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Good Morning, I'm Nathan Hager and I'm Karen Moscow. Here are the stories we're following today.
Karen, we begin with the ongoing controversy around the probe into j Powell and the FED. Bloomberg's John Tucker joins us with the very latest. John, Good morning, and good morning.
Nathan.
Bloomberg has learned that Washington, DC, US attorney and former Fox host Jeanine Piro subpoena of the Federal Reserve without ever seeking permission from her bosses at the Justice Department, and she doesn't plan to back down. The blowback from lawmakers and government officials continues to grow. Federal Reserve Bank of New York President John Williams among those leaping to the defense of FED Chair Jerome Powell.
He's proven himself to be a man of impeccable integrity and a man who has been calmly leading the Federal Reserve.
Former Philadelphia Fed President Patrick Harker, as members of Congress can't let this happen.
Grim, You've talked to members of Congress on both sides of the aisle. They understand this. They may have different rhetoric out in public, but you talked to them one on one. They understand how critical the Federal Reserve is and they are going.
To push back.
Senator Tom Tilli is a key GOP member, and the Banking Committee bound to oppose any Trump nominees to the FED until this is resolved. Senate Majority Leader John Thune said the threat of a legal battle with the Fed
could make confirming future nominees quote challenging. Axios reported the Treasury Secretary Scott Besson warrent President Trump the investigation had created a mess that could be banned for financial markets, and judging by market reaction, investors doubt the probe of the FED is going to lead anywhere In New York. I'm John Tucker, Bloomberg Radio.
All right, John, thank you. By the Trump administration is facing new legal action over the immigration crackdown. In Minnesota. The Estate is suing the Department of Homeland Security and Secretary Christi nom over the precedented surge of ICE officers at Minneapolis and Saint Paul. Here's Minnesota Attorney General Keith Ellison.
The deployment of thousands of armed mass DHS agents to Minnesota has done our state serious harm. This is, in essence, a federal invasion of the Twin Cities and Minnesota, and it must stop.
Minnesota Attorney General Keith Ellison's lawsuit comes nearly a week after an ice officer shot and killed thirty seven year old Renee Good in Minneapolis. Her death during a tense confrontation in her car has sparked protests across the country.
Tourneing to US foreign policy now Karena by partisan congressional delegation is headed to Copenhagen later this week to show unity with Denmark mid tensions over Greenland. Delaware Senator Chris Coons is leading the trip. It includes at least nine members of Congress. They plan to meet with Danish and Greenlandic officials on Friday and Saturday.
Let's get to the latest from the Middle East, Nathan. President Trump plans to meet with advisors today to weigh options on responding to deadly protest in Iran. On social media, the president announced a twenty five percent tariff on countries that do business with the Islamic Republic that could upset his one year trade truce with China. Alivias is Iran Project director at International Crisis.
Group we have to see if that thread is really implementable, because Iran's biggest trade trading partner is China, and of course the US is a complicated relationship when it gets through in position of tariffs on China second most important trading partner is the UEE, again the close ally of the United States, and it's hard to imagine that these countries would be willing to really cut off all their ties with Iran.
Overnight Aliviyas with International Crisis Group notes, China is the world's biggest buyer of Iranian oil. It's unclear if President Trump would stack the new tariffs on top of existing duties or announce carve outs for China.
In Japan, Karen Prime Minister Sanai Atakiichi is reportedly planning to call a snap election. Success at the holes for Takaichi, who has been in the premiership since October, would provide a mandate for her to continue hawkish diplomacy and pro stimulus policies. Stocks rallied and the end week into its lowest level since July twenty twenty four on the news.
Well in the US here Nathan stocks and bonds rebounded on Wall Street to eke out gains. After initially dropping on news, the Trump administration escalated its attack on the FED. Steve Chiverone is Deputy Chief Investment Officer of Equities at Federated Hermes.
It doesn't matter how you get to where we were. It's not good, right. If you have a FED share that's engaging in illegal activity, that's not good. If you have political pressure on a FED share being exerted through the courts, that's not good to have. The video release is certainly not helpful for markets. So nobody benefits from this.
And Federated Hermes Steve Chivarone. Right now, futures again are lower. SMP futures down a tenth of uve percent this.
Morning, and attention will now turn Karen to real economic data. This morning we get the latest inflation report for December. Bloomberg's Michael McKee has a CPI preview.
We get a full month's data in the December CPI, but the numbers will remain somewhat unreliable because there was no October data. The Bureau of Labor Statistics imputed them. The imputation was zero no change, which to anyone who went shopping during the month knows is wrong. That decision biased the November CPI lower. For December, we should see some payback an upward bias. That bias may or may
not push the annual inflation rate higher. Analysts are divided, so confidence in what the numbers are telling us may be low. Markets however, don't see the Fed moving anyway this month, and we'll have January and February CPI data in hand before the next Fed meeting.
Michael L.
Key, Bloomberg Radio.
All right, Michael, thank you. In addition to the CPI report, investors will get earnings from the first of the big banks, JP morgan Chase reports. Before the opening bell, we get a preview with Bloomberg's Tom Busby.
JP Morgan Chase's trading and investment thinking businesses will be in focus, with revenue from trading stocks and bonds expected to rise thirteen percent from a year ago, helping share so the bank up thirty five percent in the past twelve months, easily topping the sixteen percent gain in the SMP five hundred Financials index. Bloomberg consensus calls for adjusted revenue of forty six point three five billion dollars for the fourth quarter on adjusted earnings per share of four
dollars ninety two cents. Tom buzzby Bloomberg Radio.
Okay, Tom, thank you. Look at company news now. City Group is among three major companies cutting jobs. The bank is set to slash about one thousand positions this week as part of CEO Jane Fraser's March to keep a lid on costs, and Blackrocks cutting hundreds of jobs across its company as well. Those cuts total about one percent of blackrocks global headcount and include members of its investment
in sales teams and meta platforms. Plans to cut about ten percent of its employees in the reality Labs division. That's part of a broader strategy to shift money away from some virtual reality products and into other AI wearables.
Nathan President Trump says big tech must bear the costs of raining in electricity costs. In a post on truth Social the President said his administration have been talked with Microsoft to ensure that consumers quote don't pick up the tab for enormous data centers. The rapid construction of data centers is widely seen as one reason why electricity has become more expensive in the US, though it is not the only one.
Later Today Karen, President Trumble visit a key battleground state to promote his tariff and manufacturing policies and flesh out a more populist economic message. He'll visit a factory that makes Ford F one to fifty trucks and promote his policies and an event sponsored by the Economic Club of Detroit. This is the president's third trip to a bellweather state since early December.
Time now for a look at some of the other stories making news in New York and around the world and from ever. Joined by Bloomberg's Michael Barr Michael, Good Morning, Good Morning Karen.
About fifteen thousand nurses in New York City are on the streets into the second day of their strike. Nurses say they'll stay there until their demands are met.
We want a fair contract, so we want to save our healthcare, save our pension, and provide safe staffing for our patients.
Nurses are also calling for higher wages and better staffing. Hospital officials say union leaders are making reckless demands, including nearly forty percent wage increases. A New York City Council employee was detained by federal immigration officials when he appeared for a routine immigration appointment. That's according to City Council Speaker Julie Menin, who says the employee works as a data analyst and has the legal authorization to remain in the country until October.
DHS confirmed that this employee had gone in for a routine court appointment and was nevertheless detained. They provided no other basis for his detainment.
According to the DHS, the employee is a criminal alien from Venezuela who has an assault arrest and no work authorization. New York Mayor Zoram Mamdani calls the detention and assault on democracy and demands the employee's immediate release. New York Governor Kathy Hockle will reveal how she plans to tackle making housing more affordable for people. Hokel would use today's State of the State address to detail how she plans to cut red tape for developers to boost the state's
housing supply amid a widespread shortage of affordable units. It would be through her let Them Build program. The proposal has drawn criticism from green groups, who argue that changes to the law could open up loopholes that could be exploited by business interests. Global News twenty four hours a day and whenever you want it with Bloomberg News Now, I'm Michael Barr. This is Bloomberg Karen.
Thanks Michael.
All time now for our Bloomberg Sports updating. For that, we bring in John stash Hour.
Thanks. During the end of the NFL Wild Guard Playoff round of the Houston Texans had a one point le in the fourth quarter in Pittsburgh and then scored twenty three points in a span of ten and a half minutes. They had two defensive touchdowns. Houston won thirty to six to advance to play New England on Sunday. Was this the last game for Aaron Rodgers? Will he retire? There was talk the Packers might fire coach Matt Lafleur. Instead,
they're talking about a contract extension with him. John Harbaugh's first coaching interview with Atlanta. That to Bloomberg Sports Update.
Stay with us.
More from Bloomberg Daybreak coming up after this.
Coast to coast on Bloomberg Radio, nationwide on Sirius XM, and around the world on Bloomberg dot Com and the Bloomberg Business opp This is Bloomberg Daybreak.
Good morning.
I'm Nathan Hager. The Justice Department's moved to launch a grand jury probe against fedchair Jay Powell is drawing rare pushback from many Republicans on Capitol Hill. Louisiana Senator John Kennedy is among them. He says, a perjury allegation against Congress is a serious allegation.
Is serious as four heart attacks on a stroke.
And if you make an allegation like that, by God, you better be prepared to put it tobaccul up.
That was Republican Senator John Kennedy of Louisiana on Capitol Hill this morning. We're joined by Bloomberg New senior editor Alistair Bull and Alistair. We're just getting word from central banks around the world issuing a joint statement of solidarity for Chairman Powell as well. It does seem as though the pushback against this Justice Department probe is pretty remarkable.
Good morning, morning morning, Thanks for having me on it.
It is remarkable, But I think the most remarkable thing is the strident tone taken by key Republican senators.
Who are in a position to do something about it.
Investors may well heat comments by other central bankers and bis it could affect their long term view on US assets.
That's obviously important.
The bombmarket vigilantes do have a role to play here. Senate Republicans can stop Trump from putting his NOMA nominees on the FED board, and that really sort of like blocks the Trump campaign to get more control over the Central Bank.
So that's very serious pushback.
What are we hearing in terms of how these subpoenas came about. It sounds like there might have been some kind of disconnect between the Attorney General or the US Attorney in DC and the Justice Department rid large.
Well, you know, that's very interesting because the reporting yesterday made it clear that there were a lot of people around the White House who didn't know this coming and were not happy to happen, including Treasury Secretary Scott Besson, who, according to Axios, was very quickly on the phone to Trump on Sunday night to tell him this was going to be a mess and it was going to put a stick in the spokes of his effort to nominate
a new FED share. We don't entirely know what happens next. Really, the ball really is.
In the court of.
Because till The Republican Senator Tom Tillis said this needs to be cleared up soon. And that clip you played from Senator to Kennedy said, if you're going to make these allegations, you better back them up.
So I think people are going to want to.
See movement, but they've really not very said very much to clarify what happens.
Now, what kind of role could Congress play to get that kind of transparency from the Justice Department. Could we see a clash there?
Yeah, I expect so. I mean I think till this also sits on the Justice Committee, so I mean he has power here.
The important thing is that the Senate has oversight, Congress has oversight of the Federal Reserve, which was very carefully constructed to insulate it away from political pressure. Now the Trump president Trump is testing those layers of defense, but
he hasn't breached them yet. And there's another important thing that's going to happen this month, which is a Supreme Court going to start here the argument around Governor Lisa Cook, who Trump fired for cause, and she's fighting that the Supreme Court indicated that it wants to give some sort of carve out to the FED as a special quasi private public agency. If a Supreme Court comes down on
Lisa Cook's side. That's going to give the FED even more protection and insulate Powell further from sort of an assault that he has identified as.
A threat to FED independence.
And importantly, Republican senators say they agree with him, they say it is a threat to FED independence.
And of course this is coming as we're still waiting for an announcement from President Trump on who his successor choice for chairman Powell will be. With Senator Tilla saying he'd block any further FED nominees, that has to complicate even that announcement, doesn't it.
Yeah, absolutely, I mean that's the big story, the big news we are expecting on the FED this week or maybe after Trump goes to Davos for the World Economic Forum. Was his pick for FED share but that's been completely overshadowed by this. And if Tilli sticks to his word, if he if he votes, if he votes to block any norminee, he basically has a vita on Senate Banking
it's split it thirteen eleven. If he crosses the floor to join the Democrats, that's twelve twelve that blocks it there to move out of the committee over an objection sixty senators under the current rules. You've already got lis Mkowski, You've got Kramer, You've got Kennedy sounding dubious. You've got John fun Who's you know, majority leader, saying this needs to be fixed soon, so they you know, Trump may
not have the votes in the Senate. So it basically freezes the whole plan, which is why when you read the Besson Treasury sectary, Psson was.
Very angry and frustrated by this. You're not surprised.
This is Bloomberry Daybreak, your morning podcast and the stories making news from Wall Street to Washington and beyond.
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