0:16:26.720 and populism is still the policy that's working for most 0:16:26.800 --> 0:16:29.240 Western governments. So the UK is had an extreme but 0:16:29.400 --> 0:16:32.680 I think all Western governments are at risk basically with 0:16:32.760 --> 0:16:37.560 their policies and the spending a lot and not really 0:16:37.600 --> 0:16:41.600 wanting to increase taxes. Austerity never is mentioned anywhere, and 0:16:42.680 --> 0:16:45.640 I think higher yields are probably a consequence of that. 0:16:46.040 --> 0:16:48.560 That being said, I have closed my tenure shorts on 0:16:48.640 --> 0:16:51.480 treasuries yesterday. So we've been short treasuries now for well 0:16:51.560 --> 0:16:53.760 over a year, and we did close them as they 0:16:53.800 --> 0:16:55.640 moved past three point date they got all the way 0:16:55.680 --> 0:16:58.560 up to four percent yields, but we've closed that position 0:16:58.640 --> 0:17:02.640 now because really yields at one point six percent, So, um, 0:17:02.880 --> 0:17:04.720 that's very different from where we were a year ago 0:17:04.800 --> 0:17:07.800 when we had negative real yields of Yeah, we have 0:17:07.920 --> 0:17:10.280 the tenure yield right now is sitting at three point 0:17:10.440 --> 0:17:13.159 five as you mentioned, it did breach four percent earlier 0:17:13.240 --> 0:17:16.400 this week. Where do you see US treasury yields headed 0:17:16.400 --> 0:17:18.960 at this point now that you've covered that short? Yeah, 0:17:18.960 --> 0:17:21.520 I actually think it's going to I wouldn't be surprised 0:17:21.520 --> 0:17:24.560 if it does gravitate up towards four, but I think 0:17:24.560 --> 0:17:26.960 the bulk of the move has happened now. UM, So 0:17:27.160 --> 0:17:30.280 I wouldn't be surprised if yields do move higher from here, 0:17:30.400 --> 0:17:32.560 But I don't think you're going to have the sharp 0:17:32.640 --> 0:17:36.280 move that we've had. Um. You are being compensated with 0:17:36.440 --> 0:17:41.159 returns above inflation to invest in treasuries now, and for 0:17:41.320 --> 0:17:43.960 years now, the only buyer of treasuries has been the FED. 0:17:44.080 --> 0:17:46.440 The FED selling treasuries. But I think a real yields 0:17:46.480 --> 0:17:48.960 where they are now, you will be enticing natural investment 0:17:49.040 --> 0:17:52.480 demand as well. It's interesting because we keep hearing from 0:17:52.560 --> 0:17:55.680 FED speakers doubling down on the need for higher for 0:17:55.840 --> 0:17:59.520 longer interest rates to tamp down inflation. Are you looking 0:17:59.560 --> 0:18:02.320 for a Fed pivot away from that stance anytime soon? 0:18:03.160 --> 0:18:06.440 Not anytime soon. I think the market's perfectly discounted what 0:18:06.640 --> 0:18:08.879 the Fed has said they're going to do, and I 0:18:08.920 --> 0:18:12.040 actually think we've probably passed peak hawkishness from the Fed. 0:18:12.119 --> 0:18:14.920 I think Powell's last press conference, he and the dots 0:18:15.000 --> 0:18:17.960 that came out really showed a hawkish FED. The market 0:18:18.080 --> 0:18:21.359 totally bought into it, and I don't think there's going 0:18:21.400 --> 0:18:24.160 to be another move more hawkish than those dots are implying. 0:18:24.520 --> 0:18:26.000 But I don't think they're going to move away from 0:18:26.040 --> 0:18:28.840 them quickly either. So if the economy does deteriorate, or 0:18:28.880 --> 0:18:31.360 if there is some sort of systemic risk coming from 0:18:31.760 --> 0:18:34.800 a geopolitical event or a financial crisis in another country, 0:18:34.880 --> 0:18:37.680 that the federal change course. But I think as as 0:18:37.760 --> 0:18:40.240 things stand, they do intend to meet the dots. But 0:18:40.280 --> 0:18:42.520 I don't think those dots will be revised higher. Not 0:18:42.640 --> 0:18:45.239 about thirty seconds left here, Patrick, we keep hearing from 0:18:45.320 --> 0:18:48.440 more banks raising their odds for the probability of a 0:18:48.560 --> 0:18:53.120 recession of sparked by this FED. What's your call on that? Yeah, 0:18:53.119 --> 0:18:56.359 I think it's probably tipped into likelihood now. So I 0:18:56.400 --> 0:18:59.040 think UK and Europe we're in a recession now in 0:18:59.119 --> 0:19:02.400 fourth quarter is going to be recession. Um the United States, 0:19:02.600 --> 0:19:06.160 the employment situation is going to deteriorate. The higher interest 0:19:06.280 --> 0:19:09.200 rates probably will start to have some impact unemployment. And 0:19:09.400 --> 0:19:11.560 you see I see the U S flirting with a recession. 0:19:11.560 --> 0:19:13.719 I don't think it will be significant, but it's definite 0:19:13.800 --> 0:19:17.480 possibility and probably a slight probability, but I think it'll 0:19:17.480 --> 0:19:20.960 be shallow flirting with recession. We'll leave it there. Thanks 0:19:21.040 --> 0:19:23.880 as always, Patrick, great to get your thoughts. Patrick Armstrong 0:19:23.960 --> 0:19:27.879 with us this morning, chief investment officer at Player Gramy Wealth. 0:19:28.119 --> 0:19:31.920 As we take a look at the market slide continuing 0:19:32.119 --> 0:19:34.840 this morning. We have SMP futures right now down thirty 0:19:34.880 --> 0:19:38.040 two points down, futures down two or twenty eight. Nasdaq 0:19:38.119 --> 0:19:41.960 futures are lower by a hundred twenty five points ten. 0:19:42.040 --> 0:19:44.600 Your treasury is down twenty nine thirty seconds now, the 0:19:44.680 --> 0:19:46.840 yield three point eight four percent, yield on the two 0:19:46.920 --> 0:19:49.720 year four point to zero, and I'm excrude moving a 0:19:49.800 --> 0:19:51.919 bit lower now down two tenths percent at eighty one 0:19:52.520 --> 0:19:56.000 ninety six cents of barrel and the British pound one 0:19:56.119 --> 0:20:00.639 point zero eight three nine against the dollar. You're listening 0:20:00.800 --> 0:20:09.320 to Bloomberg Daybreak Bloomberg eleven three oh weather, sunshine today, 0:20:09.359 --> 0:20:14.080 upper sixties of increasing clouds tomorrow, upper sixties, light rain 0:20:14.320 --> 0:20:16.840 from Ian moves in Saturday. It's going to be rain 0:20:16.960 --> 0:20:22.720 all day Sunday as well. Fifty five degrees. Currently broadcasting 0:20:22.840 --> 0:20:26.480 live from the Bloomberg Interactive Broker Studio in New York, 0:20:26.640 --> 0:20:32.000 Bloomberg elov In freed to Washington, d C. Bloomberg to Boston, Bloomberg, 0:20:32.080 --> 0:20:35.399 what All six one to San Francisco, Bloomberg sixty to 0:20:35.480 --> 0:20:38.560 the country, Sirius XM to the one nineteen and around 0:20:38.600 --> 0:20:42.160 the globe the Bloomberg Business at and Bloomberg Radio dot Com. 0:20:42.600 --> 0:20:51.200 This is Bloomberg Daybreak. It's five thirty on Wall Street. 0:20:51.200 --> 0:20:53.840 Good morning. I'm Nathan Hager and I'm Karen Moscow. We 0:20:53.920 --> 0:20:56.399 are just about four hours away from the open of 0:20:56.480 --> 0:20:58.159 US trading. Let's get you up to date on the 0:20:58.200 --> 0:21:00.600 news you need to know at this hour. Again. Ian 0:21:00.640 --> 0:21:03.639 as week into a tropical storm after hitting Florida with 0:21:03.720 --> 0:21:07.080 a deadly surge of water and catastrophic winds. About two 0:21:07.160 --> 0:21:10.000 point three million homes are without power. They get the 0:21:10.080 --> 0:21:13.720 very latest on the storm from Bloomberg meteorologist Rob Caroline, 0:21:14.040 --> 0:21:17.040 Karen and Nathan. Ian tied for the fourth strongest tropical 0:21:17.080 --> 0:21:20.560 weather system to ever strike the continental United States, made 0:21:20.640 --> 0:21:23.680 landfall yesterday in southwestern Florida, with winds at a hundred 0:21:23.720 --> 0:21:26.840 and fifty miles an hour and an extensive storm surge 0:21:26.880 --> 0:21:31.520 that caused very significant flooding across portions of southwestern Florida 0:21:31.520 --> 0:21:34.159 from Naples to Venice. The storm is now well inland, 0:21:34.200 --> 0:21:37.280 headed into a northeastern Florida. Big problem will be wind 0:21:37.320 --> 0:21:40.640 gus today in excessive sixty miles and some torrential rain, 0:21:40.680 --> 0:21:43.160 particularly on the northern side of the system into North Florida. 0:21:43.400 --> 0:21:45.760 Karen and Nathan. All right, Rob, thank you. Will continue 0:21:45.840 --> 0:21:48.640 checking in with Bloomberg meteorologist Dropped Carolin throughout the morning 0:21:48.680 --> 0:21:51.679 here on Bloomberg Radio. Now, let's talk markets. The pound 0:21:51.800 --> 0:21:54.320 is resuming its slide after the Bank of England's emergency 0:21:54.400 --> 0:21:58.240 bond buying program temporarily soothed concerns. This morning, UK Prime 0:21:58.280 --> 0:22:01.000 Minister Liz Trust once again to did a giant package 0:22:01.000 --> 0:22:03.960 of unfunded tax cuts. We're seeing both stocks and bonds 0:22:04.040 --> 0:22:07.080 in Europe fall this morning. Well here in the US, Nathan, 0:22:07.160 --> 0:22:10.520