Bloomberg Daybreak: June 22, 2022 - Hour 1 (Radio)

rent increases in New York City. Plus, Trump backed Katie Britt beats Maga moll Brooks in the Alabama Senate primary. Michael barn We're ahead. I'm John stashdown Ford's home runs did in the Yankees and a loss at Sampa Bay lock studded laws with the medicine euston. The Stanley Cup

Final continues tonight. That's All's train ahead on Bloomberg day Break on Bloomberg eleven three, on New York, Bloomberg nine one, Washington d C, Bloomberg one oh six one, Boston, Bloomberg nine sixties and Francisco Sirius x M one nineteen and around the world on Bloomberg Radio dot com and via the Bloomberg Business app. Good morning, I'm Nathan Hager and I'm Karen Moscow, and it is currently five out one

on Wall Street and futures are lower this morning. We check the markets every fifteen minutes throughout the trading day. On bloomberg SMP futures are down sixty one points down, futures down four hundred twenty six and NASDAG futures down. Two ten year Treasury up thirteen thirty seconds. You on three point to two percent and the yelled on the two year three point one four percent, Nathan, Karen. The main event today is congressional testimony on the economy from J. Powell.

Later this morning, the Fed Chairman appears before the Senate Banking Committee. We get a preview from Bloomberg's Michael McKee. Politics always plays a role in the Fed Chairman's appearances, and there will no doubt be efforts to pin the blame for inflation on someone. That's a topic Powell will duck. He'll also try to avoid expressing an opinion on various fiscal responses to inflation now under consider ration on Capitol Hill, such as a gas tax suspension. The real key question

for the Chairman is how high and how fast? The FED needs to raise interest rates. The latest FED forecast is to just under four percent by the end of the year, just over it in two thousand twenty three, but there has been pushback from investors in analysts who say the central Bank may have to go much higher than that. Paul's answer may have a major impact on trading.

Michael McKee, Bloomberg Daybreak. All right, Mike, thanks, and you can catch full coverage of FED Chairman Powell's testimonies starting around am Wall Street time on Bloomberg Radio and television. Well, Nathan, as investors away a word from Powell. There are more cons this morning for the Fan again more aggressive. Richmond Fan president Thomas Barkin wants to raise interest rates as fast as possible, as long as it doesn't cause undue

harm to market through the economy. We're in a situation where inflation is high, it's broad based, it's persistent, and rates are still well below normal. And so I think the spirit is you want to get back to where you want to go as fast as you can without breaking anything. And Richmond Fed President Thomas bark And also says he does not expect the economy to swiftly return to pre pandemic patterns, a more aggressive fed, weaker demand for goods, and supply shocks are leading the way for

more recession fears. Let's get more on that live from Bloomberg's Real Need a Young, Good Morning, Good Morning Nathan. City Group says there's a fifty percent chance of the

world economy falling into a recession. As a result, the Bank now sees the global economy growing three percent this year and two point eight percent in Economists at City Groups say if a recession did occur, it's likely to be quote garden variety, in which unemployment rises several percentage points and output experiences a couple of week quarters Live in New York, I'm ren need a Young Bloomberg day break, all right, we need to thank you well. Inflation is

also a major concern overseas. Today's reading in the UK as prices jumping to a new four decade high the get the latest live with Bloomberg's EU and pots in London, Good Morning You and good morning cardena than UK inflation in the etomy ticking up to nine point one. The reading reflects broad increases in the cost of everything from

fuel and electricity to food and beverages. There are also more signs of growing price pressures at the wholesale level, with raw material costs increasing by the most on records. The Bank of England says CPI good hits eleven per cents later this year in London, I'm your parts Bloomboo daybreak, all right you and thank you. Recession fears, the news of the Biden administration is prepared to step up its fight against gas prices. Has oil on the decline once again.

Right now NIMEX screwed is down four point seven per cent, or five dollars fourteen cents at a hundred four dollars thirty nine cents of barrel. This morning, President Biden is asking Congress to enact a gas tax holiday. Bloomberg said, Baxter has the story. The President is trying to cool the soaring pump prices as we head under the summer travel season. It is not clear to this point the time frame. Mr Biden says it will not hurt infrastructure. Is it going to, in fact make it difficult to

maintain our roads? The answer is we have plenty of capacity to do that. Biden also says in the long run, there is plenty of oil to drill nine thousand oil fields in San Francisco. I'm at Baxter Bloomberg daybreak, Great and thank you. Also in Washington, the Senator has voted to advance and by partisan gun safety bill, and a vote on final passage is expected later this week. Backer has called the measure of the biggest breakthrough on the

issue in decades. Is designed to improve background checks, secure schools, and giving states federal funds to combat gun violence. Isaac balt Tanski as director of Policy research at bt i G. But as we've learned time and time again, the motivator for lawmakers is so often the calendar and the jet fumes are also in play here because they're trying to leave town for two weeks at the end of this week, and that is an undeniable motivator, especially for these lawmakers

who are running for re election. Bt i G is Isaac balt Hanski spoke with their Washington correspondent Joe Matthew on Bloomberg Sound on Catch the Program weekdays at five pm Eastern on Bloomberg radiomcaring the latest round of hearings into the January six attack at the US Capital. He's in the books testimony yesterday focused on state and local officials and the pressure they faced from former President Donald Trump, who overturn the election. Committee Democrat Adam Schiff says the

system held but barely. Anyone who got in the way of Donald Trump's continued hold on power after he lost the election was the subject of a dangerous and escalating

campaign of pressure. Congressman Schiff and other committee members heard from Georgia's Secretary of State Brad Raefensburger, who says he faced a campaign of intimidation, including threats to his wife, and then some people broke into my daughter in laws home and h I sent has passed, and she's a widow and has two kids, and so we're very concerted about her safety. Also, Secretary of State Raffensberger says he followed every rabbit hole to make sure George's number were accurate,

but he says the former president came up short. Right now, SMP futures are lower by sixty three point, Staff futures down four hundred thirty Nasdaq futures down two hundred seventeen points. The tenure treasury is up fourteen thirty seconds. The yield three point to two straight ahead, your latest local headlines and the check of sports. This is Bloomberg, five oh seven on Wall Street, sixty six degrees in Central Park of the North Boundary Jersey Turnpike. Truck lanes are closed

the whole length with overnight road work continuing. More coming up in traffic. First Michael Barr with more on what's going on in New York and around the world. Good morning, Michael, Good morning, Nathan. Rent is going up in New York City. Last night, the Rent Guidelines Board voted to increase one year and two year leases. On the five four vote, the board decided to raise the rent for rent stabilized departments to three for one year leases. It will go

up to five percent for two year leases. New York City Mayor Eric Adams said the board's decision will be a burden to tenants at a difficul old time. The mayor also acknowledged that small landlords are at risk of bankruptcy because of years of no increases at all. Katie Britt has won the Republican runoff against Representative Moe Brooks for retiring Alabama Senator Richard Shelby's seat. Britt, Shelby's former chief of staff gained ground after Brooks lost Donald Trump's endorsement.

In March. Britt got while Brooks received The head of the Texas Department of Public Safety is now calling the law enforcement response to the massacre at the rob Elementary School and abject failure. Testifying at a Texas Senate hearing, Colonel Steve mccrawl says that there were enough police officers on hand that could have stopped the gunman quickly after

he entered the building. Yet, police officers armed with rifles stood and waited in a school hallway for nearly an hour while the gunman carried out the massacre, killing nineteen elementary students and two teachers. Not enough trainings done in the situation, playing simple because of bad decision and terrible decisions. Terrible decisions were made by the unseen commander and should have never happened. Playing the simple, Colonel Cross laid out

multiple times police failed to engage sooner. Three minutes into the attack. A jury in California signed it with a woman who filed a sex abuse lawsuit against comedian Bill Cosby. Jurors found Cosby sexually abused that then sixteen year old girl at the Playboy mansion. In nineteen seventy five, the jury awarded Judy Huff, now sixty four, a half a

million dollars. Gloria Allread is one of Huff's attorneys. Today, our client Judy Huff one real change because she fought Bill Cosby one step at a time for over seven and a half years. Attorney Gloria all Read Cosby has denied the allegations. Global News twenty four hours a day on air and on Bloomberg Quick Tank, powered by more than twenty seven hun journalist and analyst in more than a hundred twenty countries. Michael Barren, this is Bloomberg, Nathan.

Thank you, Michael. Coming up to five ten on Wall Street. Time for the Bloomberg Sports Update Morning, John Stessch After Morning, Athan Esther. Cortez has been a revelation for the Yankees. Eight of his first nine starts he didn't allow more than two runs, but he has come back to earth

of it. At Tampa Bay, Cortes served up two whole runs first inning, Paradis two innings later about this second of the game and not wanting Cortez to face Paradis the third time, he was removed in the fifth inning and this was Clark Schmidt's first pick. Here is Paradies already with two homers and says one way up into the air and the lift, but did he get another?

Gon tell Us back back to the wall number three Tonight Paradies and the race of a five two league and won the game five four rays Radio called cortez is e r A has gone from one point three a month ago to two point Mets started Trevor Williams and Houston he would not be in the rotation if not for the next yus or injury, and Williams felt the one and four astro's at three home runs. They wanted to Toronto's Austin Matthews and scored sixty gold named n h L M V P Gorsches. Durkin was third.

He did, as expected, win the Vesana Trophy, third Ranger goalie to ever win that awards. Stanley Cup Finald's tonight in Tampa, Colorado. Leads two games one while Brooks Kepta not having a good year. He has won four majors. He's a big name and now Kepta the latest of Bolt the PGA Tour for the new Live Tour. Keptr said just last week he hadn't given the live tour much thought. Rob Gronkowski, having retired once before, now doing

it again. Played nine years in New England, came out of retirement to play two more with Tom Brady at Tampa Bay. Together they won four Super Bowls. Bron certain to someday go into the Crow Football Hall of Fame. John Stashward, Bloomberg Sports Nathan and potentially certain to retire.

Thank you, John SMP futures down sixty three point, Staff futures down for a thirty nine, NASTAC futures down two hundred twenty two points, NIMEX crew down four point six percent, down five oh five at a hundred four dollars forty seven cents for a barrel, West Texas Intermediate. This is Bloomberg Bloomberg eleven three oh Weather mostly cloudy, scattered showers,

especially along Long Island in Connecticut. Lost seventies today turned probably mostly cloudy, upper seventies Tomorrow, low eighties Friday right now sixty six in Central Park Markets. Headlines and breaking news twenty four hours a day at Bloomberg dot Com, the Bloomberg Business apt and at Bloomberg Quick Take. This

is a Bloomberg business lash when I'm camerin Moscow. Stocks in Europe falling along with US stock index, futures and commodities, and made ever louder warnings that the FEDS monetary tightening may lead to an economic downturn, which at the markets every fifteen minutes throughout the trading day on Bloomberg. Right now, we SNP futures are down sixty one points down, futures down four hundred seventeen and NASDAG futures down two hundred nine.

The decks in Germany's down you point one percent ten your treasury of fifteen thirty seconds here three point to one percent, the yield in the two year three point one three percent. NIMEX screwed oil is down four point six percent on five dollars seven cents at a hundred four dollars forty four cents of barrel co mix school down six tenths percent or eleven dollars twenty cents at

eighteen twenty seven sixty an ounce. The euro one point oh five one five against the dollar, British bound one point to to to seven and the ends at one thirty six point to two. And watching bitcoin this morning down two point eight percent at twenty thousand, two hundred fifty dollars. That's a Bloomberg Business flash. Now here's Michael Barr with more on what's going on around the world. Muncle,

Good morning, Good morning, Karen. President Joe Biden will call on Congress to enact a gasoline tax holiday as he looks to cool soaring pump prices in the summer. According to a person familiar with the plan, Biden will make a statement today calling on Congress to enact the pause. Senate bargainers have reached an agreement on a bipartisan gun violence built would make gun background checks tougher for the youngest buyers and bolsters spending for school safety and mental

health programs. In baseball, the Yankees and Mets lost the Red Sox one. The Nationals beat the Orioles three zip. The Giants won the A's lost. Global News twenty four hours a day on air and on Bloomberg Quick Take, powered by more than journalist and analysts more than a hundred twenty countries. I'm Michael Barr, and this is Bloomberg. Nick. All right, Michael, thank you. It's five nineteen on Wall Street Live from the Bloomberg Interactive Brokers Studios. This is

Bloomberg day Break. Let's get more now and all these developments in Washington that Michael bar just reported on. Terry Haynes joins us this morning, the founder of Pangea Policy. Terry, it's good to speak with you. And we just got word from the White House moments ago that President Biden is going to call for a three month suspension to the federal gas and diesel tax. First off, is it's

something that's going to pass muster in Congress? And is it something that's actually going to have an impact on what we've paid at the pump? Good morning, Nathan. A couple of things on that. One. I think the basic politics of the Biden proposal, UH, make certain that it's probably not going to pass. Uh. The three months gas tax moratorium, if I may, is UH is designed to get it is designed to get everybody through, you know,

until just before the election. So therefore Republicans probably won't react to it positively. Uh. Secondly, you know, I think it's a drop in the bucket for the public. Uh. There's a deep senator deep and entrenched cynicism about um about the steps that the White House wants to take on inflation overall, and you know, eighteen cents out of a out of a five dollar per gallon trip to the pump, UH isn't gonna make anybody warmer and fuzzier towards Biden or the Democrats. And frankly is gonna make

much of a difference at the pump generally. I'll be back and forth about whether anybody even sees the eighteen cents to economists and UH experts and uh oil. But you know, I think this is you know, very much a drop in the bucket at best, UH and something

that is very unlikely to happen on its own. I think there's a likelihood that you see a some version of what used to be called the Build Back Better Bill that includes uh, some prescription drug relief and cent a variety of you know, maybe some tax rises all the rest. I've been for a while at non consensus that something like that happens. It wouldn't be beyond the belief to have something on gas tax eventually in there

as part of a package of inflation fighting measures. UH. So if you see it, it will be part of that package, and that will probably happen by the end of July or it won't happen at all. We also got progress in the Senate on a gun safety bill. We've seen that advance. Uh, what's your feel on where that's going to go from here? Are we're gonna see a vote to pass that before the July fourth break? Oh?

I think so. You know, you and I talked about this on June the third, and I had it as a non consensus six that that pretty much what's happening is six likely to happen. I'd raised that to seventy. Now I think it's it gets certainly much more likely. And you've got uh, yeah, you had a pretty comfortable margin yesterday and a procedural vote. Uh, you know, well

over sixty voted to advance the legislation. Doesn't it doesn't mean they're in favor of every bit of it, but that was an important vote to to be able to have the Senate debate it. Um. I do think something like this happens. You've got some very common sense, uh, background check improvements, you've got some very common sense red flag improvements, and of course you've got Washington doing with Washington and does best, which is splashing around a lot of money on things that I I don't mean to

sound too cynical on that. The money certainly needs to be splashed in a lot of ways, but that's uh these days increasingly how Washington deals with things, splashing money at it. So uh, you know, you've got all those things. They're very hard to argue against, and uh so I look for something positive to happen here. Uh it is

for the political terms. It is both an incumbent protection program in the sense that incumbents want to have something substantial done on guns before the November election, and a testament to what I always to tell people, which is that you've got the centrists in both parties. I mean this political environment, the centrist in both political parties, combined with the president frankly staying out of it by request of those centrists. In order to get something done. Uh,

you know, something will happen. And that's pretty much where we are today. As always, Terry Haynes with us this morning, founder of Pangea Policy, some insights on all the developments happening in the nation's capital, including this word we got from the White House just this morning that President Biden is going to be calling for a three month suspension to the federal gas taxes. We see nationwide average gas

prices close to five dollars a gallon. Plus progress on gun safety legislation, with the Senate advancing a compromise bill on that front. Terry, as always, thanks for your insights. Looking ahead to the market, open futures are moving lower ahead of Chairman Powell's testimony on Capitol Hill today. All right now, SMP futures are down fifty seven points, DAL futures down three nine. Nasdaq futures are lower by a

hundred ninety seven points. The tenure Treasury is up fifteen thirty seconds, the yield three point to one per cent. Just ahead on Bloomberg day Break, Chairman Powell perhaps for two days of testimony on Capitol Hill, and now City Group joining the calls for higher risk for a global recession. This is Bloomberg Bloomberg eleven three oh weather. Mostly cloudy, scattered showers, especially across Long Island in Connecticut today with highs and the low seventies will be near eighty tomorrow,

turning partly to mostly cloudy, low eightiest Friday. Right now sixty six degrees. Broadcasting live from the Bloomberg Interactive broker studio in New York. Bloomberg E Living Free to Washington, d C, Bloomberg on to Boston, Bloomberg one O six one to San Francisco, Bloomberg sixty to the country, Sirius XM Chado one nine te and around the globe the Bloomberg Business and Bloomberg Radio dot Com. This is Bloomberg Daybreak. It's five thirty on Wall Street. Good morning. I'm Nathan

Hagar and I'm Karen Moscow. We are just about four hours away from the in the US trading. Let's get you have to date on the news you need to know at this hour. We begin with the Federal Reserve as share J. Powell prepares to appear before the Senate Banking Committee this morning. Powell's expected to feel questions about how high and fast he needs to raise interest rates to slow inflation. At the same time, there are calls

for the Central Bank to be more aggressive. Richmond Fed President Thomas Barkin wants to raise rates as fast as possible, but avoid causing undue harm to market thor the economy. I think you have to be flexible to what happens the faster inflation comes down, the less you're gonna have to do in terms of restrictive montery policy. But the more difficult the external forces are, the more you'll have

to do. Richmond FED President Thomas Barkin says he supported the decision to raise rates seventy five basis points earlier this month. You can catch full coverage of FED Chairman Powell Senate testimony today around am Wall Street time on Bloomberg Radio and television. Well ahead of that, Karen, a more aggressive FED, Weaker demand and supply shocks are leading the way for more recession fears. Blue bergs we need a young joins us Live with more on that Good morning,

Good Morning, Nathan. City Groups says there's a fifty percent chance of the world economy falling into a recession. As a result, the Bank now sees the global economy growing three percent this year and two point eight percent economy sets. City Groups say if a recession did occur, it's likely to be quote garden variety in which unemployment rises several percentage points and output experiences a couple of week quarters

live in New York. I'm gonna need a young Bloomberg daybreak all right, Reneed to thank you recession fears and news. President Biden is calling for a gas tax holiday as

oil declining once again. Later today, President bought in Molask Congress to enact in gasoline tax holiday for three months and checking prices now nine ex screwde oil is down four point seven percent on five dollars nineteen cents and a hundred four dollars thirty two cents of barrel Brent is down more than four percent, as well as a hundred nine dollars one cents. Also in Washington, Karen, the Senate has voted to advance of bypartisan gun safety bill.

A vote on final passages expected later this week. Isaac Boltanski, Managing director of Policy Research at bt i G, says there are a couple key points in the bill. The one is the boyfriend louphole and the other is very important. It's how are they going to structure federal grants to states in relation to h state level the imposition of

state level red flag walls. Bt i G. Isaac Boltanski spoke with our Washington correspondent Joe Matthew on Bloomberg sound on Catch the Show weekdays at five pm Eastern on Bloomberg Radio. This is Bloomberg Daybreak and it's now five thirty three on Wall Street. We're sixty six degrees in Central Park. Got an accident on the eastbound Jackie Robinson Parkway at Cypress Hill Street. More on that coming up in traffic First Michael Barr with more on what's going

on in New York and around the world. Michael, thank you very much. Nathan. It's going to cost more to live in New York City. Last night, the Rent Guidelines Board voted to increased rents for those who live in rent stables departments by a five four margin. The Rent Board gave the green light to a three point increase on one year leases. For two year leases, it will be a five percent increase. The January six Committees hearing

focused on election officials in Arizona and Georgia. Former President Trump and his allies are accused of pressuring those officials to overturn the results of the election. To Georgia, election workers Ruby Freeman and her daughter testified yesterday. Investigators say they were falsely accused of election tampering by Trump and Rudy Giuliani. The President of the United States is supposed to represent every American not to target one, but he

targeted me. Freeman's daughters says there were a lot of people wishing death on her. Katie Britt won the Republican nomination for Senate in Alabama, defeating six term Congressman Moe Brooks and the primary runoff, former President Trump endorsed and then unendorsed Brooks, who had run under the banner Maga mob. Trump eventually endorsed Britt, who received forty five percent, while brook Scott d C. Mayor Muriel Bowser has won the Democratic primary, putting her on track for a third term

to leave the nation's capital. Bowser received fifty percent of the vote compared to second place Robert White. At thirty civil trial juror's rule that Bill Cosby sexually abdused a sixteen year old girl at the Playboy Mansion in the Los Angeles County jury delivered the verdict in favor of Judy Huff, now sixty four, and awarded her five hundred

thousand dollars. Nathan Goldberg is one of Huff's attorneys. It proves that you know you can run, but you can't hide that, no matter what he did so many years ago, thinking that you know he could just get away with it. We brought him here to this court to have justice

and we won. Cosby has repeatedly denied Huff's allegations. Global News twenty four hours a day on air and on Bloomberg Quick Take Howard by more than twenty seven under journalists and analysts in more than a hundred twenty countries. I'm Michael bar This is Bloomberg Naked. Thank you, Michael. On Wall Street, time for the Bloomberg Sports Update with John stash Our right faith in. The Tampa Bay Rays made a trade just for the season started. They sent

Austin Meadows to Detroit for East Sank Parades. Yank, He's probably happy to hear about that trade, Meadows with someone of a Yankee killer. But last night Parades hit three home run solo shots in the first and third innings off Nestor Cortez and then a two one blast and the fifth first pitch served up by reliever Clark Schmidt. Paradis had one more at fat got hit by a pitch, raised beat the Yanks five to four. Mets lost in Houston eight to two. Jose Altuve homer for the Astros.

So did Jordan Alvarez is nineteenth. The year three one double for Kyle Tucker Stanley Cuff final resumes tonight in Tampa, Colorado, leads to one. They handed out postseason awards last night, the m v P to Toronto's Austin Matthews after a sixty gold season. Rangers goaliegor says Turkin was a finalist for the Hard Trophy. He did win the Vezzana for

Best goal. He led the league with the goals against just over to only previous Ranger winners Mike Richter and John Van Peasbrook a settlement between the Shawn Watson and twenty of the twenty four plaintiffs suing Watson for sexual misconduct. Watson has denied any wrongdoing. He's now with the Cleveland Browns. He is awaiting discipline from the NFL. Rob Gronkowski said in a statement he walks away with his head held high. This is Gronk's second retirement announcement. That's one more than

his long time teammate before still active, Tom Brady. Together they won four Super Bowls, three with New England and one in Tampa Brooks. Keepka said last week he had hardly heard of the New Live Tour. Now he's joining it. A winner of four majors, although he struggled this year. Keepki becomes the latest big name. Golford of Bolt the p g A Ton Statue Want Bloomberg Sports Nay? Thanks John seven on Wall Street Time for the Tri State

Business Report. Here s Bloomberg's head Cory. The owners and operators of all forty one Broadway theater is in New York City have agreed to adopt an optional masking policy for the month of July. The new policy ends a near year long policy of requiring masks and theaters at all times, but it stopped short of a complete removal

of the mandate. New Jersey, Illinois, and Inland California had the highest concentrations of the housing markets that faced the most risk of declining markets in the first quarter of two. Report says the biggest clusters of vulnerable markets are in the New York City and Chicago areas. The New Jersey Assembly has passed legislation that would ease the burden of tax increases on small businesses. Now, business leaders want to

build a past the state Senate. The State Business and Industry Association tells The Star Ledger businesses are confronting about two hundred fifty million dollars and added taxes this fiscal year. And your Bloomberg Try State Business Report. I did Corey, thank you at It's five thirty eight on Wall Street. Bloomberg Radio is on the air from San Francisco to

New York, London to Hong Kong. Let's check in with our global news team for some of the top stories heard on our three hundred Aphilia radio stations around the world. I'm Steve potas content and Wins in New York. We're talking about how some vacant Wall Street office spaces are being converted into places to live. M Corney Donahoe on

ktr H in Houston. Target is calling the July fourth weekend a big test for consumer demand, and Lisa Matteo and on km OX and St. Louis, I'll be reporting on why the fourth of July holiday will be a big test for consumers. I'm Gina Servetti in for Double BBM in Chicago. I'm reporting that Boeimes at CEO says air travel demand appears to be sustainable, but Dave Calhoun offered a bleak view of the supply problems hitting the aviation industry. I'm ad Cory on w A t AM

in Cleveland. I'm reporting Walgreen Cower's announced the new alliance with Buckeye Health Plan. Those are some of the stories our twenty seven hundred Bloomberg journalists and analysts are working on this morning around the world. It's five thirty nine on Wall Street. The following is an editorial from Bloomberg Opinion. In agreeing to visit Saudi Arabia next month, President Joe Biden has stepped back from his vow to treat the country as a pariah. Critics have blasted him for overlooking

Saudi human rights violations. Even so, Biden's trip conserve a valuable purpose. Healthy U s Saudi ties are critical to call me in a volatile part of the world and stabilizing global energy markets. When he meets with Crown Prince Mohammed Bin Salomon, Biden should make clear that improved relations

require both nations to respect each other's core interests. For example, if the US is to reaffirm its commitment to Saudi security, then Saudi leaders must pull back from their flirtation with the Russians and Chinese Biden's trip should be seen not as a concession, but as an investment in a relationship that both states need to work. If Biden can restore that freight understanding, his visit will have been worth it. This editorial was written by the Bloomberg Opinion in the

editorial Board. I'm David Shipley. For more Bloomberg opinion, please go to Bloomberg dot com, Slash Opinion or Opian. Go on the Bloomberg terminal. This has been Bloomberg opinion and you can hear Bloomberg opinion editorials every weekday at this time. Terminal customers can read more at opie I n go.

This is Bloomberg Bloomberg eleven three oh weather. Scattered showers, especially across Long Island in Connecticut, otherwise mostly cloudy, low seventies today, will turn partably mostly cloudy tomorrow, upper seventies, low eighties Friday. Right now sixty six in Central Park Markets. Headlines and breaking news twenty four hours a day at Bloomberg dot Com, the Bloomberg Business Outland at Bloomberg Quick Take. This is a Bloomberg business clash and I'm Karen Moscow.

And stocks in Europe are falling along with US stock index, futures and commodities, and at ever louder warnings at the Federal Reserve monetary tightening may lead to an economic downturn. We check the markets every fifteen minutes throughout the trading day on Bloomberg s and P future is down fifty eight points now, futures down four hundred and NASDAG futures down two hundred one. The decks in Germany's down two point one percent, the ten year treasury up seventeen thirty seconds.

You have three point zero percent yield on the two year three point one zero percent. NIMEX screwed oil is down about five percent on five dollars twenty two cents, and a hundred four dollars thirty cents of barrel comex s goold is down half percent or nine dollars forty cents. In eighteen twenty nine, fifty announced the euro one point oh five on three against the dollar, British found one point to two to six and the yen one thirty five point eight six and bitcoin this morning down two

percent at twenty thousand, four hundred twenty dollars. And that's a Bloomberg business flash now here's Michael Barr with more on what's going on around the world. Michael Karen, thank you very much. The Senate voted on gun legislation last night after weeks of negotiations. The biopartisan deal had ten Republican senators on board. Some of the provisions include tougher background checks for firearms buyers under twenty one. An earthquake

and Afghanistan has killed at least nine twenty people. The magnitude six point one earthquake struck in the remote parts of eastern Afghanistan, with officials saying hundreds were injured. In baseball, the Yankees and Mets lost the Red Sox one. The Nationals beat the Orioles three zip. The Giants won the A's lost. Global news twenty more hours a day on air and on Bloomberg Quicktake, powered by more than twenty seven d journalists and analyists more than a hundred twenty countries.

I'm Michael Barn. This is Bloomberg. Nathan all right, Michael, thank you. We're coming up to five forty nine on Wall Street Line from the Bloomberg Interactive Brokers Studios. This is Bloomberg Daybreak, and investors eyes will be on Capitol Hill later this morning, as Federal Reserve Chairman Jerome Powell begins two days of testimony on monetary policy, markets will be looking for clues on what the Fed plans to

do to rain in forty year inflation. Ahead of that, we're joined by David Rosenberg, Founder, chief economist and strategist at Rosenberg Research. David, good morning, It's always great to speak with you, and we just heard from the White House this morning that President Biden is going to be making a call to try to rain in inflation in gas prices by calling for a three month suspension of the federal gas tax. Do you see that having any

kind of impact if Congress goes along with it. Well, look, if it does happen, we're talking about eighteen cents for a short period of time, So it's nothing more than a gimmick, um politically motivated to show that the White House is trying to do something about inflation. But I mean, I say, come on, eighteen cents. That takes gasoline prices back to where they were three weeks ago and would still leave them up more than fifty percent year of

the year. So it's really, um a nothing more than a very small move to make it seem as though the White House is doing something and the economic impact is going to be in phantismal. Interesting though, that the President up to now has said that in order to get a handle on inflation, the Federal Reserve needs room to work, to have its independence to make the decisions that it's going to make. We are going to hear from Chairman Powell later this morning. He's been talking about

a couple of seventy five basis point moves. Are you expecting that we're going to get any more clarity from Chairman Powell today when he goes before the Senate Banking Committee? Well, how much more clarity can we possibly get that we didn't get exactly a week ago at his press conference following the Effluenc meeting. So a week has gone by, what really has changed all that much? And what he continued to stress over and over again was the FED

primary focus on headline inflation. Uh, back in the day used to be that core inflation was really the driving force for the Fed. UM, but now they think they can somehow control food and energy prices. UM. So I would say that he's going to continue to beat the drum of the necessity again from a political standpoint for the lower middle class being hit by headline inflation. Uh that um, it's uh damn, the torpedoes full steam ahead. That the FED is going to continue to raise interest

rates here until something breaks. So do you think that Chairman Palace swayed by the likes of Richmond fred President Thomas Barkin, who just came out and said the FED should go as aggressively as it can, as fast as it can, as long as it doesn't do damage to the economy. Well, I don't know, is that I could flip the question around, is it Powell gonna follow a Barkin or is Barkin following Powell? Or basically maybe outside of esther George and that was a surprise descent from

a traditional hawk. I think most people at the FED are thinking fifty or seventy five. A lot are still tilted towards seventy five basis point. They know full well that we're in a bear market and equities the FED is never tightened policy into this sort of a bear market before. But like I said, they believe their mandate now is headline inflation. It's over eight percent, and they're going to continue to tighten policy and probably will hope

that we don't fall into recession. But look, we've had fourteen FED tightening cycle since nineteen fifty eleven of them most of them unintended lemit economy and recession. So when you're taking a look right now with the stock market is telling you, the stock market is telling you both the headline and all the cyclical components beneath the veneer, is that a recession is staring us in the face.

So but my sense is that that's if the Fed is determined to get this sort of inflation principally not exclusively principally supply induced. They want to get inflation back down towards two percent, you will only achieve it in this sort of environment by generating a contraction and accurate demand. The GDP is accurate demand, and it means a recession is coming sooner rather than later. That's your call then, that we're going to see a recession, perhaps as soon

as this year. I think it's probably steering us in the face. I don't know why people think it's next year's story. The stock market tends to lead by roughly six months. Attorney points not once have we entered into a bear market where the lead time was twelve months. It's never happened before. So yeah, I think that it's most likely starting in the second half of the year, And it could have already started when you consider we

had negative one five Q one real GDP. Of course, all the economists say, oh, we'll just ignore inventories and exports as if they don't matter. And Atlanta fat is down to zero for Q two. So I think that we're uh, you know, we the k the de k in the numbers are clearly evident that we're heading into a contraction in real GDP. I think it will come more forcefully in the second half of the year. Uh.

And the leading indicators are telling you that. I mean, how often in the past have we had three months in a row of negative readings and the conference boards leading economic indicator, nobody talks about this, down three months in a row and down four the five past months,

and all people are focused on his inflation inflations. By the way, he does kill heal g DT on its own, but nobody talks about these things that basically the conference sports meeting indicators telling you, by the way that the odds of recession are nine if you live with the historical record. Thanks for this, David, good having you on with a David Rosenberg of Rosenberg Research, Karen Nathan. It is five fifty four on Wall Street. Now to a

legal story we're watching. The Supreme Court will issue opinions again on Thursday, with only thirteen cases left to decide before the summer recess. The most highly anticipated is a decision on Mississippi's ban on abortions, which could mean the end of Roe v. Wade, according to a Elite draft opinion. President Biden has said he is considering executive actions to

protect abortion rights for more Bloomberg's doing grossos Vic. To Mary Ziegler, professor at u C. Davis Law School, there's also a suggestion of using federal funds to help pay travel and lodging costs for poor women who are crossing state lines to get an abortion, assuming that states allow people to travel out of state for abortion without effectively shutting down abortion providers. Assuming that happens, then it would be important for people have the ability to pay right.

There will again probably be legal challenges, primarily based on the High Amendment, so some people will say the High amendment is narrow, it's just about Medicaid reimbursement for abortion. Others will point to language and the affordable character the heighamanman essentially saying, you know, differing the cost of abortion is kind amount to pay for abortion, and that various aspects of federal law make that impossible. Again, I don't know how that kind of federal challenge will go, but

we would again expect to see litigation about that. We've talked before about abortion pills and how that may be the new frontier for abortion. Right now, the FDA requires any pharmacy that distributes a drug to obtain a special license. So another proposal is just to make it easier to obtain abortion pills. Is that an easy fix? I'm that's

certainly an easier fixed. It won't obviously address all of the kinds of things that we see Red States planning to do in the aftermath of Rugby Wad being overturned. But I think for many supporters of abortion rights, the additional restrictions on access to abortion medication are not warranted based on existing evidence, and they do make abortion medication harder to get. I think, obviously in states that will

seek to criminalize abortion medication. That's only a piece of a bigger picture, but I think it's certainly something that abortion rights supporters will see it to be overdue. The states that want to criminalize abortion pills, how do you

think they'll go about that? More likely, what we're going to see um is some combination of kind of bounty schemes like we've seen with Texas spate, or states incentivized people or potentially even require people to report when they have evidence of an abortion taking place, or we're likely

to see lots of cyber surveillance. There are lots of ways that government can access your online data, whether that's someone who's searched on Google for abortion, or someone's cell phone location data if they've traveled for an abortion period, tracker apps, and so on, which is why you've seen some proposals from Democrats to focus on digital privacy, because of course digital privacy concerns would affect those speaking abortions, but potentially many others as well as states are trying

to figure out who's having abortions. They may be surveying people of reproductive age or even just people who are researching abortion, and that's very Ziggler professor at You See David's Law school speaking at Bloomberg Student Grass So catch more of that interview, plus analysis of the latest legal news my subscribing to the Bloomberg Law Podcast or downloading this show at Bloomberg dot com slash podcast, and our top stories are straight ahead as Bloomberg day Break continues.

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