Bloomberg Audio Studios, podcasts, radio news. Good morning, I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today.
Boeing shares are lower by four percent with labor unrest for the planemaker. For the first time in sixteen years, factory workers at Boeing have walked off the job. Members of the International Association Machinists and Aerospace Workers, which represents straw three thousand Boeing employees across the West Coast, have voted overwhelmingly to do what you just heard, to strike.
Bloomberg Aviation reporter Danny Lee says those members ignored a plea for peace by new Boeing chief executive officer Calle Ortberg.
This is a new low for buying, considering all the things I've happened to it over the past several months, and the fact that Kelly Opberg was brought in to fix all the shoes that are piling up for Boeing. This is going to be a true test of his resolve, his ability to show that for the board who hide him,
how quickly he can fix things. Because he had a strong track record at his previous company, So what can he do to perhaps personally intervene and knock some sense into the previous negotiating talks to see what more can Boeing off of. Frankly, the twenty five percent over four years clearly not enough for the work is particularly the fact that the annual bonus was being taken away.
Bloomberg Aviation reporter Danny lie says ninety six percent of union members supported the strike. Boeing shares, as I said, are down nearly four percent this morning.
Well, Nathan, We're also focusing on the FED this morning ahead of next week's rate decision. Former Bank of New York FED president Bill Dudley says their scope for a half point rate cut. Speaking at a forum organized by the Bretton Woods Committee in Singapore, the Bloomberg Opinion columnists suggested this slowing jobs market is now a more serious
concern than inflation. However, Mohammad Alarian, Queen's College Cambridge president and also a Bloomberg Opinion columnist, is expecting a quarter point cut.
We won't get dramatic series of fifties, but we will be measured for the wrong reason. Will be measured because the FED will remain over reactive, meaning it will be two data dependent. I think the key issue about Greenspan, Bernanke and Yellen when they were willing to lean forward and take a view of the economy. Chair Powell is not there yet.
And Mohammed Larian speaking of the Bloomberg's Tom Keen and Paul Sweeney yesterday, the Fed decision comes on Wednesday. For full Fed coverage, catch our special edition of Bloomberg Surveillance. The Fed decides at one thirty pm Wall Street Time this Wednesday on Bloomberg Radio and Television.
Then Karen Ahead of that Fed decision, Gold has hit another record high in Fact Bully and is on track for a weekly gain of almost three percent. As for equities, they've rallied every day this week. The S and P five hundred rows three quarters of one percent yesterday. Nadia Lovell is Senior US S equity strategist of Global Wealth Management at UBS. She says it is still a good time to buy stocks.
You've got to put cash to work. I mean, the fact is about to cut. We know that debate is still there all atus twenty five basis points or fifty basis points, but the cut of cycle is starting, and therefore you know what you're going to be able to yield in cash is going to continue to go down, and so we would look to be adding some about cash into quality equities and also have bit into fixed income.
Natti.
A level at UBS has a year end target of fifty nine hundred for the SMP five hundred. That's five percent higher than yesterday's close.
Well Nathan, some stocks on the move this morning. Shares of Adobe down more than eight percent. The company known for its software for creative professionals, gave a revenue forecast for the current quarter that missed Wall Street estimates. That's fueling investor in patience for Adobe's AI tools to begin generating sales.
On the flip side, Careen. Shares of Oracle are up six The software maker says annual revenue will rise to at least one hundred and four billion dollars in fiscal twenty twenty nine. Analysts say it's an optimistic signal on the growth prospects of Oracle's cloud infrastructure business.
Well Nathan, Turning to the race for the White House, If you've been wondering whether there will be another debate between former President Donald Trump and Vice President Kamala Harris. Bloomberg's Amy Morris tells us, we have a pretty good indication now it is not going to happen.
Donald Trump ruled out another debate with an all caps declaration on truth social quote. There will be no third debate. He insists he won their first debate, so he doesn't need to participate in another one. Vice President Kamala Harris spoke at a campaign event in Charlotte, North Carolina, shortly after Trump's statement.
I believe we owe it to the voters to have another debate.
It is not clear if the Vice president was directly responding to Trump's post. Trump and Harris's running mates, Republican Senator jd Vance of Ohio and Democratic Minnesota Governor Tim Walls, are slated to hold their owned on October first, with CBS News in Washington. Anymore, as Bloomberg Radio right.
Amy, thank you sinking with politics. Donald Trump's making a new pledge if he's elected, no tax is on overtime pay. Bloomberg said, Baxter has the story.
Seeking to gain footing after the shaky debate. This is an effort by him and his strategist to change the focus from debates and hit the road. To rallies and promises, as when in Arizona. Aimed at a blue collar workers that he needs to win, He says, the people who work overtime are among the hardest working citizens in our country. Not Over the last three months, Trump has rolled out
a steady drumbeat of tax cut plans. He has not explained yet how to pay for them, and a Bloomberg review says they would add more than ten point five trillion dollars to the national debt over the next ten years. Ed Baxter, Bloomberg.
Radio, all right, thank you. On Nippon Steele in United States, Steel sent a letter to President Joe Biden earlier this month on the Japanese companies propose takeover of its American peer. The letter was signed by both company CEOs. Nippon Steele has been mounting a last ditch attempt to try and muster support for the fourteen point one billion dollar takeover attempt, which faces widespread political opposition in the US ahead of
the presidential election in November. Time now for look at some of the other stories making news in New York and around the world. For that, we're joined by Bloomberg's John Tucker, John Good morning.
And good morning Karen. The Justice Department preparing criminal charges in connection with an Iranian hack that targeted Donald Trump's presidential campaign. Let's get to tales from Washington, Bloomberg, Steam podisc.
The prospect of criminal charges comes as the Justice Department has raised alarms about aggressive efforts by countries, including Russia and Iran, to medal in the presidential election. It was
not immediately clear when the charges might be announced. Assistant Attorney General Matthew Olsen, the Justice Department's top national security official, said in a speech Thursday, Iran is making a greater effort to influence this year's election than it has in prior election cycles, and that Iranian activity is growing increasingly aggressive as this electioneers in Washington. Steve Potosk Bloomberg Radio.
UK Prime Minister Keir Starmer has arrived in Washington. It comes ahead of a meeting with President Biden. Sources are telling Bloomberg the US and UK are discussing allowing Kiev to conduct strikes inside Russia using British cruise missiles backed by US navigational data. Speaking yesterday, Russian President Vladimir Putin warned against the move.
Addison bud but this will be their direct participation, and these of course will significantly change the very essence, the very nature of the conflict. These wo mean that natal countries, the US and European countries are at war with Russia.
Rut there through an interpreter. The discussion comes after the US confirmed that Moscow has received shipments of ballistic missiles from Iran. Cruis are battling three wildfires east of Los Angeles in San Bernardino County. There's a red glow in the sky and a strong haze in the air as the flames continue. Three fires have scorts more than one
hundred thousand acres across southern California. Elon Mosk has labeled the Australian government as fascists over proposed new laws to crack down on digital misinformation, particularly on social media websites. Under the proposed legislation, which have yet to pass Parliament, social media companies could be fined up to five percent of their annual revenue. Global news twenty four hours a day and whatever you want it with Bloomberg News. Now, I'm John Tucker, and this he is Bloomberg.
Karen, all right, John Tucker, thank you time now for the Bloomberg Sports Update with John stash Hour.
John, Good morning, Good morning, Karen. Yankees in the Red Sax first the four at the stadium in Glabor, Torres let off the game of the home run just made it over the wall into the first world seats in right field Yanks. They did not score again for the next nine in names. Anthony Volpi came up in both the fourth and six innings with the bases loaded, both times flew out the left Red Sox got a game time Danny Jansen home running the fifth off Nester Cortes.
The game was tied at one bottom of the tent.
Two two, so it all grounds it towards the medal. Bayshi Per Sono thirty year round third Rafaela comes up throwing on a hot thirty slide, says on Sono.
Wednesday game deef an two to one. Yankee wins second straight and extra innings. It puts them two full games ahead of IL Baltimore. The Yankee bullpen was terrific. Four relievers followed towards test for the night. The Yanks in ten innings allowed only four Boston hits. They had fourteen strikeouts.
All four teams vying for the three NL wildcard sponsor the night Off that includes the Mets, who played tonight in Philadelphia, the Phillies thirty games over five hundred and their fifty to twenty five, and home Thursday Night football to kickoff Week two, all Buffalo in Miami thirty one to ten. The Bills James Cook scored three first half touchdowns Dolphins quarterback two a time that we all had three interceptions. One was returned for TD. He later left
with a concussion. He had two of them two years ago. The Bills have now beating the Dolphins fourteen to the last sixteen. The Jets have brought back center Connor McGovern. He went down last year with a knee injury. Was plenty to retire, but the Jets worked him outside him with the practice squad. Rafael Dal was hoping to play next week's Labor Cup in Berlin. The feeling was it would be the last event of his career, but Nadal
has withdrawn, saying other players are more deserving. So it's certainly possible that Midell's career with twenty two Grand stam titles, is now over. John Stash Thatward Bloomberg Sports, Karen Y Nathan.
Coast to coast on Bloomberg Radio, nationwide on Sirius XM, and around the world on Bloomberg dot Com and the Bloomberg Business app.
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Daybreak, Good Morning on Nathan Hager. Boeing is grounded. As of midnight Pacific time, members of the planemaker's largest union on the West Coast have walked off the job for their first strike in sixteen years. John Holden, as president of the International Association of Machinists and Aerospace Workers, this.
Is about respect, This is about addressing the past, and this is about fighting for our future.
And this could be a crippling move for a company still reeling from the quality control issues found out its seven thirty seven max Jet just at the start of the year. For the latest were joined now by Bloomberg's Danny Lee. Danny good morning. This was, from what we understand, an overwhelming strike vote. Why did the rank and file reject this offer?
Yeah, Nathan, good morning. Well, clearly the vote was a signal of just how poor the union members for this deal was third three thousand of them voting, and you can see the strength of the rejection and look you can see how Bone responded. They were quite consideratory in their tone, acknowledging that the fact that they were committed to resettings relationship with the unions. And you know, you just look at what the deal was put in front
of members. Twenty five thousand, twenty five percent rather increase in salary over four years but losing annual bonuses. That was not enough and when union members wanted something more like forty percent. There was a big gap there between what Boeing is offering and what the union members really want. And so this is a this is a first kind of mini blow to new CEO Kelly ott Berg, drafted in to try and sort out not just this, but a wider set of problems with Boeing related to the business,
it's operations, it's finances, its culture. And so it's now down to him to see his true resolve, what he can do and particularly how quickly he can get things back on track.
So what can he do at this point? Where do contract talks go from here?
Well, we need to see both sides getting around the table or a very big table. Frankly, and the union overnight saying it was planning and keen to have more talks as quickly as possible for Boeing. They've not given an indication yet of when they will talk. I'm sure both sides will get together soon. The challenges, you know, what will be put on the table first by Boning. Clearly the first offer not good enough, and you know the question of a salary over job security and other
entitlements such as healthcare, healthcare and retirement. So there's a
lot Boeing still has to to put together. And you know, the top the clock is ticking frankly with the amount of money that it risks burning through this strike, the fact that it's factories now in Seattle where many of its commercial jets are built, most of them, the fact that it's down tools now, and the fact that they will not be able to deliver planes, build planes, deliver planes to customers, and therefore they cannot bring in the
cash to arrest what is a wider serious issue. It's cash burn and it's stress on its balance sheet.
So we're at the very early stages of this obviously, so much more to come as we continue monitoring. What is the beginning of the first strike for Boeing's largest union in sixteen years. Thanks for keeping us updated on it. Danny Lee of Bloomberg News with us this morning as this strike is just getting underway. Now, we want to turn to our exclusive conversation with the Secretary of the
US Department of Transportation, Pete Boodhajidge. Before Boeing's union members voted to strike, he sat down with Bloomberg Salaa Mosen on the Big Take DC podcast. They talked about trust and air travel, the safety concerns at Boeing, and getting the plane maker back on track. They began with the question of whether Pete Bootajidge enjoys flying commercial given airline concerns.
Mostly, I think we've all had our headaches. I am on an airliner, maybe not every day, but almost, and like millions Americans, experience the benefits but also the huge frustrations that go with air travel. We've worked hard to establish America's safety record that has made air travel the safest way to get around. We work hard to keep it that way and press the airlines to do their part.
And then there's the customer service side, where it's clear that airlines need to do a better job of taking care of passengers, and we have not just pressed them and encouraged them to improve their performance, but introduced new passenger rights that have created protections that didn't exist just a few years ago and that we think are much needed and overdue.
What is the Transportation Department under Secretary ped Buddha Judge doing to make holiday travel a little less frustrating this year.
Well, the first thing we've done is press the airlines to improve their performance. It's one of the reasons why last year saw the lowest rate of flight cancelations in about a decade, and we're working to make sure that, through things like realistic scheduling and adequate staffing, build on improving that record. The other thing that's important is that they take care of passengers when there is a delay
or an issue. One of the things we've done is introduce a new toolflight rights dot gov that's got airline by airline information about what you can expect your airline to do to take care of you when you have a problem, and those are customer service promises that we enforce and hold them accountable for meeting. We've also taken action to increase the benefits that go back to a
customer when there's an issue. For example, automatic refunds when your flight is canceled, something that has been a real headache and led to us imposing hefty penalties on airlines that weren't following through. We're trying to take the drama out of that by saying that you don't even have to ask to get a refund. And lastly, a lot
of enforcements. We have issued the toughest enforcement actions in the history of the department in cases like that of Southwest Airlines that melted down almost two inters ago now and left so many passengers strandedstigating what happened with Delta over the summer right now.
So this holiday season November and December, can consumers expect that some of these things are already in play. We can expect that we can sit with our family members, as Joe Biden promised. We can expect that we can get refunds. The way you're describing.
As a passenger today, you have protections that you did not have a year ago, or two years ago or more, and we're going to continue building on those. So yes, if you're heading to see family for the holidays, for example, those automatic refund protections are the law of the land now. And if you don't get treated that way, let us know,
because we'll follow up with enforcement. We have seen more airlines comply with what we've been asking them to do with regard to family seating and for passengers who are wheelchair users. Now we've been acting to make sure that they have a better experience because some of the stories we've heard about what they have faced traveling on airlines are just completely unacceptable, and we're developing rules that would change the experience and empower those passengers significantly.
You're talking about enforcement and penalties is one aspect there are you thinking millions of dollars? How high a penalty are you willing to levy on these airlines?
Well, the case of Southwest, it was a one hundred and forty million dollar enforcement action, which was more than we had seen in a decade or more put together before that, partly because we thought it was very important to send a message to airlines. What we saw was at some of the past levels of penalties a million here to a million, there really wasn't enough to change behavior. And we're going to continue to be ready to do that. And now, one thing I want to mention ish we
talked about one hundred and forty million. That's not all cash going back to the treasury. We did impose a cash fine of about thirty five million dollars, but part of what we did in the enforcement orders have the majority of those dollars actually go back to passengers in the form of vouchers, compensation, and other things that went back to the consumer, because the whole point of this, of course, to make sure consumers are better taken care of.
I want to talk about Boeing. What have you been able to do to get that company back on track?
Well, if A took an unprecedented measure in restricting Boeing's ability to produce aircraft at a higher rate until they demonstrated the safety of their production and the quality of their production process. Aviation in America by far the safest way to travel and has made the last decade or
two the safest period in the history of aviation. That means that when there is a near miss or an incident something like the plug door blowing out in January and Alaska, we treat that as seriously as the FA used to treat the most recent fatal crash. I think that's part of why they've been able to say that there has not been a fatal airliner crash in years, and again, it takes a lot of work to keep it that way. Boeing was put on notice that they
were under a microscope. They've provided an updated plan and now we are watching to see how they're doing and meeting the terms of that plan. They also have new leadership, and I've conveyed to Bone and the importance of them prioritizing a culture of quality and safety so that they can meet the FA's expectations and really the expectations of the American public.
There's another place where trust and air travel is really low right now. Since we're talking about trust, I'm talking about pricing and rewards transparency, So what it actually costs to take the trip that you've planned, and the value of the loyalty points that you've signed up to get. One example that you guys have been working on at the department is a lot of work on junk fees. Share a little bit about what you're doing on that front. With consumer productions.
We're making sure that you get refunded if you don't get what you paid for on your fees, same as we do on your ticket. So you paid for Wi fi, the Wi Fi doesn't work, get your money back. Same with baggage. We have another rule about transparency, and this is really about making sure that you can tell when you're comparison shopping for an airfare, the all in cost of the ticket that you're buying, including those ancillary fees or bags or picking a seat or something like that.
I thought that being Tan's parent about fees was a relatively low bar to require the airlines to meet. But when we finalize that as a rule, the airline industry lobby responded by suing us. We believe that our rule is based on strong legal authority, so we're standing our ground, but it's disappointing that they're so reluctant to do something I think most consumers would expect of anybody selling anything, which is to be upfront and transparent about what you're going to charge.
This is Bloomberg day Break Today, your morning brief on the stories making news from Wall Street to Washington and beyond.
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