Bloomberg Daybreak: September 29, 2022 - Hour 1 (Radio)

the bands solitary confinement in jails. Plus, the US Senate is ready to pass the bill that will keep the government open. I'm Michael barn More Ahead, I'm John Stash Hour and sports Aaron Judge hit his record time sixty first abroad and Yankee went in Toronto, a big comeback

win for the men. That's all trendy Ahead on Bloomberg Daybreak on Bloomberg E Live in Treo, New York, Bloomberg on Washington, d C, Bloomberg one oh six one, Boston, Bloomberg nine sixties and Francisco Syrius XM one nineteen and around the World Old on Bloomberg Radio dot Com and via the Bloomberg Business. Good morning, I'm Nathan Hagar and I'm pared Moscow. US Dock Index futures are lower this morning.

We are coming up to five o one on Wall Street, and we checked the markets every fifteen minutes throughout the trading day. On Bloomberg. SNP futures down forty four points this morning, Down futures down three hundred twenty six and Nastack future is following one hundred sixty two decks in Germany's down one point seven percent. Ten year treasury down thirty seconds, yell three point eight four percent, and they

yield on the two year four point two zero percent. Nathan, all right, Karen, we'll have one of the markets in a minute, but we want to get you the latest on Hurricane Ian. First, it crashed into Florida yesterday, bringing massive storm search and knocking out power to more than two million homes and businesses. President Biden says the federal government stands ready to help. That includes dis fashion hundreds of female personnel and activating thousands of National Guard members.

I've also developed the searching risk the team and deploy them Mulbible federalisy season, and then they're already on the ground and ready to hillp President Biden is also urging Florida residents to follow all mornings from local officials. Ian has weakened since it hit landed is now a tropical storm with top wind speeds currently around sixty five miles per hour. Let's get more on the track now with Bloomberg meteorologist Robed Caroline, Nathan Karen and Ian now affecting

central and northeastern Florida. It is moving off towards the north and east. This morning. It will bring wind gus over sixty miles an hour two portions of northeastern Florida. Now, the system is forecast to move out over the waters of the Atlantic and it may actually regain some strength before moving back inland over Georgia and the Carolinas in the next thirty six hours. Again, it continues to produce

prodigious rainfall. We're expect anywhere from five to ten inches of rain north of the storm today, with additional rainfall into the weekend. Yesterday, it went ashore in southwestern Florida with winds of over a hundred and fifty miles an hour and a storm surge that costs some historic flooding in the Naples area. Also are around Fort Myers, Fort Myers Beach, Vanita Beach, all those areas for a significant flooding.

Nathan and Karen, All right, grab, thank you, and of course I'll be checking in with Bloomberg meteorologists Robbed Caroline throughout the morning right here on Bloomberg Radio. And now back to the volatile markets. We're seeing the pound snap a two day gain following that historic bond buying program from the Bank of England. They get the very latest live from London with the Bloomberg's hun parts. Good morning, En,

Good morning Karen, Nathan. After yesterday's central bank driven rally, UK stock, sovereign bonds and the pounds all lower this morning. Prominister Liz Trust today defending her government's huge fiscal stimulus package, blaming global economic pressures for the market fallout from her announcement last week. She says the tax cuts, the biggest in fifty years, are the right plan for the UK.

Today's slide puts the pounds on track for its worst month since Britain voted to leave the European Union more than six years ago. In London. I'm you and part Sploomboo Daybreak, Are you and thank you? Former US Treasury Secretary Larry Summers the weighing in on the turmoil and markets. He's welcoming intervention from the Bank of England, but says

the UK is still facing serious issues. I think it was the right thing to do given the technical factors that are that had arisen UH in the market, and it's obviously brought some important stability to the guilt market. It does not resolve any of the fundamental contradictions in UH British policy. Former Treasury Secretary Larry Summer spoke with Bloomberg hours after the Bank of England pledged unlimited purchases

of long dated government bonds. Well, Nathan back here in the US, the White House is alarmed over the market turmoil triggered by the new UK Now it's encouraging Prime Minister list Trust to dial back or economic plans to get details now from Bloomberg's Amy Morris from our ninety nine one newsroom in Washington. The plunge in UK assets earlier this week contributed to declines in US treasuries, sources

tell Bloomberg News. Treasury officials are concerned at the volatility in the markets, and they're working through the I m F to put more pressure on Trust's government. Treasury Secretary Janet Yellen downplay the turbulence, but Commerce Secretary Gina Raimondo called Trust's approach of cutting taxes while increasing spending misguided. Trust's government argues it's program will boost long term growth in Washington, I'm maybe more as Bloomberg day break, Okamy,

thank you. We have some personnel news coming out of Washington. Sources say Treasury Secretary Janet Yellen has told the White House she will stay past the November elections. Her desire to stay comes as the Biden administration prepares for potential cabinet and other senior personnel changes. Those decisions may depend on how well or poorly Democrats do in the elections. Meantime, a House proposal to restrict stock trading by government officials

has hit a snag. Nathan the bill Woodker tail stock ownership and trading by members of Congress, the president, vice president, Supreme Court justices, and other high ranking officials, but it's currently being held up by Democratic in fighting. The bill's sponsors introduced the legislation yesterday, but multiple House officials familiar with discussions said any floor action on the measure has been shelved, at least for now. Lawmakers are scheduled to

leave Washington this week until after the November election. Now, let's turn to geopolitics, now, Karen, the US wants to resume talks with China. Ambassador Nicholas Burns is calling on the nation to reopen discussions that were halted after how Speaker Nancy Pelosi's visit to Taiwan. We do not seek conflict, and we're gonna try to compete with China vigorously and then work with China where we can, and we hope the Chinese will reciprocate. They've frozen a lot of our

dialogues since Speaker Pelosi's visit. Our message to the Chinese is, let's talk, open these dialogues and let's move forward. Ambassador Nicholas burn spoke of the Bilking Institute Asia Summit in Singapore. He says the US needs store to China on issues like climate change, in health, and incorporate news. Nathan. Amazon

is boosting pay for hourly workers in the US. The online retailing giants said the move O raised the average starting wage for most frontline employees and warehousing and transportation to nineteen dollars an hour. Bloomberg Day Breaks brought to you by SEI Asset managers don't get results that are off the charts when their solutions are off the shelf. Learned how SEI is operating platform can turn infrastructure into a competitive advantage at se i C, dot Com, slash Tech.

This is Bloomberg and it's now five oh seven on Wall Street. We're see twenty minute delays on the New Jersey Transit Northeast Quarter and it's fifty five degrees in Central Park. Michael Barr has more on what's going on in New York and around the world. Good morning, Michael, Good morning Nathan. The New York City Council is deciding whether the band solitary confinement in jails. Demonstrators on both sides clashed on the steps of City Hall ahead of

a hearing on the bill. Any Bosco of the Correction Officers Benevolent Association says the notion that we're torturing individuals in our system is not the case. However, Democratic City Council member Tiffany Common argued we need to know what is the route of the violence. A New Jersey bank agreed to pay thirteen million dollars to resolve claims of

discriminatory lending practices. Lakeland Bank has been ranked best bank in New Jersey, but U S Attorney Phillips so Lingers says that's not the case for people of color and at least three counties. If you lived in a black or Hispanic neighborhood in these counties, you likely have little opportunity to apply for, let alone obtain a mortgage from Lakeland Bank. U S Attorney Phillips Lingers said Lakeland Bank red line these neighborhoods refused to service them in violation

of the Fair Housing Act. The U. S. Senate is ready to pass the bill that will keep the government open and spending until that least the middle of December. Democratic Representative Jim mcgovernor of Massachusetts, thinks the government funding bill will pass by tomorrow. We're gonna do everything we can to make sure we don't have a government shutdown. Remember the last time we had a government shutdown, the Republicans controlled the White House, the House, and the Senate.

I mean that was irresponsible. We would we would We would not do that. And the fact of the matter is there's a lot of stuff that we I would like to see in a cr and there's a lot of stuff, you know, that I would like to add on, and I know I can't get it best to Senate. So we have to do the best we can working with the people that we we have to deal with. Representative McGovern spoke on sound On, which airs at five

pm weekdays on Bloomberg. Both parties agreed to a temporary continuing spending bill that will include disaster raid for whether batter to Kentucky, Alabama, Texas, Alaska, and Puerto Rico. Vice President Kamala Harris is in South Korea. Harris met with the South Korean president to reinforce the US South Korean Alliance. For seven decades, the alliance between the United States and the Republic of Korea has been a lynchpin of security

and prosperity. Vice President Harris later traveled to the demilitarized zone that separates North and South Korea. Global News twenty four hours a day on air and on Bloomberg Quicktake, powered by more than dred journalists and analysts. More than a hundred twenty countries. Michael barn This is Bloomberg Nather. Thanks Michael. Up to five ten on All Street Time for the Bloomberg Sports Update. Good morning, John stash Our,

Good Marrian Nathan. Perhaps you've heard Aaron Judge has been trying to hit his sixty feet over run of the season seven straight games where networks broke into programming. The show is that Fats his mother and Roger Marris's son crossed borders to watch his at bats and in Toronto seventh any Tim masa on the mound? John Stirling w F there goes did he loved to a time? Till

Us far Good has gone number sixty one. He times Roger Maris for the American League single season record, who with sixty one home run hits a two run Judge and Black Yankee and American League record. Of course, the reason this has gotten so much attention it's the so called clean record. The only ones that hit more in the season Barry Bonds, Bark McGuire, Sammy Sosa, all of their seasons tainted by steroid youth. Judge has seven games left try and hit his sixty second. The outcome the

game fairly meaningless. That's why Aaron Brune had Anthony Rizzo managed the game. Yankees beat the Blue Jays eight to three. Meanwhile, want to win for the Mets, this game very meaningful as the Mets try to win the nl East. That means to buy avoiding the Dodgers until the NLCS. They trailed Miami for nothing seventh any Edwardo Escobar to the rescue two run omer, seventh any game time two run single on the eighth game winning rb I hit in the tenth Mets won five four, just as Atlanta lost

in Tennings and Washington. So the three game series that begins tomorrow in Atlanta starts with the Mets one game ahead. Whether it could be a real issue for the series Saturday, especially jetsonated officials. Zach Wilson will return from his knee injury and starts Sunday in Pittsburgh. John Scash at whar Bloomberg Sports, Nathan, thank you, john S andp futures are down thirty four point Stouth futures down two undred forty seven,

nest At futures down a hundred twenty eight points. The pound at one point zero eight to one against the dollar. We look at the market volatile city Next with Patrick Armstrong, chief investment Officer at Gloury Mewell. Bloomberg day Break is brought to you by the New York Community Trust. Your name will live on as a champion of the causes you care about for years to come through a charitable

bequest to the New York Community Trust. Learn more at Philanthropists dot n y C. Markets headlines and breaking news twenty four hours a day at Bloomberg dot Com, the Bloomberg Business Out and at Bloomberg Quick Take, He's a Bloomberg Business Lash and I'm Carrod Moscow and risk off. Sentiment is returning to markets as concerns about inflation and the risk of the global recession over shadows the Bank

of Englet's move to restore calm. You check the markets every fifteen minutes throughout the trading day on Bloomberg Right NEWSNP future is down thirty one points down, futures down two twenty four, nasty, futures down one hundred seventeen, and the decks in Germany's down one point to first at ten. Your treasury down twenty thirty seconds, You three point eight five percent. They yield on the two year four point

to zero percent. Nimex screwed oil is down a quarter percent or twenty one cents at eighty one cents of barrel. Comex school down nine tenths per cent or fifteen dollars twenty cents at sixteen fifty four eight announce the euro point zero against the dollar, British pound one point zero eight three one, and the yen at one forty four point seven zero. Looking at bitcoin, it's down seven tenths percent at nineteen thousand, four hundred dollars. And as a

Bloomberg business flash, now here's Michael Barr with more. I'm what's going on around the world, Muddle, good morning, Good morning, Karen. Hurricane Ian has left the path of destruction in southwest Florida, trapping people and flooded homes, damaging the roof of a hospital intensive care unit, and knocking out power to about two million people. I now a tropical storm is now

aiming for the Atlantic coast. The Biden administration blasted Russia's attempt to legitimize its control of Ukrainian territories through what they're calling a stay age vote to appear as if there is Russian loyalty in these towns. In baseball, the Yankees beat the Blue Jays eight three, but more importantly, Aaron Judge hit his sixty first home run, tying Roger Merris for the a L record. The Mets, Nationals and Giants one. The Red Sox beat the Orioles three one.

The A's lost. Global news twenty four hours a day on here and on Bloomberg Quick Tank, powered by more than twenty seven hundred journalist and analysts more than a hundred twenty countries. Michael Barr and this is Bloomberg. Nathan alright, Michael, thank you. It is five nineteen on Wall Street Live from the Bloomberg Interactive Broker Studios. This is Bloomberg Daybreak, and we're joined this morning by Patrick Armstrong, chief investment

officer at PLUIMI Wealth. As we see a risk off mood return to this market, particularly given the crisis happening in the u K. How deep is this crisis of confidence in Liz Trust's financial plan, Patrick, um, I think you've seen it in the currency. You've seen it in the guilt market and populous policies, which are basically promising things that you can't afford. Worked very well when interest

rates were zero. Um, we're getting into an environment now where the Bank of England is going to be probably up to five three. So promising unfunded tax cuts and promising spending, Um, it just doesn't make sense anymore, and the markets reacting to that. So there's absolutely no confidence in these policies right now. Is there contagion risk for the broader economy? Is there contagious risk for the US market with what's happening in the UK? Limited? Um, there's some,

but I don't think it's significant for the U S economy. Um. The US market is impacted by the overall global interest rate environment and the Bank of England basically buying longer duration guilt seemed to push down treasury yields even yesterday

a little bit. So, Um, what the UK does, it's pretty much it's bailing out its pension systems that basically have a lot of liabilities they match with long duration guilt, and some of those guilts fell thirty to fifty in the last few days as a higher long term interest rates are now discounted in their prices. Now we're seeing a lot of selling in benchmark and long dated US

treasuries this morning what's driving that? Do you think, Um, well, you've got persistent inflation, you've got big debts, you've got deficits, and populism is still the policy that's working for most Western governments. So the UK is had an extreme but I think all Western governments are at risk basically with their policies and the spending a lot and not really wanting to increase taxes. Austerity never is mentioned anywhere, and I think higher yields are probably a consequence of that.

That being said, I have closed my tenure shorts on

treasuries yesterday. So we've been short treasuries now for well over a year, and we did close them as they moved past three point date they got all the way up to four percent yields, but we've closed that position now because really yields at one point six percent, So, um, that's very different from where we were a year ago when we had negative real yields of Yeah, we have the tenure yield right now is sitting at three point five as you mentioned, it did breach four percent earlier

this week. Where do you see US treasury yields headed at this point now that you've covered that short? Yeah, I actually think it's going to I wouldn't be surprised if it does gravitate up towards four, but I think the bulk of the move has happened now. UM, So I wouldn't be surprised if yields do move higher from here, But I don't think you're going to have the sharp

move that we've had. Um. You are being compensated with returns above inflation to invest in treasuries now, and for years now, the only buyer of treasuries has been the FED. The FED selling treasuries. But I think a real yields where they are now, you will be enticing natural investment demand as well. It's interesting because we keep hearing from FED speakers doubling down on the need for higher for

longer interest rates to tamp down inflation. Are you looking for a Fed pivot away from that stance anytime soon? Not anytime soon. I think the market's perfectly discounted what the Fed has said they're going to do, and I actually think we've probably passed peak hawkishness from the Fed. I think Powell's last press conference, he and the dots

that came out really showed a hawkish FED. The market totally bought into it, and I don't think there's going to be another move more hawkish than those dots are implying. But I don't think they're going to move away from them quickly either. So if the economy does deteriorate, or if there is some sort of systemic risk coming from a geopolitical event or a financial crisis in another country, that the federal change course. But I think as as things stand, they do intend to meet the dots. But

I don't think those dots will be revised higher. Not about thirty seconds left here, Patrick, we keep hearing from more banks raising their odds for the probability of a recession of sparked by this FED. What's your call on that? Yeah, I think it's probably tipped into likelihood now. So I think UK and Europe we're in a recession now in fourth quarter is going to be recession. Um the United States, the employment situation is going to deteriorate. The higher interest

rates probably will start to have some impact unemployment. And you see I see the U S flirting with a recession. I don't think it will be significant, but it's definite possibility and probably a slight probability, but I think it'll be shallow flirting with recession. We'll leave it there. Thanks as always, Patrick, great to get your thoughts. Patrick Armstrong with us this morning, chief investment officer at Player Gramy Wealth. As we take a look at the market slide continuing

this morning. We have SMP futures right now down thirty two points down, futures down two or twenty eight. Nasdaq futures are lower by a hundred twenty five points ten. Your treasury is down twenty nine thirty seconds now, the yield three point eight four percent, yield on the two year four point to zero, and I'm excrude moving a bit lower now down two tenths percent at eighty one ninety six cents of barrel and the British pound one

point zero eight three nine against the dollar. You're listening to Bloomberg Daybreak Bloomberg eleven three oh weather, sunshine today, upper sixties of increasing clouds tomorrow, upper sixties, light rain from Ian moves in Saturday. It's going to be rain

all day Sunday as well. Fifty five degrees. Currently broadcasting live from the Bloomberg Interactive Broker Studio in New York, Bloomberg elov In freed to Washington, d C. Bloomberg to Boston, Bloomberg, what All six one to San Francisco, Bloomberg sixty to the country, Sirius XM to the one nineteen and around the globe the Bloomberg Business at and Bloomberg Radio dot Com. This is Bloomberg Daybreak. It's five thirty on Wall Street.

Good morning. I'm Nathan Hager and I'm Karen Moscow. We are just about four hours away from the open of US trading. Let's get you up to date on the news you need to know at this hour. Again. Ian as week into a tropical storm after hitting Florida with a deadly surge of water and catastrophic winds. About two point three million homes are without power. They get the very latest on the storm from Bloomberg meteorologist Rob Caroline,

Karen and Nathan. Ian tied for the fourth strongest tropical weather system to ever strike the continental United States, made landfall yesterday in southwestern Florida, with winds at a hundred and fifty miles an hour and an extensive storm surge that caused very significant flooding across portions of southwestern Florida from Naples to Venice. The storm is now well inland,

headed into a northeastern Florida. Big problem will be wind gus today in excessive sixty miles and some torrential rain, particularly on the northern side of the system into North Florida. Karen and Nathan. All right, Rob, thank you. Will continue checking in with Bloomberg meteorologist Dropped Carolin throughout the morning here on Bloomberg Radio. Now, let's talk markets. The pound is resuming its slide after the Bank of England's emergency

bond buying program temporarily soothed concerns. This morning, UK Prime Minister Liz Trust once again to did a giant package of unfunded tax cuts. We're seeing both stocks and bonds in Europe fall this morning. Well here in the US, Nathan, futures are lower following yesterday's Wall Street rally, which saw the SNP five hundred snap of five day losing street.

Mac Mainley, as chief market strategist at Miller tay Back, although we could get one big wash out here in the next few days, I think we're gonna see a bounce of the last for a week or two or maybe even three, but that will find another opportunity to raise some cash. And Miller Tayback Chief market strategist Matt Mainlee said the sn P five hundred could go as low as three thousand. It closed just about thirty seven hundred yesterday. We got some personnel news out of Washington.

Karen Bloomberg News has learned Treasury Secretary Janet Yellen plans to stay on after the November elections. Her desire to stay comes as the Biden administration prepares for potential cabinet and other senior personnel changes and incorporate news Nathan. Amazon is boosting pay for hourly workers in the US. The company said the move will raise the average starting wage for most frontline employees and warehousing and transportation to nineteen

dollars an hour. Futures this morning, again, as we said, are moving lower. S ANDP Future is down thirty four points down, Futures down two hundred forty Nasdack Future is falling down one two. That's down about one point one per cent. The decks in Germany is down one point two percent, the ten year Treasury down twenty thirty seconds, Yell three point eight three percent, and the yield on the two year four point one nine percent, and Nimex screwed oil is down to tens per cent or fifteen

cents and eighty two dollars of barrel. Straight ahead, your latest local headlines, plus a check of sports and this is Bloomberg. Thanks ting three on Wall Street, fifty four degrees in Central Park, heads up, New Jersey transit writers twenty minute delays on the Northeast Corridor, saying more in traffic shortly, First Michael Barr with what else is going on in New York and around the world. Michael Nathan, thank you very much. The New York City Council is

deciding whether the band solitary confinement in jails. Many buss Ago of the Correction Officers Anevolent Association says the notion that we're torturing individuals in our system is not the case. However, Democratic City Council member Tiffany Common argued, we need to know what is the root of the violence. The ban is opposed by Mayor Eric Adams. It looks like the Senate will pass a bill to fund the government through

mid December. Democratic Representative Jim mcgovernor of Massachusetts, was asked about the odds of the measure passing by Friday. I believe it will. I believe it will. I mean, I think it will pass the Senate either today or tomorrow, and then it will come right to the House, and you know, and we're prop to bring it to the

floor immediately. And my hope is that after the election, we can you know, I know, some of the differences and get an omnibus budget pass so that we can have fundy for the for all of next year and we can we can move on. Representative McGovern spoke on sound On, which airs weekdays at five pm on Bloomberg. In a rare show of unity, both parties and the Senate agreed to a temporary continuing spending bill that will include disaster aid for whether battery can Tucky, Alabama, Texas, Alaska,

and Puerto Rico. Vice President Kamala Harris is capping a trip to Asia with a stop at the Demilitarized Zone dividing the Korean Peninsula. Harris thank us personnel at the DMZ for their service. How grateful than what you do. Before going to the d MZ, Harris met with South Korean President yunsk Yole and praised the alliance between the countries. One of hip hop's biggest names has died. Rapper Coulio with heads including Gangs to Paradise, died at the Los

Angeles home of a friend. The cause was not immediately clear. Grammy winner Coolio was fifty nine Global News twenty four hours a day on air and on Bloomberg Quicktake, powered by more than journalist and analysts more than a hundred twenty countries. Michael Bard, this is Bloomberg, Nathan, thanks Michael on Wall Streets and for the Bloomberg Sports update. He finally did it. John Ston Shower and Athan in a

symmetry is kind of remarkable. Roger Marri's at sixty one home runs in X one and now sixty one years later, Aaron Judge has joined him Yankee number ninety nine with Yankee number nine, only two in American League history with that many home run That's one thing that's so special about the Yankees organization is called the guys that came before us and kind of paved the way, and you know, played the game the right way, to do things the right way, did a lot of great things in this game.

And getting a chance of me, you know, mentioned with those guys now as I can't even describe it. It's it's it's uh incredible honor, that's for sure. Judge, of course, went seven games without a homer, but seventh inning in Toronto, facing the Blue Jays, Tim masa a liner the left. The ball dropped down into the Blue Jay's bullpen, fought by Toronto coach Matt Bushman. Yankee reliever Zach Brittain went into the Jay's pen in Toronto's Jordan Romano handed written

the ball. Britain gave it the judge, who has seven games left try and hit number sixty two. Starting tomorrow the Baltimore at the Stadium, Yankees beat the Blue Jays eight to three the Mets with a huge City field victory comes courtesy of Eduardo Escobar over the last four innings.

Escobar had three hits and drove in all five met rons as they came back from afore nothing deficit beat Miami five four intendants, just as Atlanta lost intent at Washington to the Met's back and sole possession of first game ahead of the Braves, and now comes the three game series starting tomorrow, weather permitting in Atlanta. One met win in the series means they owned the type writer.

When the Jets place Sunday in Pittsburgh, Zac Wilson will make his season debut at quarterback, returning from his knee injuryym Stashward Bloomberg Sports Nathan thanks John seven on Wall Street Time for the Tri State Business Report. Here's Bloomberg zed Corey. Several states, including New Jersey, have projected a slowdown in sales tax growth in the next fiscal year

due to shift in consumer spending patterns. States are likely to see drops and income tax collections as stock market volatility threatens to wipe out games and places like New York and California, About two hundred union employees at the Central New York distribution center for the food suppliers Cisco walked off the job Tuesday night. The strike effects applies to local restaurants as well as big institutions like schools, hospitals,

and nursing homes. Jet fuel premiums are skyrocketing in New York and Houston as low inventories stoke concerns of a supplying pinch. The premiums for barrels of New York Harbord jet fuel has jumped nearly twentyfold since the start of the week. On the Gulf Coast, the premium over futures nearly doubled to the highest and fourteen years. At your Bloomberg Dry State Business Report, I'm Ed Corey 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 affiliate radio stations around the world. I'm Steve podascon w f L A, Tampa Bay. We're talking about the billions of dollars lost to Florida's tourism industry in the wake of Hurricane Ian. I'm Corney donahoan ktr H in Houston. Boile is heading for its first quarterly decline in more than two years. I'm Stephen Carol

and Bloomberg d A B Digical Radio in London. We've been reporting on Prime Minister list Trust saying her plan is the right one for the UK despite the turmoil and financial markets. I'm Ad Cory on w w J in Detroit. I'm reporting Ship the same day delivery service is launching an accelerator to support local redmailers in Detroit, and 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 nine on Wall Street. The following is an editorial from Bloomberg Opinion. This editorial was written by the Bloomberg Editorial Board. Treasury securities play a crucial role in global finance, so it's troubling that the treasury market has faltered several times over the past decade.

The market's challenges stem from a fundamental imbalance. As deficit spending has driven up the US government's debt, the value of publicly traded treasuries has ballooned, far outpacing the financial resources of the large dealer banks that are supposed to facilitate orderly trade in this market. As a result, the dealers are occasionally unable or unwilling to handle the volume

of trades that investors want to make. Given the US government debt isn't likely to shrink anytime soon, the best solution is to get more institutions involved that would relieve pressure on dealer's balance sheets. As of now, most people have no reason to worry about the treasury market Let's keep it that way. This editorial was written by the Bloomberg Editorial Board. For more Bloomberg opinion, please go to Bloomberg dot com, slash opinion or O P I n

go on the Bloomberg terminal. This has been Bloomberg Opinion. Listen for Bloomberg opinion editorials every weekday. At this time, terminal customers can read more at OPI n go. SMP futures are moving lower by thirty four points now TOAL futures down two hundred forty three, NASDAC futures down a hundred twenty five points. The tenure Treasury is down twenty thirty seconds. Yield three British pound one point zero eight

five seven against the dollar. Sam Stove balls with us next on this market, Chief investment strategist at c f R A Bloomberg eleven three oh weather sunshine up for sixties today, increasing high cloudiness tomorrow, upper sixties. Light rain moves in from Ian's Saturday afternoon high Your sixty five with rain on Sunday in the mid sixties fifty four. Right now, markets headlines and breaking news twenty four hours

a day at Bloomberg dot Com. The Bloomberg Business atand at Bloomberg Quick takes a Bloomberg Business Flash, But I'm Karen Moscow and it's Flash brought to you by SEI. Built on advanced technologies and fifty years of innovation. SEI off as non said managers, a comprehensive and flexible operations outsourcing platform. Go to s C I C dot com

slash managers. Risk off sentiment returning to markets as concerned about inflation and the risk of global recession over shadows the Bank of England's move to restore calm, the pound snapping a two day gain, and stocks in US stock index futures are falling as Hong Kong's Hang Sing Tech

index touched its lowest since inception. You check the markets over fifteen minutes throughout the trading day on Bloomberg, SMP future is down about twenty six points now futures down a hundred seventy eight and NASDAG futures down one hundred. The decks in Germany's down nine tenths of upper sent ten year treasury down twenty six thirty seconds. You know three point three percent they yield on the two year

four point to zero percent. NIMEX screwed oil is up about two tenths percent now of twelve cents at eighty two dollars. Twenty seven cents of arrel Co makes goal down seven tenths per cent, or twelve dollars fifty cents at sixteen fifty seven sixty ounce. The euro point nine seven oh two against the dollar, British found one point eight eight one and again one point six five. Bitcoin is down four ten percent at nineteen thousand, five hundred dollars.

That's a bloomberg business flash. Now here's Michael Barr with Moore on what's going on around the world. Michael, Karen, thank you very much. Floridians are awaiting daylight to see the extent of the damage still being caused by Hurricanean. More than two million customers across Florida have lost electricity. I is now a tropical storm. A new filing by former President Trump's lawyers say that's it's not eleven thousand documents or pages that were seized by the FBI at

the Mara Logo estate. They say it's more like two hundred thousand. Because of that, his attorneys argue they need more time to declare what documents they believe are covered by attorney, client or executive privilege. In baseball, the Yankees beat the Blue Jays eight three, but more importantly Aaron Judge, it is sixty first home run tying Roger Merris for the a L record. The Mets, Nationals and Giants won. The Sucks meet the Orioles three one, The A's lost.

Global news twenty four hours a day on airrand on Bloomberg Quickdake, powered by more than journalist and analysts more than a hundred twenty countries. Michael Barr, this is Bloomberg nather Nor Michael. Thanks, It's five forty nine on Wall Street Live from the Bloomberg Interactive Broker Studios. This is Bloomberg Daybreak, and Sam Stovall is with US now chief investment Strategist at CFR. A. Sam, it's great to speak with you, and it's been amazing to see some of

the day to day moves in the market. We got a two percent jump in the SMP five hundred yesterday after the Bank of England announced it was going to go ahead and buy long dated bonds. Now we're back in selling mode. I know it's uh probably risky to focus on day to day. But what do you make of these jumps and drops in the market each and

every day. Well, they're certainly surprising because even though September does have a reputation of being volatile, of the trading days in September typically see a one percent move either up or down, but we've had two and a half times that number this year. And if you think September is bad, just wait till October because that traditionally sees thirty six more volatility than the average for the other eleven months of the year. So what's driving the volatility

right now? Obviously we've got a lot of turmoil going on in the UK. Is that the focus right now or is it more about the FED? Well, I think it's a combination of items. But the real longer term worry is whether the US and the globe will be slipping into a recession, and if so, how deeply History tells us that yes, will probably be in recession here in the US because every time we've had cp I rise above six and a half percent we were at nine point one in June, we have had a bear

market with a recession. So the question is will it end up being a mild one or a deep one. So what's your calling that. Obviously we've reached a technical recession with two trade quarters of declines in growth, But what do you think is going to happen with the economy. Well, I think that it will end up at least being

a mild one. Our economists are projecting only as a point one percent fourth quarter over fourth quarter gain in GDP this year and then only eking out a one point move in three but that number has been coming down over the last several periods. So I would tend to say that we fall into probably a mild recession, with the Fed keeping a very close eye on what's going on and possibly responding the way the Bank of England did recently. Interesting that you would think that perhaps

the Fed could make that kind of intervention. There's been a lot of focus obviously, not just on interest rates, but on the winding down of the balance sheets, some quantitative tightening as well. Are you looking for the possibility that the Fed could start to ease up on on the dial back of the balance sheet. Well, I think it's always a possibility. I mean, when you've already seen a precedent occur overseas. Uh, if the financial markets do get out of hand, then the FED does have to

step in. In fact, we're expecting the yield or the FED funds rate to be peaking by the first quarter of UH and then actually see the FED start to come down in the second half of next year. So while the FED probably won't be UH starting and stopping and starting and stopping as it did in the nineteen seventies, we do believe that a year from now the FED will be have paused and will probably be working its way toward easing rates to OH about between four and

a half and four and three quarter percent. In the meantime, where do you see treasury yields going at this point, Well, we have the tenure yield at four percent for the end of this year, but then coming down on to a three point nine percent by the end of next year. Um Our feeling also is that the US stock market is likely to continue to be under pressure. The typical bear market accompanied by recession tends to be deepfall more deeper,

and last longer than those without recession. Average decline is about thirty over a fifteen month period, which would put us to a Fibonacci level of about thirty two on the smp UH and probably see the market bottom out sometime in the late first quarter of next year. It's got about thirty seconds left here, Sam, But we've seen so much strength of the dollar, it's almost as though investors think there's no alternative to the dollar at this point.

How much dollar strength do you think the FED will tolerate? Well, um, we're looking at ten point nine UM Federal Reserve Board Major Dollar Index increase in much of that has already occurred obviously, but then continued strength into UM. So I think again that's one of the factors that they said

will be looking at it. And if we find that the dollar continues to sore and pretty much strangled demand U whether it's for energy or other products around the globe, emerging markets into challenging environments, then I think the Fed probably will look to scale back. Thanks Sam, as always good speaking with you. Sam Stovall of c f R A Karen great, Nathan, thank you, And it is five fifty four on Wall Street right now. It's time for

a legal story we're watching this morning. It brings us to the biggest penalties ever against US banks for record keeping lapses, more than two billion dollars. US regulators reached settlements for a dozen banks in a sprawling investigation into how global financial firms failed to monitor employees communications on

an authorized messaging apps. For more in the case Bloomberg's doing grosso speeches, securities law attorney Robert him a partner at Tarter, Krinsky and drow In, this is a stunning amount of fines. What do these banks do that was illegal? It really is. June it's a very big announcement from the SEC and its centers around the bank's failure to preserve electronic communications that their employees engaged in that related

to work. And under the federal securities laws of broker dealers and other regulated entities have obligations to preserve all business related to communications. And what the SEC found was that, according to their settlement papers, there was widespread ignoring of that rule by these sixteen firms that settled with the SEC.

The SEC categorized their conduct as pervasive, and not only that it wasn't just regular line employees that were using personal devices for business communications, but it was senior executives, the very people that were responsible for implementing these policies were also ignoring them. In some cases, managers even texted with employees in charge of ensuring that banks comply with the law, So it could be that none of these texts were over improper conduct. It was just record keeping.

According to the SEC settlement documents, it really was just record keeping. In some instances. The SEC says that the failure of the firms to preserve the employees business related communications hampered their investigations, but they don't really say any specifics about how it was hampered or whether any sort of key evidence was lost as a result of the firm's misconduct, and so it's hard to judge really whether

any critical evidence may have been lost. But it just reinforces the SEC's position that proper record keeping as required the law is something that they're going to take very seriously. And really what this settlement focuses on is employees who in this day and age, working remotely, and many firms

have bring your own device policies to work. Under the securities law, sperms have an obligation to capture and save any business related to communications, which you know, can be very challenging in this environment because you have apps like Snapchat that delete messages shortly after their scent. We have Telegram, we have WhatsApp, and there's many, many different devices, and they often are not very easy to sync with an

employer's main brain computer and standard compliance systems. And as Robert time, a partner at Turner, Krinsky and Rogan speaking with Bloomberg sjun Grosso, it's more of that interview plus analysis of the latest legal news by listening to the Bloomberg Law Show at ten pm Eastern Time or subscribing to the Bloomberg Law Podcast, and attorneys can find exceptional legal research and business development tools at Bloomberg Law dot com. And this is Bloomberg