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This is the Bloomberg Surveillance Podcast. I'm Jonathan Ferrow, along with Lisa Bromwitz and Amrie Hordern. Join us each day for insight from the best in markets, economics, and geopolitics from our global headquarters in New York City. We are live on Bloomberg Television weekday mornings from six to nine
am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen, and as always on the Bloomberg Terminal and the Bloomberg Business Airly I'm happy to say is with us now where I want to go straight to that inflation call and go back to what you told us at the stand of the year, where essentially what you were looking for was inflation to come down a little bit more then pick back up towards the end of the year. Are we seeing that pickup? Maybe ahead of schedule?
That's possible, But I would note that the true consecutive month of inflation upside surprises came on different sources. So the general Bunker print was mostly because of course service, and the February print was driven by quarter than expected goods. Inflationary pressure so I think the jury is still out there in terms of if we are seeing the twelve of this inflation roller coaster. Our view is that actually there is room for goods deflation to bring inflation down further.
But when that runs its course, which is more likely later this year rather than now, service starts to dominate, and that's when wage pressure pushes inflation higher, and ultimately we're looking at the trend settling around three percent rather
than two percent. But that roller coaster is for later this year rather than right now, and right now, I think the bar is pretty high for markets to abandon this narrative of immaculate this inflation, which is why we'll positive on risk sentiment and what both them on us appuy.
That is moment before we get deeper into recording markets. Way, how do you think that's going to influence the thinking of chairman Power in today's news conference.
Well, it's likely going to be a very balanced press conference and very balanced pot and C. They will emphasize data dependency, They will try to strike a balanced tone. You know, the last meeting they talked about a sticky last mile. So I am very curious in terms of how they speak to the recent outside surprises in inflation prints.
I'm also curious in terms of if they're going to revise growth higher, inflation higher, they're going to start discussing the balance sheet round off, maybe trimming that a little bit. So lots of things at play, but more broadly speaking, we are expecting dot median to stay at three cards for this year, which is in line with our expectation at the beginning of the year. So now markets finally will being closer to that.
Before shifting the stocks, what duration of bonds do you feels most vulnerable given what pricing is and give and you expect to transpire with inflation later this year.
While we have a preference for short end of the curve and also the value of the curve, so implicitly there is a stiffening view over the longer term, and that is more over a fiscal story, right, So if you look at the fiscal deficits in the US late twenty twenty two, we're looking at three point five percent and now we're getting to eight percent, and that servicing cost is increasing, expected to increase even more the higher rates for longer and turn premium needing to come back.
So all of that points to higher rates, especially for long end of the curve. But when that kicks in, when that repricing because of concern around fiscal dynamics, and that's servisibility, that's key, which is why our conviction on the long end of the curve yields moving higher is more. It's stronger over a strategic horizon than over a tactical horizon of six six to twelve one.
Are stocks vulnerable to a hawkish surprise from the FED or are they operating according to a different set of rules that really hinge on very different factors than FED set rates.
But you ask the question Javis Jensen's, I think that's what stock markets are trying to figure out as well. But if year today is anything to go by, we have had hawkish repricing of the FED like seven cuts at the beginning of the year to now just three cuts, and yet markets are very resilient. SMP is up close to nine percent, equal way to the SMP close to five percent, right, So this is not a market that
are caving in under hokish repricing pressure. And the bridging factor, the reconciliatory factor here is the strong earnings and a lot of the earnings are being heavy lifted by the AI, which is why we are positive on USM market because erniers are coming in strong and stronger, beating expectation, and we lean into AI because that's where actually most of the earnings momentum is coming from.
Given that way, do you think that calls for some sort of broadening out in the rally are premature just simply because the games still are concentrated, not just with Magnificent four three or two or whatever people have got whittled it down to, but also only the companies that are most leveraged to immediate benefits from some of this technology.
Well, I think there is room for SMP to broaden out from the very concentrated leadership that we saw foremost part of last year, but that can also be thanks to AI. So as we think about sectors like healthcare, sectors like industrials starting to adopt AI to a greater scale, the leaders within those sets likely able to broaden the gap versus the rest of the piers within the sceptor because they have economy of scale, they have a lot of data to play with, so we can see actually
AI driving broadening out of the rally. Concentrated intact so far. So that's one way that it can broaden out. Another way that it can broaden out can be a wild swing of rate repricing. Right, so we're talking about three cuts now, and remember at the peak hawkish moment of October, markets were still looking at two cuts. But we have really single wide range of rate repricing, which is also evidence in the very high elevated rate volutility the move index.
So there's no telling if we could see swim back of this rate repricing, and when that kind of tactical momentum plays out, that could benefit the broader market beyond the AI concentrated in But that's so short term. Because we have seen wild swing within short periods of time, that's not something that we're positioning our investment views around. But we acknowledged that this can swing within this short period of time.
So wait, I know you're overweight US secularies, but also a sprinkle of Japanese stocks.
Can we finish there?
The NIKT twenty five is up by almost twenty percent yere today. It's been quite a run. Can you tell me how the Bank of Japan in any way, shape or form is relevant to that decision.
Well, it's the prerequisite on which the micro story can play out, which is our expectation and rationale behind our Japanese agriplet. So we upgraded Japan twice last year, and we continue to like it at this juncture, even as it crossed the all time I last made in nineteen eighty nine. So yesterday was a key was a key event was to watch. So if they are very kind of pokushed viewing inflation as a problem, I would be
and what concerned with our Japan call. But frankly, yes, they hide rates for the first time in seventeen years, but they hiked it in the most dovish way possible. Right, So for example, they normally dropped the yield curve control, but they're still saying in case of a rapid rise in long term youths, they would make nimble responses adjustments. So if that's not the definition of YCC, I don't
know what is. So they really kind of verre is the body of an accommodated still and that paves the way for micro positive developments to continue to be reflected in Japanese applet price.
Well, that trade is working out a black rock white, Thank you, State Major. So let's round a table State good monitor. Well and John, can we start with that mildly bullish story for treasuries. Why mildly bullish in the face of a bit of a set off we've seen so far this year.
Well, Maldi, polish is not all in. All in is full on bullish.
And that's why Europe is ranked above the US in terms of possible easing and performance from duration. But we can't let go of this view that yields are going to be lower, not higher by year end. And I get they've been sliding up the last week or so, and I mean the context is important. We've come a
long way from the peak in yields in October. The inflation peaked in June twenty twenty two, the market changed its directional viewer rates in October twenty three, the Fed pivoted a couple of months later.
It seems to me that they're not going to change their mind.
The next move is down, and in the meantime we know it's either unchanged or down for policy rates.
And therefore the trade is sit in the belly of the curve.
If not treasuries, you take ig credit and if you can't take those, then you what's it called and chill?
Is that what they say over that's bills and chill. I've been here long enough now to go.
Let's go further right along the curve, get away from the belly, and go out to the ten years. Say yeah, what backs up this call at the moment? That years at the end of the year will be love and not higher.
So if you took the most hawkish individual in the December dot plot, you get a longer run equilibrium rate just below four and you get very little rate cuts in the next year or so. So if you just took that as a path for rates, it's difficult to get the ten year yield much above four and a half on our calculation, and you'd be really going some to get to five.
So, just knowing that that right hand tale of.
The distribution is sort of in at four and a half and change, I quite like the idea of being long now. It's very difficult to time this, and that's why the best trade, which I think everyone seems to be doing, is owning the corporates, taking all the new issues they can, and complementing a position in ig credit with tea bills that generates a total yield of between five and six that competes with equities, and on a risk adjusted basis, it's superb So I think that's what's
going on. If you're in T bulls and they're maturing, you've got the option to roll them again or go and buy something else. Now, the thing is, we're buying the ten year treasury. You drop one hundred basis points in yield, but at least if you go to IG credit you can sit and wait. And I think that explains the type credit spreads. I don't think we can infer too much reason in the credit spread as to
say something about default probability. I think it's all in yield that people like they can't get enough.
I was so very excited to speak with you today because for so many years I remember all of the people who are calling for some huge sell off and treasuries, and I'd get the major letter and it would come out and say, you're all wrong. Yield are going lower because basically we're looking at a low inflation, low growth reality that was before the pandemic. A little bit after
the pandemic. It sounds like you're thinking has shifted somewhat given the fact that you're not aggressively bullish in treasuries. Has it has the neutral rate shifted? Has something about your view of the world changed.
The quote that John lifted is for our march asset allocation, so it's the monthly right, so that the view hasn't changed. Our year end forecast is three point zero. That seems a long way from here, but believe me, once they start cutting, the market's going to move quickly. And this is the issue that people have is that it's very dangerous to be short of treasuries.
Here. You've got to have a.
Very interesting narrative to justify being being short of treasuries. So the minimum you can be is neutral and small. Long I think that the growth narrative has been the biggest challenged. And if I put together what explains us exceptionalism, it's the fiscal population growth, maybe even some productivity, who knows. But the thing is that explains what's happened in the last year or so. It doesn't tell you the next the next ten The ten year treasury yield should reflect
the average over that period. Does anyone really think that three percent real GDP is going to be the case for the next ten years, because it looks to me that that's very unlikely.
But maybe not.
Maybe the growth story isn't going to be there, but there is an argument for the inflation story to be there, especially given the election, especially given more protectionist policies, especially given some of the issues that are not going away with respect to wages and just the fiscal money that has been procyclical, which is sort of counterintuitive.
How do you dismiss all of that.
I don't want to dismiss it, And you're right, the last bit on inflation has been sticky, but the big picture where we've come from since June twenty twenty two, it looks like a symmetrical reversal.
So it went up and it came down.
We're not quite on the target rates yet, but they don't have to arrive at the target before they cut rates that they would be almost irresponsible to wait until after they've hit the target.
I can't dismiss what you're saying.
I don't dismiss it because to me, it's about abilities and scenarios. So there's sort of no landing scenario whereby inflation stays sticky and high growth ticks along that says there's no rate cuts this year, in which case two year yields should be five and a quarter five and a half, I get it. Ten should be four and a half four seventy five. That that's sort of where
they would land with no landing. But soft landing is where we are today, and we've got this risk on the left hand side of the distribution here of a hard landing. Has it really gone away? This time last year people were canceling meetings, canceling meetings with me.
That's an easy thing to do anyway, but.
Because it was the regional bank stress and people say to me, what does a hard landing look like? Well, the first thing is this interview doesn't happen, So it's people have forgotten.
A year ago.
For a good few weeks we had the smell and the look of a hard landing. Two year yields were screaming down towards three percent, right, So not saying that I know anything that's going to bring that back, but it's just about probabilities. It seems to me that we're leaning a bit towards no landing, soft landing stagflation, that's what it's all leaning towards, and to me, bonds protect you in case that's wrong when you go back the other way.
So that's the explanation leads.
I can't let go of the fact that I think rates are going to be coming down, and when they come down, the market with price more and that's how the bondis get down to a lower level.
So that was Q one last year. Agan, it's Q two, and then Q three we printed something like five percent on GDP stateside, which is kind of wild. And then we were seeing the heighs of the year on a ten year and on the two year in October of last year, as you mentioned, and I remember something you said about supply and some reflections you had at the time about whether supply matters or not. And now the answer is it depends. Can we talk about what it
depends on? And the fact of the matter, at Lisa's point, that we've got this sort of pro cyclical fiscal policy in the US now where definits a massive with unemployments south the four percent does that matter to the old call.
I was here this time last year and we discussed it, and yields were pushing towards five for the tense and it was on the supply demand imbalance. Looking back with hindsight, maybe the Treasury made a misstep with the amount of coupons issued at that time, given the GDP, the downgrade, the inverted curve. I mean, it's easy for me to sit here and say so afterwards, but it looked like that was a misstep and it was addressed in the November refunding. Now I think that on the whole, supply
should not matter to your yield forecast. It can matter to your near term tactical view if there's an auction coming up or there's some kind of thing, but you know, the supply impacts term premium when there's a surprise and there's an imbalance. In the longer run, I think the stock of debt the huge stock, and let's remember it's virtually doubled in the last two administrations. Under both of the last two presidents worked close to twenty seven trillion
dollars of marketable securities. That's double early twenty sixteen, So that weighs on future growth, pause the r star down everything else. The way that happens is through debt servicing. So the way that bonds supply deficits feed into the way the bond market behaves.
It's two different things.
There's the imbalance, which can hit the term premium lifted up short term, and there's the longer term what it does to the equilibrium policy rate. And I think there's an unambiguous evidence that the stock of debt weighs down, so it opposes the positivity of the population growth and the near term impulses that might come from.
AI, etc. But there's the debt stock weighs the other way.
Yesterday, just to put a bow on all this, Marc Obanner of Bank of America was saying that maybe bonds should take a message from stocks that keep flying, and that it shouldn't be stocks taking a message from bonds.
What do you push back?
Do you saying that actually starts seem to be listening to a risk that's getting baked into bonds, which is why yields are not even higher.
So that's a great debate. It's an interesting insight.
Why not.
We'll always looking at new ways of valuing bonds. But it seems to me that the yield on the two year treasury you can see quite robustly and justify it based on the path of the short rate and So if it's four seventy ish, it's reflecting a FED that cuts a couple or three times this year, continues next year.
That's basically what it's part.
Now that's an important number because it affects the fives and it affects the tens. Now, I think equities seem to be taking the positivity from what the bonds are telling them, so that rates are coming down. I think bonds are purely priced off of the short rate and its path, So I don't think that they're priced due to equities at all. But it's an interesting debate. I mean, I'd like to see how we could use equity risk premium to influence our evaluation on bonds.
I don't think we can.
It strikes me that goes the other way unambiguously, it's bonds to equities.
I think on further hike, Steve Major's with US at HSBC, with US here in New York State, we've got to talk about this first move from the boj first hike since seven and proven not to be so consequential. The yen moving in the other direction, how do you read in developments in Japan?
Maybe it is consequential because maybe it opens the door up for the next step, the next move, because if you if you were scenario playing, your role playing before this event, you would have said, imagine a scenario where they went all in, where they'd rate hikes and the your curve control and this and the other really hawkish and dollar.
Yen went up.
And actually that seems to be what's happened. So to me, the totality of the decision and the outcome in the asset markets is the measure of is the measure of success. So you have to look at all the different details in what they did and then how all the asset markets play out. And they're watching this closely, I would say that net net, it looks like there's room maybe to do some more of something. Now from a JGB perspective, maybe it means yields can keep going a bit higher.
Dollar yen is that's probably not what they want to see.
Sort of designed success. I need to understand whatere the object diff was. Yeah, it's shure if the objective wasn't to see a weaker Japanese Yet off the back of this, the.
Key performance indicators for this one would be not to break anything or make any mess It's like any big decision from any central bank. First first, first stop is don't make a mess of anything. So in that regard, it's okay, But it just seems to me that it's not really over. There's much more that could be done. The fair value for jgb's with this rate move and the changes on the YD curve control could be nearer to one hundred.
And it's interesting that it's the currency that moves, and that.
Tells you that maybe investors are putting their their views through the FX markets more than they are through the bonds at the moment.
So a lot of people are saying that the Bank of Japan is not going to be bothered necessarily by this move in the end, do you disagree?
I think they'll be delighted just to have got rid of negative rates, So in that in that sense, I totally agree they're not bothered at all, because they if their objective was to get the rate up without making an anything, than they've achieved it. But I think it's the totality of the asset class response that matters, and
that takes time to look through. It's taken them how many years, seventeen years to get the thing to get here, and it's step by step, so I think it's conditionally so I think that their analysis will'll be ongoing and they'll be looking at what's happened to dolli en and to the equity market and to bonds, and that will help frame what they do next.
What was interesting to me is a lot of people were saying that maybe if the Bank of Japan ended negative rate policies and actually tightened more significantly, all of the Japanese investors who had been pouring their cash into US credit markets, into European markets would come home and that buyer base would not be there in the same level. Do you see that as a potential likelihood? Is what we're seeing. What we're getting, which is essentially the dynamic is kind of the same.
I think that the Japanese investors are still very happy to hold dollars and there's such a big yield gap between the two that that's the thing for there to be a change in the direction of the end. Clearly more has to happen. If you told me today that policy was being shifted in a way that dollar yen would head back towards one forty, then that changes everything. It changes all the hedging strategies, and but obviously they
haven't done enough to change the direction. So I'm not saying this for sure, but it strikes me that the outcome of this could be that there might be more moves and more iterative steps, especially on the on the JGB side.
Which is this question about the threshold for today's third meeting and how harksh for SG power would have to be before you see a move in the end that would actually cause the Bank of Japan to say, wait a second, maybe we need a second step.
Yeah, I think that that's unlikely. But given what we've just seen, why not though, if we sat head, if we'd set if we'd sat here last week and called higher dollary and on the on the basis of what we've just seeing, it would have been an outlier.
So why not let's go with it?
Right?
So Chairpoe goes hawkish again and says it was a mistake what I said before. He's not going to say that one thing you can say for sure you know that was capable. He's not going to say not like that. We can we can guarantee that's not going to be said.
Right, could reflect on the previous decade or so in this fixed income market. I was in Europe, we were there together. We have to talk about negative bond yields and Lisa, what do we get up to twenty trillion, some ridiculous number of negative yielding assets? What was that period? How would you describe that period? And for those that maybe have just joining the industry and weren't living it, how would you describe that period to them?
Well, it was an experiment in monetary policy, and it was obviously a scary time because the policies were there to address the risk of deflation, the counterfactuals. We don't know what would have happened without some of these policies. I think I think they get a bad rap negative rates. Not saying I'm a fan or anything, but it's just that they get a bad rap. And what else were central bank's supposed to do?
Honestly, So I look back at that.
And I think it was an experiment and it might have had some quite serious unintended consequences, because it shouldn't have been a surprise that asset prices went up so much on the back of this.
Would you judge the success though of them?
Well?
As I say, it's the counterfactuals, So how many people would have lost their jobs without this? And there's been analysis on this from the Bundesbank and from parts of the dc B.
I mean, this is the thing.
Did negative rates actually keep the unemployment rate lower than it would have been otherwise? And that's a really important thing. You can't measure just how important it is for society. So if we used to just look at negative rates and say, oh, look what they did. They created all of this asset price bubble and all this that that's not the food analysis is going to look at the real economy and especially employment.
And how much worse it could have been. Steve, Yeah, exactly, fantastic to see you. It's going to catch up st HSBC. Just remind me that price target tenure yield. It's the yield target year end on a tenure. Okay, it looks slightly impain you're going to join us before year end.
I'm going to if you'll have me. Of course, always.
Jan Hatzius and the team at Goldman Sachs falling in live with the broad consensus expecting three FED rate cuts this year. Hatsiest right in this inflation has been firmer in recent months, but we think it is still on track to fall enough by the June meeting for a first cut. This has become less obvious, though, and our inflation path for the rest of the year is now at a range where small surprises could have large consequences. And Police of Sai in a studio in New York, Yanke,
good morning to you. Great to be here, fantastically catch up with you, sir. I remember the outlook to start this year, and we talked about it a lot on this program. The hard part was over. It's almost easy from here. Do you still think that's the case based on the days we've had so far this year.
Yeah, it's more of a question because of the stronger inflation numbers, but I think if you look at the trends, we're still on track to get down to the two point four percent range or so for core PC inflation.
By the fourth quarter.
And now at the start of the year, we thought that was going to be two point two percent, so that's been a little bit higher. We've basically gone back to the forecast that we had last fall, but two point four percent is still pretty good progress, and by
twenty twenty five, I think will be at two. If you look at the drivers of inflation, whether it's on the good side or on the rent side, or in the labor market, I think the trends there still look encouraging, but of course the prints have been higher, so there's more of a debate about it, and the FED is going to be responsive to kind of near drums and prizes.
Well, let's talk about how responsive they might be today. As we know, clear and obvious risk factor is in the dot plot, whether that medium dots shifts from three cuts, say to two, and as we all know, it only takes two officials to move in that direction. Do you think that's something that happens today. Is that a base case in today's meeting.
It's not a base case for me, but it certainly is a possibility because not that much has to change in terms of the projections. If you go back to two weeks ago when Shair Powell testified in Congress, he said they were pretty close to having enough confidence, So that sounded like a cut no later than June if you take the statements there. We've had higher inflation numbers in the past week, So all the question is has that changed this view, my expectation is null, but we'll find out two PM.
All things being equal, it seems to have changed your view on the margins. You shifted down to three rate cuts expected for this year from four earlier in a report in the past couple of weeks, and you'd said this line that John noted small surprises could have large consequences.
What do you mean, Well, if you have a few additional tenths of inflation by the end of the year, even if it doesn't really change the overall trend in twenty twenty four is still lower than twenty twenty three, but they would deliver less cuts. So in that sense, yeah, I think it'd be a continuation of what we've seen in the last several months, where in the early part of the year, with an expectation of inflation coming down to very close to two, you know, I think they
would have done more. But now it seems like the December dot plot and the December inflation forecast looks pretty reasonable to us.
It seems like people are split on their views based on whether they think that the neutral rate hit shifted materially or not. You believe that the neutral rate is still going to be around your previous projections at three and a quarter to three and a half percent. How do you push back against people who say it's actually four percent or higher, like Elslinus of RBC Capital.
I think we don't know, and I would certainly I wouldn't push back very hard because the confidence interval around any of these estimates is quite high. Four percent, though, is still well south of five and three eighths. And I am pretty confident that at current levels we're in restrictive territory by a significant amount. But whether the right number, you know, is four or three and a half or
three you know, that's harder to know. I do think that the FMC projection two and a half percent, if you take the median, that looks pretty stale, and I think that is going to drift up over time, probably by a little bit today, although we've been waiting for this for a while and so far it hasn't happened as far as the medium it's concerned.
You're a precise man and very careful with your words when you say we're in restrictive and significantly so what guides that? Where does that come from?
I think all models of neutral rates and they're all pretty imprecise.
This is not precise.
There are many different models, each of them has a significant amount of error. But you're going to be hard pressed finding a model that says three percent plus on the real rate on the real funds rate is neutral. So it's really guided by a variety of different models, some developed at the FED, some developed elsewhere. That's say, we're right now, we're outside that range of uncertainty.
Can I ask you this question then?
If I was a first year intern at government Sachs, I'd create a model really quickly and I'd say, yeah, unemployment sat to four percent, equities real time highs, and credits threads are super tight. Why is that a bad model to sit here and say that, maybe we're not restrictive at all.
Well, in the so this kind of short run and long run So I don't think that the current level is very problematic in terms of meia term growth. And as you know, all forecast on growth is well above
the consensus and you know continues to be. But over time, once the kind of short term moves in financial conditions, short term moves in fiscal policy, and other forces play themselves out, I think it's pretty clear that the current level is above normal kind of neutral levels, and so over the medium term, it's very likely that we will see declines and rates, but the time path is going to be hided by the data.
So you don't think it'll be important for j. Powell to push back against some of the record highs on stocks and some of the tightening and credit spreads.
Well, you would never comment on, you know, near to our market moves, of course.
So you say that, But actually I remember that meeting where that journalist and this an honest mistake said to Power that markets were rallying, and I remember his response to it in the news conference, and we'll talk to I think it was Jim Bianco Pianca Research that called it POW's hawkish hits. He just came out, and the hawkish tone that he used once he thought that markets were going against what the Federal Reserve was trying to guide them to. I think it was pretty stark, strong,
maybe profound. Why isn't that an option he could take today in the face of CPR is coming in pretty hot, we've taken out cuts and this market's off to the racist Why wouldn't that be something he'd be concerned by I.
Don't think it's the problem because he's not. I don't think he's trying to slough things slow things down significantly. I mean, the unemployment rate has drifted up somewhat. You know, we're still seeing rebalancing and job openings. The quits rates coming down in FLEA is going down the Yeah, the sequential numbers have been a little higher, but the year on year rate has continued to come down. I don't think he's going to be particularly worried about having to
squeeze the economy. He can respond to surprise us by delivering cuts a little bit later, delivering cuts a little bit earlier. But I don't think he's he's it's in a very different situation from where we were a year ago.
Certain identified too, and it's implicit in your forecast. And you're right to point out that your growth forecasts have been above the street ever since you came out with your round. Look, strong growth doesn't appear to be a problem to the Federal Reserve.
Why is that?
What is different about this moment?
Well, because I think inflation is much lower and it's heading down, and the year on year rate is still heading down. The labor market is much closer to balance. So the you know, inflation expectations have continued.
To come down. They've now originally normalized.
So all the things that fed officials who were very worried about a year and a half ago that you'd get un anchoring up inflation expectations, you'd get a wage price spiral. I think a lot of those things have moved into the rearview mirror, and so therefore they are much less concerned about easier financial conditions. They'll still be relevant for setting policy, but they're going to be much less of a concern than maybe in this episode that you mentioned.
Yeah, and this was great, So it's fantastic catch up. So it's been too long. It's going to see you.
Thank you.
Jan Haasis there of government sex, breaking down his outlook for the Federal Reserve, and this economy. This is the Bloomberg Sevenants podcast, bringing you the best in markets, economics, angio politics. You can watch the show live on Bloomberg TV weekday mornings from six am to nine am Eastern. Subscribe to the podcast on Apple, Spotify or anywhere else you listen, and as always on the Bloomberg Terminal and the Bloomberg Business app