Good morning.
I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today.
We begin with an historic moment on Capitol Hill. For the first time, a Speaker of the US House of Representatives has been thrown out.
The office of Speaker of the House of the United States House of Representatives is hereby declared vacant.
Kevin McCarthy was removed from his post after just nine months in the job. Eight Republicans joined every Democrat president in a roll call vote against the speaker, led by conservative firebrand Matt Gates.
He made an agreement to fulfill certain commitments to make this an open and honest process, and.
He has failed to meet those commitments, and that's why we are here.
Gates's move now leaves the House without a permanent leader and no clear successor from McCarthy. The now former speaker says he does not plan to run for the job again, but he has no regrets.
I do not regret negotiating.
Our government is designed and compromise.
I don't regret my efforts to build coalitions and find solutions.
Lawmakers are said to vote for a new speaker on October eleventh, they're out on recess for the rest of the week. Some names that have been floated include House Majority Leader Steve Scalise and Patrick McHenry, who is now serving as interim.
Speaker Well Nathan.
The reaction to McCarthy's ouster is still pouring in. Bloomberg political contributor Genie she Hands Zeno says, it's shocking.
Pretty Much everything you say about politics today starts with the words unprecedented, historic, strange, you know, And that's the sort of the position that we are in, and it just doesn't look like we are near the end of it at this point. A house in chaos. A continuing resolution gets us through the seventeenth of November, the.
Date Bloomberg political contributor Genie she Han Zeno mentioned is the next shutdown deadline. Henrietta tres, Managing partner and director of Economic Policy at Veda Partner, says, the odds are growing.
Odds of a shutdown have to start at sixty five percent or higher for my clients. I usually am at about five percent. I'm very bearish on these kinds of things. I was only at twenty five percent we would shut down going into this weekend. Now that we're in this new world. I think you have to start at least sixty five. There's a strong argument to make for seventy five, and I bet the street will be much higher than me.
And that shutdown deadline is November seventeenth. Henrietta Tres at Beta Partners and notes Moody's has already warned its confidence in US governance is waivering. It's the only credit agency that still has a top rating for the US.
And we have other major political news this morning, Karen. A gag order has been issued for all parties in the Donald Trump fraud trial in New York. Bloomberg Zed Baxter has the story, the.
Judge saying that Trump posted on social media and attack on the judge's clerk and shared a photo to his followers. The judge, saying any attack of any members of his staff are not acceptable, also told parties not to talk about the case outside the courtroom. Now, going into today's hair ing Trump, He's been.
Given Paulson information, misleading information, and corrupt information by a.
Very corrupt and encompetent Attorney general.
Trump deleted the post. I'm ed Baxter Bloomberg Radio.
All right, ed, thanks. Meanwhile, the blockbuster trial of FTX co founder Sam Bankman Freed is also underway in New York, and Bloomberg's Kayley Lines is covering the trial for US and filed this report from Lower Manhattan.
Dan Bankman Fried was present in the courtroom on Tuesday. He had a shorter haircut. That signature mop of curly hair is gone. He was also wearing a suit that appeared too big for him. It seems that he may have lost some weight while in detention at the Metropolitan
Detention Center. Of course, this case really centers around the enclosion of FTX and Alimeter Research, that crypto Exchange and the separate Hudgsbend, both of which he had founded, and prosecutors say he orchestrated one of the greatest financial frauds in US history. Kayley Lines at the Federal Courthouse in Manhattan for Bloomberg News.
Haley, thank you well. It's been quite the eventful morning in markets as well. Earlier, the thirty year Treasury briefly hit five percent for the first time since two thousand and seven. Right now it's at about four point nine to three. We get more from our market's reporter Valerie Titel.
This route in the treasury market is just absolutely phenomenal. Honestly, I've never seen anything like it myself. I've been in the markets for nearly fifteen years now. This steepening that we're seeing since Jrome Powell's testimony two weeks ago, that was ten sessions ago.
Bloomberg's salary Titel says the selloffs being seen around the globe. Germany's ten year benchmark rate climb to three percent, a level unseen since twenty eleven.
Well, Nathan.
The market reaction follows more hawkish talk from the Fed. Atlanta FED President Raphael Bostik said the Fed should hold rates at elevated levels for a long time to bring inflation back down to its two percent target.
I'm grateful to say is that we've seen inflation come down. I feel like we're in restrictive space now and now we just need to let that restriction play out and let it bring inflation, continue to bring inflation down to get back into the range of our target. And if we can do that, that would be.
A good thing we land I've had President Raphael Bostak says he expects us one rate kind will be appropriate in twenty twenty four toward the end of the.
Year, and Treasury Secretary Janet Yellen says she's very optimistic about the US economy.
Short term inflation is coming down in the context of an extremely strong labor market. We're now engaging in a very substantial program of investments to strengthen our economy.
The Secretary Yellen also indicated higher longer term rates could pose a threat to the global economy.
Or Ry Nathan, Thanks, It's time now for a look at some of the other stories making news around the world. For that, we're joined by Bloomberg's John Tucker. John, good morning, and good morning Karen.
President Joe Biden canceling and additional nine billion dollars in student loan deb Let's get more in the support this morning from Bloomber's Jeff Bellinger.
The program the President is expected to detail today will bring relief for one hundred and twenty five thousand borrowers through changes to programs intended to aid public servants, Americans with disability, and low income borrowers. It includes five point two billion dollars for fifty three thousand borrowers and public service loan forgiveness programs. The Administration also identified fifty one thousand additional borrowers who paid for at least twenty years
but never got relief. It is the President's latest action to aid borrowers after the Supreme Court blocked his debt relief plan and his payments resumed for millions of Americans. Jeff Bellinger Bloomberg Radio.
More than seventy five thousand healthcare workers preparing for the largest healthcare strike in US history. This after talks between Kaiser Permanente and a coalition of employee unions have so far failed to produce a resolution. The strike sept for today. It could interrupt health service for nearly thirteen million people.
The Justice Department unsealed indictments on several Chinese based companies charged with shipping precursor chemicals used to produce fentool and other opioids into the US Attorney General Merrick Garland.
These companies advertise the sale of precursor chemicals online using different websites and social media platforms. They then ship the building blocks needed to create deadly drugs all.
Over the world.
The indictments charge five Chinese corporates in eight Chinese nationals. A history making meeting that focuses on the future of the Catholic Church being held at the Vatican today. Catholic bishops, nuns, and lay people from around the world gathering in Rome for a meeting that will tackle some of the most sensitive topics that the Church is facing in a radical change. Women and laypeople will vote on specific proposals alongside bishops.
Previously only men could vote. The assembly will likely to discuss controversial subjects, including the ordination of female weekns and the blessing of gay couples. Global News twenty four hours a day, power by more than twenty seven hundred journalist and analysts in more than one hundred twenty countries. I'm John Tucker. This is Bloomberg.
Karen all right, John, thank you well. We bring you the news throughout the day here on Bloomberg Radio. But now you can get the latest news on demand whenever you want it. Subscribe to Bloomberg News Now to get the latest headlines at the click of a button. Get informed on your schedule. You can listen and subscribe to Bloomberg News Now on the Bloomberg Business app, Bloomberg dot Com, plus apples, Spotify, and anywhere else you get your podcasts,
and it's time now for the Bloomberg Sports Update. Here's John stash Hour.
John jar It was the longest losing streak in the history of North American professional sports. The Minnesota Twins had lost eighteen consecutive postseason games. The streak is over, and.
The Fish slang a hide ride deep left field, backing up our showing a run turning fits gone home run Royce Lewis, we'll touch them all, hey, two run shot to light them up here in Minneapolis.
ESPN had the call two innings later. Lewis, who was called up from the Miners in late May, homard again, so he provided the entire offense as the Twins beat the Blue Jays three to one. They hadn't won a postseason game since two thousand and four. Earlier, Texas won poor nothing at Tampa Bay behind seven scoreless sittings from Jordan Montgomery, who the Rangers acquired at the trade deadline
the nationally. Arizona was down three to nothing early, came back hit three home runs one sixty three at Milwaukee, and the Phillies, behind the pitching to Zach Wheeler, beat the Marlins four to one. Game twos today with the winners yesterday looking for series clinchers, and the losers looking
to win enforce a decisive Game three. In college football, Iowa has lost its starting quarterback Cade McNamarra, the former Michigan QB for the year, Torn acl it's good the lineup changes in Pittsburgh taylors co Mike Tomlin not happy about losing thirty to six to Houston. Those changes could include a quarterback change. That's because of an injury to Kenny Pickett. If he can't play Sunday against Baltimore.
It'll be Mitchell Trabis.
John Stashower Bloomberg Sports.
From coast to coast, from New York to San Francisco, Boston to Washington, DC, nationwide on Syrias Exam, the Bloomberg Business app in Bloomberg dot Com.
This is Bloomberg Daybreak. Good morning. I'm Nathan Hager.
It took fifteen votes to elect Speaker McCarthy as a House Speaker Kevin McCarthy, but only one to kick him out after just nine months on the job. Now Congress is left without a permanent leader for the first time in its history, and it's raising tough questions about what comes next. And Washington's ability to govern with another shut down deadline a little more than a month away. So let's put some of those questions now to Terry Haynes,
the founder of Pangaea Policy. We've used the words historic, unprecedented so many times when it comes to what's happening in Washington, but this really is one of those moments. I'd like to get your thoughts first on just the fact that Speaker McCarthy is out after such a limited amount of time.
Sure, sure, Nathan, good morning. A couple of things. One, there's kind of the Washington small ball, and I don't mean to disparage anybody that's involved in this, but there's kind of the you know, the back and forth about what happens next, and we'll talk about that. You know. The bigger markets concern is that it's more I think it's markets negative because it makes more intractable the two intertwined political crises we see in Washington now. First, the
bipartisan inability to reliably fund the government. I think that becomes tougher now and i've a government shutdown in mid November up up to eighty percent. And secondly, the bipartisan inability to address the out of control fiscal situation. I think this is embedding in world markets increasingly the view that the US is unable to address spending, debt, and deficits. So I think that's all bad.
Does this move further in trench the four factions that you've talked about so many times, or could we see more bipartisanship come out of this just because Congress is so calcified at this point.
Well, I think thank you for remembering the factions. The the factions I think still exist. I think what ends up happening as part of this is that the centrists in both parties become a little bit more empowered than they were before. That's probably non consensus in the political world, but the you know, the centrists are always the ones who drive spending deals, and there's an you know, now
now they have an extra rationale to do so. They want to make sure that they they have the place functioning, that the government's funded, that their priorities funded, and a funded government, you know, helps them best politically. Frankly, they are centrists, and a lot of them are in the Republicans, for example, A lot of them are in you Marginal Biden districts, so that helps them as well. The big problem is going to be, of course, how long this
lack of speaker goes on in the House. And I know that the interim Speaker, mister McHenry, would like to have a speaker election next Wednesday. I think he's right to want to place a timeline on it and do it fairly quickly. But at the same time, there's no guarantee that the warring Republicans are going to be able to call us around a candidate.
Now, we should talk about who some of these potential candidates are that are going to try to find some calls. Since we've heard Steve Scalise, the House Majority Leader, is already trying to bandy about where the interest lies for him. Who could we see potentially find some consensus around a potential speakership candidate.
Well, you know the you know, mister Scalise of course would want to move up, Mister Emmer, the Majority whip would want to move up. There's a variety of other candidates out there. I also wouldn't commend to listeners a good article that you all have on your site this
morning about the different candidates. I also wouldn't rule out, mister McHenry continuing, because he's one of the few people in the body right now that is trusted by both sides and could be relied upon to kind of drive bargains and drive process in the House, to try to keep the try to keep the spending bills moving and that sort of thing, but to drive compromise as well, and that's no small thing. McHenry I think very much does not want this position, and I'm I mean that sincerely.
He actually doesn't want to be speaker. But you know, needed did Paul Ryan, and look what happened to him. So it's entirely possible.
Just thirty seconds left, Terry, what could Kevin McCarthy have done differently to keep his job.
Nothing, Honestly, I don't think that's the case. You've got. You've got a situation where he you know, he made it. He chose Yeah, sorry to stammer. He he could have shut the government down and kept his job, I suppose, but then you know, the greater good would not have been served. And uh, you know, he could have chosen to be completely partisan instead of mostly partisan, and uh, but the country's better off that he didn't.
I think.
This is Bloomberg Daybreak Today, your morning brief on the stories making news from Wall Street to Washington and beyond.
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I'm Karen Moscow. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak