and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything. matt: welcome to "bloomberg markets." i'm matt miller. let's kick it off with a quick check of how we are doing this hour. the s&p 500 continues to rally, up /23 01 for -- 2/3 of 1%. you can see the u.s. 10-year yield rising 8 basis points as investors sell of this debt. 10-year getting ever closer once again to the 4% level, just a

few weeks after we came down from that. the bloomberg u.s. dollar index is also on a tear. it had come down to 1200 even with five days of drops in a row. and since then has been bouncing back up. the pound is below 130. most interestingly, we see nymex crude southerly above -- southerly above $80 a barrel. going on in terms of -- a lot going on in terms of asset prices. if you want to dig deeper into what is driving the stock market higher, certainly the s&p getting a huge boost from meta after earnings. the owner of facebook rallying after posting strong results for the second quarter, also giving an optimistic outlook, saying more than 3 billion people use at least one of its products every single day. absolutely gigantic scale, and if they can do that while also

sucking in the ad dollars, they can continue to print money. we have an expert on that for you. mark douglas is the ceo of an advertising software firm and he joins us now. great to have you on the program after these meta results. i got a note from you pointing out there are two different kinds of ad sellers. one group sells ads, the other sells an outcome. that is what he said about google, mountain, and facebook. explain what you mean. >> essentially you have in the ad market you think of big television advertisers. they are trying to build awareness. and people think of advertising, they think of big brands that spend hundreds of millions of dollars on tv advertising. really you are talking about a couple thousand advertisers. in that space we call outcome-based advertising, direct response, paid search,

paid social, performance tv, you are talking hundreds of thousands to millions of businesses advertising to get consumers to see their brand, come to their website, come to their app, and potentially purchase. that is the market that meta is in. they are virtually immune from economic downturns. when things go bad, their revenue tends to go up because advertisers want to invest more to get the consumer traffic. matt: one of the things i noticed in going through the analysts' reactions to the earnings is a lot of them are saying meta is going to be able to leverage artificial intelligence, leverage ai, for other businesses, small to midsized businesses. how is that going to work? mark: the really hard part is when you have a larger brand. you might've heard of them, your friends might've heard of them, your coworkers might've heard of

them. but when you get the smaller and smaller brands, not only do they have to figure out who would be interested in this company, in his product, there is no brand equity. they really have to nail finding that consumer that is going to be interested in the product, and that is without a doubt as it relates to advertising almost holy grail of direct-response advertising. meta's making big investments. i think everybody in a direct-response advertising, that is the goal, to match that consumer with the right product that will be of interest. i think it is going to bear a lot of fruit. matt: is it really -- apparently more and more people are watching reels, which are like short videos, the kinds that you would see on tiktok. do you think they are really making headway into taking market share away from tiktok? are kids happy to watch reels and put tiktok away?

mark: i mean, i think they needed to do it for instagram to make sure the app didn't lose relevancy. i think a lot of tiktok users also use instagram and vice versa. back -- people want short form content on these apps, they want it to be interactive, funny, engaging company be exciting. -- funny, engaging, may be exciting. i don't know if that takes market share away from tiktok, but it keeps them southerly in the game. -- solidly in the game. matt: i wonder about threads. they added 100 million users in the first five or six days of threads, but they haven't come up with basic features like a desktop app that super users like joe weisenthal needed to make a product relevant. why do you think they came out with a product that doesn't seem finished?

mark: i think reed hastings said if you are not embarrassed by your first product release, you waited too long to release it. [laughter] and so in silicon valley, the mantra is release early and often. i think threads is solid -- the fact that it grew to hundreds of millions of accounts to literally within days and they were able to scale that, it is something that in some ways twitter should be a little jealous of because they had in twitter spaces, they couldn't handle certain meetings that recently politically related. it proved that meta has incredible infrastructure. getting the engagement, obviously that is going to be a lot harder, getting people to really every day go to this app and engage with it. that is the cycle they are now. but they have instagram to leverage to get that engagement. that is what they are focused on, how do we get this instagram

community to extend their daily behavior over to threads so they can vote -- grow both of them together. matt: how much more engagement can they hope for? they have 3 billion people, one third of the planet, using one of their apps at least once a day. it just seems unbelievable that you could grow any further from there. mark: it's a lot of people. but they have to get threads -- you have got to get people in there if they app is going to be successful long-term. after get in there in 15 minutes a day or we've threads capabilities instant instagram -- weave threads capabilities instant instagram. that is what i would do. you start getting threads posts in instagram and vice versa. it would be a boon to them in terms of data. one of the biggest issues is back in the day when everyone was on facebook, you typed in what your thoughts were and the data from that for targeting was

incredible. they need that again from threads. if you type, "hey, i think the maldives are incredible," guess what ads you get on instagram five minutes later? threads poses potential to be a more word-based engaging platform to advertise on instagram and other apps with. it is one ecosystem. matt: i want to ask a broader question because you have your finger on the pulse of silicon valley. how is the left coast dealing with these higher rates? the fed came out and boosted us to 5.5%. after the collapse of svb, already a problem for startups, how do these tech companies deal with rates they have never seen before? mark: most tech companies are not borrowing money.

what made svb a remarkable partner is you would raise the funding and they would extend year-round by loaning you additional money so you can have more of what everyone refers to as runway on that round of funding. the interest rate on that didn't matter because no matter what it is, it was cheaper than going out and raising more money. can you still get those kinds of loans that extend funding rounds? it's sad that svb in its previous state is gone. it still exists in its new state. hopefully something is going to replace that. i don't think the average tech companies focused on interest rates as part of their business. matt: great to get you on the program. thanks for joining us. our go to guy when it comes to advertising, especially on demand. ebay's ceo joins us next as the

latest results come out. they are pushed into luxury sales and thoughts on elon musk's x app. this is bloomberg. ♪ welcome to the place where people go to learn about their medicare options before they're on medicare. come on in. you're turning 65 soon? yep. and you're retiring at 67? that's the plan! well, you've come to the right place. now's the time to plan ahead. learn about an aarp medicare supplement insurance plan from unitedhealthcare... and how a plan like this helps you take charge of your health care with lower out-of-pocket costs. here's why... medicare alone doesn't pay for everything. your deductibles and copays could add up to hundreds, even thousands of dollars a year.

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call unitedhealthcare for your free decision guide and learn more about lowering your out-of-pocket medicare costs and seeing any doctor who accepts medicare patients. oh, and happy birthday... or retirement... in advance. matt: this is "bloomberg markets ." i'm matt miller. taking a look at shares of ebay, they are off, having their worst trading day since february after the third-quarter earnings outlook missed estimates. they beat on the earnings report but missed what analysts were expecting on the guidance, with concern that growth initiatives could result in reduced margins. let's talk about this with the ceo of ebay. jamie iannone joins us now.

let's talk first about that outlook. analysts love to hear good outlook, and i have learned in the last 20 years it is better to under promise and over deliver. is that what you are doing? jamie: look, we are pleased with the momentum we are seeing. we beat all the metrics, expectations in the quarter. the strategy we laid out is working. we had the strategy of focused categories through seven point faster than the rest of the market. when we look at the long-term opportunities for ebay, we feel really great about it. the strategy that we have is focused on three elements, which is in raising the bar and going after relevant experiences, building scalable solutions, building magical innovations. really reinventing the future of e-commerce for enthusiasts. and it is working. we are increasing customer satisfaction on the platform, and our new innovations are being well received by customers. matt: full disclosure, i am

like an ebay power user, and i have been for over a decade, maybe 2. but i am 50 years old and i buy and sell motorcycle and car parts. it is so difficult. you need to grow beyond me to please the street. how are you doing that? jamie: well, thank you for your business. our motor parts and accessories business for the second quarter in wrote group -- quarter in a row group mid single digits. it is working well. but you ask how are we acquiring gen z's. we are doing great work across the board and sneakers, authenticating sneakers, bringing new sneaker heads in. we locked in authenticity guarantee for streetwear, bringing in leading brands of streetwear. we are strong from the fashion standpoint, bringing in a younger and more female consumer. we acquired a company based out of milan which helps drive

sustainability and fashion through great ai technology. we are sponsoring love island over there. we are doing a great job across the board catering to parts and accessories enthusiasts like you but also bringing in younger shoppers, female shoppers, through what we are doing in sneakers, jewelry. we launched authentication in handbags on the platform and that is performing extremely well. and frankly, refurbished. we have been focused on the circuit economy, and in times like this people need values also when you look at our refurbished category, it is going double digits year-over-year because the great values we can provide in the business. matt: i want to ask you about elon musk's x app. just because the idea -- we have seen great success in this kind of everything app in asia. i don't understand why ebay doesn't want to do the same thing. it seems to me you are perfectly positioned to be that.

have you thought about it? jamie: look, our third pillar of our strategies about magical innovations. we are doing a bunch of groundbreaking things. we are bringing live commerce to the rest of the world. we had hundreds of live commerce events for sellers selling handbags, watches, trading cards. they have great feedback from those experiences. in addition, we are really having an explosion of innovation around ai at ebay. we are launching a feature called magical listing. at magical listing come we do all the hard work for you. you put your camera up to it and we identify what the object is, the product you are selling, we write the description for you can we fill out the specifics can we tell you how to price it. people look at this and say, wow, this is going to unlock so much more inventory in my closet and things around the house, because you have made this so easy with this new technology you have brought into ebay. matt: you have amazon with a prime membership that's done very well.

walmart has a walmart plus number ship, and they have overtaken -- walmart plus membership nf overtaken ebay in online sales in the u.s. are you thinking of a higher-tier power user level? jamie: you know what's great about ebay, we get that same level of customer lifetime spend without them paying a membership fee. if you look at the busiest buyers, they are growing, they spent over $3000 a year on the platform. and what is unique about ebay is the cross category shopping nature. we will acquire a buyer into sneakers and they buy $400 of sneakers, but then they shop and spend $2000 outside of sneakers on other parts of the site. that is unique for ebay, we can provide these relevant experiences for your category but also have these massive, scalable solutions where we can bring cross-border trade for 190 countries to a given seller. that is unique about ebay and that is why we have these

enthusiast buyers. our strategy to do more for frontal marketing to bring on more parts and enthusiast buyers like you is working really well. matt: i'm a motors man, so i thank you for that. ebay ceo jamie iannone talking about the business after the results. president biden spoke about how extreme he is costing the u.s. $100 billion a year. we will look at how america is powering up to defeat this extreme weather, or at least keep cool. federal energy regulatory commission chair willie phillips joins us next. this is bloomberg. ♪

matt: this is "bloomberg markets ." i'm matt miller. i want to get to something that caught my eye.

extreme heat this summer is pushing air conditioner sales to lofty levels in the u.s., adding billions to committees already eyeing record profits. carrier group and lenox are among ac makers boosting full-your guidance as sales top estimates investors are taking note. the hvac index is up 20% from the start of june and nearing an all-time high. sticking with energy, let's bring in willie phillips, the federal energy regulatory commission chairman. mr. chairman, great time to have you on. thanks for joining us. clearly there is a concern, as all of these air-conditioners get plugged in and turned up to max, that we will have a problem with our grids across the country. are you seeing witnesses, are you worried about failures? chairman phillips: well, thank you for having me. i can tell you this -- we are definitely concerned. i was in austin, texas, last week. they are dealing with the impacts of the extreme heat there. what we just did today, the

federal energy regular commission, the agency that i chair, is an historic day. we had a bipartisan, unanimous vote to approve a new regulation that is going to help bring new energy projects onto the grid. it is going to speed up the timeline to connect those projects to the grid. it's going to improve our reliability can which includes extreme weather, our resilience, and lower costs for all customers. this is a great day for all americans. matt: so, in short, red tape, government right tape that held up to some extent our attempt to transition to alternative energy sources. what you and the commission are trying to do is get rid of some of that red tape so that you can streamline projects and get them to the goal line quicker? chairman phillips: that's right. we know there are huge backlogs. we have over 2000 gigawatts of

energy projects that are waiting to be connected to the grid. we also know that the timeline, the backlog is 4 times as big as it was just 10 years ago. it's 40% bigger than it was two years ago. what we are doing, we are aiming -- projects that were built in 2022-weighted five years on average to be connected. that means of projects just starting today wouldn't even begin construction until 2028. that's on except of both. technology moves fast -- that's unacceptable. technology moves fast. regulations have to keep up. matt: what can you learn from this heatwave we are experiencing, mr. chairman, in terms of what the grid needs to be capable of to deal with a transition to battery electric vehicles? chairman phillips: we don't have to look any further than what is happening right now. we know from extreme weather and

brutally cold winter storms that when there is a shortage of electric supply, it can be costly, they can be deadly. that is why we are focused on making sure that projects that are needed for reliability and resilience are coming on. that me put it this right. without interconnection, and energy project is like a train without a track. that is where the federal energy regulatory commission has taken action. you're taking bipartisan, historic action to bring more resources on the grid. that is good for all customers. matt: do you see a shift, by the way, when we see a spike in energy prices and gasoline prices, which we are starting to see again across the country, shift over to more use on the grid? chairman phillips: we know that energy demand and electric demand is on the rise. this impacts all the things that

we do at the commission. that is why my focus since i've taken over from the commission, day one has been reliability. a huge part of the commitment to making sure that we have the rules in place that can help power the electric grid that we needed to build the grid of the future, we have to make sure that we have long-term, holistic planning that takes account of the reality that is happening on the ground. matt: the grids we have now are infamously old and brittle. if you had a congressional genie in a bottle, what would you wish for, mr. chairman, in order to completely modernize the u.s. electric grids? chairman phillips: i think we are doing at the federal energy regulatory commission what we need to do, focusing on a mission. i made transition reform a top priority when i became chairman. while this rule is a great first

step, and i tell you, we are just getting started, we have more work to do, we have the long-term regional planning rule that has been proposed, we looked to finalize that rule in the coming months. that is what we are doing. ferc is working hard, ferc is working as it should work. matt: mr. chairman, thank you so much for joining us. hope to have you back. willie phillips is chairman of the federal energy regulatory commission. i want to break some news on the bank of japan. we heard from the fed and the ecb and now the bank of japan is expected to discuss yelp curve control -- yield curve control, a tweak to its yield curve control, in order to allow rates to float higher than 0.5%. this is being reported by japanese news agency. there interesting news reaction in the markets. the u.s. dollar's strength --

weakening now, i should site, against the yen. you can buy less than ¥140 for one u.s. dollar. we will talk about this when we come back. this is bloomberg. ♪ back in the day, sneaker drops meant getting online to wait in line.

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>> welcome to "bloomberg markets ." i'm amber kanwar. matt: i'm matt miller. a lot of action in the markets. you have the s&p 500 gaining about .2%. we have taken a significant leg lower because i half-hour ago we were getting .7%. decent gains on the s&p 500. you can see that the 10-year is now up 11 basis points in yield as investors sell off the bonds.

3.9742 is the level we're looking at now. bloomberg dollar index at 1215, not the strength to be saw earlier put a big bounce from the 1200 level last week. pound down below 130. nymex crude is the big mover of the day. getting 1.34 to solidly more than $80, 80.12 for west texas intermediate. amber: let's look at some of the big moves we are seeing under the hood of the s&p 500. meta coming out with a beat and showing discipline on the expense side of things. align -- kids today have it so easy. they don't have the clear braces , multicolored elastics. they get this beautiful invisible line braces to strengthen -- invisalign braces district and other people that is benefiting align technology. we do have some weakness.

these stocks rose on results and the latest earnings were a bit of a reality check. southwest and tripoli offering a forecast that was a little disappointing -- southwest and chipotle offering a forecast that was a little bit disappointing. matt: as a result, markets are punishing them significant. interesting to see them moving so low. let's talk about fx. the u.s. dollar is weakening against the yen. the bank of japan is talking about tweaking its yield curve control policy according to japanese news agency nikkei. let's talk to any tauro investment analyst. we have been waiting for this for -- it's been at least a year we have been waiting for this kind of announcement. we finally get it and it moves the markets a little bit. what is your take? >> like you said, matt, we already waiting for this. it's not much of a surprise. the pan has been -- japan has been one of the best-performing

stock markets this year and at one of the strongest rebalance. loosening of the control was expected and you are seeing that in the market reaction. matt: i think a much bigger surprise, callie, was the gdp numbers as well as inflation that we got out of the u.s. this morning. much stronger gdp reading than had been anticipated for the second quarter. in the little bit better core pce numbers that we were looking for, 3.8% instead of 4. what is your take on the u.s. economy? callie: to your point, u.s. investors are putting a little more stock into it, and this gdp print along with other gdps we have seen are hard to argue with. strong consumer spending, strong final demand. inflation clearly coming down. i think that coupled with what we heard from jay powell yesterday really takes out the chance of recession that everybody has been worried about.

i think the chance is still there, but powell and the fed seem willing to step in if we see any weakness because the progress we have seen in inflation. we have been more optimistic than the usual wall street firm, telling clients to be more cautious around these levels. but we have felt very encouraged by the economic data we have seen recently in the fed's willingness to be flexible. amber: i wonder if powell did get a look at those numbers, because as you mentioned, the press conference yesterday took the chance of a recession off the table. use of the market responded to that by pricing in a lower risk of a september rate hike. but the question is, if gdp is this a drunken is that at odds with getting back to an inflation target. callie: i think it could be. from the data we have seen so far, services inflation, the demand-side inflation the fed is trying to control come is coming down a bit. powell shrugged off that wages

were feeding as much inflation can which i think is a worry among economists on wall street. the payraise you are getting could lead to higher inflation. it's a bit of a question, amber. we are feeling optimistic, considering what we've seen from inflation data lately. but if a risk were to pop up, that would be at, the reignition of inflation. amber: it is all faltering into the equity markets where it is all systems go. we've got growth, we have subdued inflation, earnings beating expectations, broadening out of the rally. is anything giving you pause and caution to investors putting additional dollars to work today? callie: we are looking at a pretty great picture. you summed it up well. the sentiment is giving us pause, especially us on the side of the pond. thinking of the fact that people

are feeling more optimistic but we don't want them to pile too far into speculation, especially when interest rates are so high, and highlights are still a concern, too. they are becoming less and less of a concern from especially given that inflation has come down so far. but in a high-rate environment, it can be tough to look at small, speculative companies that aren't profitable. that is what we are reminding customers as we look to the realtor out -- retail investor who is more willing to speculate in risky names here and there. we are telling people it is still time to look for quality risk. you can be happy here, but make sure you are looking at companies can whether a recession, because the risk is incompletely often table -- isn't completely off the table. matt: if you talk to investors, don't you tell them to track an index and be done with it? stockpicking is unlikely to work for retail investors. callie: look, i'm not somebody

to ever tell anybody else what to do with the money. a lot of our customers are long-term investors. but they want to be a little more tactical with the money they have. i don't think it's a black-and-white type thing. many investors are long-term investors at heart but they are becoming more sophisticated and educated in the markets and trying out more context strategies. we are here to help them along the way. amber: it is tempting when you see these returns to kind of shun what is going on in the bond market. how are you thinking of allocations to fixed income? callie: this goes back to recession risks, amber. we are telling customers it may be time to pick up conservative on exposure, considering the fact that we are in a high rate environment and growth is slowing down and the fed is being more flexible. the recession risk while lower isn't completely off the table. with rates of 4% and treasury's track record in past recessions,

we think it is important to pick up some bonds. amber: thank you so much to etoro investment analyst callie cox for joining us this afternoon. mastercard sees a jump on travel and entertaining spending. more on the latest quarter from mastercard. this is bloomberg. ♪

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amber: this is "bloomberg markets." i am amber kanwar with matt miller. it is time for stock of the hour. mastercard credit-card volume grows more than expected with many consumers spending on international travel, which is boosting revenue in the quarter by 14%. bloomberg reported on this. jenny, thanks so much for being with us. put these numbers into context, especially with the pandemic and the huge boost that we saw. >> i think what is really strange is that everyone expected this quarter to be one of a major slowdown, and we have not seen that yet. consumers are going out and traveling in spending on entertainment, and that is why

you have seen mastercard low expectations out of the water. it is flying in the face of what folks were expecting, given how interest rates have been rising aggressively and the continued fears of recession. you don't see that in mastercard's numbers today. matt: purchase volume on the firm's card jumped to $1.84 trillion. people are spending money on plastic. is there anything holding them back? are they paying off the bills monthly? have a stop using cash? is that part of the story? jennifer: that is definitely part of the story. pre-pandemic, you would see a lot of cash usage, and now that we have tap to pay widely available in the u.s., it has been another boon for mastercard. i talked to someone who said that even within our numbers to see how premium consumers compared to mass consumers come are the richer folks papering over stumblings by lower income consumers?

they are not even seeing that. these are broad-based gains and a that consumer confidence is at the highest we have been talking about. amber: yet the stock is pulling back. was there a blemish in the quarter, or is this just an example of a stock that is run up and you use earnings as an excuse to sell? jennifer: no, one thing that came out was they reaffirmed their guidance for the year. given that the guidance was such a huge beat, that would allow you to get more movement on the full-year guidance. they got asked about that during their call the day, and really they just said guidance is arranged and we feel good about where we are at right now. i think that is part of it. the indexes they are in, they are now in the financials index, which is getting a little pressure given all the stuff we have been writing about with the fed and the big changes to capital rules they have proposed. they might be getting caught up in that as well. matt: jenny, i'm sure this is a

tiny, almost irrelevant portion of the business, but i would be remiss if ai did not bring up yesterday story, that mastercard is demanding payment processor stop allowing we purchase -- weed purchases with their debit cards. what is that all about? jennifer: to your point, really not making a difference in their next, but they have been investigating the space for a long time. what is common in the areas they go in and use the debit card at an atm and get cash and it is something that mastercard wasn't a huge fan of as they investigated further. they asked processors to go to the emergence and let them know they are no longer allowed to be processing on the mastercard network. i think he was a little too small a volume to make a difference. matt: not a big chunk of the $1.84 trillion. jennifer: not quite yet. amber: all right, thank you so much to jenny surane for that. coming up next, u.s. bank regulators unveil plans for the

most conference of overhaul of capital rules in years. insights on what that means from the ceo of financial services forum. this is bloomberg. ♪

matt: this is "bloomberg markets ." i'm matt miller with amber kanwar. it is the most comprehensive overhaul of bank capital rules in years. u.s. regulators unveil the plan that would force the biggest banks in the u.s. to increase capital by 19%. kevin fromer joins us now, ceo of the financial services forum, which advises these banks. tell us the reaction. kevin: first of all, matt, thanks for having me. i think i should start with repeating what you just said, because it is very important, increasing capital requirements

by at least 20% for the largest institutions. this is something the fed, the occ, and fdic have voted on today, and it will significantly increase, we believe, because that apply to services and lending that american families and businesses rely upon wasn't that 20% increase which could be understating the actual impact of the largest institutions, comes at a time when the industry has never been better capitalized, and that is been established by stress test, you -- real-life stress test, as well as the fed-run stress tests over the years. there is no justification for large increases in capital for these institutions right now. we think that policymakers are going to have to take a hard look at this proposal to examine

costs. we have seen the banking system perform very, very well over time. matt: they have, but having these banks -- if i'm not mistaken, you represent the 8 biggest banks. they have been huge recipients of deposit flows after the collapse of svb and others. they have done very well, as we have seen in the most recent earnings reports. kevin: they have done very well because they are the strong institutions. they are institutions that have built up their capital and overall resiliency over the years. a lot of this is a result of dodd-frank-era regulation and international regulators focused on capital standards. they are healthy institutions. that is why they do draw deposits. we are in a situation now where increasing capital at the level that is anticipated from this proposal is really a solution without a problem.

no one has established why you would need to raise capital levels for these institutions to this extent. other jurisdictions who have internationally active banks are also going to be implementing the same standards, are not going to adopt this approach. they are going to ensure that the basel standards are met but not in a way that significantly raises capital requirements. again, the u.s. as a policy has decided to be super equivalent with respect to these international standards. it looks as if we are going to go beyond the capital required to meet the standards, we are going to be above and beyond where our peers are in the european union in particular, and there is no reason for that right now. amber: well, this is not just happening in a vacuum. this is happening after we got the first banking collapse that we had seen since the financial crisis. and why your argument is that

ultimately this is going to raise the cost for main street, i guess part of the purpose is to make sure that if there is yet another stumbling block, whether with respect to these companies' balance sheet or the economy, that mainstreet is not on the hook for it. kevin: well, large institutions and their capital adequacy and the basel standard itself has nothing to do with the situation involving silicon valley bank or signature bank. in fact, you saw these very institutions put deposits in first republic bank to buy time for regulators to deal with that institution. there is no question about the capital adequacy of the 8 largest institutions, and the banking system as a whole is well-capitalized as well. amber: you mentioned this might hurt competitiveness. there is hundreds, thousands of banks out there. how does this hurt competitiveness? kevin: well, again, we have

standards that have been agreed by the basel committee. as they have been implemented in various jurisdictions, the united states has decided to goldplate those standards. we have higher capital requirements mandatory under the institutions, higher than the ones that exist outside the united states, particularly in the eu. the proposal we see today is going to expand that differential. it is going to expand the disparity between very large u.s. institutions and their peers on the other cited the pond, same activities, same types of risks, but different capital requirements. and that is a competitiveness issue. matt: what are the chances, kevin, that the big banks are going to be able to avoid this capital increase? how do you think the likelihood -- how high do you think the likelihood is that they could win this fight? kevin: i think you have to look

at the practical implications of these changes. and we have already seen reports and analysis coming from affected parties in the united states. those that are focused on housing finance, community reinvestments, american businesses that rely on banks to help hedge and manage their business activities here and abroad, those constituencies have already identified this proposal as costing themselves as end-users essentially a higher price for the very things that they rely upon the banks for. i think as we unpack this proposal, 1000-page proposal, our industry is going to look at this hard based on what we know we will be objecting to many parts of this. and i would also note for you and your viewers come in past years, post crisis, there is

generally a consensus view that we need to beef up capital requirements and make other steps so that our system is highly resilient. we have done that. we fought the last war, we won that last war. we are now is adopting requirements that go well beyond what we needed to. as you saw with boats on the federal cashvotes on the federal reserve board---votes on the federal reserve board, we had dissension. we got lots of questions. we had consensus in past years, we don't have consensus right now. matt: do you think that the sec specifically is overreaching and a lot of these regulatory cases? we have seen them lose cases when it comes to crypto. they put out the 283-page first salvo when it comes to regulating ai on wall street. is this a gary gensler problem?

kevin: well, the capital rules we are talking about involve the federal reserve, and the icy, and occ -- fbi see, and occ -- fdic, and occ. our institution and the largest institutions in particular have an excellent track record identifying the risks associated with technology and mitigating those risks are not conducting those activities if they are deemed to be too high risk. and they are highly supervised along the way. matt: i just see -- you can for the ftc in their in terms of flexing regular toy muscle -- that wall street is doing a lot of this. we will have to have you want to address the broader issues because compliance costs are going to be a big part of it as well as capital. kevin fromer is the ceo of the financial services forum, a lobbying group that represents the 8 largest banks. amber, it's been interesting.

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romaine: resilient economic data giving buoyancy to a persistently bullish market. i'm romaine bostick. katie: i'm katie greifeld kicking you off in the west with about two hours to go. looking at the s&p 500 that is green by only about .1%. nasdaq 100, big tech carrying the rally. you can see that in the nasdaq 100 up about 20% or -- .8% or so. in the yen, breaking