fed chair powell: sure. you say the intent is to slow and we have slowed but then stopped the process of shrinking our balance sheet at a time that is somewhat above the level that we judge to be consistent with our ample reserves. meaning we don't want him to suddenly appear to be shortages of reserves. are going to think of where those shortages might appear and were going to put a buffer on top of that because nothing good happens when there aren't. there's not enough liquidity so that's our overall framework and right now feel like we're a all -- all the evidence suggest that reserves are still abundant which is more than ample. >> as you know in early 2021 the fed stated it would invite comments on supplemental leverage ratio and that has not happened yet. i made the point that the growth of the u.s. treasury market paired with a decrease willingness of banks to act as intermediaries is a major issue on the horizon. when former treasury secretary yellen was before this committee last year, i ask her abo

the plan to eliminate the fed.tching this play out as trump doubles down on his efforts, and got the independence of the fed as we seen with demands that you drop rates immediately in fact, is copresident mosque attacked the independence in a tweet earlier this year, i know you have been adamant about the independence of the fed and have thus far resisted pressure from trump after your decision to eliminate the ei initiatives, following trump's illegal order i am i speak all of my colleagues on the democratic side when i say that you must stand firm in defending the fed's independence checked any attempt by elon musk and his g of millions to gain access to the fed in systems and data and forcefully about what's at stake e for our company. the american public must hear from you, our central banks today. >> gentlemen yields back i got myself five minutes for questions. thank you for being with us. let me start with the fed's bank regulation and supervisory function. as i mentioned in my opening statement over the pas

can you talk about what the fed does with fed listens? chair powell: we did this as part of our review five years ago. the idea is that we break out from the usual people that we talked to, which is a pretty diverse group, and try and deal directly with people who are experiencing the economy and our policies. it has been eye-opening to listen to people. we had one person at the chicago conference five years ago who said the expansion which was nine years old is just reaching their community. he talked about how companies were going into prisons and finding people who weren't going to get out for a year or two and training them. you could hear a pin drop, it was very telling stuff. i think we learned from all of that. so we will keep doing it. sen. blunt rochester: i will end by saying a famous quote. we may have come over on different ships but we are all in the same boat now. we need to get it together. chair scott: senator marino. sen. murray: no thank you for being he -- sen. marino: thank you for being here. -- is not going to drive

can you talk about what the fed does with fed listens? chair powell: we did this as a part of our review and we did it on an ongoing basis. breaking out from the usual people that we talked to, which is a pretty diverse group, and try to deal directly with people who are experiencing the economy and our policies. it has been quite eye-opening to listen to people talk about -- we had one person at the chicago conference, five years ago, who said that the expansion, then nine years old, is just reaching his community. he talked about how companies were going into prisons and finding people who were not going to get out for a year or two in training them and stuff like that. you could hear a pin drop. it was very telling stuff. i think we learned from all of that. so, we will keep doing it. sen. blunt-rochester: i will end with a famous quote, i think it was martin luther king, we may have come over on different ships, but we are all in the same boat now. need to get it bit -- get together. i yield back. chair scott: sen. marino: a broad gen

he covers all things fed for bloomberg. on inflation and gdp growth that we learn anything new from the fed chair today? michael: we did not. basically chair powell repeated what he had other members of the fed have been saying for quite a while. it was kind of a quiet message to the markets that nothing has changed. the fed is still on hold but they aren't putting a timetable on it because they do not know with the president's policies will be. he wanted to stay out of the markets. for the most part he did. >> he also said absolutely nothing about tariffs. you anticipated that would be the case. he doesn't want to go there. michael: he doesn't. we knew that going in. he has done his best all along to stay out of the debate, at least in public, about what will happen to the economy. but they don't really know because the administration hasn't given any details. they put 20 5% tariffs on but they don't start until march. will there be exceptions? we don't know. there are a lot of unknowns out there. at one point he committed

the fed has been making adjustments to the fed funds rate over the last several months. although there has been movement on short-term rates, there really has been minimal impact on intermediate to long-term rates. can you expound on why you think this phenomenon is starting to exist with respect to federated, monetary policy, versus the general borrowing rates for businesses and consumers? >> you are right, of course. you lowered the federal funds rate. longer rates are going up. they have gone up and down. they are higher. the reason is that we don't control long-term rates. they react to a whole bunch of different things including a sense of more deficit spending coming including expectations of more growth. risk of higher inflation. markets are not pricing in higher inflation. the risk of that is there. that could be a reaction to new policies or not. alternately, the increase in longer-term rates is mostly not about fed policy or our job of maintaining price stability. the term premium in particular. happy to meet with you and go through this in a lot of detail, mor

the fed is more likely to sit on their hands.ersation is up next with leslie falconio of ubs. you are watching bloomberg tv. ♪ you know what's brilliant? boring. think about it. boring makes vacations happen, early retirements possible, and startups start up. that's why pnc bank strives to be boring with your money. the pragmatic, calculated kind of boring. jonathan: we are taking everything in stride at the moment. equity futures done one third of 1%. no real drama when it comes to tariffs. a key date is march 12. we have time to negotiate this away? do we have time to negotiate carveouts? when does this actually happen? lisa: if you look at markets, well, something might happen but wake me when we are there. we are not paying attention to what has been some anytime so for just noise. annmarie: when it comes to exemptions, trump mentioned australia. you have to look at who we have a trade surplus with. the top line figure to focus on is the trade deficit the u.s. has with a specific country. maybe australia could be saved. not s

but where i agree with david come in this is a conversation that the fed fed doesn't want to have, iswant to pull the world from under u.s. exceptionalism. there is already a lot of uncertainty in the environment. finally, the face value qualification was important, because not only as mike pointed out to we had the annual updates to also to measuring things but also the impact of the wildfire and we simply don't know what the net effect is but at face value, this is certainly not good news for the fed and the bond market and equity market is reacting accordingly. lisa: on one hand, you can say this truly is a more inflation prone market and especially with companies more able and willing like coca-cola to pass along price increases and you can see us make the fed should be patient because 3% inflation might be ok as long as it keeps going downward. which is it? what is appropriate to respond? mohamed: it goes back to two issues. at that powell is finally willing to talk about in the second one that he doesn't want to talk about. the first one is what is a neutral rate? he said yester

the fed is certainly on pause, and. fed chair powell indicates that.s where he. >> intends to be. >> you got two inflation reports that matter plus a jobs report before the next meeting. plus you also have this comment from the treasury secretary that well the administration is targeting the ten year whatever that kind of means that there you know, i think it was an explicit, you know, way to take a little bit of the direct pressure off this idea that they're going to be hammering for rate cuts on the short end from powell. interesting that he says housing has stabilized, maybe, but at a kind of a pretty, you know, kind of tough level. that's not necessarily a big source of growth for, for the economy just yet. but i think, again, preserving optionality and characterizing things as if they could, you know, go either way, but are in a good place seems to be the message. yeah. i mean, take a look at, say, the homebuilders, for example, coming way off of the highs of october. the other little wrinkle that will be attuned to is the discussion about fed ind

the fed next meets in march, supply. the fed next meets in march. when _ supply.ch, when do you _ supply. the fed next meets in march, when do you expect i supply. the fed next meets in march, when do you expect it| supply. the fed next meets in l march, when do you expect it to make another cut in rates? i am make another cut in rates? i am thinkin: make another cut in rates? i am thinking of _ make another cut in rates? i am thinking of may _ make another cut in rates? i am thinking of may or— make another cut in rates? i am thinking of may orjune, - make another cut in rates? i am thinking of may orjune, by - thinking of may orjune, by that stage they should have a lot more clarity on the impact of the labour market with the immigration moves and what is actually going to materialise, in terms of tariffs and how thatis in terms of tariffs and how that is impacting trade. by that is impacting trade. by that stage, by may orjune, they should have a much clearer picture of exactly where is going and some idea of the impact. is going and some idea of the im act. .,

and we got to go for the fed minutes. i'll join for the fed minutes.l join brian sullivan on the other side (vo) what does it mean to be rich? maybe it's not just about the places you can go... but also the people who welcome you home. it's not about living like a star... but about feeling like one. rich measures life in laugh lines... in moments, shared... and in days well-spent. the key to being rich is knowing what counts. your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. our advanced matching helps find talented candidates, so you can connect with them fast. visit indeed.com/hire before the spotlight— we struggled to keep the lights on. i saw more for myself. and sofi gives members the financial tools to see more for themselves. join the official bank of the nba. sofi. get your money right. when i started walton goggins goggle glasses, i had no idea what i was doing. but godaddy airo does. using ai to build a logo, website and social content. so i can let the world know, if your goggles

and so the fed.ed to it. >> but exactly. >> that will be tricky if we do start to see sort of unemployment rate move higher. layoffs pick up because fed chair powell has said that he will react to. >> that and they. >> could lower interest rates. but you. >> can't do. >> that if inflation is perking back up. so that's something. >> you can always you can always build your case using what you can in terms of the data. but yes. >> how about kraft heinz, which is a loser today. off results i guess profitability is the one thing that was better. but if you look below in terms of the sales trends, it's not pretty. organic sales declined 3.1%, a 4.1% volume mix decline. they're just they're struggling. you know, all these consumer staples did well in the last few years coming out of covid because they had pricing power and people were eating more at home. and we're just giving that back. and if you don't have strong brands like a kraft heinz, then you see how ugly it can be right now. the guidance. >> was

the fed where does the fed play in your thinking? a lot of fed speakers are out now because the blackout is over. they're able to give their perspective. and most of it seems to be we're on hold. because we don't know any more than you do about what the impacts of tariffs or a trade war or renewed trade wars is going to be. >> we heard from mester this week, and there seems to be this consternation from the fed that inflation expectations are at risk of becoming unanchored go back to the summer of 2022. why did the fed raise 75 basis points? it's because we got a hot university of michigan consumer inflation expectations number. it ended up getting revised lower. but the point here is that the fed is concerned that if you see tariffs get pushed through, that it will cause consumers to expect higher inflation. look at egg prices. look at people at costco. you still have this notion of inflation that is still simmering in the consumer psyche. so the fed is concerned about that, which is why they're on hold. but the good news is the job

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they cut 100 basis points -- it is less about fed and fed independence.e telling us they will need offsets, because the 10 year does impact the economy. the economy is intra-sensitive. there were a lot of positives, fiscal, etc.. annmarie: what is the pain threshold in the market for their policies? what is your guiding light? priya: i would say 5%. if you ask me for number. the speed matters, though. there's nothing magical about 5%. i would look at 5%, i would look at real rates. i think real rates matter a lot more than nominal. this has been a real rate driven move. that 4.8%, we were starting to see risk assets start to pay attention. anything above 4.5% to 5%, if it is driven by real rates, driven by expectations of fiscal expansion deficit financed, then it is tricky. this idea that tariffs will pay for trade -- if tariffs were a negotiating tool -- or that tariffs would pay for fiscal. if it is a negotiating tool, you cannot have it both ways. you cannot delay tariffs and expected to pay for it. so i would say a quick rise in rates getting to that

nothing big from the fed chair today. winner and meta going for that what 17 in a row now. >> yeah the market's kind of withholding its true feelings here a little bit. it's very split i looked a minute ago the new york stock exchange up versus down stocks was 1350 against 1350. so volumes light in the index products. if you had to say there's a story aside from what you mentioned with apple and meta picking up the slack, it's that tesla's down 75 billion in market cap on the day, and the rest of the market is managing to counter it and keep the s&p harmless at these levels. i do think the kind of churn has a little bit of a flavor of defense and laggards kind of coming to the fore a bit. nobody's having a real growth panic. but i do think that there's a concern out there that if everyone's eyes are on inflation and tariff effects of inflation, you might take your eye off the ball when it comes to a little bit of waning momentum in the near term in the economy, but i don't think, again, the market has a strong enough view

is a pleasure to introduce michael barr, vice chair for supervision at the fed. it is a little unusual. i know him well, to recount his many accomplishments is a bit intimidating. i have known him since his time at the university of michigan and my earliest days as a professor of law. look through the decades to see how much he has been able to do. in and out of public service. i want to jump to many of the important conversations, but just a reminder for our students, the vice chair for supervision at the federal reserve is one of the nation's most important positions in the economy, one of those positions that if you are really lucky you will have the chance to if not work with some of the really smart important people working in government. something about monetary laws, the law of money, a question that goes at the heart of integrity, to the heart of financial stability of the economy and how you devise rules that work for everyone. throughout his career, vice chair barr served at the university of michigan as professor of law. he has served as dean of public

in the fed now, the fed's real-time payment system allows individuals and small businesses to send and receive money instantly, which is a step in the right direction, mr. chairman. so what is the status of the fed now adoption for financial institutions? mr. powell: so it's coming along. as was the case with ach back in the day, it takes quite a while. there's investment that has to take place on the part of banks. we are working with a lot of small- and medium-sized banks to get them comfortable with the requirements of fed now so this is can build up over time. it is something we expected to be slow in terms of uptake, and it has been slow. rep. cleaver: well, is technology adoption a barrier for smaller community banks and mission-based lenders? mr. powell: yes, it is. and so we work with -- there are nonbank service providers that do reach out and do a good job with small institutions, and we have encouraged that. those institutions cannot have direct access, for their business is to -- they have the information and they can go to smaller institutions and show them how to do this,

he calls the fed policy less restrictive.nd note the language, because it is definitely in somewhat restrictive mode. we have had 100 basis points of easing but should they hurry to cut rates? we do not think so. sonali: what do you think the short and long end of the curve? one thing that came up is the lack of control that the fed has on the long end. at the same time we spoke to the national economic council's kevin hassett where there was a pitch that fiscal prudence would help lower the long end of the curve. but at the same time the opening offer was really for increasing the debt limit which is greater than the gdp of france? more than $4 trillion that they are asking for. do you believe that there can be a clampdown on where the upper bound is on the 10 year with what we are seeing in the market? vishy: i think so. but i think we will come to that point from a different angle than what you just portrayed. i think and i just heard pramilla speak and i do not think we are that different in our expectation. our expectati

we have lots of coders at the fed. you don't think of the fed as a coding agency, but we have thousands of people at the fed who were engineers because we help run the payment system. and it is important for us to do that efficiently and effectively. one thing generative ai is good at is reducing the amount of time that coders need to spend testing code, doing testing of code. we have been experimenting in a very controlled, very separate sandbox with could we get coding efficiency by using generative ai? it turns out, yes, we can reduce the amount of time we need to spend on unit testing, and therefore increase the amount of time hypothetically in the future that coders have to do more creative things that are higher value inputs into making sure our system is safe and sound. >> let's give you two seconds for the microphone. >> craig torres from bloomberg. vice chair, i remember when we had a republican head of the fbi see, a democrat, as head of the treasury -- fbi c , a i'm wonderingif the sort of general lean now b

it is a tricky position for the fed.old and watch how this plays out. a movement higher inflation inflation expectations would be something the fed would be focused on and could delay or mute the extent to which they cut the policy rate even amid a growth scare or deceleration on the activity side. i think this is something they will continue to watch and it sets up for a tricky position for them. jonathan: what is our experience of tariff threats lingering for this long? if this persists, how does the consumer behave? how do companies behave? tiffany: i think there is, i hate to be a two-handed economist, but you have expectations that impact behavior. that can go both ways in terms of growth and inflation. you certainly have evidence from the first trump administration that increases in policy uncertainty, economic or trade policy uncertainty does hold back hiring an investment as businesses are more unsure of the rules of the game. at the same time, you see some frontloading behavior. we think we are seeing consumers

fed.e economy but fuel volatility further. the pause button will be on longer than the markets were expecting. jonathan: we will be catching up with adam posen. he joins us next on the prospect of rate hikes in 2025. ♪ you know what's brilliant? boring. think about it. boring makes vacations happen, early retirements possible, and startups start up. that's why pnc bank strives to be boring with your money. the pragmatic, calculated kind of boring. jonathan: equity futures on the s&p, up by .1%. in 40 minutes we will get data for you, ppi and jobless claims. bond yields are lower by two basis points. under surveillance this morning, the fed's long pause. >> at face value this isn't good news for the fed. we could talk about the inflation target for an economy going through massive structural change. it would not be so obsessed with 2%. it would be flexible. there is no meaningful forward policy guidance coming from this fed and that's the mistake. look for the fed policy not to act as an an

wait and see and you can see the fed bets are not changed. 1-2 fed cuts.ck, the sentiment is hawkish. as we get cpi print, we will get back to the raft of earnings. heineken ceo and andrea at 9 am. a lot to talk about, the opening trade is next. this is bloomberg. ♪ a sleep number® smart bed is perfect for couples the climate360® smart bed is the only bed that cools and warms on each side and all our smart beds adjust the firmness for each of you. and now, save 50% on the new sleep number® limited edition smart bed. shop a sleep number® store near you. anna: good morning from london, one hour away from the opening

that's the fed kryptonite. that's the long end of the kryptonite it and comes down to uncertainty the market is uncertain about tariffs and that's going to be the story throughout the year and where rates go in the short and long term. vonnie: this move, five, six basis points in the 10 year, it's not what everyone wants to see but at the same time, the data rule, right? >> yeah, for sure. there's no question that the jobs numbers were stronger than expected and the economy's holding up really well. so that's really what the market is reacting to and i think we're expecting more or less of a range from a ten year for the rest of the year, four and a half plus-minus 25 basis points. maybe where we can see a lowering movement will be more on the front end, the two year where we're expecting still potentially some cut from the fed during the year, depending on economic data, definitely around trump policies going forward. so if we do see that, we could see the two year moving lower. but the 10 year, we're expected

the fed does not control that. the fed does not have any control over the yield curve.elieve beyonce six months or one year max. and if you look at what happened since they cut rates in september, the rates in that part of the yield curve one year out, two years out have all risen significantly. why? because the supply demand factor. with the treasury. and i'm very much looking forward to seeing what the new secretary of the. >> treasury and the. >> president does to bend that curve. but so far, we haven't heard any discussion of it whatsoever. >> yeah. for sure. no market yields on the longer end up quite a bit from that first rate cut and even december, but definitely off their highs. so we'll see next move. richard appreciate the time today. thanks so much. >> appreciate you mike. thank you. >> thank you. all right. >> up next, technician. >> jeff degraff says he's watching. >> one key sector. >> in the market right now. because if you lose that sector, you could lose the whole market. he'll explain after this break. closing bell. we'll be right back. >> i am here. >

so some of the issues you talked about, the fed can't do a lot. also, i think and i think scott bessent may have said this, i think the administration is more focused on the ten year treasury than the fed funds rate and moves they can make. that might keep this term premium on the back end from inching up, which is affecting the cost of a lot of financial services that you just talked about there. it's affecting rents, it's affecting mortgage rates. and so i think for the time being, i think you'll see the fed kind of move a little bit quietly off to the side, be more muted. try not to be in the middle of the headlines and fiscal policy and other executive actions. the federal government are more center stage, and i think you're going to see again, a more whole of government approach to dealing with these issues. and we're in the middle of that. but we're in the early stages of the middle of that. >> robert robert kaplan, goldman sachs, always appreciate your valuable insight. weird time, like you said, unique time. but that's what makes it intere

sharon powell give -- fed chair jay powell will give senate testimony. the expectation is he will highlight the resilience of the economy as a reason the fed can wait to cut rates and digest the impact of trump's policies before acting further. on the geopolitical front, friday, we had to munich for the security conference. the focus is the war in ukraine. elliott takes a significant stake in bp as it looks to shakeup the struggling oil maker. we will bring you the details next. this is bloomberg. ♪ lizzy: bloomberg has learned elliott management has built a significant stake in bp. sources say elliott once to boost value by pushing the energy giant to consider formative measures. more detail with anthony. notably over the past five years bp is down about 8%. shell is up at least 30%. is this the crunch point? >> bp has seemed to be at a crunch point for a while and harkens back to the days of deepwater horizon exploding and the gulf of mexico around 2010. at the time bp was considered a target because the market cap crashed and the unthinkable came out

. >> the fed minutes steve liesman is there. steve what can you tell us. >> minutes from the december for the january meeting are replete with mentions of concern both to the upside and the downside for the economy, from potential policies from the trump administration. the committee says that it's well positioned to take time to assess the evolving outlook. the fed wants to see further inflation progress before making additional adjustments to the funds target. as long as the economy remains near maximum employment. quote, there's a high degree of uncertainty made it appropriate for the committee to take a careful approach. trade and immigration policies were cited as having the potential to hinder the disinflation process, as business contacts were telling the fed, they, quote, would attempt to pass on to consumers higher input costs arising from potential tariffs. they were also reporting an increase in uncertainty, generally from changes coming to government federal government policies. however, there were also expressing op

you can't say, oh, i also have this fed tailwind. so i think the challenge would be if you get a couple of hot cpis, they're going to cut less than you thought. it's not as bullish for the multiple as it was before. i think historically there's been a pretty strong relationship between the change in perception about rates and the change in multiples for growth stocks. so i don't i don't think it's like a disaster. but what you're saying is they stopped it because growth's going to be awesome or not. you're saying. but that's implied. so i think that's what we need to believe. and a lot of our stock selection stuff is around where is revenue accelerating. because i need to believe i'm going to get accelerated accelerating. >> i hear you. i mean, i guess part of my point, brant, is like, all right, enough of the multiple expansion. great. we got it. we know why we got it. and now we actually can stand on the back of earnings, and that's all that matters. that's why the market's been resilient. that's why it hasn't fallen fully out of b

yesterday the fed chair told the senate banking committee the fed is in no hurry to lower its rates.f the economy remains strong and inflation does not continue to move sustainably toward 2%, we can maintain policy restraint for longer. if the labor market were to weaken unexpectedly or inflation were to fall more quickly than anticipated, we can ease policy accordingly. >> for. >> joining me now is gene goldman, chief investment officer at cetera financial group. gene good morning. great to see you. >> hey good morning frank. >> how are you? >> so, gene, i'm looking at my notes right now. you say the fed's not as good of a friend as we kind of thought it was before, but i want to ask you, doesn't a good friend tell you the truth? i think jay powell has been very forthcoming. he's been transparent. isn't that good friendship, at least on the investor side of this, because it can help you make your decisions a bit better? >> no. >> and frank, that's. >> a great point. you know, our. >> one of our biggest themes last year was the fed goes from being a foe to a friend. they go from rais

what the new cpi data means for the fed.in is going to join us in just a moment. we'll break down all this news. the dow by the way, off about 376 points on the back off about 376 points on the back of this is steve. steve takes voquezna. this is steve's stomach, where voquezna can kick some acid, heal erosive esophagitis, also known as erosive gerd, and relieve related heartburn. voquezna is the first and only fda-approved treatment of its kind. 93% of adults were healed by 2 months. of those healed, 79% stayed healed. plus, voquezna can provide heartburn-free days and nights, and is also approved to relieve heartburn related to non-erosive gerd. other serious stomach conditions may exist. don't take if allergic to voquezna or while on rilpivirine. serious allergic reactions include trouble breathing, rash, itching, and swelling of face, lips, tongue, or throat. serious side effects may include kidney problems, intestinal infection, fractures, life-threatening skin reactions, low b-12 or magnesium levels, and stomach growth

reporter: i want to ask about fed employment. i know tax money is not used here, but elon musk alleges the fed is "absurdly overstaffed." we've seen the executive branch push to reduce the federal workforce. i want to get your reaction. chair powell: we run a very careful budget process. we're fully aware that we owe that to the public, and we believe we do that. i've got no further comment than that, thanks. reporter: i'm from associated press. president trump has said he will lower inflation by reducing gas and energy costs. do you see such costs assist a particular driver of inflation and would lowering them have a dramatic effect? chair powell: i'm not going to react or discuss anything any elected official would say, so give me a mulligan. reporter: two weeks ago the fed said it was withdrawing in the network for the financial system, even as we had significant wildfires in los angeles. of course, this is a group to talk about how the financial system could address climate change. many commentators did see the timing as poli

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the fed was on hold at the level for 14 months. and 2006 through 2007, the fed was also on hold for about 15 months. 1990 seven through 1998, also an 18 month extended period where the fed was on hold. it is not historically unprecedented for the fed to just stay on hold. does that mean for bond yields? it probably means the front end of the yield curve is fairly pinned. pricing of the terminal rate, so the lowest rate the fed funds rate gets to in this cycle, is probably going to stay fairly stable. all the volatility in yields is probably going to come from the term premium. today, what you are seeing is a flattening where the biggest moves are happening in the longer end of the curve. that is because most people expect the fed to stay on hold, and all of the shifts and expectations are occurring around longer-term growth prospects, longer-term inflation prospects. scarlet: we know trump has made clear he wants lower rates. scott bessent, his treasury, is clarified that the administration is looking for lower 10 year yields. how

it is really -- far too early for the fed to make their next rate cut. >> joel shulman. >> to john'sg to two things one unemployment down from 4.1, 4% we also see labor costs rising a cpi next wednesday, i think that is going to be critical we will have to look at shelter costs coming down, is, is charles payne mentioned a bifurcated economy it is -- it is the rich getting richer poorer not going to impinge consumer spending going to merge more key indicator to see what happens with interest rates. cheryl: stephanie you were talking about this i want to add in apologies looking at revisions, november, it was revised up 49,000, december arrived up 51,000. so for the november december again 100,000 more jobs. >> well, i think takeaway from all of this is that the numbers on monthly base are totally unreliable, we are looking at benchmark revisions, revisions last two months we've got wages going up, headline months in going down, and i think the scary thing about this is that while we all understand since we are sitting here, you know, parsing this coming out of sausage factor numbers

you know, if the fed wants to stay really what we're calling a recalcitrant fed, if the fed wants to stay combative or recalcitrant, then i think it's going to be a tough time for the markets. but ultimately, one way or another, i do think we're going to get cuts. they might not come till the back half of the year, but we're i'm taking the over. that's part of why we want to be overweight bonds here, i think i think the fed cuts three times, if not four this year. >> you want to be overweight or market weight on on tech. i mean there's a pretty good debate, i think, to that question being asked right now. >> i want to be overweight personally. you know, i look at this, the growth scare part of deciding what to be overweight is looking out and making, not making mistakes. so i don't want to be i want to have interest rate sensitivity in my portfolio. so maybe utilities, interest rate sensitive stocks like that. and i think large cap tech you know it has they've trailed the market here. we've had a broadening out. but ultimately if the market's going to break out and really you want to

so for example, we heard from the fed. fed will likely keep rates where they are, which means they're higher for longer and that's bad for small caps. so what we are doing now is rotating out of small caps, which we did in early january, and instead went into the big cap trade that centered on defense, which is another, you know, practical reality of moving away from collaborative, interconnected economies to more tariff oriented deal making style that has a win lose outcome. and in doing that, i think you want to stay close to home. >> all right. good to see you again here at our home, the new york stock exchange. all right paul. up next, we're tracking the biggest moves into the close today. seema mody is standing by with that. hi, seema. >> hey, scott. 18 minutes left in trade and one of the biggest winners on the year. palantir plunging on comments made by president trump. we'll get you that full story after this short break. >> the bond report is brought to you by pimco, a global leader in active fixed income. >> at b

no, no, that's the fed story. i'm going to get to the fed. yes, you are correct. okay. the gold. they have gold certificate ises. okay? -- certificates. which was given to them on some equal par basically by fdr in 1934. no, i wasn't there. i missed that whole story. [laughter] all right. again, mark the market, it was $34, these gold certificates, and now it should be $3,000. so if you do that, right now the fed is bankrupt. let me say that. >> yeah. larry: all the bonds they own are underwater badly. you know, like a terrible bank, like these silicon valley stories that we heard a couple years ago. so the fed is broke, they won't admit it. if, on the other hand, you revalue golded -- gold, their certificates would push them up by $750-800 billion, and they'd be equal. they won't have money but they'd be equal, and maybe someday they could contribute $100 billion to the treasury like they used to. they're not going to bail out the cfp if b, because that thing's gone, it's dead. >> we can only hope. larry: that would a make the fed solvent. or maybe you don't want the f

and then there was what the fed was doing. so i don't think you can point to the fed as being driving that ten year. the weird thing. >> i don't know if we have this chart ready, but it would be a chart of monthly job growth over the past 12 months. and it just this eerie thing happened where job growth started to slow throughout the summer. we had that yen carry trade things, you know, sending markets lower in august. and it looked like the economy is rolling over, the markets are rolling over. and that's why they cut 50 okay fine. then immediately jobs started to pick up again. and so those facts change. i'm trying to figure out if you're the fed what do you do about that? i mean, this is such an unusual cycle. >> well, you do know that when the data comes in, you know that they can be revised. and so that's why the fed always says, look, we don't move on one data point. we're going to look at what the data is telling us. and you're exactly right. i think the reason they started cutting in september was because, right, they

that gets the fed to act in a more aggressive way. we think you'd have to see a mid fours on the unemployment rate to really see the fed step in and deliver a lot more rate cuts. >> you know malcolm, and then we get next week. invidia you sort of alluded to it that that company is going to report mid next week. there's always a lot riding on it as we know, given what happened with the deep sea sell off. and even though jensen huang, the ceo, commented on it, albeit briefly, in the last 24 hours or so, this is really going to be our first look under the hood of what they're actually thinking about demand. we know what the hyperscalers are spending, but we're going to get a better look on where the environment currently is. >> yeah, scott, you said it. deep sea changed the game for nvidia and for nvidia shareholders. and i think that it might have actually done them a little bit of a favor in the sense that it gave them some cloud cover. right. so jensen had been making comments about the rollout of blackwell or the shift to blackwell,

it is not downward enough for the fed.making more progress and i think that is what has the bond market stuck. lisa: it is not lower enough for the fed and it is not lower enough for the treasured part. we are going to be speaking with scott bessent, who says he is focused on the 10-year yield. how much control do you think the treasury has over this? how much will their issuance plans, as well as offsetting some of this spending, how much is that going to be the main driver for the 10-year is? jonathan: i gennadly: think the focus is well received by bond markets. there are a like of the fact that he is looking at the long end of the yield curve and saying, what can we do to ensure there is ample supply and demand? maybe that means once november comes around, which is when we expect auction sizes to increase, maybe they moderate the increases on the long end. that is something potentially on the table. i doubt that would have been on the table with prior administrations. here we are really looking at, where is the optimal

fed speak throughout the trading day.eak now, and we heard from collins, goolsby, bostic, the tone is wait and see. lisa: what are they trying to communicate? what is the scenario analysis? we have no need to move. what is the big deal? this will be one of the biggest tests. do they lay out some sort of plan for how they will respond to specific incoming data one way or another? jonathan: if the data point is a tariff, what do you do with that? chairman powell was waiting for the administration to articulate the policy changes. they did over the weekend and then they did not happen. they backed away. let's say tariffs happen and they meet on march 19 and they last for two or three weeks. they have to put up forecasts. they have to base that on tariffs that might not last that long. that is difficult to set policy for. lisa: that's why i'm looking at job openings and how tight the labor market is. to francis donald's point, we don't have people to fill the jobs. i'm curious about the outlook for different companies and ear

and david: the point is the market understands but the fed doesn't and why do we need the fed?m going to tell them to go to wikipedia and look up soviet union and that's what happens when you try to manage a big economy from the top. it'll take care of itself. it's big enough. key thing, keep a stable dollar, get out of the way and be there for the occasional panic we have to be a lender of last resort. david: steve and john, appreciate it. coming up, sinking grades on math and reading pointing to the truth and more on spending for the department of education and getting through and we're going to talk about j gianno caldwell, sarah carter and more whenurn. kudlow continues. (background sounds) freeze in your tracks? (♪) or, let curiosity light the way. (♪) at t. rowe price, we're asking smart questions about opportunities like ai. and how the industries born to support ai might better support us all. better questions. better outcomes. t. rowe price progressive makes it easy to see if you can save money with a commercial auto quote online so you can get back to your monster to-

we have been hearing from fed chair of course or fed governor chris waller suggesting he is comfortablerates. the door is still open for cuts later this year. 450, 10 year yields are up, pound in focus ahead of the dater. brent holding onto gains, opec-plus considers pushing back additional ... barrels onto the market. currently the yellow metal is up . let's check in on asian markets on a hawkish cut, yes, cutting rates but the aussie dollar is unchanged. the broader benchmark is flat across asia, optimism around beijing. nikkei is up. officials meet to discuss the ending of the war in ukraine, coming after france's emmanuel macron hastily convened with leaders to discuss possible ways to boost defense spending. i'm joined by yana bugerin. thank you for your time. will europe meet the moment? yana: i have heard this is the time and i'm very tired, i was hoping we would see more results. it became clear europeans are not on the same page. tom: ... is is russia exploiting that division? is the u.s. exploiting that? jana: jd vance gave that speech, that very special speech that rang a bel

i imagine the fed might as well.abor market they might want to cut but inflation, we've had people coming in saying to hike paired where is the balance of risk? kristina: it is very asymmetric at the bar to hike going forward is much higher than to ease. but i think the base case, they would be happy to at least wait until june if not longer paired with said this before, when data print doesn't do it, three they can maybe react. so many things coming on the pipeline that it feels like june is the absolute earliest they can see where they have the same inflation surprises of last year, the seasonals that make them be cautious to react quickly. lisa: people are bullish on equities and they have been bullish and the prospect that the u.s. economy can grow regardless of what happens in volatility and inflation. you still feel that incredible rush to credit, in particular riskier credit at a time where the economy has to slow or the fed has to remain on hold for these foreseeable future? kristina: i think the market has b