Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg Surveillance Podcast. Catch us live weekdays at seven am Eastern on Apple CarPlay or Android Auto with the Bloomberg Business App. Listen on demand wherever you get your podcasts, or watch us live on YouTube right now.
With a blistering note, I want to make clear here he was my market Economist of the Year two three years ago for congenital optimism when everybody was gloomy. Neil Dudda with a blistering note this morning, and Kevin Wash, mister Dudda is economist Renaissance Macro. Neil come on the first sentence, President Trump has picked everyone's least favorite candidate. Discuss Was it something I said?
I don't think I stuttered that. You know, look, well he is everyone's least favorite candidate. I mean, I mean to me, look, the main criticism I have of Kevin Walsh is lack of judgment. Okay, because the performance his performance during the financial crisis was not a pretty particularly good one, and I think you could say arguably that it is disqualifying. I mean to be that concerned about inflation at a time when the unemployment rate was rising
very rapidly, you know it kind of strange fradulity. So and in the years since, everyone makes bad calls, Okay, I mean I've been market treat economist for a while.
I've made bad calls.
Everyone makes bad calls. The issue is when you make bad calls and you're always wrong in the same direction that to me was open minded.
This I can't just say enough how I agree with that. Not for mister Walsh, folks, but part of the game is to be wrong and learn from it. You call him a cookie cutter Republican coming off of Bush the younger, the idea that he's a sweetheart of Wall Street, and you say it's time you equate it here to say worsh would make sense if Mitt Romney was president Donald Trump is not. Mitt Romney discuss the card carrying Republican dealing with President Trump on a meeting to meeting basis, Well, think.
About some of the I mean, President Trump, I think, relative to the median Republican official, at least in my lifetime, has much better monetary policy instincts. I mean, remember there was a time when people like Paul Ryan and Mitt Romney were talking about changing the Fed's mandate to just purely a price stability one. It's people like Kevin Warsh
that love that, right. So you know, President Trump, by contrast, in many cases, got the nomination by bucking a lot of the traditional Republican orthodoxies right on trade, on immigration, on social insurance.
On the FED.
And so I think that's what makes this so perplexing for you know, the so called greatest jobs president that God ever invented. He's picked someone that's, you know, frankly, based on his record, a threat to working people.
Okay, So.
A member of the sort of MAGA movement, Kevin Warsh is not okay. And that's why I say, I mean, remember there's also he has a track record too, right, I mean he's been he's critiqued previous administrations for not pursuing free trade deals. Now he's being nominated by someone that's trying to you know, rip up the sort of global trading system and trying to kind of move it
towards the US's favor, America's favor. So that's why I say, like, if you think that this is sort of a populist pick, if you think this is uh, you know, someone that's a member of the sort of president's base. I'm not so sure about that.
Right, Hey, Neil, given this nomination, what do you think FED Chairman J.
Powell will do.
Well?
As I say, I mean Kevin Worsh's newfound dubbishness. I mean, all of a sudden, now that he's in the sort of public interview process for this job, all of a sudden he likes right cuts.
Okay, So that.
Suspicion, I think is going to peak the interest or that that about face from Worsh is going to peak the interest of not just your own Powell, but a lot of the people around the table at the form C. So if your Powell, I don't know, maybe you want to stick around a little bit longer.
See what's interesting interesting? Good morning everyone, Neil dought it with Jay Hebfield on deck. Claudia Sun coming up later. This is a special edition of Bloomberg Surveillance Across a Erica. Kevin Walsh point nominated, I should say, by the President
of the United States to replace your own Powell. Of course, confirmation by banking is necessary, you know, I want to polarize here the vector of Stephen Myron and Michael McKee speaking with the governor Myron this afternoon, who's looking for a hugely accommodative fed with the natural restrictiveness of Kevin at Walsh. I mean, basically, Myron and worsh are polar opposites that I can see in terms of tone discuss that.
Does a president understand this is not a Myron replacement? Yeah, I'm not so sure.
I mean I think look, I mean, the president is trying to find someone that kind of that sort of believes in this notion of a golden age, you know, of strong productivity.
Growth.
Lower nehru, I guess, and maybe he's found his person in, you know, maybe he's found his person in in Kevin Warsh. You know, Steve Myron has been making similar arguments. But again, I mean look at the you know, look Tom, I mean Myron. Has Byron been successful and swaying the committee to his point of view?
Yeah? This kid comes out of Albany, he ends up at Stanford under the guys of Michael Boskin and John Taylor. He's got a shingle out Neil Dudd at the Hoover Institution. This screams to me restrictive GOP economics. Am I wrong on that? Jay, Yeah, Fields over your nodding, you know, am I wrong on that?
Nice?
I mean, look, look, I mean this is someone that he clearly overweights the inflation side of the Fed's mandate relative to employment. Okay, I mean I don't. I don't think that that's a pretty particularly controversial thing to say.
One thing I would say, though, is that you've heard a lot of folks in the administration talk about how they want the new FED chairman to kind of pull and Alan Greenspan right, And so the idea here is that in the nineties time, as you know, Alan Greenspan resisted the temptation to raise interest rates in the mid nineties because you know, productivity was strong and you know, inflation was was slowing right now, if you actually go back at the time, I mean that was coming off
of a period where inflation had already been slong. So that was sort of the opportunistic disinflationary years, right.
And if you look at that.
Time during the nineties, what was green Span really doing. He was really just following a tailor rule. So the reason why they didn't hike in the mid nineties is because the data were more or less telling them not to hike in the mid nineties. I mean, yes, it is true the unemployment or it was declining, but inflation was also rapidly fallen. And the combination of those two things is why interest rates didn't go up the policy rate that is. But you know, rarely is it meant.
And you know, when you talk about pull at green Span, look think about what happened in the late nineties. There was an aggressive hiking cycle about a year after the LTM LTCM blow up. And why was that happening. That was happening because the labor markets were red hot, right, So again I mean we were having it maybe a golden age then too, right, I mean strong activity growth. But because the labor markets were on fire, Alan Greenspan
rapidly increased interest rates. So this notion of like pulling Alan Greenspan, I think it's a bit of a it's a bit of a choose your own adventure.
Yeah, Neil, how.
Controversial, if at all? Do you think this confirmation process will be for mister Warsh.
I mean, you know, it's hard to know.
I mean, I think there's obviously a lot of things going on in the background, right, I mean, Senator Tillis has basically said that he'd slow down the nomination process so long as this this investigation into the head and you know, Jerome Powell remains open. We'll see if he means that, but that could presumably slow the process down
a little bit. But as you know, guys, I mean these these this role has become less sort of bipartisan, right Like in my career it was sort of every you know, every every person that's been up the Jet Yankee has had a thinner and thinner margin in the Senate when they've gotten confirmed.
You know, I got to get the Jay Hatfield. But let me frame this out. We're gonna go to Hatfield. I'm gonna ask them the same questions, folks, Neil dot right now. And you've been phenomenal about the labor fragility of America. What is your real GDP forward the chairman worship is going to deal with and the inflation overlay that's gonna upset him to get the nominal GDP. How do you frame that out through the rest of the year.
Well, I mean, for me, Tom, you know, I have a very much a state of labor market driven view, and you know, aggregate hours are barely rising and wage growth is slowing, so you know, I think we're basically in on track for you know, essentially a four percent nomenal growth environment, maybe even a little bit lower than that. I mean, if you look at wages and salaries over the last couple of quarters. Quite so, really you have to you have to tell a tale for why the
labor markets are going to strengthen. And it's hard to do that right now because you look at what consumers are saying about the jobs market.
Okay, We've got to leave it there, folks, and I'm going to not mince words. We protect the copyright of all of our guests. This morning. Neil Dotta with a fiery note out at Renaissance Macro. But bonus Neil Dutta out on LinkedIn and Twitter. Look for mister Dotta particularly on LinkedIn today with fiery thoughts his note, as you mentioned, Paul is just really on fire. Neil Dotta, Thank you so much. Stay with us. More from Bloomberg Surveillance coming up after this.
You're listening to the Bloomberg Surveillance podcast. Catch us live weekday afternoons from seven to ten am Eastern Listen on Applecarplay and Android Auto with the Bloomberg Business app or watch us live on YouTube.
Chris Waller goes to the heart of the matter, which Claudia some has lived, which is the jargon of their world outreach meetings. I can't emphasize enough how hard our public officials work. They go to every rotary breakfast yep. I can't say enough, folks, how they're on the road and not in the office with their Bloomberg terminal. Claudia Some Governor. Waller says, there are multiple outreach meetings of planned layoffs, and I'm going to editorialize firings. Do you
see that trend? Doctor, some of layoffs like Amazon like ups.
So we have certainly seen layoff announcements pick up that this is not new right. We saw several of them last year, and say theer announcements at this point, we haven't seen them translate into jobless claims, broader measures, aggregate measures of layoff. So I think there's every reason to be concerned about the labor market. There's some signs of stabilization. But I think Waller is appropriate to point out when are not out of the woods yet.
Stanford Economics, everybody's got a different flavor associated with the Hoover institution. What kind of inflation a hawk? What kind of economist or lawyer comfortable with a restrictive policy? Is Kevin Worsh? What, Claudius sam flavor is he? So?
I mean I was at the FED when Kevin Worsh was a governor. I've watched him in action as a policymaker. I've certainly followed his comments since then. I mean there's a lot about his track record and his recent comments about what we see in the economy and what's appropriate for interest rates. All that said, I think the conversation about Kevin Warsh and again today he got the nomination.
He's not the FED chair yet, he needs to go before the Senate and I think the hearing, his confirmation hearing, should be a pretty difficult one because right now, the big conversation is about the independence of the FED. Will it be free from political influence and setting interest rates? And there are some comments from Kevin Worsh. I think he needs to be asked about and that goes before all his views on the economy.
So, Claudia, what do you think the FED should be thinking about right now? Again, it's got that dual mandate here, and we're getting more and more data.
As we speak here.
What do you think the focus should be or is for the FED right now?
Well, the Fed, the Fed's focus should be its dual mandate. It should be about maintaining maximum employment and getting inflation back to the two percent target using the tools that it has. I mean, this is where you know, the unemployment rate is below four and a half percent, the inflation rate is around three percent, much lower than it was, you know, just a few years ago. But you know it's not it's not all the way back to target. So I think there, you know, their job is not done.
But I don't see this as a moment where we need to have, as Kevin worsh has talked about, a regime change, come in and knock heads right there. There's work to be done the like. There needs to be a continuity, a continued focus on the two sides of the mandate and and if we have a disruption of that, that could be you know, really problematic in general.
Paul, was that, Claudia, sam shade?
Is that maybe a little bit shade there, Claudia, how do you think mister Walsh will work with, interact with, deal with the other members of the FED here.
What if he is confirmed, he's the public comments that he's made in recent months suggest that he's going to come in on a pretty combative footing. I mean he's used words like knock some heads. He's been very critical of the FED. I mean, he went so far as to accuse the FED of its rate cuts in twenty twenty four as the unemployment rate was rising, that that was political, right, That's a really serious accusation to make. The FED was reacting to a labor market that looked
like it might be unraveling. So I think he's going to come in. You know, the FED works by consensus. He's by his own remarks. I think he's going to have a tough time building consensus, but he is capable of doing that. It's just it's a it's going to be a could be a rocky transition.
Claudia sam with us. We're thrilled to have her here in the nine o'clock or do we have Paul yet when we're going to get a press conference? I have not seen for the President of the United States, we don't have it yet. But again, for those joining a nominee as chairman of the Federal Reserve System, Kevin Walsh. This morning, we've heard from Christopher Waller and his descent. I'm sure we'll hear from others through the day. I want to emphasize here and again, folks, this comes down
to the pedigree. Claudia Sam Michigan, PhD. Absolutely definitive and trying to understand the court to the corter gyrations of recession, or Richard Clareda, the vice chairman, and all of his work at Columbia where he literally herded cats at Columbia for years, and his work with a strange thing called dynamic stochastic general equilibrium theory. Doctor some lawyer Powell. I guess we really didn't know what he was going to do other than he was a finance guy. What was
the song last summer looking for a finance guy? Six five? He was blue eyed in six' Five, Claudiusam do you have any real understanding Of Attorney worsh's.
Economics worsh has said in interviews in recent. Months last, year he's very critical of the models that THE fed, uses has called them. Outdated has you, know really push the idea that we need a new? THINKING i, mean one of the. Things you, Know powell came in he
was not a diet in the world monetary policy. Theorist, yeah but he came in as a governor and then continue on his chair as really listening to the experts around, him building his, understanding relying on their, expertise being very data.
Driven you, know this.
Is the heart of the. Matter, doctor some you worked With warsh at THE. Fed do you suggest he will mimic the pattern Of Governor powell or is there going to be a different approach here where he does not listen TO fed.
PhDs i'm reacting to comments that he made just within the last. Year now you, know it's over a decade ago when he was a. GOVERNOR i, think you, know we really need to listen to what he's been saying. Recently and he's been extremely critical of THE fed, models extremely critical of the staff and the CURRENT fed. Officials so you, KNOW i think he'll be different Than, powell and it could be different in a way that's disruptive and not.
Productive, Claudia i'm looking at a note From Ben emmons At Highline Asset management in which he, says Quote worsh has made it explicitly clear in Is Hoover Institutional interview In may of twenty twenty, five that THE fed is responsible for interest, rates administration is responsible for the, budget and that this should be the basis for a NEW Fed treasury. Accord how radical are out of consensus is.
That it's extremely radical and out of. Consensus my biggest concern with Worsh AND i think this is something that he should be asked about by The. Senate, right let him explain more his thinking on. IT i don't want to, prejudge BUT i mean he's talked about that there needs to be a coordination use those, words a coordination between The White house And treasury on the balance. Sheet we need to remember The fed's balance sheet is an instrument of monetary. Policy THE fed has used it to influence
long term interest. Rates short term political interests Of White house have no business in that. Conversation revisit a decade.
AGO i MEAN i was at a you, KNOW i read only important papers at, bars of, course so you, know like fifteen years, AGO i met this Great greek restaurant In midtown reading forty eight pages Of. Geidner you know the world was blowing. Up or That claudia take us back To Governor walsh and the basic idea that he said we shouldn't Ease And i'm saying this in a very general. STATEMENT i want you to tell, us was he against accommodation in the heat of the battle of the.
Crisis governor warsh participated in helping stabilize financial markets right in the global financial. Crisis he, was you, know worked very closely With chairman Bernank, on you, know trying to figure out how to stabilize financial. Markets he worked on the first you, know the first asset, purchases quantitative. Easing as it moved moved into the unemployment rate is near ten percent and the economy is really, Weakening warshwood got very concerned about inflation and was very critical of The
fed using asset purchases to support the. Economy it doesn't make any. Sense inflation was not a, problem then unemployment was the. Problem and in the many years after that he hasn't revisited that and said it was a. Mistake so that's WHERE i think his credibility on the labor market is really, then.
And, Paul i'm going to interject here the wonderful and late and dearly Missed Charles plosser also was worried about, inflation and he came out and SAID i was. WRONG i, mean this was a raging. Debate McKee lived this but at the. Time but this is a really important, distinction folks that maybe will be in the, Question, paul get one more in here with Doctor.
Sam doctor some how contentious are? You are you anticipating a contentious confirmation process for this? Nominee, YES i.
Am AND i think that's.
APPROPRIATE i, mean given moment THE fed is, in these are not normal times and it's the sentence, job right like they are supposed to vet the, candidate make sure they have the. Expertise and this time, around it is so important that there are very clear lines drawn between The White house and THE, fed and that THE fed chair can really back up that they're going to continue that independence because it matters for All. Americans it matters
for financial markets and. Stability SO i think it should be a tough, hearing but that's that's the.
Way it should.
Be, claudia thank you so, much really really appreciate your commitment to what we. Do we look forward to seeing you jobs day if that's on the date. Calendar. Doctor some driving The American Economic conversation in our public service to The fed as. Well stay with us more From Bloomberg surveillance coming up after.
This you're listening to the Bloom Work surveillance. Podcast catch Us live weekday afternoons from seven to ten Am Eastern listen On Apple karplay And Android otto with The Bloomberg business, app or watch us live on.
YouTube heavy dose of economics, today but far more a heavy dose of what these momentous announcements mean to your portfolios of currencies. Commodities did you sell all the gold?
YESTERDAY i don't, know, BOY i tried to ouload the.
Boat, yeah.
Exactly the kids are on the.
PHONE i couldn't get to the. Phone how about the stock market with futures negative? Nineteen and of Course John stolfus is just young enough to remember the panic Of Alan greenspan taking over in nineteen eighty. Seven it was a swall matter at the end of nineteen eighty. Seven should you adapt an adjust to this or just steady forward for the bullmarket Of John, Stulphus.
Well, TOM i think it's it's steady.
Forward it's a rock steady. Moment when we think about the bullmarkt and what's supporting. That the big, CHANGE i think is for short term, investors for the, traders for the highly leveraged. Crowd some of these declines that we're seeing in commodities and stocks this morning likely directly related to unwinding of positions that were looking for a much more aggressive stance in terms OF fed policy and lightening up on what remains of the hike. Cycle AND i
think that's what it. Is you, KNOW i don't think IT'S i don't think it's a dramatic.
Change if. Anything the one thing that.
Occurs to me right away as, well you, Know trump Nominated powell for the fan that he didn't like, him or he may have trouble With warsh very soon after, thereafter AND i think part of it may have been a concern about weakness in the dollar that had been expressed By bess and sometime in the last twenty four or forty eight hours he was saying it was supportive of a strong dollar after The president had infer that he liked a week. Dollar and the, market the market
plays that stuff on a day to day. Basis that's why we you, know we're not surprised when we go from risk on to risk, off risk one to risk, off and one day's, value one day's, growth one day's.
Mids and so we do have a little bit of a lift here to the D X y index here this, morning but still with a ninety six spot three, eight much lower than what we've seen over the last several. Months, john we're racing back in the middle of earning. Season this is a, busy busy week four. Earnings what have you seen From Corporate america so far and what do you think the market needs to, see.
You, know related To Corporate, america what we've seen in THE s AND p five hundred earnings results is double digit growth, again and double digit growth not only within technology but also AS i, recall.
My screen just went out over here real. QUICK i went to another.
Screen SO i can't look at THE ea, page BUT i recall That energy it was double digit earnings on THE ea, page AND i.
Think materials was as.
Well so what you're looking app is really the process evidence of an economy that shows sustainable, growth likely with the monetary policy that we've, had even if it is at a slower pace than some would.
Like this special edition Of Bloomberg surveillance across the arc of the, morning Including Paul sweeny And Scarlett. Foo later on this, morning the seismic announcement a NEW fed chairman Sometime paul In, may is it it's like, there like when it's, warmer, Exactly.
Hope we got to get a freezing In New York.
City before we can have a NEW fed. Chairman John stulphus leads us off with his wonderful conviction in a bull market that we've seen over the last number of years At, Claudia sam and otherworthies will join us for perspective on mister WORSCH i look at this And i'm. Sorry as an equity, GUY i got to look at the bond. Market that's WHAT i was doing last. Night it's seven thirty and eight. Pm don't tell Missus. KEANE
i was the thirty year bond right? Now eighty eight percent to, Me John stolfus for, everyone housing, equities everything that long rate is the Worsh litmus, paper, now AM i? Right?
Well you KNOW i quite, Honestly i'll have to, SAY i don't.
Recall what was His litanus paper in the in the LAST u if we get.
A, five if we get a five thirty One John Paul sweeney's housing market falls.
Apart you, know AND i think the reality is is that we've had good housing markets when we were a double digit interest.
Rate so you, KNOW i can recall my first mortgage was ten.
Percent one of my colleagues first mortgage was, sixteen and his boss's first mortgage was twenty.
TWO i can't believe.
It and the only reason why mine was ten is the bank wanted to charge me thirteen and my seller fortunately wanted to move AND i was able to negotiate this therapy took. It when you look at, it IT'S i think there's less need for drama at this moment in THE fed chair name that has come, up AND i think that the market is in good stead right. Now it's, notwithstanding you, know on a day to day, basis, bears skeptics and nervous investors will take opportunity to trim positions WITHOUT fomo.
If they can find a, catalyst and this is a near term.
Catalyst BUT i really think most of this is probably traders reducing positions that we're looking for a much more aggressive policy for cutting at THE.
Fed, Hey Johnny, SAW i guess starting totish last, year kind of a little bit of a rotation starting people kind of maybe moving a little bit out of some of the big tech names and trying to find some value in other parts of the. Market is that something that is going to continue to be a theme in twenty, sixty you, Think, Paul.
We really think.
So we think this is the process after tech led with great power out of That april eighth bottom last. YEAR i think the play is here a broader participation by other sectors because investors are looking for a way to.
Diversify one thing That i've, noticed it's going to be forty three years sometime Between may Or july THAT i reported to my first job On Wall, street and WHEN i look, BACK i remember the private investor at that time was usually a lot of it was cocktail party, chatter you, know how well had they done in a particular. Stock today people are investing because they know that Social, security while it will still remain.
In, place will just not be anything as much of the.
Income they'll need during, retirement and they want to keep a standard of. Living so past performance no guarantee of future. Results we unerize the equities tend to be a good place to, be to weather, inflation to garner trends that are important for.
Growth Johns dolphus with us with The vics up sticks seventeen point nine zero The. Vicks if you're just joining, us good morning Across. America you have a NEW fed. Chairman The president of The United states Selects Kevin warrish to be the NEXT fed. Chairman per The. Senate As paul, mentioned that's a bit iffy right. Now we'll have to see what The Senate banking will.
See how they do.
It, john what's some sectors here that that screen well for you these? Days maybe, sectors maybe, factors what screens well for you guys these?
Days we would have to say within the. Sectors we continue to like information. Technology we don't think we're going back to the abaccus or the avocas or the other slide. Rule we think chips are an important part of. LIFE ai is here to just stay and will morph in different ways going. Forward we also like communications services at the traditional telephone, companies as well as about eighty percent social,
media the search engines and the. Streamers but we, like we do like industrials and have liked them for a long.
Time financials when you're At, oppenheimer, folks and this is ancient, history like back To volker Green, span When stulfus AND i had. Hair there was a guy that we learned the sell, side and we learned the discipline of byhold cell from giants Like Myron. Picot we walk in the. Shadow he was legendary at your. OpCo here's WHAT i observed. Yesterday microsoft totally tanked for fourteen REASONS. Omg and the
entire cell side seventy one buys two, holes zero. Cells John stolfiz ignored it lifted or, ADJUSTED i should, say their target. Price and they're still looking for a blended thirty percent. Pop And, microsoft can you explain to mere mortals how aircraft carrier goes down ten percent and the cell side goes long long.
ONE i would say that the adage of it's better to have to be time in the market is more important than timing the market for most. Investors the other side of it, is you, know investors over the course Of i'd tell, you over the.
Last ten, years have grown accustomed to buy the dips when they when they see it.
Happen.
Myths what appears to be a secular bull.
Market we often, say not so much by the, dips but look for the babies that get thrown out with the, Bathwater those perfectly good stocks the traders will hurl down on the floor like a hot potata because there's a piece of a quarterly report that doesn't quite meet up to.
Snuff SO i, MEAN i, mean that's a great story of me BECAUSE i mean a lot of people talking about valuation in the.
Market, boy it's.
Expensive but then the other side, is but earnings are, Growing so how do you have that valuation discussion with your?
Ques, WELL i think the good thing is that earnings are growing substantially so that those fat multiples may be taken down a little.
Bit as we go.
Forward and we've seen over the last few, years you, know WE'RE i think right now we're about it at twenty two or twenty three, times but we've been even higher than.
That but the earnings are helping us.
Out the other side of it is, is you, Know yardini talks about the fact that there aren't enough companies to go into The wilshire five thousand anymore because there's only what thirty four hundred publicly traded due to private equity consolidation AT m AND, a and, so what we'd like to say is we think because of the seriousness of people designing their portfolios with advisors or however they may be working their portfolios in terms of retirement preserving
a standard of, living we do, think but they're really looking at they're willing to pay more for each dollar of earnings if the company shows that it's got good, management good, product.
And then it has cash flow and profit or.
Kill one more question For John stolf's, folks is we really all line up A Jay hatfield we've just learned coming in who's absolutely exquisite to go From John stolf as that's pretty. SURE i feel this what this is. About we come to your commercial free this morning Across, america The president announces a new. Chairman subject of banking, Confirmation John, Sofis i'm going to ask this question fourteen times.
TODAY i start with. You the heart of the matter Is Martin's wige would, say if a fed's, restrictive things. Change can you envision a set of circumstances Where chairman worsh would deliver a RESTRICTIVE fed to the stock.
Market, WELL i think the stickiness in inflation would mean that we remain somewhat restrictive in the near term with maybe only that generates ah NOMENAL.
Gdp that's pretty, snappy, right.
Yep, still that's the thing.
Is it depends on how tight is the. Tightening you, KNOW i could remember very well when people were mourning the loss of twelve percent yield on bonds AND i was talking. Stocks stocks were going. Up, well interest rates will remark high relative to. Today the nominal coupons were.
Phenomenal one of our listeners sent me a photo from his studio with six gretches lined, up you, know the, jet the white, falcon the. Whole do you have six gretches at?
Home you, KNOW i don't even own one? Gretch Is nexus fixed? THIS I, gibson The defender, guy and the McCurdy.
Guy mccurty Is rick, mccurty the great contemporary jazz and rock and roll.
Guitar, sorry sweetwater out In Fort. WAYNE i, mean come, on get on the. PHONE i should you get a?
Gretch you, KNOW i think IF i got a, Gretch i'd have mccurty. Rebuilt shake the neck a little bit.
More I'm American John stolphus honored to have you in with these important announcers? Today he is legendary at. OPCOD i really want to make note mister stulpus through thick and, thin Including april of last, year said participate in the, market stay with. Us more From Bloomberg's surveillance coming up after.
This you're listening to The Bloomberg Surveillance. Podcast catch us live weekday afternoons from seven to ten Am Eastern listen On applecarplay And Android auto with The Bloomberg business, app or watch us live on.
YouTube just off the four top headlines of The Bloomberg on the, terminal The president picks a reinvented wash to lead The Federal. Reserve gold and silver plunge is wild, swings rock metals, markets dollar fears are flaring As trump rekindles the basement trade at a big. Take you're On. Unitlove i've never been in The unit. Clove, no it's not popular, demo but, yeah somebody, said you, KNOW i was looking at what are the tights the? Lemon?
Yeah, yes, NO i don't own any see, leggings you don't own?
Any why sized up two sizes and it still didn't work as. Well we begin our coverage With Katie, kaminski chief for research Strategist Alpha. Simplex, katie what are the trends in the market right? Now the chairman worsh will.
Enjoy, well this is interesting because today's news has actually reverted the Big i've been calling it the pedal to the metal, trade where everyone's thinking interest rates are going. Lower so you've seen you, know big moves in the dollar. Weakening you've seen massive moves and, metals and you've seen equities up as. Well so today's announcement kind of has caused a reversion across those different.
Themes we'll see how long that. LASTS i. GUESS i mean it's so far as just one day hens all.
Exactly, Yeah katie mentioned that the dollar, here, boy it has been really weak this. Year we're got the D X y index ninety six spot five, here a little bit of strength, today but really weak this. Year what's your thought there on currency?
Markets so we saw a pivot in a week dollar trade starting to strengthen later last, year and we've really seen it, accelerate especially around the commentary last week regarding you, Know trump's view on THE us. DOLLAR i think the general view has been that the dollar is going to
be weaker if we're going to have lower. Rates but there's just generally been pressure on the dollar for quite some time, now and it has been close to its bottom in terms of breaking out to a new, trend but it hasn't hit a new trend.
Yet but it's. POSSIBLE i, mean it's definitely.
Possible, commodities, boy they have just been ripping to the. UPSIDE i think about the precious metals has just been, extraordinary, gold, silver what's your view. There we're getting a little bit of a pullback, today but, boy they've been on a, tear.
Yes AND i mean what's interesting to us is also the inter day price action you, saw for, example, yesterday for, examples you're, seeing you, know the market has been going up so, much but you're starting to see a little bit of, hesitation a little bit of. PULLBACK i think copper and base metals to also be a big story as, Well.
And you're seeing inter.
Day moves that go from really good to really bad to really. Good that suggests we might be at a. Top but we'll.
See Kathery kominsky with us on a trend based analysis with alpha s. Inplex, again the headline in the last hour the red sticky across The. Bloomer The president of The United states Nominates Kevin walsh to be the next chairman of The Federal Reserve, system and with a special edition here of good conversation Across Kati kaminski's. Equities we're doing to commodities Of Suki cooper here in a Bit Ira jersey on. Bonds claudia sam scheduled to be with
us in the nine o'clock, Our. Katie i'm looking within trend analysis at tip points or. Signals my easy signal on The bloomberg terminals a yield on the thirty year. Bond IF i see a five percent and may be able to get my radar And President trump's radar. Up what is your? Signal you're monitoring to see the dynamics of the worsh.
Chairmanship so what's interesting is we have been following fixed income pretty strongly in terms of we're seeing more short, views which is suggesting somewhat of a.
STEEPENER i think most people.
Expected a much more dubvish pick for The, fed SO i think that's baked in. Some in, general fixed income has been the hardest asset class to trade for the last year and a, half so we're still looking for something to really break, out but it has been a lot of back and forth in that asset.
Class, well important headlines From washington right.
Now, yeah mister tillis suggesting saying that Mister walsh is a QUALIFIED fed, nominee but Mister tillos also saying On Kevin walsh will oppose confirmation of ANY fed, pick so kind of just confirming what we kind of already.
Know The senator speaking Of davos With Jonathan ferrell made it real clear that he's just really not happy with the judicial, process as we saw From Chairman pole as. Well we continue With Katie kominsky At alpha Sim. PLEX i, Look katie at the equity, markets and there's a point where even AT mit they GO omg technology sand disk this, morning alexis talking that. UP i, MEAN i, Mean Katie kominsky is an Old Sun microsystems hard drive nailed to
the wall in her. Office, katie are you surprised by the technical the technology juggernaut that we see right?
Now, WELL i, MEAN i think the market has been kind of trying to process some of, these you, know can we go higher, recently and that's what you. SEE i, mean you've seen a little concern this week in the tech, sector which is and we've actually seen more of a. Rotation some places like em have been the big winner because of the metal moves and other things and the week. Dollar but you, know you have still seen technology showing incredible.
Results SO i think even though there's a, rotation these signals still continue to be strong for t and there's Little, well we'll have to see, better we'll have to see continued, earnings but we really still see that trend.
Continuing bond, market it looks like fixed income yields ARE i don't, know they've they've moved a little, higher but they still kind of seen within ranges. BOUND i guess at this, point how do you think about?
That, WELL i think what we have seen with fixed income is there hasn't been a lot of movement in fixed income over the last year and a, half and it's been very difficult to trade because a lot of people are anticipating a steeper yield. Curve they've been worried about inflation that hasn't Been and, now of course there's been a lot of focus on the construction and set up how THE fed is going to look in the
next few. Months but we have to remember that THE us is still not done with its cutting, cycle whereas other economies are pretty much at the, end especially if.
You look At.
Australia so we're kind of in that inflection point trying to figure out what's the next move in fixed income and it's been really hard to tell.
Where's your opportunity right?
Now so the biggest themes we're, SEEING i, mean there's huge moves in the, commodities short positions in. Cocoa you're seeing long positions in, silver, platinum, ladium anything that's shiny is really on the top. There but also THE us dollar weakness trade has worked very well And australia is benefiting from some of these big moves in.
MEDALS i Got, JAMES i Got james mccannon. Deck But, katie help me here with. Dollar let's go off the VANILLA dxy right, now what's your scope?
Is?
Go paul mentioned ninety? Six are you going to give? ME i got to make some, News. Katie can you give me an eighty nine week dollar ON?
Dx, wife that's a big, One i'd, say you, KNOW i think we've gone pretty far, already SO i, think you, know if WE i would say it would take a lot to get to eighty. Nine but if we had a very strong rate cut, move why not Right so right Now i'd say low, probability but.
Possible, Okay, katie thank, you, thanks thank, you thank you so. Much Ket kominski with Alf simplex this. Morning there and some of the trends that we.
See this is The Bloomberg surveillance, podcast available On, Apple, spotify and anywhere else you get your. Podcasts listen live each, weekday seven to ten Am eastern On bloomberg dot, com The iHeartRadio, app Tune, in and The Bloomberg business. App you can also watch us live every weekday on YouTube and always on The bloomberg.
Terminal