Investors Ready for Fed Rate Decision; Cool China Eco Data

Bloomberg Audio Studios, podcasts, radio News. 0:00:09.680 --> 0:00:11.640 Good morning, I'm Nathan Hager and. 0:00:11.560 --> 0:00:14.640 I'm Karen Moscow. Here are the stories we're following today. 0:00:15.120 --> 0:00:15.600 Thank Karen. 0:00:15.600 --> 0:00:17.799 Our focus is on the markets this morning, as we 0:00:17.840 --> 0:00:20.360 head into the final full week of trading in twenty 0:00:20.520 --> 0:00:23.919 twenty four. Investors get key economic data this week, with 0:00:24.000 --> 0:00:27.479 retail sales due out tomorrow and November's core PCE, the 0:00:27.560 --> 0:00:30.880 Fed's preferred gage of inflation on Friday. Traders also have 0:00:30.920 --> 0:00:33.800 a slew of central bank meetings to follow. Rate decisions 0:00:33.800 --> 0:00:36.040 from the Bank of Japan and Bank of England come 0:00:36.080 --> 0:00:39.559 after Wednesday's FED meeting. Goldman Sachs economists have a note 0:00:39.560 --> 0:00:42.320 out this morning saying they expect a twenty five basis 0:00:42.320 --> 0:00:45.000 point reduction from the Fed this week, followed by a 0:00:45.080 --> 0:00:49.080 pause in January. Consensus is a likely cut on Wednesday, 0:00:49.360 --> 0:00:51.879 but former New York Fed President Bill Dudley says the 0:00:51.920 --> 0:00:53.159 path for rate cuts in. 0:00:53.159 --> 0:00:55.520 Twenty twenty five remains unclear. 0:00:56.160 --> 0:00:58.760 Last time in September, they had four recuts for twenty 0:00:58.760 --> 0:01:01.360 five base point recuts twenty twenty five, So this title 0:01:01.360 --> 0:01:04.400 will be two or three second. I think I'll talk 0:01:04.440 --> 0:01:07.280 about how inflation is a little bit sticky. 0:01:07.400 --> 0:01:09.000 The economy is doing really well. 0:01:09.160 --> 0:01:11.679 You'll price se some upper revisions of the FED estimates 0:01:11.720 --> 0:01:13.840 of so called our star, the neutral rate. So I 0:01:13.880 --> 0:01:15.920 think all those things together will make it pretty clear 0:01:15.959 --> 0:01:17.760 that Janguary is probably. 0:01:17.480 --> 0:01:18.080 Going to be a pause. 0:01:18.880 --> 0:01:21.280 And former New York Fed President Bill Dudley also tells 0:01:21.319 --> 0:01:23.800 Bloomberg the FED expects tax cuts from the first Trump 0:01:23.840 --> 0:01:26.640 administration to be extended, and we'll take that into account 0:01:26.640 --> 0:01:29.160 as it decides how to ease monetary policy next year. 0:01:29.480 --> 0:01:32.920 Stick with Bloomberg for live coverage of this Wednesday's FED 0:01:32.920 --> 0:01:35.760 decision will bring you a special edition of Bloomberg Surveillance. 0:01:35.840 --> 0:01:39.600 The Fed decides with Jonathan Farroll, Lisa Bromwoitz, and Tom 0:01:39.680 --> 0:01:42.440 Keane on Bloomberg Radio and Television. 0:01:42.840 --> 0:01:44.119 Well and Politics, Nathan. 0:01:44.200 --> 0:01:46.920 Much of the focus remains on policy and how a 0:01:47.040 --> 0:01:52.560 second Trump administration will implement proposed tax and a tariff policies. 0:01:52.040 --> 0:01:52.760 To be specific. 0:01:52.840 --> 0:01:55.960 Former Trump economic advisor Gary Colin told CBS. 0:01:55.600 --> 0:01:57.480 Has faced the Nation this weekend. 0:01:57.240 --> 0:01:59.800 He expects taxes to be a major focus of the 0:02:00.040 --> 0:02:00.920 coming administration. 0:02:01.480 --> 0:02:04.120 We do know that taxes will be taken up by 0:02:04.200 --> 0:02:07.040 this Congress in this session. We know that they're going 0:02:07.080 --> 0:02:09.120 to have to deal with the personal side of the 0:02:09.120 --> 0:02:12.400 equation because if not, the personal side will revert back 0:02:12.440 --> 0:02:15.520 to the pre twenty seventeen tax code. 0:02:15.600 --> 0:02:17.359 I don't think anyone wants on. 0:02:17.360 --> 0:02:19.280 Either side the Aisle wants to go back to the 0:02:19.280 --> 0:02:20.560 prior tax code. 0:02:20.680 --> 0:02:24.119 Former Trump economic advisor Gary Cohene was speaking on CBS's 0:02:24.160 --> 0:02:26.639 Face the Nation, which you can hear every weekend right 0:02:26.680 --> 0:02:28.480 here on Bloomberg Radio. 0:02:28.280 --> 0:02:31.040 Also in focus something that's turned into more of a 0:02:31.040 --> 0:02:34.760 political issue now Karen drone sidings across the northeast. New 0:02:34.880 --> 0:02:37.560 Jersey Governor Phil Murphy and New York Governor Kathy Hocheler 0:02:37.560 --> 0:02:40.960 among state leaders demanding expanded authority to act against drones 0:02:41.000 --> 0:02:43.800 That could appear as a thread, but Homeland Security Secretary 0:02:43.880 --> 0:02:48.120 Alejandro Majorcis tells ABC's This Week Americans will likely see 0:02:48.200 --> 0:02:51.480 more drones, but there is no evidence of foreign involvement 0:02:51.680 --> 0:02:53.280 or a national security risk. 0:02:53.720 --> 0:02:56.440 I want to assure the American public that we are 0:02:56.600 --> 0:02:59.800 on it. We are working in close coordination with state 0:03:00.080 --> 0:03:03.320 and local authorities, and it is critical, as we all 0:03:03.360 --> 0:03:06.920 have said for a number of years, that we need 0:03:06.960 --> 0:03:11.560 from Congress additional authorities to address the drawne situation. 0:03:11.800 --> 0:03:15.760 Homeland Security Secretary Alajondromericus also says drone fightings may be 0:03:15.880 --> 0:03:19.359 increasing due to the Federal Aviation Administration deciding last year 0:03:19.400 --> 0:03:21.480 to allow nighttime drone flights. 0:03:21.960 --> 0:03:25.200 Meanwhile, Nathan at the White House, the Biden administration has 0:03:25.240 --> 0:03:29.160 plenty to take action on land protections, clemency, and artificial 0:03:29.240 --> 0:03:32.560 intelligence in his final weeks in office. According to a 0:03:32.600 --> 0:03:35.800 memo to allies, the President's aiming to codify his legacy 0:03:36.000 --> 0:03:37.960 before a President elect Trump's inauguration. 0:03:38.440 --> 0:03:39.800 Trump's repairing a flurry. 0:03:39.600 --> 0:03:42.400 Of executive orders, some on his first day that could 0:03:42.400 --> 0:03:44.760 take aim at key planks of the Biden agenda. 0:03:45.080 --> 0:03:48.200 Star Back to markets now, Karen, because bitcoin has hit 0:03:48.240 --> 0:03:51.840 another all time high. The digital asset continues to soar 0:03:51.920 --> 0:03:55.840 on optimism over a second Trump administration, reaching another record high, 0:03:56.200 --> 0:04:00.240 surpassing one hundred and six thousand dollars. That advanced also 0:04:00.320 --> 0:04:02.920 helped to boost sentiment in the wider crypto market. The 0:04:02.920 --> 0:04:06.840 President elect is moving forward toward creating a friendly regulatory 0:04:06.840 --> 0:04:09.600 backdrop for digital assets and is back the idea of 0:04:09.640 --> 0:04:13.880 a strategic national bitcoin stockpile and checking bitcoin prices right now, 0:04:13.960 --> 0:04:16.680 They're off that one oh six record now trading at 0:04:16.720 --> 0:04:19.560 about one hundred and four thousand, six hundred dollars on. 0:04:19.680 --> 0:04:23.400 Nathan Weturn overseas now to the continued economic slowdown in China. 0:04:23.560 --> 0:04:27.159 China's retail sales growth and expectedly weakened in November despite 0:04:27.200 --> 0:04:30.599 signs of improvement in the housing market. City head of 0:04:30.640 --> 0:04:35.080 Emerging Market Economies Johanna Chua said the data highlights the 0:04:35.160 --> 0:04:38.480 need for Beijing to introduce more measures to boost spending. 0:04:39.000 --> 0:04:41.480 We really need to see actual consumption stimulus. I mean, 0:04:41.680 --> 0:04:43.240 what do we have so far this year has been 0:04:43.320 --> 0:04:46.160 very small, you know, targeted cash subsidies before the Golden 0:04:46.160 --> 0:04:48.560 Week or even the consumer trade in programs. I really 0:04:48.600 --> 0:04:51.159 expect going into twenty twenty five, which we've already seen 0:04:51.200 --> 0:04:54.120 this signal that we should get a larger fiscal stimulus 0:04:54.160 --> 0:04:56.360 with a composition much more skew towards consumption. 0:04:56.839 --> 0:04:59.919 And City's Johanna Cheua says the global headwinds and on 0:05:00.120 --> 0:05:03.960 certainty of a second Trump administration's policy does not instill 0:05:04.040 --> 0:05:07.680 confidence in jobs and income prospects in China. 0:05:07.240 --> 0:05:10.040 And China's soft retail sales reading is weighing on oil 0:05:10.120 --> 0:05:14.120 as well. Karen Crude slipped after advancing last week. Consumer 0:05:14.160 --> 0:05:18.000 weakness in China is reinforcing concerns over weakening demand, with 0:05:18.120 --> 0:05:20.839 the country's creud refining dipping to its lowest level in 0:05:20.960 --> 0:05:24.520 five months in November. Checking well prices right now, Nimex 0:05:24.600 --> 0:05:27.680 crudes down one percent at about seventy dollars fifty seven 0:05:27.760 --> 0:05:30.000 cents per barrel. Brent is down eight tens of one 0:05:30.040 --> 0:05:32.680 percent at seventy three dollars ninety three cents. 0:05:33.040 --> 0:05:35.240 Well, Nathan, and Europe, we're getting a sense of monetary 0:05:35.279 --> 0:05:39.159 policy this morning. European Central Bank President Christine Laguard talked 0:05:39.200 --> 0:05:42.479 about the path for rate cuts while speaking in Lithuania today, 0:05:42.839 --> 0:05:45.359 saying she expects a further reduction in rates as the 0:05:45.400 --> 0:05:48.240 ECB approaches its two percent inflation target. 0:05:48.640 --> 0:05:51.320 We are close to achieving our target, so we are 0:05:51.320 --> 0:05:53.839 no longer in a situation where we need to fix 0:05:53.880 --> 0:05:57.919 the policy horizon at the shortest possible transmission, like we 0:05:58.000 --> 0:06:01.920 can return to a situation the policy horizon can a 0:06:02.160 --> 0:06:06.159 just depending on the nature, size and persistence of the 0:06:06.240 --> 0:06:07.440 shock as needed. 0:06:07.800 --> 0:06:10.360 He's to be President, Christine Leaguard, as is the Central 0:06:10.360 --> 0:06:13.800 Bank well came monetary policy sufficiently restrictive for as long 0:06:13.880 --> 0:06:16.800 as necessary to reach its inflation target. 0:06:17.120 --> 0:06:20.120 Staying overseas, Karen, let's get you updated on the political 0:06:20.120 --> 0:06:23.680 turmoil in South Korea. The country's parliament voted to impeach 0:06:23.720 --> 0:06:27.640 President yunsukyol on Saturday, following his brief martial law declaration. 0:06:28.120 --> 0:06:31.080 With Yun's duty suspended, he now awaits a ruling from 0:06:31.240 --> 0:06:34.600 South Korea's Constitutional Court on whether he will be removed 0:06:34.680 --> 0:06:37.599 or restored to office. That decision can take up to 0:06:37.960 --> 0:06:41.280 one hundred and eighty days from the passage of impeachment. 0:06:41.480 --> 0:06:43.239 And finally, back at home, Nathan. 0:06:43.279 --> 0:06:46.200 An update on the deadly shooting of United Health CEO 0:06:46.279 --> 0:06:50.120 Brian Thompson. Police claim to have overwhelming evidence that suspected 0:06:50.200 --> 0:06:54.480 gunman Luigi Maggioni fatally shot Thompson in Midtown Manhattan, with 0:06:54.520 --> 0:06:58.360 evidence including video footage, fingerprints, a weapon, and a manifesto 0:06:58.440 --> 0:07:02.040 to crying the healthcare industry. Mangioni remains at a Pennsylvania 0:07:02.120 --> 0:07:05.640 jail fighting extradition to New York and hired high powered 0:07:05.760 --> 0:07:10.200 New York defense attorney Karen Friedman Agnefilo to represent him, 0:07:10.640 --> 0:07:13.720 and she could argue an insanity defense or challenge the 0:07:13.720 --> 0:07:16.640 evidence and may consider a guilty plea to reduce his 0:07:16.720 --> 0:07:22.680 potential prison term. Time. Now for a look at some 0:07:22.720 --> 0:07:24.520 of the other stories making news in New York and 0:07:24.600 --> 0:07:26.880 around the world. And for that we're joined by Bloomberg's 0:07:26.920 --> 0:07:27.480 John Tucker. 0:07:27.560 --> 0:07:30.480 John Good Morning, Good Morning, Karen toom Atwinzer to New 0:07:30.560 --> 0:07:34.680 York City's mayor resigns, joining a wave of departures is 0:07:34.720 --> 0:07:37.560 a corruption probe Titans. Let's get more in this report 0:07:37.560 --> 0:07:39.680 this morning from Bloomberg's Jeff Bellinger. 0:07:40.400 --> 0:07:43.600 Ingrid Lewis Martin is one of Mayor Eric Adams's closest 0:07:43.640 --> 0:07:47.000 confidants and longest serving aids. She is one of a 0:07:47.040 --> 0:07:51.400 dozen senior administration officials who have retired or resigned since 0:07:51.520 --> 0:07:55.080 late September, when Adams became the first New York City 0:07:55.120 --> 0:07:58.960 mayor in modern history to be indicted on federal corruption charges. 0:07:59.440 --> 0:08:01.960 Lewis Martin and has been scrutinized as part of the 0:08:02.040 --> 0:08:07.280 multiple investigations into Adams and his administration. Investigator seized her 0:08:07.360 --> 0:08:10.200 phone when she returned from a trip to Japan the 0:08:10.320 --> 0:08:13.920 day after the mayor was indicted. She is being investigated 0:08:13.960 --> 0:08:16.720 as part of a probe opened by the Manhattan District 0:08:16.720 --> 0:08:19.720 Attorney I'm Jeff Bellinger Bloomberg Radio. 0:08:19.920 --> 0:08:23.160 Israel struckt Syrian weapons depots and air defenses over the 0:08:23.200 --> 0:08:25.520 weekend in what appeared to be part of an effort 0:08:25.560 --> 0:08:29.440 Israel says is aimed at depriving extremists of military assets 0:08:29.800 --> 0:08:33.080 after the rebels seize power in Syria. In all, Israel 0:08:33.160 --> 0:08:36.000 struck its neighbors seventy five times at attacks that began 0:08:36.120 --> 0:08:40.840 Saturday night near the Syrian capital Damascus. Unionized to Amazon 0:08:40.880 --> 0:08:43.679 workers at two New York warehouses gave leaders the authority 0:08:43.720 --> 0:08:46.200 to call a strike as soon as next week. It 0:08:46.280 --> 0:08:49.560 threatens a work stoppage unless the e commerce giant comes 0:08:49.600 --> 0:08:53.000 to the bargaining table. The International Brotherhood of Teamsters gave 0:08:53.040 --> 0:08:56.640 Amazon a December fifteenth deadline to begin negotiating in earnest 0:08:57.000 --> 0:08:59.880 or faces strike off at least fifty five hundred workers 0:09:00.520 --> 0:09:04.520 just ten days before Christmas. France's new Prime Minister of France, 0:09:04.559 --> 0:09:08.040 Woiberreul is meeting with far right leader Marine la Penn today. 0:09:08.440 --> 0:09:10.520 It kicks off an effort to form a government that 0:09:10.600 --> 0:09:13.160 could push a budget through a divide in parliament. The 0:09:13.160 --> 0:09:15.880 effort to form a government and craft a budget took 0:09:15.880 --> 0:09:19.000 on added the urgency at the Moody's ratings over the 0:09:19.040 --> 0:09:23.160 weekend cut France's credit rating, citing it's weak finances and 0:09:23.320 --> 0:09:27.000 political gridlock. Global News twenty four hours to day whenever 0:09:27.040 --> 0:09:29.559 you want at Bloomberg News. Now, I'm John Tucker, and 0:09:29.960 --> 0:09:31.480 this is Bloomberg. Karen. 0:09:31.760 --> 0:09:38.400 All right, John, thank you, and it's time now for 0:09:38.440 --> 0:09:40.680 the Bloomberg Sports Up Day, brought to you by Try 0:09:40.760 --> 0:09:43.720 State Out. He here's John stash Hour, John, good morning, Good. 0:09:43.559 --> 0:09:44.000 Morning, Carey. 0:09:44.040 --> 0:09:47.720 The NFL Sunday and begain with another flyover at Medlighte Stadium, 0:09:47.720 --> 0:09:50.800 again directed at Giants owner John Marra, this one with 0:09:50.880 --> 0:09:54.960 the words enough, we won't stop until you fire everyone. 0:09:55.000 --> 0:09:57.360 And then the Giants with the club record time ninth 0:09:57.440 --> 0:10:00.960 loss in a row, unable to stop the Baltimore Evans quarterback. 0:10:01.520 --> 0:10:02.400 That's it. What's the throw? 0:10:02.520 --> 0:10:05.000 Spreading to the right, spreads out, valley goes deep. He's 0:10:05.000 --> 0:10:06.840 got a man wide opener shot. Bavement has it at 0:10:06.880 --> 0:10:08.200 the ten paston. 0:10:07.840 --> 0:10:13.040 Of five sacks up to Jackler touchdown. Riggins pres Shan 0:10:13.360 --> 0:10:17.600 Bateman on a beautiful catch from Lenard Jackson's throw on 0:10:17.760 --> 0:10:21.280 WBAL one of five Jackson td passes had more TV 0:10:21.320 --> 0:10:25.079 passes than incompletions. Baltimore beat the Giants thirty five to fourteen. 0:10:25.120 --> 0:10:27.880 The Giants at QB started Tommy Devido and then finished 0:10:27.880 --> 0:10:30.880 with Tim Boyle due to a DeVito concussion. They've now 0:10:30.880 --> 0:10:33.400 played four different qbs of the last five games, and 0:10:33.440 --> 0:10:35.920 none have played all that well. Giants are two and twelve, 0:10:35.920 --> 0:10:38.319 oh win eight at home. The Jets, with their fourth win, 0:10:38.400 --> 0:10:40.880 only the second the last nine games. They won at 0:10:40.960 --> 0:10:43.520 Jacksonville thirty two to twenty five. That's the most points 0:10:43.559 --> 0:10:46.719 they scored all season. Aaron Rodgers three TD passes, two 0:10:46.720 --> 0:10:48.040 to Devonte Adams, who had one. 0:10:48.080 --> 0:10:50.240 Hundred and ninety eight receiving yards. 0:10:50.240 --> 0:10:52.800 Patriots dropped to three and eleven and lost to Arizona 0:10:53.080 --> 0:10:56.120 thirty to seventeen. The Commanders a twenty to nineteen winning 0:10:56.160 --> 0:10:58.640 New Orleans. The Saints scored on the final play but 0:10:58.840 --> 0:11:01.480 got stopped on the game winning two point conversion at ten. 0:11:01.800 --> 0:11:05.040 Two late afternoon games that are possible Super Bowl previews, 0:11:05.080 --> 0:11:08.199 Buffalo won at Detroit forty eight forty two, with Josh 0:11:08.200 --> 0:11:10.680 Allen in on four touchdowns. He was in on six 0:11:10.800 --> 0:11:14.040 last week. Jared got through five ten passes in defeat. 0:11:14.080 --> 0:11:17.040 It's the Lions first loss in three months. Philadelphia hasn't 0:11:17.080 --> 0:11:20.800 lost since September. The Eagles easily beat Pittsburgh twenty seven 0:11:20.840 --> 0:11:23.920 to thirteen. Kansas City stands alone at NFL best thirteen 0:11:23.960 --> 0:11:26.800 and one. The Chiefs won twenty one seven at Cleveland. 0:11:26.800 --> 0:11:29.839 O Patrick Mahomes left early with an ankle injury. Last night, 0:11:29.840 --> 0:11:32.599 Green Bay beat Seattle thirty to thirteen. Nicks one in 0:11:32.720 --> 0:11:36.000 Orlando one hundred and ninety one. The Rangers struggles continue 0:11:36.000 --> 0:11:37.880 at three to two loss in Saint Louis. The Islanders 0:11:37.920 --> 0:11:41.240 won five to three at Chicago. John Stash Edward Bloomberg 0:11:41.280 --> 0:11:42.240 Sports Karen. 0:11:42.080 --> 0:11:48.960 Nathan Coast to coast on Bloomberg Radio, nationwide on Sirius XM, 0:11:49.040 --> 0:11:51.920 and around the world on Bloomberg dot Com and the 0:11:51.960 --> 0:11:56.240 Bloomberg Business app. This is Bloomberg Daybreak. Good morning, I'm 0:11:56.280 --> 0:11:59.640 Nathan Hager. The wave of central bank decisions around the 0:11:59.640 --> 0:12:01.200 world crashes. 0:12:00.760 --> 0:12:02.200 Into the US this week. 0:12:02.240 --> 0:12:04.840 The FED begins its final policy meeting of twenty twenty 0:12:04.880 --> 0:12:07.120 four tomorrow with the rate decision on Wednesday, and we're 0:12:07.160 --> 0:12:09.319 also going to hear from the Bank of Japan and 0:12:09.360 --> 0:12:11.760 the Bank of England before this final full training week 0:12:11.760 --> 0:12:13.800 of twenty twenty four is out here to get a 0:12:13.840 --> 0:12:16.600 set for at all. Bloomberg Radio and TV anchor Kritty Gufta, 0:12:16.760 --> 0:12:20.160 so critty. It seems like a cut this week from 0:12:20.240 --> 0:12:23.400 the Fed is just about baked into this market. But 0:12:24.040 --> 0:12:27.720 the big question remains, what about twenty twenty five? 0:12:27.880 --> 0:12:29.120 Good morning, Good. 0:12:29.040 --> 0:12:30.880 Morning, Nathan. Yeah, that seems to be the question. 0:12:30.960 --> 0:12:33.040 Goldman Sachs, for example, already saying that that's where you 0:12:33.040 --> 0:12:35.960 get a rate cut skip for example. And remember this 0:12:36.080 --> 0:12:39.559 was a really key strategy that the Fed had done 0:12:39.640 --> 0:12:41.520 on the way up where they were hiking. They said 0:12:41.559 --> 0:12:44.480 we would maybe hike, take a pause, hike again and 0:12:44.520 --> 0:12:47.679 just give the economy a second to digest at a 0:12:47.720 --> 0:12:50.440 time when they need to act quickly, but not enough 0:12:50.480 --> 0:12:52.920 to kind of shock the system. And luckily, the economy 0:12:53.000 --> 0:12:55.880 was able to digest every single rate hike, even when 0:12:55.880 --> 0:12:58.640 they were say fifty basis points or seventy five basis 0:12:58.640 --> 0:13:01.200 points or even one hundred basis It feels like they 0:13:01.240 --> 0:13:03.360 may be doing the same thing on the way down. 0:13:03.520 --> 0:13:05.640 I have no insight, no crystal ball, but that is 0:13:05.640 --> 0:13:08.760 something that Goldman Sacks is suggesting could be a possibility 0:13:08.800 --> 0:13:10.000 in terms of that strategy. 0:13:10.080 --> 0:13:12.480 Because it had worked on the way up as well. 0:13:12.480 --> 0:13:15.800 But Nathan, the concern I think is what happens if 0:13:15.840 --> 0:13:19.000 you startainly get more inflation in twenty twenty five. 0:13:19.040 --> 0:13:21.640 That's when cutting is not the strategy that works. 0:13:22.120 --> 0:13:25.160 What's to stop the Fed from going ahead and pausing 0:13:25.240 --> 0:13:28.079 this week? Is it just about the messaging that's been 0:13:28.080 --> 0:13:30.760 put out there that if they sort of gave the 0:13:30.760 --> 0:13:33.040 market a head fake like that, that it would cause 0:13:33.200 --> 0:13:34.320 even more volatility. 0:13:34.760 --> 0:13:36.040 It's a really hard question. 0:13:37.120 --> 0:13:41.520 I can't see why, just given kind of the message 0:13:41.520 --> 0:13:44.040 that they've given so far, why there would be hesitation 0:13:44.160 --> 0:13:47.199 simply because when they have looked at things, citing the 0:13:47.280 --> 0:13:49.360 labor market for example, they've said there's been a lot 0:13:49.400 --> 0:13:52.040 of strength, but that they do want to ensure that 0:13:52.040 --> 0:13:55.040 that strength continues, and that there is still a lot 0:13:55.080 --> 0:13:57.480 of hikes kind of bakes the system. So even cutting 0:13:57.520 --> 0:14:00.600 that policy still leaves the federal reserve at a fairly 0:14:00.640 --> 0:14:02.000 restrictive level. 0:14:02.080 --> 0:14:03.959 They're just kind of creating a little bit of that headroom. 0:14:04.000 --> 0:14:06.280 So that's at least the argument that's been posed by 0:14:06.280 --> 0:14:08.400 a lot of these FOMC members when it comes to 0:14:08.480 --> 0:14:11.480 labor market. Even when it comes to the CPI. But Nathan, 0:14:11.520 --> 0:14:13.920 I imagine when you look at the commentary, that's where 0:14:13.960 --> 0:14:15.760 you need to see where their head is at. Because 0:14:15.800 --> 0:14:20.400 in previous iterations of this of these kind of concerns 0:14:20.440 --> 0:14:24.000 about economic resilience out of the United States, some members, 0:14:24.120 --> 0:14:26.600 some economists even on Wall Street, including a very own 0:14:26.600 --> 0:14:29.760 analog at Bloomer Economics, have pointed to cracks that are 0:14:29.760 --> 0:14:31.840 not in say, your top tier markets, but are in 0:14:32.160 --> 0:14:34.560 smaller markets in the United States. Let me elaborate, the 0:14:34.600 --> 0:14:37.680 housing market has come up multiple times in that even 0:14:37.720 --> 0:14:43.040 though you're seeing some extreme property value jumps in New York, La, Miami, etc. 0:14:43.680 --> 0:14:46.400 You are starting to see cracks in the likes of Seattle, 0:14:46.520 --> 0:14:48.280 and the likes of Dallas, and the likes of kind 0:14:48.280 --> 0:14:50.520 of the smaller markets that are maybe say Tier two 0:14:50.600 --> 0:14:53.200 cities for example. Another place you may see it is 0:14:53.240 --> 0:14:55.680 that some of the major industries have been laying off 0:14:55.720 --> 0:14:59.400 workers and not kind of replenishing that work supply. 0:15:00.000 --> 0:15:01.880 I've seen a lot in the IT industry. You've seen 0:15:01.920 --> 0:15:02.760 it a lot in. 0:15:03.040 --> 0:15:07.200 Kind of more public funded roles like teaching, for example. 0:15:07.520 --> 0:15:09.480 That's really where some of the data is starting to 0:15:09.480 --> 0:15:13.480 come up. But net net, the numbers on wage growth, 0:15:13.560 --> 0:15:18.360 on CPI, on labor, even on housing prices have been positive. 0:15:18.440 --> 0:15:21.920 So when they're saying that they want to potentially cut rates, 0:15:22.000 --> 0:15:24.600 and it's in response to not slowing any of that 0:15:24.720 --> 0:15:27.320 down but perhaps creating a little bit more headroom where 0:15:27.320 --> 0:15:28.000 they may need it. 0:15:28.080 --> 0:15:29.200 In twenty twenty five. 0:15:29.160 --> 0:15:31.320 And just thirty seconds left, is there a concern that 0:15:31.400 --> 0:15:34.080 the Fed that Trump policy is going to force them 0:15:34.120 --> 0:15:35.560 to keep stay more restrictive. 0:15:35.800 --> 0:15:38.960 I mean, that's the highlight, that's the elephant in the room, right. 0:15:39.080 --> 0:15:41.560 The idea that in twenty nineteen J. Powell and the 0:15:41.560 --> 0:15:44.520 first things he did was cut interest rates when Donald 0:15:44.560 --> 0:15:46.600 Trump was talking about a trade war with China was 0:15:46.640 --> 0:15:49.760 the first inclination of it. And that actually worked because 0:15:49.760 --> 0:15:52.120 again it created more headroom. But the question is do 0:15:52.160 --> 0:15:55.360 you create insurance rate cuts given that the lag could 0:15:55.360 --> 0:15:58.520 still be twelve to eighteen months, And that's the strategy 0:15:58.800 --> 0:16:00.000 that no one has quite figured out yet. 0:16:01.680 --> 0:16:04.640 This is Bloomberg day Break, your morning podcast on the 0:16:04.720 --> 0:16:08.240 stories making news from Wall Street to Washington and beyond. 0:16:08.480 --> 0:16:10.880 Look for us on your podcast feed by six am 0:16:10.920 --> 0:16:14.320 Eastern each morning, on Apple, Spotify, or anywhere else you listen. 0:16:14.520 --> 0:16:17.400 You can also listen live each morning starting at five 0:16:17.440 --> 0:16:20.040 am Wall Street Time on Bloomberg eleven three to zero 0:16:20.160 --> 0:16:23.040 in New York, Bloomberg in ninety nine to one in Washington, 0:16:23.120 --> 0:16:26.440 Bloomberg ninety two to nine in Boston, and nationwide on 0:16:26.560 --> 0:16:28.800 serious XM Channel one twenty one. 0:16:29.200 --> 0:16:29.520 Plus. 0:16:29.560 --> 0:16:32.160 Listen coast to coast on the Bloomberg Business App now 0:16:32.160 --> 0:16:34.800 with Apple CarPlay and Android Atto interfaces. 0:16:35.000 --> 0:16:38.040 And don't forget to subscribe to Bloomberg News Now. It's 0:16:38.040 --> 0:16:40.760 the latest news whenever you want it in five minutes 0:16:40.880 --> 0:16:44.000 or less. Search Bloomberg News Now on your favorite podcast 0:16:44.040 --> 0:16:46.280 platform to stay informed all day long. 0:16:46.560 --> 0:16:48.960 I'm Karen Moscow and I'm Nathan Hager. 0:16:49.120 --> 0:16:51.160 Join us again tomorrow morning for all the news you 0:16:51.200 --> 0:17:04.160 need to start your day right here on Bloomberg dabray