chair powell: not at all.o think about the balance sheet is we want to be highly transparent and predictable. it is not the main story about monetary policy. the main story is interest rates. what happens is when we get into a very difficult situation like the pandemic of the global financial crisis, we buy treasuries to lower interest rates and support the economy. when we are left with a bigger balance sheet that we start -- when the time is right let it run off and shrink back to where it needs to be. we would slow the pace, and the reason is it is moving down quickly. we have decrease the size of the securities portfolio by $1.5 trillion, so we would say that we would slow the pace, and what we are trying to do there is try to actually get further without being disruptive. at last tightening cycle for the sheet ended when we suddenly found ourselves that we had gone too far, and it was very disruptive to markets, and we had to buy treasuries to create more reserves in the economy, so we tried to learn from

chair powell: maybe. chair brown: that's very short.l: i don't want to make a specific commitment like that without talking to the people who are carefully in touch with this. that is the right thought. chair brown: thank you, senator. senator fedderman from pennsylvania is recognized. senator fedderman: --wé senator warnock sits down the next five seconds, are you ready? you're so generous with each other. >> i'm happy to have the junior colleague -- chair brown: senator fedderman is recognized. senator war■snock is recognized from georgia. senator warnock: thank you, chairman. thank you very much, mr. chairman. bank spending buy backs is rising again. the consumer small revenue has increased. interest rates are high. the interest being paid to depositors ordinary working families, working people with bank accounts. not a lot of money in wall street accounts remains low. chairman powell, i'm concerned that when banks don't increase the inst rates on bank accounts, families are losing outs on dollars that could be in their pockets. agai

chair powell: uni had a long call on this. i am doing exactly what i said i would do. >> you said you would support vice chair bar to get a strong rules and now he is putting out rules. chair powell: the vice chair has every right to bring proposals to the board but as i made clear in our colloquy, you're not the comptroller of the currency. i only have one vote. there are 11 other voters. >> you are the leader of the fed and when the heat was on last year you talked about getting tougher on the banks but now the giant banks are unhappy and you have gone we could meet on this. the american people need a leader who is encouraged to stand up to these banks. thank you mr. chair. >> senator daines is recognized. >> i can tell you montana's continue to see the impacts from inflation brought on by the policies of this administration and my colleagues across the aisle and i commend you for the job you have done and trying to rein in inflation and i encourage you to continue the fight despite political pressures you may face. is going

chair powell: sure., very few transactions in commercial real estate right now, particularly in the troubled areas. it's not a question of prices still falling, it's a question you don't have the price discovery. you just have to assume the prices are very low and have come down a lot. on commercial real estate, we have a secular change in people working from home. this is one big part of it. that means that in many cities the downtown office district is very underpopulated, there are empty buildings in many manger and minor cities. it means that all of the retail that was there to service the thousands and thousands of people who work in those buildings, they are under pressure, too. banks will have made loans to many of those buildings. not all of them, but many. this we have known for some years. what do we do? we have identified the banks that have high commercial real estate concentrations, particularly office and retail. and other one that is have been affected. we identify them and we are in dialo

chair powell: thank you. sen. menendez: i agree with my friend the ranking member that when you tell a story, you should tell the whole story. mr. chairman, are you aware of the "washington post" february 22 article that says the economy is roaring and immigration is a key reason? chair powell: i do not recall that but i would have read it. sen. menendez: "immigration has propelled the u.s. job market further than anyone has expected, helping cement the country's economic rebound from the pandemic as the most robust in the world. it goes on to say, economists and labor experts say that this surge was ultimately key to solving unprecedented gaps in the economy that threatened the country's ability to recover from prolonged shutdowns. would you take issue with those statements? chair powell: there are a lot of adjectives and adverbs that you would not see in bed world -- fed world. the story i think is broadly this. it is that there was a very significant increase in the size of the workforce last year. and it was h

chair powell said yesterday he still sees the job market as relatively healthy. over time again there's been some steady jobs added and the unemployment raten is double by historic standards. but it is a bit something to watch. unemployment rate at the bottom it was 3.4% the lowest in 50 years about a year ago. so itas has come up since of an, but so it is something to watch even though most indicators, for example, there is a weekly measure of jobless claims which is how many people have been laid off and are seeking unemployment benefits. those numbers are still pretty low. it suggests layoffs are still not -- that layoffs are still very low historically. >> host: columbus, ohio, republican. hello, brandon. >> caller: how you doing today? >> host: good morning. >> caller: good morning. is, i have been a lifelong republican and some people don't think it matters th i am african-american as well.. i always have lived in a two-party household. my mom was a democrat and my dad was a republican. we are still at that same point now with my wife, she's a democrat and

himself >> i would say chair powell. i would agree there's more reiteration than anything else, and he just didn't send the signal as being somebody who was trying to gather up excuses to do anything but follow the plan, which is as soon as you get pretty consistent further affirmation of where inflation is headed and it's benign, he will not be alarmist about the january date, about gasoline prices ticking up, then we can sort of go in that assumption that the next move is down this is a very long pause for the fed. you have to keep that in mind. normally in other cycles they've tended to follow the last hike with a cut within several months so if you get to june, it's going to be time and i think the bond market has seized upon any hint of deceleration in the economy to have those yields come down. they're following global yields. so it's a benign setup, i think, for stocks in that regard. that said, another one of these one-day shakeouts. we've had one every month going back to late last year, and it doesn't have legs

guest: fed chair powell has made clear that they are very data inflation.nt measures of that. the hope is that will be enough to give them the confidence to cut rates. they will certainly look at jobs and unemployment as well. they■= have what they call a dul mandate so not only are they mandated by congress to keep prices stable and bring them down but they are also expected to kee h unemployment and helped engineer an economy with maximum employment. they will be looking at jobs as ns that people are getting laid off in the unappointed rate goes up, that would encourage them to cut rates. the hope is that inflation by itself comes down and continues to do so even as the economy continues to do well. what i think has incurs a lot of r yesterday that even as the economy, if it continues to grow and hiring continues to happen, as long as an ration comesstillt this year. host: republican in ohio, good morning. caller: good morning, c-span. three really quick points and they tie in together. let's start out with a question -- what to the following countries ha

we don't have chair powell yet, but let's take a look over the markets stand right now. and the equity markets have basically gone from flat to what i would characterize as a very modest gain of about 4/10 of a percent for the dow, a little more than that for the nasdaq, and a little less than that for the s&p 500. the 10 year bond yield at 4.29%, and then the -- dipping today, now back up to 4.297%, or thereabouts. here is chairman powell. >> good afternoon. my colleagues and i remain squarely focused on our dual mandate to promote maximum employment and stable prices for the american people. the economy has made considerable progress toward our objectives. inflation has eased substantially, while the labor market has remained strong, and that is very good news. but, inflation is still too high. ongoing progress in bringing it down is not assured, and the path forward is uncertain. we are fully committed to returning inflation to our 2% goal, restoring price stability is essential to achieve a sustainably strong labor market that benefits all. today, the fomc decided to

investors are waiting for day one of chair powell's testimony on capitol hill in front of the house whereecting a less dovish message. the employment data coming at 8:15 eastern ahead of powell's testimony at 10:00. chair powell heads to the senate tomorrow before the u.s. payrolls report on friday. we touched briefly on this. will the data confirm the boom or not and give the chair of the federal reserve more space to breathe? lisa: i like that you point straight to the data and not what powell will say because that is how deemphasized he feels to everyone who will come out and try to say words and not try to say much of anything and then we will look to the data. that will ultimately be the question. we see the weakness that the ism data seemed to suggest transfer or or another 300 something trend, what about revisions come about hours worked? are people working more hours which means that all of those fears that companies are cutting back little bits around the edges to not lay people off is kind of fiction? jonathan: he has to face down some dumb cuts in that room tomorrow who have wr

so chair powell will want to keep that on the table.hink moving to a two-cut baseline would be probably a bridge too far. >> thank you all very much. appreciate your time today. see you again soon. >>> all right. let's turn to housing and another sign of how sensitive buyers are to any movement in interest rates right now. diana olig has the latest. hi, di. >> yeah, it's all in the weekly mortgage demand numbers. you see it there, and they're getting more sensitive to the small rate moves around bigger numbers, like 7%. so rates rose last week for the first time in three weeks. as a result, demand came down for the first time since february. the average rate on the 30-year fixed rose to 6.9 b%. if you take a look at the daily rate, by thursday, the rate crossed back over 7% and rose higher to start this week. so applications to refinance a home loan, which are most sensitive to weekly rate changes fell 3%, and we're also 3% than a year ago. applications fell 1% and 14% lower than the same week a year ago. and interesting on those purcha

last question chair powell. do you believe the impacts of climate change pose a risk? have you been talking about that? chr. powell: i certainly believe climate change is real and poses risks over the long term. >> there have been some that say higher interest rates actually makes it more difficult ill doubt the renewable energy projects and other investments required to prevent climate impacts? you believe that to be true? >> i believe that we need to do our job that you have assigned us which is maximum employment and price stability and we do that through interest rates. it's not our job to consider the effect on climate change. any effect on climate change of that would be minuscule. >> who do you see as the major winners and losers from high interest rates and terms of income groups, age groups and racial or other demographics? >> the point of high interest rates in the current environment is to bring inflation under control. the people hurt the most by inflation as you know our people on a fixed income who right away are in trouble and the cost of transportation,

you saw a bid on the bond market given comments with chair powell .you start to see that move-in yields marginalized, the dollar weakens intend them creating a tail into the euro and pound as well despite european weakness continuing to be the story. brent crude higher by .71% trading with an $83 handle. at handle is a marginal move relative to geopolitics we have been covering all morning long when it comes from joe biden and his approach to israel and gaza to how your is approaching the nato story. christine lagarde had comments on that as well. >> upside risks to inflation include heightened geopolitical tensions especially in the middle east, which could push energy prices and a freight cost higher in the near term and disrupt global trade. kriti: i am joined by founder and managing director of ada economics. let's talk about these geopolitical risks and the readthrough into monetary policy. they are coming back to the conversation, but you are not seeing this overt reaction from jay powell, christine lagarde, we're in the markets there is talk of

we heard from chair powell that they will discuss it deeper in march. we cannot wait to hear what deeper discussions were had. the other thing we have not talked about yet is we will get new fomc dots. all eyes are focused on that expectation. it is unstable. two people needing to move their dots for that to move lower. the cpi data will be very important for indicators of where that ends up. sonali: we have to leave it there. critical data next week after critical data today. up next, the auction block, high-grade u.s. sales up the fastest start with any year on record with $430 billion already priced in. we will dig into the bond binge up next. this is "real yield" on bloomberg. ♪ sonali: it is time for the auction block, or u.s. investment great issue it stayed hot. weekly sales exceeding 50 billion for the third straight week. notable offerings included barclays, blackrock, new york mellon. sales are around 30% higher than they were this time in 2023 and they are on record pace to start the year. the weak sales on u.s. high-yield -- alcoa and xerox

chair powell, as you know, there's been serious concerns expressed on both sides of the aisle and across america and across the industries about the the endgame proposal that vice chair michael barr has proposed. the concern is on how the proposed rule was developed and analyzed the lack of economic justification for these actions and but also on the substance. the proposal goes much further than the basel 3 committee recommended on capital requirements putting us to a great disadvantage internationally potentially. is the fed listening to these comments that have been nearly, you know, nearly unanimous in opposition to this rule and are they -- is the fed listening to these comments on impact it will have on everyday americans and what is the status on rulemaking and what is the plan moving forward? >> you're right. we've received voluminous comments and the impacts study that we put out. we got those responses in mid january and we're carefully analyzing them. we had asked for a very specific detailed databased comments and i'm happy say that we did get that. so we're now just now reac

how can we think about what chair powell might say? i have a lot of variables in my head as i ask you this. i have weaker data today, a stronger economy overall, it would appear, and then i have a roaring stock that would have to be influencing him, somewhat. he alluded it to it in his comments the other day. >> yeah. i think, actually, just a little bit of disagreement with anastasia there that there is some downside risk and it is hard for me to figure out what the upside risk is here. i think the game has been lost on a margin may cut that is priced out. i think june is what is in play, and the question is, does powell -- i think he will try to strike a more neutral tone, but i am not sure the market is going to. in that way, in part because i wonder the extent to which he is potentially thinking about this idea that, you know, what has broken the economy that requires these rate cuts? i will be listening, scott, for how we talked about how much restraint is on the economy right now, and how if he is asked and answers the uestion ab

take a listen to what chair powell had to say. there is reason to think there could be seasonal effects there. we don't want to be completely dismissive. the february number was high. the two of them together, i think they have another changed the overall story. >> take the two of them together and it has not really changed the picture. those are the words from chair powell in the face of some pretty consecutive prints. on the surface, this seemed a little hawkish to me. you saw the idea that they are still talking about some of these inflation upticks. what did you make of the dot plot in particular? then we will go into the nitty-gritty of inflation. >> good morning. i thought the dot plot was an impossible effort to squared away by the fed. they sent the jobless rate will be lower this year. this is the core pce will be sharply higher than they were expecting in december. they also pushed up the gdp growth forecast for the year all the way from 1.4 to 2.1%. 2.1% is a pre-magical level when you think about the long-term rate in

. >> hi, chair powell. jean young with him and i market news. i wanted to ask about the balance sheet. you said that starting the taper sooner could get you to a smaller balance sheet size. does that mean you do not have to make a decision on when to end qt at this point and will you be setting up the process for deciding that sooner or will you wait until we are closed tonight? >> it's sort of ironic that the going slower, you can get further but that is the idea. the idea is that with a smoother transition, you want to live this you will run much less risk of liquidity problems which can grow into shocks and cause you to stop the process prematurely. so that's where it interests. and when it ends, we will be looking at money market conditions and asking what they're telling us about reserves. right now, we would characterize them as abundant. what we are aiming for is ample. a little bit less than abundant. there is not a dollar amount or a percent of gdp or anything like that where we think we have a clear understanding of that. we will be lo

i would like to think chair powell for his testimony today. in which to submit additional written questions for the witness to the chair. the questions will be forwarded to the witness for his response. i ask chair powell, please respond as promptly. with that, this hearing is adjourned. >>> comcast support c-span is a public service, along with these other television providers. giving you a front row seat to democracy. >>> on thursday president biden is set to give the annual state of the union address. ahead of his speech we are asking what issue is most important to you. to participate scan the qr code on your screen or go to c- span.org/pull to add your voice to the conversation. as is customary, the president will be speaking before a joint session of congress where he is expected to outline some policy priorities and share his thoughts on the state of the country. this will be the third state of the union address of his president see and likely his last speech in front of congress before the 2024 presidential election. we will keep this p

reporter: thanks, chair powell. brendan peterson with punch chair news. central bank currency stuff. we've been hearing a lot from republicans in congress about what the fed is or isn't doing in a digital dollar. you've said to congress you were going to wait for approval before the fed does anything and launches anything but folks like house majority whip tom emmer said that the fed is actively researching or hiring personnel for implications of the cdc and >> sure, i'll try harder. we haven't proposed or coming to a cross-examination we should propoise or anything like that that congress considers legislation to authorize a digital dollar and would take us the ability to do a cbdc or retail cbdc with the public and so we're just a long, long way from that. what we are doing and every major central bank is doing is trying to stay in the fran tiers of what's going on in digital finance and it has many, many different areas. they've become front burner in the last five or six years and we need to be knowledgeable about all that and we have people trying to

welcome back, chair powell.ile i am pleased with the progress the administration of made to tackle inflation, we are not out of the woods yet. in fact, even though her mother my republican colleagues refuse to acknowledge this fact, housing is still the number one driver of inflation. based on the latest data, housing costs continue to make up nearly 70% of overall price increases, outpacing modest wage gains. we address the underlying housing supply shortage and americans will continue to pay an increasing share of their income on housing. the affordability prices will worsen, and inflation will remain ■too high. with that said, it's hard to understand why republicans feign concern about the economy. they are unwilling to address the key driver of an elation -- housing. in fact, republicans of only put forward legislation that makes things worse for millions ans, including moving legislation to slash funding for federal housing programs, including in rural america. this abysmal record of housing is par for the

it is nice when we uld like to think chair powell for his testimony today. which to submit additional written questions for the witness to the chair. the questions will be forwarded to the witness for his response. i ask chair powell, please respond as promptly. with that, this hearing is adjourned. minutes earlier today. [cheers and applause]

. >> reporter: hi, chair powell, rachel siegel from "the washington post." thanks for taking our questions. you and others are saying relief on housing inflation is coming but it still hasn't shown up meaningfully in the pce. will that change your opinion on inflation since it hasn't to this point? >> i think there is some confident that the market rents, lower market rent increases will show up in measures of housing services inflation over time. there's a little bit of uncertainty about when that will happen but there is real confidence they will show up eventually over time but again uncertainty about the exact timing of that. >> reporter: and will you be able to get overall inflation down to target if housing doesn't break through quickly and does that affect the timing for eventual cut this is year? >> we will get aggregate inflation down to 2% over time, we will, and i will assume we will continue to see, we'll see goods prices coming into a new equalibrium where they're going down perhaps not as quickly as they had been earlier this year. where housin

chair powell want the clear victory yet but so far, we are on track for that.want to invite our viewers to join us in this conversation where you see the economy where you live. democrats dial in at (202) 748-8000 republicans (202) 748-8001, an independents (202) 748-8002 and you can also text us at (202) 748-8003. facebook or you can also join us on x, just post @ c-span. what about food prices? is there anything the federal rese prices in the uptick that consumers have seen since the pandemic? guest: not than they been able to do so far. grocery prices are as much a 25 percent higher than they were before the pandemic. creases have come down the past year, they are only up around 1% but that's still a lot higher than three or four yeawhat we have seen is consumers pushing back a bit. some of the big food companies have talked about that they raise prices a fa amount in the past couple years and they've seen some of their sales drop off with people going more to private label or discount stf,Ñj. some of the bigger companies like kraft, heinz, proctoring gamble

stocks mixed in asia after fed chair jay powell said he still expects u.s.st rates to fall this year. let's bring in former bloomberg's mliv team. what will the takeaway be from the fed meeting later this month, what did you take from what we heard from jay powell? >> good morning. i think that the fed unleashed a lot of spirits on the markets. when they did a dovish dot plot indicating three rate cuts in 2024. since then, the incoming data has shown the economy is doing well with the cumulative great heights -- rate hikes we have seen. the labor market is still going strong. the disinflationary narrative that we saw has stalled for now. so there is hardly any incentive for the fed to greenlight those three rate cuts that they signaled again when they meet in march. i think that they will take back one of the rate cuts that they had penciled in. that will leave us with two great cuts. that ties into what the cash carrier has said recently. i do think there is a hawkish out that we should expect from the fed this month. tom: that's really interesting. kashkar

for that reason, chair powell will be really careful about how he proceeds. that is why the rate cut expectations continue to be pushed out. he has been very deliberate and rightfully so. sonali: talk about the data we are seeing and the gentle weakening. do you think things can get worse? you think there is a longer horizon here given expectations for elevated rates? collin: we aren't in the camp we will see recession soon. soft landing seems most likely. look at the fed's reaction function and how the markets and economy is handling that. we see that consumers and corporations have handled the rise really well mainly of how they -- because of how they manage balance sheets with corporations pushing back maturities and homeowners that have locked in low rates the rise in rates have not impacted them. you are looking at a more gradual slowdown. we do still subscribe to the idea that a high real rate will weigh on activity. we focus on the real rate. the idea of cuts coming up is not necessarily to stimulate, more maintain. if inflation keeps coming down and t

in fact, chair powell told congress that.i think the decision has been made, so there has to be some type of data that would change that core strategic decision that would disturb essentially the path that we're on for the cycle to begin here in the second half of this year, most likely starting in june. and if it's july, that's okay. >> right. well, we're kind of like kids in the back of the car, "are we there yet?" are we really going to start cutting? paul, steve liesman, thank you. >>> following a year of major gains in tech, our next guest is sticking with that trade from here, but doing it in a specific way. for more, we're joined by the potomac wealth adviser's president. mark, you're trying to get away from some of these companies that have been big tech players and make gone up a little too fast. how do you do that? >> well, you use the tried and trued principle of diversification. a lot of investors are not aware if they're in the s&p 500, they're in the triple qs, they own apple and microsoft and other big games, a

yesterday, it was interesting to hear chair powell sound so confident about the deceleration, to your point, he did say he is not gaining greater confidence, but he seems to be sure this is just a bump along the road, and for the most part he's focusing on the deceleration we got in the second half of 2023, not so much on the acceleration in the first two months of the year. >> he's not lost confidence. what is in the inflation number now that he can take confidence from? >> a couple of things i was looking at yesterday is for us to get to core pce at 2.6%. we kind of know what this month's data will be given the inputs on cpi and ppi. the rest of the year, he would have to be sure that you are going to get pce at .16 or .17. i guess that is one thing they are relying on, that even if inflation on cpi remains strong, that it's pce, which has a long wait, saves them a little bit. i also think you focused on non-housing services, they expect that to decelerate. so there core measure is still at .47. imagining they expect that to come down. one positive thing i did see in this month's cp

chairman. >>> all right, the gavel has come down ending fed chair jay powell's testimony on day two, this time before the senate. really underscoring what he has said over the past couple of days, that rate cuts are coming late they are year if the economy and the fed chair's words does, as expected, the stock market obviously liking that once again because we do have a rally on wall street. bond yields are falling. the ten year hitting a one-month low at 4.11%. we have a lot to get to. i have the investmentcommittee here. we'll get to a lot of stuff. i want to bring in senior economics reporter steve liesman. steve, that is the headline of what the chair said today. rates are coming if the economy does as expected and what he started to say yesterday. >> reporter: yeah. i think it's very much a repeat, scott, of that. the economy is in a good place, talking about the u.s. being the best of the advanced economies, waiting to be more confident to cut rates. a lot of talk about fiscal policy for the housing market and a deep dive coming on the balance sheet. scott, i think the story he

if that weren't enough fed chair powell leaving expectations of summertime rate cuts or at least one intact. the rally is relatively broad today. you have two thirds of all stocks higher. even energy coming to life just a little bit. nvidia, about three or 4% all day, no real news, 3 1/2%. approaching apples weight in the s&p 500 so there is plenty to like and investors are loving it. there are signs of rapid optimism in mergers and surveys. that brings us to our talk of the tape, we asked cameron dawson. also cnc -- cnbc contributor. if you are looking at the behavior of the market it got over bought and it is saying that way. that is usually a sign of a pretty durable rally. with stocks at record high, the economy looking okay, you have the fed not doing anything today stop thinking about rate cuts. i think it is one of those situations where is the only bare case that there is no bear case? >> right now they are not giving any reason to pause this momentum. to your point you are still seeing this chase into the market and something we are watching closely because positioning is ex

where fed chair jay powell has been reluctant to make a call on how the u.s.omy has changed since the pandemic. the feds economic projections for the long haul have hardly changed since 2019 and investors are growing frustrated over policymakers lack of conviction. furthermore, let's bring in our guest for some analysis from the big take and we know that there are risks to calling out any sort of changes or new futures in the u.s. economy, not least politically in the election year, but is that what is holding jay powell back at this point in time? >> it is interesting because i think what you are seeing here is a disconnect with what a lot of companies and investors are experiencing on the ground where they are saying this labor market resilience, this tightness they are experiencing seems like they are kind of settling in for the long haul and they are seeing that change in the overall economic picture. we really have not gotten that really robust forecast update from the fed in quite a while. at this point, traders are pricing in something like 3.5% longer-

now real quick something else to think about, what was made the fed chair powell's comments yesterday it and other media did too. the question is if he might have been more forceful and clear if he meant to send a strong signal. >> in other words, he didn't mean to send a strong signal? is that what you're saying? >> it could have been just a comment there that maybe the market went a little bit too far with, but still, i think the or yen sayings between where the market is priced and fed is, is not that far off. just trying to sort it out. >> got it. steve liesman. >>> our next guest sees four 25 basis points cuts this year. chief economist jan hatzius joins us at post nine. are you still at four cuts? that's more than the market and fed expects? >> we are still at four and i would say at the margin the news flow i think has said they're probably not too far from cuts. a little bit hard to know how much weight to put on chair powell's comment in the testimony, but it pushed in a slightly dovish direction and if i look at today's jobs numbers, they certainly say that labor market is v

fed chair jay powell giving two days of testimony pal repeating cuts are coming.nfident inflation is heading towards 2%. the ecb holding rate steady at its meeting but keeping the door wide open to a cut in april. some investors the ecb and fed could be on different timelines. the boj looking at a different policy. negative interest rates later this month. a growing number of bank officials leaning towards a hike which is why we've seen a little bit of strength intraday so far this morning. two hours away from the latest payroll support. january scintillating report shows the labor market is holding up remarkably well despite tighter monetary policy. we look for the rate to be remain unchanged prayed for average hourly earnings to ease to 0.2 during the month normalizing supply and demand for workers. sarah joins us for more. why won't this data be a repeat of what we got a month ago? sarah: what we saw coming out of january is it is a real tough month for seasonal adjustment. we tend to feel a lot of layoffs and just the fact we see businesses hold onto workers m

chair powell goes hawkish and says it was a mistake what i said before. he's not going to say that. thing you can say for sure, he's not going to say that. lisa: not like that. >> we can guarantee that is not going to be said. jonathan: reflecting on this fixed income market, obviously in europe we were there together, we have to talk about negative bond yield. what did we get up to, some ridiculous number of negative yielding assets? how would you describe that? for those who maybe are just joining the industry and were not living it, how would you describe that to them? >> it was an experiment in monetary policy. it was obviously a scary time because the policies were there to address the risk of deflation. we don't know what would've happened without some of these policies. not saying i am a fan or anything, just that they get a bad rap. what else were central banks supposed to do? i look back at it and i think it was an experiment ended might have had some quite serious unintended consequences because it should not have been a surprise that asset prices went up. jonathan: do you

chair powell lost confidence than gain confidence.ouldn't you suggest he should be losing a little bit of confidence right now? whether he shares that publicly is another story but based on the information, i wouldn't be looking at that and gaining confidence from what i've seen so far. lisa: the market is not gaining confidence, it's pushing rate -- it's pushing back on rate cuts pretty significantly. they might be saying neutral is 3.5%. we don't know if the fed will address this but it depends on financial conditions and how worried they are about a stock market that is at record highs, bond market that's held as benchmark rate climb. the financial conditions question might be the most crucial one to understand their psychology and how much they think the market is getting away from what they are trying to do. jonathan: all-time highs in the s&p 500 going into a fed decision and whether it's an obsession about them reducing interest rates. equity futures are negative by 0.1%. on the s&p in the bond market as well, the 10 year treas

fed chair powell wrapping up day one of his system. he'll be before the system tomorrow nvidia, $887, a gain of better than 3%, so the march towards $900 continues there microsoft, that is green, as well apple, it's hugging the flat line i'll see you on "closing bell. "the exchange" begins right now. welcome to "the exchange." i'm dominic chu. here's what's ahead on the show. fed chair jay powell not ready to cut rates yet our next guest says the biggest risk he sees now is the fed waiting too long to lower rates. >>> openai fires back, publishing elon musk's emails. what he wrote and how it may change where this fight goes next >>> and there's a new fomo trade emerging says one analyst and it's not too late to get in on the action he is here with the trade and the upside of this industry. >>> now a check on the markets the major averages are rebounding, but the chart of the day right now once again goes to new york community bank corps. believe it or not. down more than 40% so far on reports thousand that the bank is seeking a major c

welcome, chair powell. if you have time after the hearing you ought to go by and see him. >> i don't want to disturb his nap. >> but thank you for being here. i want to get back on the basel iii proposal. the senators and i sent a letter indicating our concerns with the curren also worth noting that t number of organizations, the diverse group that are not normally aligned on policy, you got bank trades, national housing conference, naacp, habitat for humanity, national community reinvestment coalition, the list goes on and on, who have concerns about the current proposal. here's my concern. i think we're, you know, trying to make the best of what was foundationally a bad proposal. i'm in the category of people who think that it should be reproposed. because i think one of the reasons why i did no here. it was pretty clear to me before he ever got confirmed on the board that we were going to be in this place some months or years later, and here we are. i think that the industry felt the same way. all of the

chair powell again on friday. "last mile of disinflation will be a lot harder than markets expect and the fed will need to be patient on monetary easing. the new equilibrium we are trending to will have markedly higher rates than we've been used to in the pre-inflation surge period." sonal joins us for more. ultimately if the federal reserve is willing to accept higher inflation for longer and you believe this journey could be a lot longer, where does it leave your view on fixed income? sonal: i like fixed income. the only thing is people have to adjust what they expect to get out of fixed,. it is time for fixed income to says -- to do what it says it will do which is deliver boring returns. they are not looking for capital gains. jonathan: where across the curve do you prefer? sonal: we have been neutral for a while but between 425 and 450 we've been adding duration. clearly spreads are extremely tight. one has to look for pockets of value wherever we can find them. terribly tight right now on most of credit spre

chairman. >>> chair powell i want to talk to you about housing before i get there let me address thef mergers last week i led a letter along with 15 democrats to you as well as doj, fcc and fdic expressing my concern about the lack of progress you have made in updating your bank merger review procedures this is critical now we just learned of another mega merger involving capital one and discover, which would create the sixth largest u.s. commercial bank with a major role in the credit card market before too long experts have raised alarm there's a rubber stamping process of bank mergers where virtually all applications are approved all the while unbridled market poses great risk to consumers and entrepreneurs. what is the status of your updates to the merger review process and does the fed plan to convene public hearings on the capital one and discover merger? >> i believe we're in regular contact with the justice department on what's going on with their review of merger practices. we are -- we're looking at that. and considering. i have think on the potential merger with -- that yo

>> certainly, again, chair powell and all -- many of the ffed number indicated the he desire to be cautiousor more data to support continued disinflation and i think, mark, you made some really good points, that historically when we've looked at inflation, often it comes in waves and we've seen our recent data really reaffirm that with some bumps in the way a lot of that path of price pressure is coming down. so again, we expect that rate cut hopes to continue to be a little further out as we look forward into the future. maria: all right. we will leave it there. lisa, good to see you. thanks very much. >.lisa erikson joining us this morning. your morning mover is macy's, it's up in the premarket. shares up 16 and-a-half percent after real estate faux of cussed investment firms arc house management and brigade capital raised the offer for macies by nearly $1 billion, they offered to acquire macy's stock they don't own for $24 a share, a 14% premium to the previous offer which was $21 a share or $6.6 billion. mamacy's confirmed it received e new proposal. the board is taking it under review.

fed chair jerome powell telling the u.s.enate banking committee that policymakers are getting closer to the confidence they need to start easing. >> we are in the right place. we are waiting to become more confident inflation is moving sustainably at 2%. when we get that confidence, and we aren't far from it, it will be appropriate to dial back the level of restriction so we don't drive the economy into recession rather than normalizing policy as the economy gets back to normal. paul: bloomberg's global economic correspondent enda curran joins us now. we heard from jay powell and loretta mester of the cleveland fed's and she also wants to see a couple more data points, more evidence of inflation cooling further. the question is timing. when will we see the fed move? into --enda: we had a signal from chair powell today saying you need to be very confident inflation is heading back towards target. then is he thinks that is not far away now. what constitutes not far off course will be the great game over the next few weeks but

if that weren't enough fed chair powell leaving expectations of summertime rate cuts or at least one

however, fed chair powell says the fight is far from over. edward lawrence with us.orter: stu, the president now blaming inflation on companies again. now for the state of the union address, the president will highlight what he calls historic achievements. the president will talk about jobs that he's created but use creative language. he'll mention he created 14 million jobs when the truth is he, the economy added back all the jobs lost in the pandemic and has created 5.4 million jobs. the president will also repeat this sentiment from earlier this week on inflation. reason. listen. >> wages are up more than prices. unemployment has reached hiss to havic lows -- historic lows. families are finally getting a little breathing room. prices are still too high, and they shouldn't be this high. that's why we're going to do everything we can to keep lowering costs for hard working families. >> reporter: the lowering costs sounds good but affects a smaller grape of people like insulin at $35. only those on medicare part d and and only part b if it comes from a pump that's co

. >> chair powell stuck to the narrative we have been hearing for some time. >> the reiteration of data dependency. >> i said, over and over again, that it would depend on the data. >> that's their guide. >> i wouldn't gosar -- so far sue say it doesn't matter, we are still trying to get inflation down to 2%. >> the base case is still a start in june with the committee cut this year. >> it was really much closer to a two cut scenario. >> this is a signal. >> the threshold to cut was higher than it was prior to the meeting. >> we still think we are cutting rates this year. >> this is a fed that once the soft landing to continue. >> i have the unfortunate view of viewing him as a bartender still pouring drinks. i think we haven't heard last call yet. vonnie: let's take a look at how many rate cuts the market is pricing in. it has changed substantially in the last few months. a tortoise hair situation, if you like. we thought there would be seven cuts in 2024, turns out it might be slower than that. you can see we are pricing into .4. more than the fed anticipated. let's take a look at whe

up with the fed and we didn't get much conversation at all about the balance sheet, even though chair powell had said we would be focusing on the balance sheet at this week's meeting. i don't doubt that they focused on it. we will find out in the minutes, one way or another. that's something investors are very focused on. another takeaway is that to me, anyway, the fed is willing to focus on job growth and sacrifice a little on inflation. they increased inflation numbers, growth numbers, lowered unemployment numbers, signaling that if push comes to shove, we will let inflation run a little bit hot as long as we keep job growth grow -- going. vonnie: ellen, thank you for your time today. ellen: thank you. vonnie: coming up, the feud between bob iger and nelson peltz heats up with a board vote. this is bloomberg. ♪ you know what's brilliant? boring. think about it. boring is the unsung catalyst for bold. what straps bold to a rocket and hurtles it into space? boring does. great job astro-persons. over. boring is the jumping off point for all the un-boring things we do. boring makes vacations h

powell. how surprised are you with the amount of confidence the fed chair exuded yesterday?oks like immaculate soft landing. gdp revised up, inflation not really changed and unemployment revised even more benign so he is very much betting everything on a soft landing and definitely not any paul volcker. i thought the conference was as we all know over the past two months inflation has been surprising to the upside. when asked about that chair powell was basically, yeah, january, that's just seasonal stuff. charles: yeah. >> february, you know, that is actually not so bad you know. so he seems to be downplaying and looking through what looks like inflation stablizing at 3 and 4%. and not just that so, we have financial conditions which i think everyone thinks are quite loose. look at equity markets going to the moon. looks like dog with hat a meme coin will show up on the las vegas sphere. clearly a lot of speculation in the markets. when asked about that, actually i think financial conditions are restrictive. i don't know when he is looking at but not what anyone else is loo