but his fed chairman was arthur burns, very complex person. e burns was above all he wanted nixon's admiration. i go into this a lot, you know, because personality plays a major role in all of these decisions. and burns simply wanted to be in nixon's good graces, but he also was a distinguished economist and he knew he had to do something about inflation. and he came to the conclusion that neither physical nor monetary policy was the right policy. but in fact, inflation was being caused by labor unions which were negotiating ever higher wages, which made companies raise prices and it came, you know, it was a spiral, a wage price spiral, so rather than focus on interest rates, arthur burns decided that he wanted wage price -- and he convinced nixon to do it. it was a terrible decision and of course when those controls came off, prices relay shot up. so, inflation played a big role in the nixon years. and you know, when i think about it today, richard, i'm not gonna let you off the hook here, you know more about this than i know, we face a very t

but his bid chairman was arthur burns, very complex person. burns was above all he wanted nixon's admiration. i go into this a lot to cause personality plays a major role in knowledge these decisions and burns simply wanted to be in nixon's good graces but he also was a distinguished economist and he knew something about inflation and he came to the conclusion that neither physical nor monetary policy was the right policy and in fact inflation was caused by labor unions which were negotiating ever higher wages which made companies -- and spiraled so rather than focus on interest rates arthur burns decided he wanted to -- and he convinced nixon to do it. it was a terrible decision and of course windows controls came off prices really shot up so inflation played a big role in the nixon years and you know what i think about it today and i'm not going to let you off the hook here, we face a very tricky situation now. i don't know the parallel but certainly the biden administration is very focused on getting everybody back to work and they are sayin

>> arthur burns had no nixon from eisenhower white house. he thought moynihan was an academic and he chewed on the pipes them all the time. >> even in this picture. >> arthur was a very decent good human being and he went on to a real estate career and as an ambassador. he was conservative and nixon as a political matter realized two professors from harvard in the top national security adviser and daniel patrick moynihan of urban affairs he thought i have to take care of my concerns so they reached out to arthur and he said i know you want to be chairman of the fed but in the meantime i want you to oversee broad policies so he came in and put it late counter pointed the moynihan appointment. they were intellectual sparring partners because they would fight each other with great decorum and quite articulately that went on for the next almost 12 months. >> i think if we move forward past that we have a photograph. this is the urban affairs counsel and this tells a lot about that moynahan sense of humor so can you describe what's going on there?

that is what is unlike arthur burns.hink jay powell has said -- i think commute getting about what used to be done is very important. >> jay powell mentioned at the last conference that the fed was neutral. i thought he must have meant long-term neutral. where do you see neutral? particularly in the near term or the medium-term. when you have a fund rates so far below, how can we call that neutral? >> sometimes it is interest rates of 1% or 3% and that sounds neutral but need to go above neutral. we need to get these inflation rates down to the 2% number. eventually i think it has to go higher. it is not neutral in the sense that it is neutral on all sides. >> so if you are sitting around the table, would you be saying 4% is not going to be high enough? are you looking at something like 4%, 5%? a stunning crash in inflation, that is something people are not expecting. >> we want to take actions to bring it down. those actions will require someone higher risks. but that is the reason for our strategy. it will be higher bu

mays his goal is just not to be arthur burns. what are your thoughts on that? >> well look, hears the problem and this was the example of the arthur burns policy to stop and go, is that if you do not tackle inflation decisively, you're just going to make it worse and my concern is, you know, the fed is always super- aggressive or has been trained everyone to be super- aggressive in easing as soon as there's any sign of trouble, in terms of in a potential crisis. they slipped through this inflation crisis that is hurting so many millions of people. they've been very slow here. they call themselves being aggressive but they aren't. qt has hardly done anything this summer and supposedly final ly in september we'll see that liquidity coming out. so i hope that not too late to the party again, in terms of making another policy mistake. charles: sven, thank you very much, always appreciate these conversations with you. meanwhile, folks, also today, a wave of economic data out. i want to bring in nat west markets co-head of global economics michelle gerard. first i ha

it was pointed out that they said to arthur burns, these are food and energy. both are one offs. systemic there was longer in arthur burns thinking that he had done enough only to see it vengeance. what was it about the '70s that made it so sticky back then and do you see things in the current environment that are similar to that that could make it just as sticky or is it not -- we don't have a lot of what went into what happened in the '70s like hyper inflation. we don't have that or do we? >> i think there is good news here that the '70s were different from the current period different in three ways. one is there had been a long period of overshooting and federal reserve that seemed to make excuses of the type you mentioned from chair burns the second thing that i think was different was there is no anchor people had no -- the fed had no particular target of the target. now we have the 2% goal. i think that has helped. the third thick that was different then as far as i can tell is inflation expectation. right now, fortunately, although we can be complacent as chair powell says

>> arthur burns had known nixon from the eisenhower white house days. he thought moynihan was an academic. and unlike moynahan, he chewed on pipes all the time. >> i think you can see him holding a pipe even in this picture. >> and arthur was a very decent, good human being and went on to a further great career. ambassador to germany. but he was, indeed, a conservative. and nixon, as a political matter, realized that he had just hired two professors from harvard. henry kissinger, who was his top national security adviser and daniel patrick moynahan of urban affairs. he thought, well, i have to take care of my concerns on the more conservative side of the party. and so we reached out to arthur and he said, i know you want to be chairman of the fed. but in the meantime, i want you to oversee broad domestic policies. and so burns came in. and really, politically, it was a counter point to moynahan. and it was clear that nixon set them up sparring partners. because they would fight each other with great decorum. and quite articulately. and that went on for

had a short but not sweet statement the meeting that we can't let up and we don't want to be the arthur burnsthis era and a stop to soon and let inflation get out of hand. the market will price that the 75 in and even though the fed is still trying to say they are not crushing the economy and that is there not coal -- not the goal, a lot of people are saying we will probably have to have a recession the early part of next year. that is why the curve is a flattening. it is like someone said the message was pain. powell said consumers will have to take pain and businesses will have to take pain. credit spreads could widen more, maybe higher yields. that has to roll things over after a while. meanwhile, all of us are fighting high do you buy this or maybe not that. jon: thanks very much, liz mccormick, breaking down the realities of the bond market. we are watching the s&p 500 after the challenging start to the day. slowly moving the positive territory. flat on the day. we will talk more about the markets, coming up. this is bloomberg. ♪ jon: time now for what it's worth. today, it is not just t

we saw it happen to arthur burns in 1974. there was a recession in 1974.ld you know that prices would not come down in a recession, right? tom: i remember arthur burns. nobody watching or listening does. only i remember. jonathan: anna wong from bloomberg economics. it was a clinic. anyway. tom: you got me going. the interview of the week was federated air mass and her gloom about the dismal 1970's. jonathan: in the last couple of months the prospect of a flip-flopping fed, if they pause too early, do they have to go again? tom: what are we going to do at 6%? besides we are going to be employed over these raging debates? it's going to be great, but i refuse to believe it is one nice, smooth curve down. jonathan: lisa has raised the same question. are we going to start cutting as soon as we stop hiking? is that what people are looking for? lisa: that's what people are looking for. that it will be the shortest time ever at that people before they start cutting. experiencing the potential for some significant downturn. otherwise how can the fed get the convic

i'm not going to be arthur burns, i will be paul volcker. we'll keep rates higher for longer until we know for certain that inflation won't rear its head again which is a tall order. so we're in this position right now where the market is recalibrating what multiple it wants to pay for stocks. so i think what josh hit on with housing is so interesting. what he said is spot on, but the conundrum we're in, so all the stats he gave you about new home sales, it's all about new home sales are racking up, but we are still structurally very undersupplied in overall housing. so we'll be in the situation where rents stay higher, energy stays higher so i just think that the market has not priced in that we actually have longer inflation that is stickier that's where i don't think we'll have this v-shaped rally over the next couple of months in the market because we're in this time period. i will say, it's okay if stocks are down this year i've said it all year long the stocks go down we've had an amazing ten-year run. if we're going to have a negative

the leadership of arthur burns who was chair at the time -- they felt they did not have the capabilityrol inflation. paul knew differently. he took over from burns and brought inflation under control. it was a victory over inflation. the policymakers understood just how important is to control inflation in the medium-term. >> is this really the issue here? what is the biggest take away? >> one big takeaway is the imperative for central banks to deliver on their inflation job in the medium-term. without that, the rest of the economy just doesn't function well. we are seeing that play out in the united states and many other countries around the world. i think the other big takeaway is any organization is doomed to fail and where they have to distinguish themselves and their ability to pick up, learn from that experience and get better down the road. >> there was david wilcox with that big take on the fed. paramount has reached a deal with walmart to offer its streaming service to subscribers. walmart plus members will have access to paramount plus at no additional cost. they have rejecte

without citing him, saying i am not like arthur burns, i will not step away from this too earlyand allow it. i will follow saint paul volcker and be as strong as i need to be i think the differences clearly are things like the high level of the oil price in those days that was a major factor. we had just come off the guns and butter policy of lyndon johnson with the vietnam war, so there's certain key historic disparities here, but he's dead right about one thing. you can't do touch and go when you're fighting inflation. you have to grind about it he has a big problem facing him, much of this inflation is global you're starting to see agricultural prices creep up again. some of that is due to the war, and some is due to drought he has a local market to talk to, but he has some punishment from outside. >> absolutely he's not counting on just getting lucky for sure art, great to talk with you. thank you. >> my pleasure. >>> as we head to a break here are the biggest laggards for the week, led by dollar tree, advance auto parts are not far behind we have briefly in the green right

think when we talk about vulcar and the fed pivot, jay powell also knows about the history of arthur burns. i think it's much dicier to say the fed's going to stop and sit still. don't forget qt is coming soon to a theater near us and how that kbakimpacts the market it's an actual thing that's happening, not just rhetoric. >> weiss is going to join us momentarily, we have a problem with his feed. he probably thinks i have something to do with that directly, which as much as i wish i did, i don't. we'll get his voice in just a second what about this idea, jim pushes back on the notion that it's a false narrative. he suggests that inflation is actually coming down to a degree that the fed is not going to have to tighten as much as people fear the most that they could. they do 50, then maybe 25, then 25, and then we're good because inflation is finally cooperating. >> so i think with all due respect, what's happened now is that we've repositioned towards the potential outcome that you're defining, and we could move further in that direction we see that, right but more work needs to be done, a

the top advisor was arthur burns. pushed the ball during the reagan years and burns was the ambassador to reagan and a very good ambassador in the later yearss and we became very friendly. all those years eisenhower, nixon he sold them work during the reagan years. so there were three recessions and this r is what gave kennedya step up. nixon didn't really deal with much on economic policies and domestic policies. i remember nixon's son-in-law by the way is a personal friend of mine, very dear friends of ours. i met nixon in the middle 80s. i was out of office back on wall street. he had his office down at one federal plaza in downtown new york in those days and his son-in-law would bring in various policy people before president nixon would go on trips so i had at least one visit, maybe two. i had written numerous pieces in the wall street. took thek dollar and we had booming inflation. and i said no, sir, with respect i don't. it was a very cool moment and as i said this is the mid 80s. the reagan tax cuts. >> insan

pretty clear that the fed wants several months to know it's coming down there's the old story of arthur burnss, but let up too quickly and inflation came back. so there's a lot to do to figure out, how high does inflation go? i think that's what's going to determine the outcome. you get, it light pretty good. >> thank you for pointing that out. i did agree that the market did initially read it as muted, but there were positive points in there as well. >> yeah. >>> the fed and the markets, lets bring in megan shoe and andrew sluman. meg, the markets are pricing in a much lower -- bank of america saying the recent rallies priors in -- do you think the market is overestimating or underestimating the risks right now? >> leslie, i think it does matter which market you are looking at i think the equity market is starting to increasingly price in that soft landing and discount the chance of a recession, either this year or in to2023 the bond market, you're looking at a deeply inverted yield curve. we know what that means. it just takes time to play out i think equity investors may be less patient, b

his top advisor was arthur burns . he advised nixon. push the ball down the road during the reagan years. he was ambassador to germany and a very good ambassador. he and i became very friendly and he became something of a mentor of mine. arthur creed -- i had a point about lower tax rates. he opposed it -- eisenhower, nixon -- he saw them work during the reagan years. there were three recessions and this is what gave kennedy a step up in the election. he ran as a growth guy and nixon did not deal with much economic, domestic policy. i remember nixon's son-in-law, a very dear personal friend of mine, his daughter and son-in-law are very dear friends of ours. i met nixon in the middle 80's. i was out of office, back on wall street. he had his old office down at one federal plaza, whatever it was in downtown new york those days. his son-in-law would bring in various policy people before president nixon would go on foreign trips. i had at least one visit, maybe two, and it was very charming -- but what i had written, numerous op-ed pieces c

i appreciate his genuine nature making the 70s and 80s analogy, he doesn't want to be arthur burns, he wants to be paul volcker but he because two recessions, the you want that? that's the conundrum, he reset expectations and the market is trying to pass that into the rest of the year. neil: for those not knee-deep in this, picking paul volcker did a lot of good, he lost the election, that was then. where are we now on this thing? where do you think the fed goes? the percentage of people thinking we will see a hike in september, the next meeting is overwhelmingly of that mindset? do you agree? >> for him to be talking this tough to larry's point we are in front of the midterm election, he will plow right through, despite the fact that it is november. the one that follows is six days before election day. stuart: will he continue this? >> that is what he is saying and he is saying he's going to plow through into 2023, and this is astounding jay powell, he was a political potato for a while. biden was or was not going to reappoint him. now that he has reappointed, he's exercising full vet

i want to get back to arthur burns and i have trouble with the comparisons. them are out of tune, but that paper he did in belgrade years ago, the english of central banking was crushed. he gave that speech. i've crushed are you going to be in 23, 2020? >>'s speech was from the soul. it was an anguished cry, and it is now recognized as deeply mistaken. the audience on the day when he gave that speech was paul volcker. he understood central banks could control inflation. we are living in that legacy today. it is not going to be easy going forward, but much easier than it would have been had it not been for paul volcker. tom: does jerome powell and his team, do they understand that part of inflation matter? >> absolutely. they are looking at the full package. the fed has to take responsibility for delivering overall and lucian that matches the 2% objectives over the medium term. they are well aware that there are going to be some stubborn components like to rent pieces that you .2, tom. lisa: at what point do they say we understand that this is a little bit sti

and general powell is following the playbook of arthur burns and g.han the person he keeps calling his hero, paul volcker, who would never do what we are seeing happen with powell. >> i like jay powell, i don't envy him so you think that -- i've been trying to figure out whether they are going to remember the '70s, and therefore try to avoid that, or whether they'll fall into the same trap you're saying they're going to fall into the same stop and start trap that volcker's predecessors did >> i'm saying -- exactly they'll fall into the same trap. i'm not saying it just as a guess. i am basing it on the record that we have as chairman we have, again, one full term of powell as chairman, and then another last six months. so that's what you hear. you have seen so many pivots during this period >> all right we'll have to end it there, sri. it's not the end, just a pause until we see you again >> thank you, look forward to it >> it will be after jackson hole, so we'll have a lot to talk about thank you, sri andrew >> we do have a big week it's all coming t

at a time when a fed official is embargs or the history isn't so good, people are talking about arthur burnsat was an inflationary challenge. clearly we had a number of officials oversee recession. that's been a problem of course but damaging to a legacy but nothing like letting inflation get out of control like this so i think they'll stay the course much more maybe than was thought on thursday. >> we could talk about your background, but you do try to help clients with a total return are you seeing opportunities in, i don't floknow, dividend-payin stocks? what do you think you can deliver safely to people >> there really have much more opportunity for balance in portfolios in ways that work so not only is that in the context of allocation, i mean, great. it was terrible before, now it's less terrible, but actually there's really good vallouues we like maste mastercard you want to have a bunch of different things working in this environment. the one place i really don't like is sort of a, hey, it's down 80% it must be good kinds of names that's not where balance is in the market right now >

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reporter: 13-year-old haley is one of dozens of survivors who gather for a week every july at the arthur c. love burn it's her sixth time here. why do you keep coming back to camp? >> this is my second home, and it allows us to socialize with people that are just like us. >> when you're in other places, sometimes people tend to stare. here it's like you're all the same. >> reporter: now in its 31st year, the connecticut camp is free and staffed entirely by volunteers. including former campers like kathy wright. do you think that you would be where you are today if it wasn't for this camp? >> not at all. i wore turtlenecks all over the place. i didn't value myself until i came and i saw others who had more self-confidence. >> reporter: these campers call it a community, born of understanding. >> when i was younger, i got bullied. but as soon as i hit this camp, my attitude just changed, my personality changed. i feel it made me a better person than what i was when i first came here. >> reporter: it may look like fun and games, but this camp is also a real game changer. >> i did it! >> reporter: nancy

six. 80 arthur road can see some active flames burning. firefighters are in the area just a few minutes ago, con fire sent out a tweet update. they are attacking this fire. from the air and on the ground pacheco boulevard. you can see the homes to the right of your screen there. fire officials say there are no evacuations this time, but they're telling people if feel threatened, do not wait to leave firefighters asking people to please avoid the area. you can see the large plume of smoke. it's putting over the area and perhaps another spot fire here. we will continue to update this as we get more information mark. yeah it's interesting looking at that. those live pictures, greg, you can see the big smoke plume and then it looks like yeah, he mentioned some spot fires, so the wind this time of day is in this portion of the bay area. you would expect to be a factor in the wind has been up. as well. take a look. what wa the weather. around the fire. zone. and the wind. you can see moving in. out of the most. most air. of the way. to northwest

we'll burn in hell do you understand that? in hell, i promise. arthur. i'm sorry. i assure you sir.busy. i know our memo didn't go through, but you know, all is not lost. you can talk to her and i don't understand you to prevent a catastrophe. maybe just a nuclear equilibrium. and it will be soon. how do you know? premonition, that's the way it should be. i just wanted you to know there will be a disaster, there will be a balance. forgive me for the intrusion on the 85th anniversary of andrei konchalovsky of a nervous proportion, if he is a torment, he is not interesting for me to enjoy it's just me and you, yes, me and you the meaning of life, in general human, listen to see this and no more sense of conduct sends me this creation this divine beauty. i always always take on more than i can cover with age, and you become, firstly, tolerant. secondly, you begin to understand those things that you don’t understand at the age of 30-40. because that he likes me, went for him, that you are styopa, i love you alone and want exactly what you have , nothing more is needed on saturday at the

arthur wants. he showed that in russia hype works only on those topics that burn out during the day or week, and topics so ask yourself valery meladze or someone else they spoke about some more global topics, such as ecology, and you will see that they don’t, because ratists only work on topics that have there is a hysterical dimension. they should be held accountable for it if they work it turns out. as much as possible, please, you know me, in this whole story, i am extremely struck by some kind of increasing degree of shamelessness of many people. i agree that everyone can express their opinion for a long time. really. so far, we remain the only country where this is possible . there are laws of the russian federation that have started certain statements that punish broadly, i understand that when a person experienced in february understanding. yes, somewhere here, of course, the situation is very difficult. yes, unfortunately, we have received such an elite that is not very capable of analytics. you also need to think about this, but in the colossal spring, which is now six months later. these peop