sonali: welcome to bloomberg markets traders are continuing

to digest this week's economic data here are three beneficial's. susan collins will speak soon and john williams the president of the new york will give the keynote. we have had a flat day in stocks. mass dog breaking into the red, down .3%. the s&p is still in the red. two year yields are down .03 and bitcoin going parabolic breaking above 62,000 less than 7000 from an all-time high and will talk more about that later. mid-day movers on the equity side. we have used and bitcoin and

marathon digital have seen gains. we are also looking at beyond meat sore after delivering a better than expected forecast. ebay shares are up the most since november 2022 after a buyback plan. united health with the biggest declined by 4.8 5% on the day. the u.s. initiated an investigation into the largest u.s. health insurer. when it comes to the fed, mark mccormick gave his to take when they have their first cut. we believe they will cut ma, growth is slowing but not catering.

sonali: let's bring in policy editor michael mckee he was tracking of the fed speak. what are you expecting. do you expect them to say anything that will change that trajectory? mike:what you are seeing is people on hold for tomorrow. what we've seen from the fed officials is that we think we're gonna get to 2% but we just don't know and it's going to be bumpy. we will stay on hold for a while. not giving any clues on when they will start cutting rates. tomorrow, we may see the ppe come in hotter than expected which will have people wondering if the federal changes views on

when and how many cuts will come in 2024. the next meeting is march 20. we have to point out an important market note today, the first person speaking was lori logan in a conversation exclusive with bloomberg down in dallas and she said she thinks the market got it wrong when they interpreted her comments about the balance sheet suggesting that the fed might stop soon. was surprised her about the market reaction is that we need to disconnect slowing and stopping. it just means managing the pace. a lot of people thought we could get a revision in the march where the feds thought there might be a slow rather than

stop. sonali: turning back to bitcoin we have the price within just a few within an all-time high. across 62,000 and we will discuss this now with milton's matters. how much further do we have to go? >> i have always been a bitcoin girl. what we are seeing, this is the most hated rally. we were not expecting it. it has been an incredible catalyst, 10,000 mccoy per day

being consumed by the etf versus bitcoin mind. the supply and demand imbalance is profound. the key target is 69,000 the last all-time high. beyond 69,000, the air is getting thin. i have very high expectations. sonali: what do you think is driving the current performance. but it begs the question if the having is priced into a large degree? >> what i look at his flows. we published a lot of data around flows and with the etf's we have data around flows as well. if we look at the flows over the past two months we have seen 20

billion of inflows in the outflows on the grayscale side. on top of that if you look at daily trading volume yesterday we saw a new high 2.5 billion traded within a 24 hour. enough is the etf on par with large-cap stocks. the other thing that is interesting, these bitcoin etf's are not offered on every platform. there is a huge campaign against charles schwab because they're not offering these etf's on their platform and not as many investors are accessing these. fidelity is recommending a one-3% allocation to bitcoin. j.p. morgan published a report of a 1.4 allocation.

we are seeing these creatures of demand, a lot of retailers coming in with trades on the smaller side we get to see what this will look like once these etf's are offered on more platforms. sonali: one thing i am worried about, do you worry that these retail investors are buying in at a high? meltem: that's a great question but one thing i know about bitcoin is this really hard to price in the market. in the 10 years i have been in this industry, we see higher highs and higher lows. while volatility has historically been one of the talking points for why it may not be suitable for every investor. we have seen increasing volatility across asset classes.

relatively speaking, bitcoin's volatility is no longer as great of a concern for investors and at the end of the day the allocations are not so large and i think there is a huge appetite if we look at stocks, they are at stocks. it doesn't feel like a crazy idea. sonali: what does this mean for other crypto asset classes. you are at an event around a theory and do they have as bright of an outlet for bitcoin or are the outlooks priced into by autoload. meltem: mccoy dominance is a

great way to track. bitcoin is 50% of that, it is hovered between 45-55%. it is still a really large portion of the suspect class. i am out one of the largest theory and there's a lot of people excited about the crypto space. there is a lot of enthusiasm in etheriem. we are watching solana closely and more broadly, the one i'd love to look at, my dogs, frogs and memes. when the dog started to run is when we see large-scale retail

participation and we are not there yet. sonali: as we are speaking you have bitcoin headed to 63 thousand. not too far from breaking the high, only $200 off from 63,000. coming up we will shift gears. we will go to the housing market, cautious spending is hurting home improvement costs. stick around, we will be right back. back. at t. rowe price, we ask smart questions about opportunities like advances in healthcare and how these innovations will create a healthier world tomorrow. better questions. better outcomes.

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markets and i am sonali basak, the home improvement market is in need of improvement. the indexes falling for the fifth straight week in home depot and lowe's acknowledges slow down and do it yourself renovations due to the weakness in the housing market. the home improvement provider issued guidance was below the estimate and we will discuss this with front door ceo bill kopp. was interesting about what were seeing in the mortgage market is compounded with the idea that rates might stay higher than the market initially expected. how much more weakness could be ahead? bill: there is a lot of optimism among the real estate industry. they think home sales will go up

13% this year, there is belief that mortgage rates will come down with interest rates and we have not seen any change. is hurting sales. last year we were down 20% which is in line with the decline in real estate. we don't see a turn but a lot of industry experts think the leader of this year it will turn. sonali: how do you navigate the problem here? do you expect softer sales for a while and do you counter that with things like price because? bill: that's what were looking at right now. we can only control what we can control. our renewal business, customers coming back year-over-year is at an all-time high of 76%. our direct to consumer business suffered a little bit last year but we're launching our new

brand with the new website, new logo and new campaign with the celebrity spokesperson. we will focus on the renewal business and then on real estate, we had a terrific real estate team and we will do best efforts and try to outperform the market but it's a tough market out there. sonali: your stock was up 70% last year and it's been dropping this year based on the worry about the housing market. it is worth giving assist to investors on where you think the bottom is in terms of pain on the market? bill: we had a great year last year, our adjuster growth was 62% higher. we had to take price increases

because of the labor situation with contractors in the supply chain and parts and equipment had gone up with appliances and hvac and skilled trades have gone up in terms of labor rates, fuel, etc.. we think we are in a stable situation where margins are stabilized we will grow the customer growth on the top line. sonali: who is your new customer? bill: our customer is the middle-market customer. the person who needs peace of mind, budget protection. home systems will break, appliances break and need to be replaced. for $70 a month or so to protect 23 systems and appliances in the home and is a great value.

we do to service calls a year which provides value for our customers because they could see the benefit of having someone, a nationwide network of contractors, they are bonded, insured and we can guarantee a great experience when people come in. sonali: we thank you for giving insight into the market at an interesting inflection point. francis newton from optimist capital is up to discuss market strategy. all of that and more up next on bloomberg. ♪

sonali: this is bloomberg markets and i am sonali basket. there are so many things that could derail this equity rally. for now, there are no imminent

risk we will speak to abigail doolittle. we have seen the idea of further rallies in the market stalling out but we are not seeing major tips. when you're sitting at market highs how do you think about where we go from here? frances: was interesting about what's happening now is when you have multiple all-time highs and in the face of a tightening fed that has done a record amount of tightening in a record amount of time in the stances is to reduce the balance sheet you think about getting defensive and traditionally bonds played a role. we have all been written by the bond trade. i have permanent scars from the bond trade.

the thing i found recently, as far as the rate of change on the growth of inflation, daily volatility is being driven by an options market that lends itself to things like zero days to expiration and is harder to pull the trend out because you have a day that is pro-inflation and a day that is progrowth and another against growth and you find yourself in one of those quadrants that change all the time. you sit on the access when everyone's question is where do rates keep? is it a fed that preemptively cuts or stays higher for longer because of re-accelerating risks. i was looking at another correlation to give me an indicator. abigail: your last statement with if rates have peaked jamie

dimon said the 10 year yield could go as high 7% and all is forgotten as inflation came in but we had a cpi and ppi coming in hot. we seem to be in a two week long period of hotter than expected. do you think the peak is going higher than next year? frances: it depends on if we can stave off a credit event. a credit event could stop this discussion. when we look at why the credit event has not occurred or haven't got into recession. the inverted yield curve usually has a specific domino effect that hasn't played out. you look at these exogenous things like covid that have

changed the timing. fiscal spending has buffered a lot of the tightening that the fed is doing. were moving money i at the balance sheet and you have an inverted yield curve, banks stop lending and a bunch of private credit step in. where the top out i don't know? abigail: if you had to guess based on these unusual factors where are we in the credit cycle? frances: because we have so much fiscal spending it is starting to reignite and we have been saved recession, is starting to reignite the global growth story. i'm watching to see if that has legs and i'm watching this correlation between oil and the

10 year. oil is front running the 10 year and i'm watching that because the global growth narrative, oil is pertinent to that picture and that gives us some idea of rates in the u.s.. francis newton stacy and blueberries abigail doolittle thank you for helping us navigate this market. some large breaking news, mitch mcconnell is stepping down as the senate republican leader in november. this is a record broad and we will keep you posted on all of those details. this comes amid a lot of lobbying between the deadline of the continuing resolution.

we will bring you more on that front. coming up next we will check on markets before we had to morph and speak coming up next. we have a market stalling out with the s&p quickening losses down .1% and the nasdaq facing losses of 0.4%. 10 year down at 4.65. we are not going to bring you a little more on the news with mitch mcconnell. we have our own kailey lines joining us for the update. bringing in kailey from washington whether we know about this? kailey: he does indeed intend to stand down as leader. this is not to say he will be leaving the senate chamber but

leaving the leadership position that he sell for a long time and it is worth knowing that november is an election year where the senate could be up for grabs. the republicans could flip the senate if they're able to flip seats in pennsylvania and maryland. this is mcconnell saying he will not try to be senate majority leader or hold any leadership position beyond november what congress is coming to the capital. this comes at a moment where mcconnell's power does seem to be diminished. he has been a vocal advocate for aid to ukraine. he advocated for a deal that would tie supplemental funding together with border security measures in his own party costed

before it had a vote in the lot of the calls for things he has prioritized have gone ignored. he has been an outspoken critic of former president donald trump and we know that he is likely to be the republican nominee november. there's a difference between the republican party that mcconnell represents that there is an acknowledgment from mcconnell who will be stepping down in november. sonali: how does this change the power dynamics and how do you think about this about what's happening in washington in real time with the shutdown conversation you been having? kailey: it's unclear whether

mcconnell holds the power that he did earlier in his tenure because thinks he is advocating for, he is struggling to garner support for us he would've in the past. he is serving as the minority leader, it's chuck schumer who holds the power in that chamber. house speaker mike johnson has said he supports aid for ukraine but is not willing to put that on the floor and mike johnson is close to the president trump. there is a real difference between the two leaders with the influence they hold over the republican party. it may change the dynamics but i'm not sure if everyone will be surprised about this move that he is making to step down in november. sonali: we thank you so much for your analysis and we will bring

you breaking news us a comes through. including the ramifications of this maven the senate. we got a comment from susan collins and raphael bostic. what have we learned in the last half hour? mike: raphael bostic giving a fireside chat in roswell, georgia, where it is 72 degrees. not sure if they have a fire going or not. saying the fed still has work to do on inflation and they are not declaring victory but he expects inflation to continue on its trajectory down. susan collins saying what is it that you are looking at when you decide when and where to cut. as housing and non-housing

services prices, inflation expectations and moderation in markets that slows wage growth. she remains a realistic optimist in thinking the economy is on a path to 2% inflation while maintaining a healthy labor market. the economy is in a good place overall. sonali: you don't seals moving us much off the back of these comments but we have john williams coming up and is there anything he could say that will be important? we have some tea leaves on how fed officials think about inflation. frances: they are giving us something to watch. we have always asked jay powell and he says were working on the totality of the information but in this case there are specific she's talking about was will

come into play because we will get the pce inflation and housing and nonhousing so we can look at the inflation expectation numbers. it will be the next clue along the way it we will see if john williams echoes what they are saying. he is a vice chair so he could always say something that will have more influence than the others. sonali: thank you so much bloomberg's michael t. we will speak more with jennifer lee. we have such an interesting roadmap when you think about the pce data and knowing what we know now how are you viewing those numbers. jennifer: very carefully. i feel like we are in the state of flux but we do know lots of things. we know the u.s. economy is still quite resilient. sonali: we have to cut you off

because we have breaking news. ms., addressing the senate about his plan to step down as gop leader. >> the introspection that accompanies the process. it's a way of reminding you of your own life's journey to prioritize the impact of the world we will all leave behind. i turned 82 last week. the end of my contributions are closer than i prefer. my career in the senate began amidst the reagan revolution. , the truth is when i got here i

was happy if anybody remembered my name. president reagan called me mitch o'donnell, close enough i thought. my wife elaine and i got married on president reagan's birthday, february 6 which is probably not the most romantic thing to admit but reagan meant a lot to both of us. for 31 years elaine has been the love of my life and i am eternally grateful to have her by my side. i think back to my first days in the senate with deep appreciation to the time that help shaped my view of the world. i am on conflicted about the good within our country in the irreplaceable role we play as

the leader of the free world. it is why i worked so hard to get the national security package passed earlier this month. i know the politics within my party at this particular moment in time. i have many faults but misunderstanding politics is not one of them. i believe more strongly than ever that leadership is essential to preserving the shining city on a hill that ronald reagan discussed. for as long as i am drawing breath i will defend american exceptionalism. when i was thinking about delivering news to the senate i always imagined a moment when i would have total clarity and

peace about the sunset of my work. a moment when i am certain i helped preserve the ideals i so strongly believe. that day arrived today. my goals when i was narrowly elected in 1984 were fairly modest to do the job for the people of kentucky and convince them to rehire me for a second term. that was the plan. if you would've told me 40 years later i was stand before you as the longest serving senate leader in american history i would've thought you had lost your mind. i have the honor of representing kentucky and the senate longer than anyone else in our state

history. i never could've imagined that happening. when i arrived here in 1984 42. i am filled with heartfelt gratitude and humility for the opportunity. but now it is 2024. i am now 82. as ecclesiasticus tells us for everything there is a season and a time for every purpose under heaven. to serve kentucky in the senate has been the owner of my life. one of life's most underappreciated talents is to

know when it is time to move on to life's next chapter. i stay before you today mr. president and my colleagues to say this will be my last term as a republican leader of the senate. i am not going anywhere anytime soon. i will complete my job my colleagues have given me until the elect a new leader in november and take the helm next january. i will finish the job the people of kentucky hired me to do as well albeit from a different seat and i'm looking forward to that. it is time for me to think about another season. i love the senate.

there may be more distinguished members of this body throughout her history but i doubt there were any with anymore admiration for the senate. after all this time, i still get a thrill walking into the capital and especially on this venerable floor knowing that each of us have the honor to represent our states and do the important work of our country. father time remains undefeated. i'm not the young man sitting in the back hoping colleagues would remember my name. it is time for the next generation of leadership. as henry clay said in 1850 the constitution of the united states was not made for the

generation that that existed but for posterity, unlimited, undefined, endless, perpetual posterity. time rolls on, there will be a new custodian of this institution next year. it won't surprise you to know i turn this over to a republican majority leader. i have full confidence in my conference to lead our country forward. there will be other times to reminisce. i'm immensely proud of my accomplishments i played some role in attaining for the american people. today is not the day to discuss all of that because as i said earlier, i am not going anywhere

anytime soon. there are many challenges we must meet and each will have my full effort and attention. i still have enough gas in my tank and i intend to do so with all of the enthusiasm with which they have become accustomed. to my colleagues, thank you for entrusting me with their success. it's been an honor to work with each of you. there will be plenty of time to express my gratitude in greater detail as i sprint towards the finish line which is now in sight. i yield the floor. [applause] sonali: that was mitch mcconnell

announcing his plans to step down as the top republican after the presidential election in november. we will get back to kaylee lyons after the speech. how does this start to change the power dynamics particularly when we are days away from a government shutdown deadline? kailey: mitch mcconnell saying he will end his reign as the longest republican leader in the senate. he has had this position as the head of the conference since 2007. mr. o'connell said it himself that he recognizes the change in politics of the gop which vary much has changed in color since 2017 and the ascension of donald trump which mcconnell has had some difficulty with former president trump.

he says he's aware of those politics within the party and this is been a difficult time within his party. he is married to elaine chao and he goes on to say he will defend american exceptionalism including his work to pass a supplemental. there are many members in the senate and house who don't feel the same way as mitch mcconnell. he will still remain leader for the next eight months until the presidential election. there will be a question of whether that will be the majority/minority leader if they are able to flip the chamber. there are a few names of who could be the next leader. you have john barrasso or john

cornyn of texas. expect to hear more from them and others who have put their hop forward to replace mcconnell but this is the end of an era. he's not leaving the chamber he will still serve as the senator from kentucky as he has for decades but he said this will be his last term as a republican leader and this is a pretty remarkable moment in history. it comes out intense time as they try to set out government funding. he was with president biden trying to find a way to keep the government open and a path forward on ukraine. but his role will be quite different. sonali: there are senators on the sideline to take that seat. but there are a few months

before his plan to step down. how do you see those next few months playing out with key deadlines ahead? kailey: this friday, march 1 at midnight is when part of the government could shut down with appropriation bills like the fda and veterans affairs. mitch mcconnell was talking about the potential of a minibus to tie these things together and get them all past together and we could be looking at a continuing resolution, that will kick the can down the road to keep the lights on. that is the most immediate priority but mitch mcconnell has been impassioned of the ukraine issue making please that this is about american security is much as ukraine.

he will likely continue working on trying to see if this makes its way through both chambers. a lot of this is not up to mitch mcconnell who was a minority leader but to mike dawson in the house. sonali: watch kaylee tonight on balance of power. coin base where users may see a zero balance they say on the website post that their team is investigating the issue and will provided update. if users experience errors in buying or selling, they are now up less than 1.5% on the day. this comes as bitcoin is barreling higher and crossing that 60,000 mark, thousands of dollars away from its all-time high. we will switch gears and get

back to the fed. let's discuss the data we have seen throughout the hour. with jennifer lee, we talked about the critical data we are seeing tomorrow. we know susan collins has mentioned a focus on housing. are you concerned that inflation may not be subsiding as fast as investors like? jennifer: that's one of my fears. inflation will remain sticky for longer and we can see the fed pushing back on their plans to cut rates. it's earlier in the year so there is a lot of data to digest the big one being the core pce deflator. sonali: what do you think about the data relative to what we see

after tomorrow? you are seeing the cooling of yields this week. we have seen them be very volatile in recent weeks. are you worried data may suggest a stuffer out there? jennifer: i feel like we are in a state of flux right now. we know that in q3, q4 we were very strong. this is an economy that is sad hundred 25 basis point hikes in the past few years. we also know that the january data has been weird. this is what we are going to have to watch but certainly, tomorrow's spending data will be critical given the u.s. consumer

accounts for 70% of the economy. wages and salaries are one of the key things that will help drive the consumer. but they are spending, and what they are spending on in the core pce deflator will show the opposite of what we saw in the january pci. republican missy some kind of offset -- we are probably going to see some offset. it will argue for more patients a caution in all those great words we hear from fed officials. sonali: jennifer lee, we thank you for setting us up for the moment of the week we are all waiting for. and now is time for the stock of the hour. we are looking at cava driven by

consumer cravings for its premium menu. same-store sales remained at 11%. romaine boss taken alex steele are standing by with the ceo of kava. romaine: greg shulman is joining us now the ceo of cava on the back of those earnings. we talk about 22% on a restaurant level investors don't expect that to continue. >> we have guided to 27.3 and 2024, a slight decrease from what we were able to put up in

2023 but that is a reflection of the investments we have made. multimillion dollar investments and incremental adjustments and are team members. we wanted to live or the value proposition to create long-term expansions in shareholder value. romaine: i'm curious about your own pricing power. in the previous conference call your previous ceo that calvo wanted to return to price increases around 2.5-3 percent said that get implemented? >> our last price increase was in january 2023 and the only plan price increase for 2024 we

talked about absorbing a 30 basis point impact from legislation in california whose predecessor was known as the fast act with minimum wage of two dollars more and we look at this as an investment in our team that we don't want to pass along to our guests. no incremental price increase. which is making your margins more impressive. as you pay more minimum wage what is your cost profile like now? >> it moderates year over year and we have seen benign inflationary pressures and direct source model on the supply chain. as well as vertical integrating management structure. we came online with their state-of-the-art facility in southwest virginia in addition

to maryland and this facility where we prepare our spreads and were able to do it at a high quality and consistency at scale and take the complexity out of a restaurant and deliver it to our guests. alix: are you noticing a weight loss drug effect? >> the early data we're seeing that this would be a net positive for us. people are cutting out alcohol and gravitating towards food and diet like cava. we were one of the greatest beneficiaries of the advent of the glp-1 drugs.

romaine: how do you expand this business there has been discussion already about the current footprint the idea of moving into new geographic areas places like chicago and other major cities in the real estate at cost associated with that. how hard is it to find locations that are cost-effective? >>. we haven't had issues were excited about the opportunities we have. we operate in 24 states and the d.c. we don't have any presence in the upper midwest. the ability for us to succeed in so many different ways. we operate in urban areas in suburbs and small towns on the east coast to west coast which allows us to cast a broad net to source new sites to support our growth. alix: we need one in brooklyn.

what are your hiring plans for this year? >> we have had tremendous growth at both our collaboration centers as well as the restaurants. we are cutting 240 a-52 new restaurant which is a lot of team members were looking to hire and team members we want to promote to operate this new restaurants. romaine: my brother-in-law is in alabama and thus the only place you can get decent mediterranean food. i always tease him, if you open a new york or new york, you are dealing with the more competition for folks selling similar types of food. >> we have a clear dominant

leadership position and mediterranean it's a category we are creating a defining. we think it's the next big cultural cuisine category. the country is becoming diverse with health and wellness trends where people want to eat better but they don't want to make compromises or sacrifices which is where military cuisine comes in. thus are differentiated point of view and were able to deliver something different that when people have been traditionally able to get in the market. romaine: all eyes are on the stock. our thanks to brett shulman the ceo and cofounder of the kava group. sonali: we want to check on coin base because it is aware that some users may see a zero balance across accounts and may experience errors in buying or selling. the company says the team is

investigating. bitcoin has been barely past $60,000 and only thousands of dollars away from a fresh record high. we will keep an eye out on that and more. we have flat markets on the day but of course, a big story with the inflation data. same time, same place. that does it, this is bloomberg. ♪

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>> from the world of politics to the world of business, this is "balance of power."