All Eyes on Jay Powell and Joe Biden

Chinese spy balloon. I'm a Mean Morris. A person of interest is in custody in connection with the shooting of an off duty n y p D officer, and the city is ending one of its workplace vaccination rules. I'm John stash Allen. Sports the Nets now without Tyrie Irving lost it home to the Clippers. Victories for the Rangers,

Devils in Islanders. That's All's trading ahead on Bloomberg day Break on Bloomberg eleven three on New York, Bloomberg one, Washington d C, Bloomberg one oh six one, Boston, Bloomberg nine sixties and Francisco Sirius Exam one nine team, and around the world on Bloomberg Radio dot Com and via the Bloomberg Business add Good morning. I'm Nathan Hagar and I'm kmerin Moscow. Here are the stories we're following today. The direction of markets today could take cues from the Fed.

Friday's big jobs report appears to have changed views on what the Central Bank will do this year, and today Chair J. Powell weighs in taking questions at the Economic Club of Washington. Bloomberg's Michael McKee will be there, and as a preview going into Friday's jobs report, the narrative was the Fed chair hadn't pushed back hard enough on markets pricing rate cuts Later this year, the payroll report

may have done that for him. If job growth is strong and hours worked our rising, that's a lot more money in consumers pockets available to spend, and at least according to the feds Phillips curve model, that means inflation

will be stickier. Paul gets another chance to make that point when he sits down with David Rubinstein, host of Bloomberg TV's Peer to Peer and David Rubinstein shows at the Washington Economic up expecting to say the Fed will stay the course, raising rates one or two more times and holding them throughout the year. Michael McKee, Bloomberg Daybreak All right, Mike, Thank you, and stay with us for

complete coverage of Howell's comments. We will bring them to you live on Bloomberg Radio and television around twelve thirty pm Eastern time. Nathan Markets are holding steady ahead of those remarks from Powell. Lori Calvacina ahead of US. Equity strategy at RBC Capital Markets thinks the worst maybe behind US.

I would be surprised at this point in time if we were to retest or really even break below those October lows, because I think the market is still got enough evidence that the soft landing thesis is intact for now. I mean we are, I think coming up on the point when we'll have most of the earnings downgrades, and traditionally that's a clearing event for markets. So I think there's was to the downside, but I think the bears have kind of overstayed their welcome and over articulated their case.

Laurie Calvacina of RBC Capital Markets cc sn P five hundred, ending the year around on the earnings front. This morning, Karen's shares of BP are up three and a half percent. The UK companies joined other energy giants in posting a record profit for two now. BP CEO Bernard Looney tells

us he's looking to reinvest that capital. We're actually announcing that we're going to increase investment in the energy transition by about eight billion dollars this decade, and at the same time, we're going to increase investment in today's energy system, which is predominantly all in gas, by about eight billion dollars as well. CEO Bernard Looney says VP is boosting its dividend and will buy back an extra two point seven billion dollars in shares. Shares a b MP perry

bar up almost two percent. The French bank says it plans to buy back almost five and a half billion dollars in stock. The move comes after BMP posted a quarter that beat many Wall Street peers. All right, let's turn now to the major political event of the night, Karen President Biden's State of the Union address. The president's speech is expected to call for a new minimum tax on billionaires and a stock tax on stock buy backs.

Wendy show Are, director of Brown University's Tobman Center for American Politics and Policy, says the economy will likely be a key theme tonight. You have to spend a lot of time talking about was working well in the economy and also counteracting a theme that's been ever present in mainstream and social media for more than six months eight months, that there will be recession. There is a recession, and the layoffs in the tech industry, which over expanded, are

the big headlines. But are there layoffs in other major industries that affect more Americans. That's the thing that Biden has a racial about. Brown University political scientist Wendy Schiller and listen for live coverage of Tonight's State of the Union on a special edition of Bloomberg's Balance of Power. It starts tonight at eight thirty pm Wall Street Time on Bloomberg Radio and Television. Well ahead of Tonight's speech, Nathan how Speaker Kevin McCarthy has delivered one of his

own with a focus on the debt ceiling. President Biden wants Congress to raise the debt limit yet again without a single sensible change to how government spends her hard earned money. None does that sound responsible to you? Speaker McCarthy says he wants to negotiate with the President on a responsible dead limit increase with no lines in the sand However, the speech he said, However, after this speech, he said he will draw the line on one issue.

He's ruling out tax increases. Turning to geopolitics and national security, the White House says it's looking forward to getting whatever data are recovered from the Chinese balloon down in the Atlantic. Bloomberg said, Baxter has the story. It says recovery efforts are in full swing. Spokesman John Kirby says they aren't worried about any lost intelligence to China at this point, and says this is not their first dance with a balloon.

Some dating back to the Trump administration, at least on three occasions uh survanance balloons by the PRC transited uh US air space. I will say that for me, the indication that we have that that was for brief periods of time. Kirby says, I hope to find out how high up the China leadership food chain decisions were made aid in San Francisco. I'm at Baxter Bloomberg Daybreak. Thanks. There's plenty of the U S officials can learn from

what's left of the balloon. That's according to Mark Esper, served as Secretary of Defense under President Trump, is the instrumentation made of US parts or a lot of parts. It would tell us where they're sourcing their the engineering stuff for for the system. So we can learn a whole lot from from this package once we get it ashore and able to kind of pick through it in

close detail. Former Defense Secretary Mark espersa as President Biden made the right call shooting it down over water, but he also says the President could have done it sooner over Alaska. Esper spoke with our Washington correspondent Joe Matthew on Bloomberg Sound On. Catch the show weekdays at five pm Eastern on Bloomberg Radio or anytime wherever you get your podcasts, and this is Bloomberg. It is thirty degrees

in Central Park. We'll have sunshine with clouds building this afternoon, going up to near forty five degrees, some showers possible tonight as we head down to around forty. Time Now to take a look at some of the other stories making news in New York and around the world with Bloomberg's Amy Morris, Good morning, Amy, Good morning. Nathan. Rescue teams from overseas began deploying in Turkey after a pair of powerful earthquakes killed at least four thousand people in

both Turkey and Syria. White House Press Secretary Koine Jean Pierre says the Administration has been working with their counterparts in Turkey to provide assistance. The President authorized an immediate US response. In addition to the US personnel currently on the ground, we are in the process of deploying additional

teams to support Turkish search and rescue efforts. Turkey's President her Dewan says Turkey is facing the strongest disaster in a century and the country has declared seven days of mourning. A person of interest is in custody for the alleged shooting of an off duty NYPD officer Saturday night in Brooklyn. Channel four reports police tracked down a thirty eight year

old man in Rockland County. That shooting happened when the twenty six year old NYPT officer from Deer Park arranged by a car off Facebook marketplace, but when he arrived, the person he was meeting open fire. The officer was shot in the head remains in grave condition. New York City is ending one of its last workplace vaccination mandates. Mayor Eric Adams says city workers will no longer be

required to get vaccinated. Adam says the mandate, which led to the firing of hundreds of city workers who declined to get the shots, will end on Friday. Adam says more of city employees and more than eighty percent of city residents have gotten their initial vaccine series. The city ended its vaccine requirement for employees of private businesses in November. Two. Masks are now optional in most public places, including subways and buses. There's pushback against Mayor adams mental health plan.

During yesterday's hearing, Councilman Charles Barron said he feared it would lead to more physical altercations between the police and the Mentally illness is a dangerous proposition that you're presenting him. If we don't do something about getting pair intervention. More

than you, I'm fearful that there'll be more death. Yesterday's hearing focused on the plan implement it at a few months ago, ordering first responders to take anyone with serious mental issues off the streets into the hospital even if the patient refuses. A former staffer who worked for em battled New York Congressman George Santos has resigned. Mario Niccolodo tells ABC why he left his job as a Queen's

District Office staff members. The allegations and the documents came out that it did not vote well for the congressman. Obviously I had to take a step away. That's just a decision again. I made for my family, for myself and for my uh you know, my community and my friends. Maryo Niccolodo says seventy residents in Santos District wanted to resign, which he says is unprecedented and sad. Global News powered by more than dred journalists and analysts and more than

one hundred twenty countries. I'm Amy Morris. This is Bloomberg, Nathan. Thanks Amy, ex time for the Bloomberg Sports update brought to you. If I try stayed out of Good Morning, Johns Tesshower, you morning to Nathan. The Nets will miss Carrie Irvans talent on the court, they will not miss the drama he provided off of it. The day after has trade to Dallas Nets post to the l A Clippers. The new net spencer, Dinwittie and Dorry and Phinney Smith

were not yet with the team. Cam Thomas played He scored forty four points last Saturday, and he scored forty seven last night, but the Clippers won one sixteen, So good trip to New York for them, with wins over the Knicks and Nets Knicks plate tonight in Orlando. Also from the NBA, the sale of the Phoenix Suns. The real estate Magnet mattish be A approved unanimously hockey back to the All Star Break Rangers and Flames. A couple of goals for Philip Hill and then two by maker's

advantage at four four in overtime. Kelly Shoot sports Net in Canada the call Alexey Law front year game winner. Just as the Rangers were winning five four and overtime at the Garden, the Devils won five four in ot and Newark beating Vancouver. Jack used two more goals for New Jersey. He's got thirty five on the year Island. There's one to one at Philadelphia College Hoops, Duke was coming off the big one over North Carolina but got blown out. At Miami. Kansas beat Texas the battle of

top ten teams. They finished the weather delayed golf at Pebble Beach. Forty two year old Justin Rose had the lead, lost it, then came back got his first tournament, winning four years. Tom Brady said he won't be a Fox Sports announcer next season. He'll start the ten year, three hundred and seventy five million dollar gig in twenty four.

John stash are Bluebrook Sports Live from coast to coast, from New York to San Francisco, Boston to Washington, d C. Nationwide on Sirius xamp, the Bloomberg Business app, and Bloomberg dot Com. This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. On a day when two major speeches are in focus for markets. FED Chair Jerome Powell speaks in Washington this afternoon, and then tonight President Biden delivers his second State of the Union address. The message he intends to send inflation

is trending lower and jobs are on the rise. Top White House Economic advisor Brian Deese is hammering that message home, even as we've seen real progress and inflation coming down over the last six months. In particular, we have more work to do to bring prices down on lower costs and create some breathing room, as he says, for American families. National Economic Council director Brian Deese and this morning where you're joined by Terry Haynes, the founder of Pangia Policy. Terry,

Good morning. It seems as though when you look at the polls, the president has some work to do as well on bringing that message to Americans that the economy is working. Why do you think it hasn't been delivered in the way that the president might like up to this point. Good morning, Good morning, Nathan. And yeah, it's remarkable, isn't it. Uh. You know, one of the ways that the President's been talking about this speech is the opportunity to make our case quote unquote, And usually making your

case comes before enacting Paul season instead of afterwards. Uh. Yeah, they don't get a lot of credit and uh and then they get a and for the good things, they get a lot of credit for the angst And to some extent, I think that's the lot of presidents everywhere.

But in part it's because Biden has not really been at the forefront of pushing individual policies or or or getting them put together through negotiations and uh, and really has been the forefront of kind of presenting them in a unified way as things that he's doing to make life better. Do you expect that to change as we had through the second half of the president's term at a time when you could presumably be focusing on a re election campaign. Well, I think he's already starting to

do that. Yeah. You know, they clearly want to be able to to take credit for what they can take credit for, and you know that's as old as the presidency. Uh. But so they will start making their case and already have as you know, more work to be done. But we've done all these things so far. Even though what they've done is you know, really uh put the FED into place and have given the FED the responsibility for attacking inflation, uh and uh and putting together this inflation

reduction actors really doesn't do much. Um. And you know, the signals from the speech so far really are that he's going to focus on proposing things that are red meat for the base, like stock buy backs and the like that won't get enacted, as opposed to things that might be inactable. So uh, you know, net net, you're not gonna see much more in the in terms of uh push from the Biden administration on things that will actually mitigate inflation and make the life better for average Americans.

And ahead of the speech we heard from how Speaker Kevin McCarthy to putting the debt ceiling back in focus. How much is the ongoing and looming fight over the nation's debt limit overshadowing tonight's address. Well, ye know, there's a lot of things overshadowing tonight's address. The Chinese balloon for one, of course, and that because that brings up all kinds of issues and problems relating to the national

security and national defense. Uh. You know, my view of this has been that where the debt ceiling resolution finally comes from in the summertime is probably from centrists, uh, to boil it down. You're looking much more at a kind of Senate centrist House centrist Joe Manchin ish kind of play, uh than you are by having Biden and McCarthy to actually resolve things. And I think that's ultimately

where this goes. UH done nothing that either President Biden or Speaker McCarthy says this week UH is going to move the needle on debt ceiling because both of them think there's political advantage and stringing this thing out as long as possible. Frankly so we're gonna get some brinksmanship. That is finally in the summer time, I think in

the royal markets a little bit. In our last minute here, Terry, given all the attention on the Chinese balloon this week, how much do you expect the President to take a tougher line on China in this address, given all the moves that he's made up to now in the economic

front against China. I think what you'll hear from the President is kind of a recitation of all the things that have happened so far, both from a national security perspective and from an economic perspective, chips manufacturing, reshoring, and

all those sorts of things. But you know, the administration, but more importantly, I think the defense establishment, UH have a lot of questions to answer what we've Uh listeners shouldn't miss that what is going on with the balloon now isn't so much a you know, Biden versus Trump what about is and but what it is has to do with whether the defense establishment ever identified these things back in the day and what they're doing about the now.

This is Bloomberg Daybreak today, your morning brief on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed at six am Eastern each morning, on Apple, Spotify, and anywhere else you get your podcasts. You can also listen live each morning starting at five am Wall Street Time on Bloomberg eleven three oh in New York, Bloomberg in Washington, Bloomberg one oh six one in Boston, and Bloomberg nine six in

San Francisco. Our flagship New York station is also available on your Amazon Alexa devices. Just say Alexa play Bloomberg eleven Plus listen coast to coast on the Bloomberg Business app, Serius XM Channel one nine, the I Heart Radio app, and on Bloomberg dot com. I'm Nathan Hager and I'm Karen Moscow. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak and be