yellen wednesday and then says in a single line not crap but it was it was awarded in russia. the british resigning. my cleaning in the concerns ana contractual or. similar complaints against him love longer unique. and. seventy. it will build twenty nine nineteen with whole hotel checked his cleats seats when the winne. territories paranoid that was very bridge every child while the great race related to try travelled one way day and is expected to carry our helpful town councils holiday. well that's it for now. twenty george last but only only. okay. . giving giving you. this information. when you. the international forty eig. what does this look like? a station. our record changing. one twenty to build those. in the west bank. maintain local ministers it in military territorial. but will tend to us on france24 rule and fun fun people total home. this move tonight. for it's into now you know off. doesn't which was and have. like ibm and. so ten ten wrecked don't yo. our. south south offline playing on government also. does dozens of them into the legislation sons and examine

michael: jay powell is seen by the markets as a steady hand, continuing the policies of janet yellen,y. is that an accurate impression? jay for aave known long time. i think he is a really good guy, has really good character. my guess is those activities are more important over the next three or four years than some people in markets might believe. i suspect this is a continuity fed. what i'm looking for chairman powell and the new team that the president and the chairman assemble after they get their feet under them and put in place much of janet yellen's policies. they spend a few years after that reforming the institution. i think 2019 might be the first year before you see a new put his imprint on the institution, and for purposes of continuity that starks me as a good thing. michael: you argue to the one thing that is on autopilot that he would be cap -- would not be affecting, the balance sheet, needs attention. kevin: we cannot go back to 2014. my own judgment is the same as chairman bernanke he's in the depths of the crisis, which is that we cut rates to zero, we grew the bala

so did janet yellen, so did ben bernanke. i think it will be fine about this, but it remains to be seen -- not to be dictated to by the markets. there was a tendency some years back -- at least i was worried that the fed was letting the markets lead by the nose comes as big. -- lead it by the nose, so to speak. the markets should be catching on to what the fed is doing and what it is thinking. that is what transparency is all about. and i think that will continue. caroline: what about leading the rest of the world? the fed has almost been the only central bank that has been fully able to start to raise rates even slightly, and slowly but surely. the ecb has not been able to. we are seeing european growth slower than has been the case in previous quarters. you have the u.k. having to shy away, mark carney backing away from rate hikes. how does the u.s. assets the rest of the world, and how divergent is it occurring in monetary policy? alan: i think it jay powell and company had a magic wand, they would have the u.k. and ecb mo

jant yellen like the facebook ceo mark zuckerberg talks about learning how to become an effective education philanthropist and the shortcomings in the current education system. here's a look. >> this is not going to sound humble and i also think it's true of all of you in this room. i was really good student. were you guys pretty good students? but what that means is that i was, i am really good at sitting in a lecture hall just like this listening to someone share information, write it down and then tell it back to someone later. i'm still really good at it. if i were in your seats i would be really having a good time. i'm having a good time up here, too. but like, when it actually went to work with families, build the primary school, i didn't have any of that skill set no one ever prepared before that. i asked my friends who got mbas, did the teacher this? now. the core of it is our current system even if we are wildly successful don't actually prepare students to do what they need to do in the workplace. what my hope is that we actually think about how we can actually change that come ho

money printing the rise of the central bank the whole the central bank the ben bernanke is the janet yellen of the world and we worship priests in front of the disease will of money printing now that era is coming to a close the era of the u.s. dollar as the reserve currency is coming to a close with the rise. in crypto currencies is it an asset class or darn right it's an ass i class how do we know that because as people abandon the fee out currency nightmare that was given us and nothing but misery for fifty years they're plowing into fee at currencies is a go at one hundred thousand you're darn right it's going hundred thousand because there is trillions of dollars sloshing around in a cesspool called the global financial markets there's absolutely no rhyme or reason to valuation on any of these assets that whatsoever. and i saw a headline coming up here today which immediately got my attention so the exchange crack and right crack crack and jesse powell jesse powell at the crack and exchange they have told schneiderman in new york to pound sand a basically. they're trying to.

, every time -- remember the talk from janet yellen?hewould inflation numbers until you finally got a year-over-year comparison that got past that. that is what is happening because yes, 2% inflation on the headline. g-v --to the bloomberg g because it hasic only been this high once in the last year. for most of the past six years it has never gone to 2%. so this is a big deal. for the meeting that wraps up on wednesday, however, there is no rate hike expected for a number of reasons. the fed said it will be gradual. suddenly moving a height rate would not look so gradual, would it? and the other thing is to have a task. the u.s. expansion, the second-longest on record now. if you look at another chart with me he will see this accomplishment that the fed does not want to mess up by hiking rates too much too soon. you have to go to the 1990's to see the longest tenure expansion. some of the past expansions were stronger. this one is averaging just over 2%. some people say it is more sustainable. you know as one -- there is no press confe

money printing the rise of the central banks the whole the central bank the ben bernanke is the janet yellen of the world who we worship as priests in front of the disease will of money printing now that era is coming to a close the era of the u.s. dollar as the reserve currency is coming to a close with the rise. in crypto currencies is it an asset class or darn right it's an ass i class how do we know that because as people.

janet yellen eight that 2% was not a cap, that 2% was always going to be a target around which inflationmably circulate. >> talking about just how sensitive they are, a greater the downside.r as you pointed out, two point two means 1.8 in the current scenario. >> it does suggest, and the statement said they will monitor on a minute to minute acis or in that may change one night or another and they may monitor it on a short-term basis. it basically means with the rest of the world in low inflationary environment, actually, the e.u. can't get out of the 1-1.5 end zone themselves, probably because the currency has been so strong, but, 2.1 or 2.2 probably does not matter. on the other hand, as a caveat, are forcesion there in the u.s. economy, mainly a weak dollar with the exception of the past few weeks in the past month, that may force inflation up a point or two higher on a 12-24 month type of basis. we have a real economy that would probably be stronger in the second half based upon the trillion dollar deficit and the trump programs and corporate tax cuts. so there are arguments for both

you've got people on the street shooting up heroin death or kidding on themselves and like janet yellen weber's running the fed these days powell jesse powell walking by and saying that's an indication of our success my kids are there shooting up heroin and difficult in the street just you powell say because i'm a hero in america thank you just this last hour is going to show exactly and demonstrate the truth of what you just said because this is government backed firms make up ninety six percent of mortgage security issuance so u.s. housing policy is frozen in time when fannie mae and freddie mac. were bailed out in two thousand and eight lawmakers promise to reset of u.s. housing finance but ten years later next to nothing has changed so government backed firms ninety six percent of all mortgages are backed by the. u.s. government the taxpayer and you know i remember the two thousand and eight financial crisis well it was a caused by wall street reaping huge amounts of fees and profits for themselves when they spun all these subprime mortgages into c.d.o. as another mortgage backed se

money printing the rise of the central bank the whole the central bank the ben bernanke is the janet yellen of the world and we worship as priests in front of the disease will of money printing now that era is coming to a close the era of the u.s. dollar as the reserve currency is coming to a close with the rise of big cohen and crypto currencies is it an asset class or darn right it's an ass i class how do we know that because as people abandon the fee our currency nightmare that was given us and nothing but misery for fifty years they're plowing into fee at currencies is a go at one hundred thousand you're darn right a skilled hundred thousand because there is trillions of dollars sloshing around in a cesspool called the global financial markets there's absolutely no rhyme or reason to valuation on any of these assets that whatsoever. and i saw a headline coming up here today which immediately got my attention so the exchange crack and right crack crack and jesse powell jesse powell at the crack in exchange they have told me to new york to pound sand basically you know they're trying to d

andrew simmons al-jazeera khalifi county in kenya this talks between the colombian government and the yellen rebel group will move to cuba the original host ecuador pulled its support for the talks the negotiations started fifteen months ago and chris how after more than fifty years of fighting ecuador stopped hosting the talks after two ecuadorian journalists and their driver were killed by former fark rebels a coal mine explosion in southwest pakistan has killed at least sixteen miners emergency crews are carrying out an operation to free around a dozen others who are trapped in the mine the blast in the coal fields in baluchistan was caused by a buildup of methane gas inside the mine. at least four people have been killed in violence in indian administered kashmir a man died in srinagar after being run over by indian security forces and earlier at least three separate us fighters were killed during a raid by soldier is just a warning that you may find some images in a sauna binge of aids report disturbing. this is the moment when an indian security vehicle crashes a protester. the vehicle

>> this is janet yellen's fed.ast year by acting at every press conference meeting but only at the press conference meeting and signaling well in advance that is what jay paul's iowell' inherited. and in doing that, janet yellen locked in at most one full percentage point increase in the funds rate per year. think about how hardwired that is this he act at a nonpress conference meeting, everybody on the floor will go crazy thinking they are going to be tightening every meeting. if they ever try to pause, everybody would say, that's it, one and done, they have stopped. they are stuck with going quarter point every press conference meeting until they are pretty sure that they have to stop. they will know when they have to stop when they know inflation is above goal >> mr. reinhart, thank you for your thoughts on the fed meeting that ended yesterday "squawk on the street" will return after a short break whoooo. when it comes to travel, i sweat the details. late checkout... ...down-alternative pillows... ...and of cour

. >> and i remember when miss yellen was here, chair yellen was here about a year ago, mr. barr asked her specifically, do you oversee the budget at all of the cfpb and she couldn't answer the question. i. >> i think the answer is no. >> the statute does not provide for oversight by the federal reserve over the budget of the -- >> you don't report to any board? >> no, sir. i don't report to anybody. >> we don't appropriate any money to you, you don't report to any board. the head of the cfpb can be removed for cause by the president, but only for cause, correct? >> right. >> i remember we agree on a lot of things. i remember my time as state treasurer in maine, we ran into a certain type of organization, in the affordable housing space called maine state housing authority. i was on that board along with others. i'll never forget this as long as i live. we had an executive director with a five-year term appointed by the governor that could not be replaced except for cause. the individual did not report to any board. including the board i sat on, which was their board. he did

have a fad that said if the economy performs to these benchmarks that we've said, and remember janet yellen said that for the last three years and always had an excuse not to raise rates. i was hoping this that would stick to its word and stick to its parameters. guess we'll find out in june but they just keep kicking the can down the road and i don't think that's good news overall. >> we will look at the potential of the output. you have supply concerns from venezuela which i think is more important than iran. i do think that economic story plays into that contract. >> i think of to make a distinction, and you made here really well. there's a distinction between the summer driving season and gasoline prices and oil that's refined versus just oil itself. i think there's plenty of oil around the world. but capacity is really tight right now. push-up in oil, another five dollars here and back, it will be interesting to see if gas prices pulled back as well goes on and i guarantee you the summer they won't. >> i have to agree, we've seen a big run-up in the past three weeks on retail gasoline.

the yellen put, the bernanke put, it is always going to be there, but it is a lot lower than people believee fed managing asset prices indefinitely is a fiction. the bar is quite high. i think what chairman powell wants to see is a normalized u.s. interest rates at a time when unemployment rates are very low and the u.s. economy is growing nicely. gyratingces might be around, but they are still near all-time highs. why would you not carry on raising rates? but the second comment by powell himself came last week about emerging markets. he was asked, can emerging markets cope with higher rates? he said, it is manageable. i don't want to be too semantic, but i think he is saying, this is not a real problem. if it is our problem, i think we are doing ok. that leads us to believe that the next round of rate hikes is coming. one in june, a couple more this year from shaw. and 2019, they will carry on. the u.s. economy is coping. tax cuts are coming through, prices are ok. anna: and he thinks emerging markets are coping as well. thank you. we will say this conversation. coming up, what our busines

. >> we always joked about the ben bernanke or janet yellen fed here, having the investors back.ds like you're saying that about europe. it feels like the ecb is a couple years behind us, where if things continue to go where they're going, that draghi and crew will come in and rescue us. >> absolutely. you're correct europe -- we took our pain and our medicine sooner. the u.s. is a bit ahead of europe in the business cycle we've started raising rates. the ecb owns about 15% of the italian bond market. they maxed out on what they could bay of the german bond market the ecb is massively involved in the european sovereign market, even more so than the u.s. is. their balance sheet is around 30%, 35%, in the u.s. it's 23% and falling. you're right it's the bernanke policy but on steroids >> will it work? >> will it work? that's an excellent question it will work in the short-term if you're asking whether the ecb has enough to keep everything contained, relatively stable, yes. the other thing is for a long time italian ten-year yields were well below u.s. yields. that fundamentally doe

in janet yellen from the fed will go across the screen. forget about dog whistles this was like a fog horn. as rabbi semel put it let's face it the american jewish community has been abandoned by its leaders. i want to be clear here about one think i am not saying that the jewish response to the rise of anti- semitism and white nationalism should be uniform adoption of west wing politics. they have come from conservatives in republicans and especially conservative republican jews. the infant -- defense. the rule of law. american intelligence. he should not be considered democratic or republican endeavors these are american endeavors. neither party is supposed to cross these lines. authoritarianism. that is not liberal or conservatism that is american. in closing, bear with me, i want to share an obscure story that has meaning to me. back in 2014 before anyone have heard of the outbreak. the lags the video games places like reddit these are online chat groups that you probably don't even know exist. they call collectively decided that a sma

it is exactly the same as janet yellen said, we will have a change at the ecb, the same problem, theres not enough inflation. i am sure mario draghi would like to leave his legacy. the economy is not ready for it. karen ward will stick around. we will -- we are minutes away from the start of trade. we will look at stocks worth watching. it will see a reduction in total net gaming revenue after the government has cut the betting allowed -- amounts that are allowed on fixed terminals. the open is nine minutes away. this is bloomberg. ♪ guy: let's can't you down to the market open, talk about some of the stocks we are watching. joining us now from our team, the u.s. and looking at william hill, the bookmaker. let's start off with mirsky -- maersk, a miss. >> estimates were looking at a profit of 211 million dollars. take a look at the company's performance over the last three years. you can see we had the chart ready for you, the earnings have not been what we have seen before 2016. year to date, the stock is down more than 6%. what is behind this? the company saying unsatisfying -- unsat

. >> we might get a little postscript from janet yellen?> i told you so. >> what about the inflation story? to getong does it have to change the conversation in the united states? dial, between three and four or beyond? to payroll brings us on friday. to really move the dial, we need to see an acceleration in wage pressures, further declines in unemployment. we startoyment drops, getting confirmation we are getting broad-based wage pressure developing in the united states economy as it becomes full capacity for unemployment. actually, we need to start putting our foot on the brake harder. unemployment is very much close to their target. the fed funds rate is negative in real terms, still. we actually need to pick this up -- i think they might signal that in june. and how close to the speed limit the u.s. economy is. lengthening for u.s. factories, waiting an average of 67 days. this goes to the tuesday ism, weakle -- a little bit because the economy is running too strong. there is a shortage of materials and labor. is this an early side of

a guest was talking about how janet yellen would factor geopolitical risk into her decision. seeill be interesting to what is happening regarding italian prices and the rest of europe, with european market selloffs and the global market, if that would affect the amount of rate rises in the united states. manus: great to have you. the dot climbs over rome. let's discuss tim hayward on the bonds market, and our mlviv strategist. welcome. tim, in terms of the marketplace, two year notes ratchet higher. give us the view -- deja vu? are we in an existential crisis? tim: i don't think so. one of theharp call, sharpest since the euro was created. it was three times worse in the crisis, which extended from april to november. very far, but not yet as deep as that. the situation economically is as much as it ever was. the rate of change, inc. lending, is showing their reasons to be optimistic -- there are reasons to be optimistic. but the market moves yesterday were powerful. manus: one thing we have put together is a liquidity index for the italian government bonds. this defined what

he emphasized what he did in the last year of janet yellen's term, that is promising, normalization seems going well and balance sheet adjustment seems to be going well. >> is it time for the fed to rethink its policy regime, it's reaction function? >> they are in the process of doing that. not so much rethinking the reaction auction but getting back to the reaction function they have always thought about. what is promising is they talk about it a lot. you see it in reports and speeches, discussion of policy rules, such as the taylor rule. the strategies. where we are going? those things have to do with the medication at about where policy is. >> as the discussion goes on, john taylor will be a part of it. we will send it back to you in new york. david: thank you. mike mckee in stanford. you saw why the president might have thought putting him as chair because he likes tax policy and the regular version. -- deregulation. shery: still worried about trade issues. david: and the budget, he cannot fix that. more on the federal reserve coming up, we will hear from the outgoing new york fed pre

consider, there was a time when ben bernanke and janet yellen were begging for fiscal stimulus what they up with was the recovery and investment act of 2009, where we created a boatload of debt and got little back for it. the fed at the time keeping the rate at zero was masking the notion of how much debt we were accumulating you fast forward now, the fed was late to the normalization game and stimulus comes late because of this president putting it forth. what we have is bad timing because the notion of stimulus in the form of tax reform being the culprit to debt, maybe you could say it was a straw that broke the camel's back for sure, and i know i as a debt hawk was certainly not enamored with $1.3 trillion spending, but in the end, it needs to be put in perspective. i think that jay powell, as much as he wants to normalize, needs to understand the dynamic and tread softly back to you. >> we're going to find a lot more in a few hours, rick, and we'll rely on you for that rick santelli in chicago >> meanwhile, dow hanging on to pretty moderate range today. down about 73 points apple has

yellen took that on board. i am wondering if jay powell well. -- powell will.s the world bank when economic data impacts united states data. that happened in 2015. guy: where are we now? at the stage where global factors are not strong enough to affect the united states, given that china started to lucas -- to easy e policy. -- to ease policy. thank you gentlemen for coming to see us. we are to be on bloomberg radio very shortly in london. the stock of the hour is rbs. the royal bank is settling with the doj. the number really stands out. billion toelow $10 settle the mortgage claims in the united states. that number is half what the markets initially predicted. it will have a capability of making that. this opens the door back up to dividends being paid by rbs. the stock is trading well above , andge volume on the gd certainly outperforming the markets. it will be interesting to see how the british government ends the exit, which would carry a significant paper loss. it is a busy market move this morning today when it comes to stocks more broadly. bt group dow

fed it was there during crisis and i don't think anyone will find it different if you talk to janet yellenanley fischer or jay powell. they would like to get rates at a level high enough to address the next problem down the road, the next time we have a recession, they have something that allows them to cut rate and not have to dip into unusual whichlike to be -- qe, are therefore crisis. they're going to be following the data. if he did is strong enough they will keep it up. i spend no time trying to believe they out there to deceive me. believeslike everybody , let's hang on every single word, it is too much. julia: it is have it. >> -- it is have it. -- it is habit. scarlet: it is recency bias. body all care about language. we read people's emotional responses to things we do but we have gone too far down to focus on every little thing. julia: what you need to see to make it more comfortable but thought you are seeing? we have midterms coming up, and a lot of policy from the u.s., moves whoon of the seen the shares down to tax reform? what do you want to see? >> 2:00 on tuesday afternoo

i still think they will be they're more hawkish than janet yellen i don't think they're going to be careless. they're going to look at the data >> you have painted a scenario where the data supports raising rates. >> that's okay, though that's all right >> i think actually the fed will be donald dependent and we heard from kevin walsh a week and a half ago he gave an interview about when he interviewed for the job of fed chief. he said no comment when he asked what the president thinks of the separation between the federal reserve and the white house. i think it's very unlikely that you will see rates be taken to a level where there are stress in the system and potential for an economic event imminent. you're not going to get to that point before there's some sort of intervention. we know this is a white house that thinks it should be in charge of everything from law enforcement to whatever else you could think of i would say donald dependent that's not a negative thing. that's a good thing. the president wants continued job growth, wage growth, capital expenditure growth, and i don't think

wall street journal editor and the leader of the hudgins enter, heavy-handed recruiting both janet yellent recent fed shares. we thought it was pretty >> one of the obvious things for me was the criticism for the nomination here. i.e., it is the same old story, and older white man instead of something different. reinforces groupthink. you have all of these familiar faces. >> it was a question we were trying to answer with the story. the center itself has been criticized occasionally of being an echo chamber where the fed has accepted it to be right. of people say no, this is a form for transparent the date it out on webcast programs where the public can access them. there is a segment of the population that thinks it reinforces the consensus. it certainly is not challenging it the way we see them do. >> birth of a feather flock together. great story. pretty fascinating. let's move on. you can go to g tv . you can find all of the exciting charts you can see on bloomberg tv. keyk on them to catch up on analysis and save charts for future reference. awhats on tap today, i love this chart

janet yellen talked about it for at least a year. she said it was temporary, when it rises again.sen again. you see cpi flattening out. will the cpe flatten out as well? does this reinforce those who say, my baseline is three rate hikes total this year, not four? bonds, bond investors not waiting. if you look at the yield curve today, they have decided rising inflation will not be a problem in this economy, at least not for a while. five to 30, continues to flatten down to 27 basis points. it has not been that flat since 2007, just before the great financial crisis started. investors saying, i am not concerned about inflation. yes,r the bank of england, they have been signaling rate hikes as soon as august, but after mark carney said we are waiting to see if inflation rises and we think a slowdown was temporary, when inflation peaked around 2%. expecting that the turnaround, but meanwhile has to wait. we saw the weakness in the british pound rally in u.s. bonds. anything on rates until you see inflation coming on board your it -- on board. yvonne: perhaps more drama in the philipp

the minutes were more hawkish, janet yellen was more dovish. question over how is he spinning this thing. markets,general in the you are seeing pretty much flat in the u.s. in italy, you have a potential new government run by the populace and yet italian stocks are down just 1%. other asset classes, 10 year yields only up two basis points. you had a bigger selloff earlier in the session, but by the debt, why not? sterling moving well off of the lows of the session. crude still up on the day. david: let's find out what is going on outside the business world with kailey leinz. kailey: president trump has thanked kim jong-un for releasing three americans who were detained. he welcomed the men after they flew on a military plane to join base andrews near washington. he was optimistic about the chances of a successful meeting with kim. >> i think we have a good chance of doing something very meaningful, and if anybody would have said that five years ago, 10 years ago, even a year ago, you would have said that is not possible. administration official

not your yellen's fed. fomc could not agree on anything. david: welcome to bloomberg: daybreak.in here with alix steel. alix: are you buying a car? david: fortunately i have a car, because prices are going to go up. i am not sure why. in the markets, a little bit of softness in equities. we are down by about two points. euro-dollar off the highs of the session. the ecb account from the late april meeting. they are warning of potential risks in the market, warning of potential growth issues. this is before the disruption in italy and before we saw the latest tariff swing from the u.s.. in the treasury market, we are pretty much flat, down to 2.99. there was some buying in the backend, but that seems to have paired off a bit. russia saying that opec plus could discuss gradual easing of cuts in june. don't know if the saudi's are going to be into that. david: not the way to get to $80. alix: turkey's president is now launching his election campaign now. some of the highlights he is saying, that he is confident and he is also never coming in front of a nation empty-handed. the poten

when i look at this news that's under cover about wholesale, go back over the release of when janet yellen'ssaid if this continues, we are going to keep them capped at a certain level of growth. so i understand that they also made seeeach board member had to sign a letter about this so it's a little more significant because they will keep the lid on the growth here. i thought they had gotten everything right >> we have a blastics company that's killing it. then i got to go there cap pit growth guess what they grow cannabis that is a growth market. i'm going there. >> if it's good enough for gene simmons. >> i know. i was going to have him on but i don't want to be a pot show. >> we'll see yout 00.m e rm c on the company's earnings in a minute d manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities - trade confirmed - and i have global access 24/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you. i'm not really a, i thought w

students from around the country compete at the national economics challenge with hopes to be the next yellenbehind the scenes look in just a moment. it took guts to start my business. but as it grew bigger and bigger, it took a whole lot more. that's why i switched to the spark cash card from capital one. with it, i earn unlimited 2% cash back on everything i buy. everything. and that 2% cash back adds up to thousands of dollars each year... so i can keep growing my business in big leaps! what's in your wallet? >>> small caps, outperforming large caps by a bit this year. giinone said the rally is just benng.find out why tradingnation.cnbc.com more "squawk on the street" after this at crowne plaza, we know business travel isn't just business. there's this. a bit of this. why not? your hotel should make it easy to do all the things you do. which is what we do. crowne plaza. we're all business, mostly. >>> let's get to the cme group in chicago rick santelli joins us with the santelli exchange. rick >> good morning. thanks, david. i like to welcome my first guest of the week, peter thanks for ta

money, it was there, whether it was the greenspan put or, you know, what was done by bernanke or yellenw money supply is not growing. it's not growing because the fed is shrinking its balance sheet >> in terms of where to look in the opportunity spectrum of banks, do you prefer the big cap names, smaller caps, what's the best performing stocks >> the smaller cap stocks are killing big bank stocks in terms of performance, there's just no comparison whatsoever. in other words, if you look at the period from 2000-2017, you got, you know, mid-cap bank stocks, up 20% a year on average, big banks, biggest universal banks are down >> and give us some opportunities, top picks in the small cap space. >> well, you know, silicon valley bank, you know, a huge winner, companies like pimco, and the stocks have done well, some over last five years are up 25% to 30% in terms of price appreciation while the big huge banks sit on their butts >> touch on goldman sachs a little bit does it have some of the flexible aspects that the silicon valley banks of the world have with what's it doing in the consumer

cautious about doing too much, too fast if you think about where -- >> this is a new fed, not the yellene. i think the fed is probably focused on a couple things we don't talk about they need to focus on credit spreads which haven't really given a lot of ground. that sounds like it should be -- that's a good thing, but i think the fed wants to see commensurate move also not just what we are seeing in rates but in credit spreads to feel like something's happening here >> john, jump in >> one thing i would say is the fed's interested in keeping the cycle going. the fed has no interest in ending the business cycle prematurely. this idea they want to put arrows in the quiver may be there but that's a second order of consideration the first order of consideration is not to make a policy mistake. don't do anything overaggressive or rash. and as long as inflation is below 2% there's no reason for them to be more aggressive here. we think the market's pricing a lot of fed for this year, it's pricing more for next year and given the backdrop, we think that's about enough. >> pricing in a lot of f

even though jay powell and janet yellen said if it inverts, it is not a problem, since this has comeve said the yield that's an version of the yield curve has 100% power of recession. francine: do you think they will try to manage it so it does not invert? actively managed this dilemma. megan: as the yield curve flattens more, i think the fed will feel more pressure to adopt a dovish bias. francine: do you agree? in terms of, but yields, if you look at year-over-year affect in wti or brent, we have seen the peak of these year-over-year growth affects in the middle of july, which tells you until august there could be on the headline inflation, some basis for positive inflation surprises. if you look at the last 18 to 24 months, it was heavily coordinate with the 10 year curve, inflation surprises. if we have inflation surprises to the upside, that could be the basis for temporary steeper curves and higher yields. thereafter, i do not famous of a case for 3.5% or 4%. you have the natural rate -- sorry, the neutral rate, two and three quarters, 3%, it is not really the basis of getting

and deposit accounts for which they were fined $185 million and it was so bad that cappedmer chair, yellen, the bank's size until they cleaned up their act. they were found to have illegal student loan practices, inappropriate checking account fees, unlawful mortgage lending practices such as overcharging veterans for refinance loans and charging customers for automobile insurance policies they did not need which resulted in some customers losing their vehicles and they were fined $1 billion but it really doesn't make them any different. it is just the cost of doing business. and yet we have my friends on the opposite side of the aisle who come and ask us to be lenient on the banks. to do away with the dodd frank reforms. forget about what happened in 2008. somehow, it's all right for these greedy banks to continue not only in the practices that they have, despite, despite the fact that dodd frank reined them in. they're doing very well. 2155 again is not a community bank bill. and it certainly does not help consumers. we should not pretend that's the case. instead, considering improvement

tom: within that is chair yellen's comment on slack.s well manage policy for the math, which you just said is a tight labor economy, and also manage it for a behavioral or structural employment of the have-nots? martin: those are really very separate issues. unemployment of the have-nots and the structural employment problems reflect labor market rules and transfer policy rules and the fed cannot really change that. i think they are moving in a direction of higher inflation and higher interest rates in the longer term. francine: when you look at the fed and the u.s., do you think the phillips curve is back? will we finally see the correlation between jobs and inflation back to normal or at least a little bit back to normal? shahab: certainly that's what the market is looking for at this point in time in as much as it consistently pushes short-term u.s. rates higher and higher. it's obviously been helpful that unlike the rest of the world, u.s. data has held up strongly in the past few weeks. you are seeing that reflected obviously in th

as janet yellen and president s some of thee point. we have to look at a broader perspective.loyment population ratio or employment of the rate. it tells a less complete recovery or a less complete expansion following the great recession. critical is really with that employment dynamic. we want to move this up to get back somewhere in the vicinity of what we felt like, or are we just not going to do that? carl: if we zoom back into that last circle, we can see a plateau. that is a key focus, to make sure that we are continuing on that upward trajectory. we saw a soft patch for consumers in the first quarter, and we need to see evidence -- tomorrow in retail sales, for instance -- that consumers are back on track because they have been the fundamental driver of this economic expansion. if consumers are petering out, that would significantly change the economic landscape. dots reallye the that clear? 8, 9 months ago we were just saying ditch the dots. carl: you cannot ditch the dots. they are important for guidance of fed policy. my own estimation, loretta mester is in the for-h

may be tethered to what is going on abroad a >> if this was the janet yellen fed, i'm sure they got more guidance out of washington than out of canton, ohio or austin, texas. globalism was more important in the last fed this is a new fed, i'm not sure what powell is looking at. having said that, we priced in three rate hikes, it's hard to get a fourth one with all the stresses in europe right now that's why you're seeing the ten-year close to 2.85 >> drew, your view on rates? >> we would agree on that. we would look at it slightly different. we think where the ten-year yield is dictates where the fed funds rate is at the end of the year we think the fed is taking cues from the markets they don't want to invert the yield curve. as much as economists will tell you it doesn't matter if the yield curve reverts, most portfolio managers would tell you that means you're moving towards a recession. the fed doesn't want to signal that >> any risk of contagion if italian bond yields remain high, morgan stanley came out with a note saying banks will feel the pain if yields remain high we were talki

jay powell, the new fed chairman has the same bucket in hand that janet yellen dead and that his slow gradual interest rate increases. right now they are ready to see it run a little harder than it's been since inflation has been solo. dagen: wells fargo chief executive tim sloan and exclusive interview yesterday talks about the many scandals surrounded the company. here's a little bit of what he sold. listen to this. >> one of the things that i said to all of our stakeholders is we need to rebuild our reputation with all of them. the retail accounts that we've sold to customers that maybe they didn't need were in the midst of remediation. we reached out to over 120 million different customers to say hey, if you have an issue with the wells fargo account, come in and see us. we are most all the way through the process. >> perhaps bigger than all of the above in the misconduct we're talking about is the federal reserve ordered the bank not to grow anymore? you cannot increase the size of your balance sheet beyond $1.95 trillion as to what you do? is that a death now the wells fargo is

money printing the rise of the central banks the whole the central bank the ben bernanke is the janet yellenof the world and we worship as priests in front of the disease will of money printing now that era is coming to a close the era of the u.s. dollar as the reserve currency is coming to a close with the rise. in crypto currencies is it an asset class or darn right it's an ass i class how do we know that because as people abandon the fee at currency nightmare that was given us and nothing but misery for fifty years they're plowing into fee at currencies is a go at one hundred thousand you're darn right it's going hundred thousand because there is trillions of dollars sloshing around in a cesspool called the global financial markets there's absolutely no rhyme or reason to valuation on any of these assets that whatsoever. and i saw a headline coming up here today which immediately got my attention so the exchange crack and right crack crack and jesse powell jesse powell at the crack in exchange they have told me to new york to pound sand basically you know they're trying to dig into all th

i was encouraged when the fed took action under then chair janet yellen and initiated a strong enforcement action against wells fargo for its egregious consumer abuses and capped the bank's growth until it cleans up its act. of particular significance is the fact that this enforcement action is not just defined but comes attached with real consequences for waells fargo which is a repeat offender with a terrible track record of harming consumers, including opening up millions of fraudulent accounts without their customers' consent. i hope to see the fed continue to strongly use its enforcement tools. we need our independent regulators to be vigilant in carrying out their statutory duties. sadly, that independence is under attack. just last week mick mulvaney -- there have been zero enforcement actions by the consumer bureau since his appointment. he had taken a series of actions to weaken the agencies ability to carry out its important mission and benefit the predatory actor that is the agency is designed to police. indeed, the trump administration and my colleagues across the aisle are wor