when the fed finished its hiking campaign before this one the fed funds rate ended at 5.25%. we're just at 2 right now, to your point. trish: okay. i kind of like it. >> i love it. trish: it feels like the right thing to be doing. >> yes, it is right thing to be doing. trish: given our economy and it bothered me we were so low for so long and printing away, adam. >> you know, just ask danielle at that and her former mentor at the dallas fed, mr. fisher, who was adamant the fed overstayed welcome. kept rates far lower than they should have been. thank god we're getting back to normal. the only surprise for me as i heard what from the fed read to us from washington the fed thinks economy is only growing 3.1%. atlanta fed, has concurrent indicator where they think it is right now, their number is 4.1%. higher than q1, q2. this is great story. two es of earnings and employment. i love the everything but the gdp forecast. trish: we'll hear momentarily from mr. powell answering questions there and talking to reporters in his update. charles payne, what do you think would be, what y

for any fed program. if this means eligible at the time the fed provides the first loan, it may make it harder to nit the contagious run in the butt. they would have to wait for five institutions to be under attack. if it means ever eligible then it is not much of a restriction at all. who knows if it could ever occur. its use could cause congressional cute knee. third, dodd-frank says all loans must be challenge ralized and -- before they could, you know -- make lending -- felt assured the loan was protected. this new requirement would preclude lending to unsecured commercial paper issuers because they aren't secured. and that's a major thing the fed did in the crisis. now, the fed can only loan to nonsolvent institutions. the solvency requirement is a requirement in baggio -- i never -- i would have to do some historical research on pronunciation -- is a cardinal principle in the 19th century formulation of the appropriate role of the lender of last resort. but as we all know, judging solvency or insolv

the fed is coming up widely anticipated to hike. markets are mixed going into that we saw the third negative session in the row for the s&p, even though for the quarter it's on track for the best quarter since 2013 the last couple of days, price action has not been that positive generally speaking it's been a strong quarter the mood overnight was better. we saw relief in chinese equities there there was a report from the msci saying they are considering increasing the weight of equities in their indices next year we saw a bounce in the nikkei, up 0.3%, touching its highest level since january. that was the picture overnight in europe we have a dented mood. we're down about 0.10%, slightly weaker heading into the trading session today. let's get into the individual markets. the mood is a bit sour in europe the ftse 100 around the 7,500 mark watch out for jeremy corbyn's spe speech later today the xetra dax, focus is back on the political back drop. this as the cdu's party whip was pushed out one of merkel's loyal colleagues is out of

from the policy statement, this was a critical change according to many fed watchers, the fed expectsay above neutral. fed chair powell getting ready to hold a news conference now. let's bring in jeb in texas, he's the chairman of the house financial services committee >> let's talk about trade and work our way back to the fed if you want to come along, canada, come along you have been outspoken about your concerns about tariffs, which you see as taxes simply put >> indeed, i have been concerned, because i believe that for most americans, they're enjoying the best economy of their entire life. tyler, i'm heartened by the fact that we seem to have now a truce with the eu, i'm heartened, but we haven't seen the text the fact that we seemingly now have a handshake agreement with mexico, i believe it's important that canada be a part of that, i must add mid also having returned from china, that's where our problem is, there's a serial violator of the wto, they're still taking our technology our intellectual property by hook and crook, i've encouraged the administration, let us focus our r

with that move the fed? -- would that move the fed? james: in some yes and some no. think the chairman said that to they look at conditions in emerging markets as a consequence of how it may affect u.s. conditions or u.s. employment. they are looking at it and i think they see well that's some parts of the market are not in balance. i would call things like private equity and credit, some of the sectors allen talked about after the statement was released on your program. those are indicators to me. at the end of the day, the fed has to do what they have to do around their mandate. it is appropriate to look more broadly. joe: cameron, one thing you noted on the blog is that the powell puts list referring to the idea that if we got a be the, then that would type of thing the fed would be inclined to respond to. usually, those things do not happen in a vacuum. they are associated with something. what is his articulation of the point mean. .> i thought it was interesting i can't recall the dingdong highs of a fed chair saying the market does poorly and that's will impact

fed.omething for everybody, something for the hawks and doves and we saw that reflected in what markets are doing. equities showing the performance yesterday, gaining momentum after the decision and dropping as we had the press conference from jerome powell. let's look at the gmm function. negativeed up on the -- negativity. performing and gaining some speaking broadly things have been negative in asia. in terms of forex markets, this is where we get the virgin market reaction to the fed, e.m. policies coming down and the euro is down. the australia unit is down. the dollar is strong. have held onto their decline. they are declining more. we will talk about that with our mliv colleague in a moment. let's show you where we are on commodities. talk about $100 oil. we are trading up by 1.1%. some upward momentum talking about $100 oil and we will bring you that interview. the u.s. energy secretary saying the strategic national oil reserves will not be tapped. asian stocks have been falling as

and he's now kind of more call of the fed. -- critical of the fed. in brazil something interesting happened which was going back to the beginning of 2008, president lula, who's now basically indicted and in prison, but at the time he was sort of a major force in brazilian politics, and he was very concerned that the u.s. financial crisis would hit brazil, which it ultimately did. and so he had an appointee who was running the central bank of brazil, and he basically was trying to also do a little bit about what the fed was doing, and then he tried not to. he tried to raise rates in brazil such that that there wouldn't be inflation and people wouldn't be able to not afford food and so forth. ultimately, there were shifts in government he left, etc., the new person tried to do what the u.s. was trying to do and what the fed was trying to do, and that hurt brazil even further. now he's back. he actually became the finance minister under michelle temer's government, he was interim president of brazil. now he's running for president. so the other thing ab

a fed that has to react. that is were the fed has always been. reality has set in that the model cannot catch all of this. thennot catch the complexity of the supply chain. there is more of a humility with jay powell at the helm to note that they just of know it all. >> jay powell is a very different fed chairman. phd inn't have a economics. he has real-world experience. >> he is also operating military -- monetary policy in a different part of the cycle. he's left with normalization. the hard part of normalization. you don't know where you are. that's what the debate is all about. how tight is monetary policy? the fact is we really don't know. a very different stance because you are no longer clearly accommodative. you're not sure where you are. >> where are we? if we don't know where we are. >> that's an easy question for me. we are saying that monetary policy is no longer stimulative. does that mean we have had the neutral rate and the fact that the dot plot tells us we are going to raise rates, are we signaling that we are going to move to a

. >>> fed decision in a couple of hours. a busy day tomorrow on the hill with kavanaugh bed and bath tonight to the judge >>> i'm scott wapner is the blue chip breakout a sign stocks are poised for an even bigger bounce in the months ahead? this is "the halftime report." >>> the theme of the hour is big. a big run for big caps as we close out the quarter with stocks like pfizer and apple up 20% or more in three months. what's going to lead in q-4? plus a big call on big blue. we're talking ibm. and get ahead of the fed with two hours before the big decision "the halftime report" starts right now. >>> here to debate and trade, joe terranova, jon najarian, mark tepper is here, president and ceo, and chris bitterly is along as well, citi, head of markets for the americas good to have you with us on this wednesday. stocks are higher. we're trading the final days of the quarter. now one quite good for your money. you have the dow in the quarter up 9%. the best quarter since q-1 of '17, up month to date. this is where the action h

it is not just about the fed.d a central bank decision from the new zealand central bank and the governor suggesting they could -- there could be a cut on the table. the kiwi is down against the dollar by .41%. we are awaiting decisions from bank indonesia. both currencies slightly higher against the dollar. we are expecting a quarter-point rate hike from bank indonesia to 5.7%, half of percentage point from the philippine central bank that would take their rate to 4.5%. mark cudmore was saying that is an interesting one to watch than the fed which was widely priced in. nejra: more interesting than the fed. to my juliettech saly in singapore. great work. let's get to our top story and the fed has raised rates for a third time. givend jerome powell has an upbeat assessment. >> our economy is strong, growth is running at a healthy clip, unemployment is low, the number of people working is rising .teadily, and wages are up inflation is low and stable. all of these are very good sides -- signs. that is not to say ever

the fed is supposed to be independent. after the president commented about the federal reserve, people are questioning that independence, in some corners of wall street. here's what the president said recently. he told reuters i'm not thrilled with his raising of interest rates. no, i'm not thrilled, referring to jay powell, your thoughts on the president's response to the fed's work. >> so i won't comment directly on that, because i don't think it would be appropriate, but i will say this, part of this job, and one of the reasons i joined the fed, i've only been at the fed for three years, and one of the reasons i went from the private sector to take this job is i knew it would be challenging to quote unquote normalize monetary policy. and the key part of this job is the fed needs to do its work without political considerations or political influence. and so my challenge and i think our challenge is to analyze the economy, weigh this balance that i just talked about, and make good monetary policy decisions, and i think we

let's look at the fed spectrometer. see there is only one from atlanta fed, then three plus one, very hawkish fed bank presidents in the hawkish range. in the middle we have jay powell. he carries a lot of weight when it comes to the vote. will he be a moderating factor? the voter survey shows concern. it is not the main concern, but probably one on people's radar. the fed led by this hawkish contingent will hike too much. maybe in 2020. jay powell asked questions about that. we're is the neutral rate? towill be an important place see what he is thinking and what he expects for the rest of the fed. shery: let me turn to argentina. the federal bank chief resigning abruptly. we had heard a deal could be coming this week. has this anything to do with that? kathleen: i think what it has to do with is, for example, yesterday he said the revised imf deal will need a new monetary policy report -- approach. i think many people are wondering if he is taking the fall. very importantly he helped all those creditors get on board wi

coming up, more on the fed howsion with our guests and to price a fed rate hike going forward. this is bloomberg. ♪ >> this is "bloomberg daybreak: americas." sprint is arguing there is good reason to allow its purchase by t-mobile. it tells regulators customers are fleeing and is on able to recover from losses. a said it would set up stronger competitor to at&t and verizon. the ceo of total sees oil hitting $100 a barrel. he tells bloomberg when the price of oil goes too high, the door is open to competitors and demand falls. operating profit fell for the 10th time in 12 quarters for h&m. investors focused on the margins that beat estimates. said it would not require more markdowns in the fourth quarter. that is the bloomberg business flash. the federal reserve made its third rate yesterday of the year as chairman powell takes an optimistic view on the u.s. economy. here is what he had to say. >> our economy is strong. growth is running at a healthy clip. unemployment is low. these are good signs. readers of the fomc statements likely noted it dropped the sentence that the pol

shery: coming up, the former atlanta fed president. we just had the fed raising rates. at the highest level since october 2008. we will ask if this was the right move. ondi: all the action "daybreak: asia" is next. nextll be around for the two hours as asia wakes up and reacts to the fed. this is bloomberg. ♪ this is bloomberg. ♪ haidi: good morning. i'm haidi stroud-watts in sydney. asia's markets an hour away from open. shery: good evening from bloomberg's global headquarters in new york. i'm shery ahn. sophie: i am sophie kamaruddin in hong kong. welcome to "bloomberg daybreak: asia." ♪ haidi: top stories this thursday, the fed hikes rates as expected and indicates more to come this year and next. president trump says he's not happy. the president also accuses beijing of meddling in the november midterms. china dismisses that claim as nonsense.

guy: yes, we are counting you down to the fed decides.his is a big meeting, a meeting we will want to pay attention to, 2:00 p.m. new york time. things will be shifting to press conferences at every meeting. the next one is the last one without a press conference but i am fascinated to

there was a fed paper -- jonathan: to give you any kind of indication. >> there was a fed paper that suggesting if you adjust for the term premium, it is a better predictor when you adjust for the term premium. jonathan: thank you to our guests. coming up, the auction block. volatility and uncertainty in emerging markets wreaking havoc on russia's debt market. that conversation is around the corner. you are watching "bloomberg real yield." ♪ ♪ jonathan: i'm jonathan ferro, this is "bloomberg real yield." i want to head to the auction block, we start in the united states. it was the most active week of 2018 for investment grade issuance. supply was at the high end of estimates, leading to more than $53 billion in sales. cigna carried the heavy lifting. selling $20 billion worth of bonds across 10 tranches to fund its takeover of express scripts, the second-largest high-grade deal of the year. in emerging markets, russia had its second auction in as many weeks. the finance ministry was due to offer 15 billion ruble notes, but they cited "heightened market volatility for the cancellatio

jodi: the fed will be somewhat nervous -- >> the fed is somewhat nervous. we have seen leverage both up in the system so i do not think they will want to continue. there will be a pause for evaluation at some point. i think we could see a little bit of a soft patch in the first quarter as we have done through pretty much every year for the last five years or six years and that could give the excuse to pause and wait. manus: you talk about the potential for bubbles. where aren to you is their bubbles? where do you see the risk of bubble is the market? -- in markets? james: that's right. if you're building up potential for the future, the fed will be alive for those risks. if they do start to worry about asset prices, that could be the reason for this sort of situation and why they are focusing in on that. nejra: in this survey, economists basically said the next recession in terms of the respondents would be triggered by the fed raising rates to quickly. the financial bubble was third. second in line was an external nontrade short. if the fed does not do wha

tune in later today, our fed special, "the fed decides" at 2:00.have reaction from alan blinder, diane swonk, scott minard, and others. coming up, how are the trade tensions waiting on global economic growth? we will have the interview with the oecd secretary-general next. this is bloomberg. ♪ emma: this is bloomberg daybreak. it is the end of an era under sadie's bend parent daimler. longtime ceo dieter zetsche is stepping down two years early after being in office since 2006. he'll be replaced next or by the first non-german ever to leave dialer. ola kallenius rose through the ranks. dieter zetsche it has come under fire from regulators over diesel emissions. anda is offering incentives asking for volunteers. the company is trying to get electric cars out the door. online polling company surveymonkey raised $180 million and an outside ipo. the market above price range. they are still losing money. in the past two years, then began partnering with companies such as google and microsoft. that is your bloomberg business flash. david: we are back at

most fed officials have said.he odds have risen substantially to suggest the markets are in line with this as well. let's jump into the world interest rate projections. when you can see is if you look almost to the middle, almost 99% in that top row of that 5%.rease, range of 2. if you go to the next column and go down until you see 12-19. a lot to expect but nearly 80% now for the december hike. ever like to share with you what our bloomberg economics team has been arguing because i think it is interesting not only that i think they raise good points, because they think the fed is not going to want to box itself into a december rate hike. led by jay powell. here is why. first of all, they are saying third-quarter gdp is really at 4% before it slows down to 2% or more. how about the impacts of tariffs? and even the midterm elections? jay powell is also going to be concerned about the neutral rate. how does the fed know it is neutral? he cautioned this in jackson hole. if he is going to express enough doubt to have

i would like to add that if we include the fed nonvoters, and remember, this is consensus driven fed,e three more s, so you have maybe a different look. this is what is so interesting, when they finished that meeting and give us their policy statement decision, will the hawks the pushing for more rate hikes or maybe the doves are centrex will say to is enough. asian central banks due out this week with their monetary policy. we're just getting some trade numbers through from new zealand. the trade balance for august was a great miss on expectations. it's a deficit of $1.48 billion, missing expectations for $925 million. august in the month of shy of expectations, just over $4 billion. $4.4 billion is what the market was looking for. less matching expectations for august. tot takes the trade deficit august at $4.8 billion mean deficit. we are seeing that decline in the kiwi dollar which had started to fall after comments from that are being governors saying the tricky thing with re-inflation is how to get it up and not how to get it down. done dealtially a that the federal time after's

across the world all those shorts because the fed -- the hawkish borrower was high, and the fed at thef the day wasn't as hawkish as the market expectations came in so everybody covered their shorts and bonds went up, yields went down. so every fed meeting you are seeing a tremendous amount of people, because of what you're talking about, the investment community globally a lot of investors have been betting on higher yields. it's a crowded trade so the bar is high if the fed is not hawkish enough, people buy bonds >> yesterday we saw the ten-year yield at 3%. we saw yields come back just a bit. the markets did fall off a bit on concerns for financials but were you surprised that kind of the lack of overall move to the federal reserve yesterday? >> yeah. i was, but when you talk -- over the years when you learn about rates. my younger years i spent a lot of time on equities, the last 20 years more time on rates, some of the smartest people on planet earth trade dollar futures something important happened in the last 10, 15 days you can make a bet in the euro/dollar futures, so a bet on

>> the fed always follows. the fed will be slower raising rates than they should be.phone, n.c. state football schedule. we are going to do something european now and you don't have to be involved. francine: it is actually one of the most global european banks. dennis gartman stays with us. the ubs chief executive spoke exclusively to bloomberg. hike forect another december, another three hikes in 2019, said the fed is executing their plans and the economy is sustaining this policy. i think we will continue to see hikes in the future. >> what do you make of trump's comment, having a punch at jerome powell? >> an intervention to influence out to bankers turns create a counterproductive outcome. doubt, under pressure the fed to come in the ecb, and any central bank tells to the contrary of the pressure, so monetary policy should be a matter of the central bank. >> in june you said i will not be surprised to see a 10% to 15% correction. investor are we to the turning on this market at the moment? , you you look at the u.s. could argue we are reaching all-time highs. in t

as soon as december and fed chairman jay powell was pretty clear why the fed is doing all of this. >s running at a healthy clip unemployment is low. the number of people working is rising steadily, and wages are up inflation is low and stable. all of these are very good signs. >> now, amid expectations for the good times to more or less continue next year, federal officials on average forecast, this is what mike were talking about, rates will rise another 75 basis points next year and finish the year above 3, that's 2019 powell said there are risks out there to the fed not doing this. >> if we move too quickly we can snuff out the recovery or if we move too slowly we have an economy that can overheat. that's happened through history. we don't see any signs of that now, but we're always trying to navigate between those two scholes, and we think that gradually, you know, raising interest rates is the way that we kind of take both of those -- those risks seriously. >> some response to my question about the level of the market. he did not seem overly concerned about asset valuations or c

when you were at the atlanta fed, part of the policymaking by the fed, very different issues now. thing that hasn't changed. we talk about checking history. many times, the markets are concerned about the fed's mistake if it does too much. the fed's mistake is not able to know when it hits neutral and keep going on rate hikes. is there a risk happening this time? >> policy is always set in a context of really a lot of uncertainty. some of the tools are less than precise, so they are trying to navigate, which i think is what jay powell is using in the jackson hole speech. they are navigating in a situation of uncertainty between bad outcomes on both sides, and it is never a sure thing. so, yes, something could happen, but i think the current approach of gradual increase in rates that are calibrated to the strength of the economy and to the inflation and employment , veryion is a very solid predictable for the markets, and therefore i think it is a very good path that they have carved out. the u.s. may be able to rein in effects of a trade war because it is not trade dependent anymo

the fed, as well, digesting the statement seen as a modern day exit. let's look at what is going on. tencent, a big decline or so far in the session for the hang seng. looking at positivity from japan, positivity for hong kong, as well. .1%. the nikkei gaining ground. china under a bit of pressure. let's look at what companies are doing on here. it is a situation where we have banks in the crosshairs as to what they do next with the base rate going up in line with the fed by the hong kong monetary authority, and do they move their primary? hsbc has a news conference coming up in an hour and they could be announcing a change. has certainly not gone out that well carried 15% down on the back of the retail side of this, which was under subscribed. that is on the way down. we are talking to the ceo in under half an hour. stephen engle's down at the exchange. it does put pressure on mortgage holders and so far, a little , butmmittal for shire moving in other directions seek assets and henderson lined. giving you a taste of what is going on in hong kong. >>

the fed is reacting to that. >> assuming the fed itself -- >> there is no sign the fed plans to pauset is a recipe didn't quietly and judiciously and don't do anything radical in one way or the other. four expect we will see rate hikes next year after another one at the end of this year which is above what is being priced in. >> the committee will simply said policy and the best long-term interest of the country and of the economy. i think they will do their very best to ignore outside pressures. >> the economy has been doing quite well. i think that is because of the tax and regulatory reform. the fed's policy about normalizing is part of that in the markets will be working better as that continues and i hope it does. jonathan: still with me, diana amoa, scott thiel and colin robertson. colin, i want to begin with you. the reserve moving that word, "accommodative." is is still in accommodative federal reserve? colin: yes, it is still in accommodative federal reserve. there are a number of important things going on here. removal of "accommodative" was them more of a position and that'

we think the fed will tighten twice this year. i don't think december is a pause.here is a risk of a pause next year. we think the macro and monetary policy factors all point to still higher rates from here. watching the show, it is interesting to see how many of my colleagues and other firms are getting more bullish on rates. i think they might be a little early. that said, i am not expecting the 10 year to hit four or five anytime soon. it is a question of how high do you go in the threes and when does the rate cycle peak out? jonathan: what is interesting is how comfortable the fed appears to be to invert the yield curve. the new york fed president came out this week and essentially suggested it is not something that would stop him from rising interest rates in inverted the yield curve. if you have a fed that is saying guess what we are comfortable doing this, don't you have to stay with the trade? >> yes, you do. we are also short duration and we are looking for a flattening yield curve. apparently perhaps, an inverted yield curve. where i tend to watch is the

the fed is reacting to that. >> assuming that the fed moves very gradually. >> there is no sign the fedns to pause. >> it is really a recipe to move quietly and judiciously and don't do anything radical in one way or the other. >> we actually expect we will see four rate hikes next year after another one at the end of this year, which is above what is being priced in. >> the federal open market committee will simply set policy in the best long-term interest of the country and of the economy. i think they will do their very best to ignore outside pressures. >> the economy has been doing quite well. i think that is because of the tax reform, the regulatory reform. the fed's policy about normalizing, to get back to normal is a part of that, and the markets will be working better as that continues and i hope it does. jonathan: still with me, diana amoa of jpmorgan, scott thiel of blackrock, and colin robertson, from northern trust asset management. colin, i want to begin with you. the reserve moving that word "accommodative." as the federal reserve still an accommodative federal reserve? co

the fed base book coming out wednesday and we get ecb and bank of japan.h me are my guests. looking ahead to the ecb, i want to get the view from london. what are you looking for from president draghi through the next next 12 months? -- through the next 12 months? >> given the forward guidance, we think they have given themselves very little wiggle room. there's not as much excitement around the ecb as there used to be. exiting qe is telegraphed on its way out. i think what is interesting will be to see to what extent they take into account italy on their periphery in changing the tone of their statements. and also the language around growth. we had a pretty soft start to the year. making the end of summer more likely than later down the year. jonathan: kathy? kathy: i would agree with that. i think it is mostly about the balance sheet decisions going forward, and forward guidance. next year with the ecb, someone new will be in charge. that is a wildcard as well. jonathan: it might not be a german, though. kathy: yes, which is surprising. we all thought we

at certain levels, the fed is at its sweet spot.re at pce inflation rather than cpi inflation. pce inflation is at a good spot. it needs to be forward-looking i think it believes expectations are well anchored. we will not see inflation shoot from 2.5% to 4% or 5% because of the anchoring. i think it is concerned about losing credibility, but it has its at the time being. that allows it to him about the gradual pace they have been moving. mayank seksaria, macro risk advisors, thank you for being with us. we will look at paychecks next. this is bloomberg. ♪ this is bloomberg. ♪ alix: this is the wall street journal reporting, tim armstrong, the executive emerged aol is with a well is -- in talks to leave the company. david: that is not a surprise. tim armstrong is very effective, a great advertising i when it comes to online. there's been a change at the top at verizon. they are taking a very different approach. before they were going to go big intermediate. not so much now. they are going big into 5g now. that is not surprising. tim

the fed's fault.ate in the cycle when the economy overheats, usually the fed has to chase the inflation rate higher because that's part of its mandate then it hikes too many times and you get an inverted yield curve at the same time you have the fed's policy rate well above the so-called neutral rate we should compare it not to zero but what would be a neutral rate >> we may be looking at that now. if inflation is 2%, you're getting to 2% -- >> well, so that is my point so the neutral rate, the goal post seems to be moving. the estimate was revised higher by almost 85 basis points over the summer if it is 3, and the fed needs to get moderately restrictive, we are looking at a fed funds rate of 2.5, where 2.75 was priced in so it's a moving target, but as the natural rate goes up, it allows the fed to raise rates further without damaging the economy. therefore if the curve were to invert next year, it may not be as damaging as it might have been in other cycles >> hank, what are you telling investors t

how hawkish is the fed being regardless what financials are telling you.e predictions for growth are upped a little bit as far as gdp, liz. i don't know if they're extra hawkish, if anything a little dovish. that is hurting growth and that is hurting financials. liz: they predicted federal reserve in the statement, would see by 2021 gdp median 4.4%. we hit 4.2%. we're expecting revision tomorrow. we'll see what happens tomorrow. got to watch fox business. stay up all night and watch us. dow industrials down 114. s&p down 10. nasdaq down 18, significant swings on the news coming out of the federal reserve. goldman sachs is one of the lag guards here, charlie. it is down about 1 and 2/3% at moment. >> nothing to do with this story. we're talking about what -- liz: financials are getting hammered. not hammered, they're getting hit which is interesting because a rising rate environment is supposed to be good for financials because it means they get to charge more for money they lend. >> none of the people at goldman sachs can charge for this. liz: they can't p

lisa: is this the fed's fault? priya: i think there is a fed component.he fed ecb, boj, they are , also retreating. you have this liquidity that is coming out of the system. when you have them giving you more than 2%, you should reprice risk premium elsewhere. e.m. thingt of this is absolutely quantitative tightening. even the rate market reaction to e.m. has changed. earlier on, it was being viewed as more idiosyncratic. in the last month, the markets are saying, maybe the fed can't hike that much. i think the rate market is saying this is more than argentina or turkey, this is contagion, this is systemic. this has the chance of potentially slowing the fed hiking cycle. lisa: this is contagion, this is problematic. iain, i want to get your thoughts. you said you see opportunities and need to dig in there, do fundamental research. what are you doing with your portfolio? are you buying mexican bonds and bonds of other places? if so, is it corporate debt, sovereigns, what are you doing? iain: we are looking for the areas we like. we like areas like mexico.

inflation remains pretty contain the fed will take opportunity it can get to list the fed, to list theates, particularly with the economy growing at twice the pace but in the end, you're getting fairly close to inversion, i think if they do four more heights it will invert. while it's not the be all and end all and not part of fead fed policy mantra, they'd be paying attention to it and would not want to invert it deeply for very long. so i still suspect there's only four left. >> how inflationary a power for the feds, something to worry about? >> they would already know what the inflation impact, it's not tremendously inflationry. but the interesting thing for me is that it's a one-off. much like when australia hiked the g.s.t. in 2000, the inflation spiked up but the r.d.a. overlooked it. the fed will overlook a one-time inflation hike, they'd be more concern and the labor market and growth. we tend to think if there's 5% in tariff the fed will probably pause in december because it will create a lot of uncertainty about the u.s. economic outlook. and there's no worry about them missi

what isn't nearly as exciting, a frequent guest on fed days, one of my favorites, ex-fed governor markpassed away two weeks ago today, and we just wanted to mention that he was a wonderful guest to talk about. he was fed governor from 2001 to 2006 at 43 years old he was the leader of the american bankers association, the youngest leader ever his financial services career spanned 40 years mark olson, thank you for joining us with your opinions on so many occasions. we'll miss you our condolences to your family carl, back to you. >> always a gentleman, rick. very sad news. thank you. >>> "squk awalley" is back in a couple of moments. alerts -- wouldn't you like one from the market when it might be time to buy or sell? with fidelity's real-time analytics, you'll get clear, actionable alerts about potential investment opportunities in real time. fidelity. open an account today. fidelity. this is moving day with the best in-home wifi experience and millions of wifi hotspots to help you stay connected. and this is moving day with reliable service appointments in a two-hour window so you're u

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there would be bigger deflation and yet here we've seen as janet yellen recently suggested that the fed should create future booms right that the fed to deal with any crash they should promise market participants which eighty four percent of stocks in the us are held by the top ten percent but that they should promise market participants a boom and is this a sort of melt up are we seeing an irrational exuberance again are we see is this what the fed wanted is this an engineer and you know you do have amazon you do have apple worth a trillion dollars there are several other heading towards that as well. you know this it looks like a mouth up you see in the chart that that chart looks like a melt up right well i mean a flashing lights is just that the dollar is going down in value but the dollar's been moving up gold to moving down so you know from the classical economics perspective we don't see inflation well we see is financial engineering and. money being printed and given to people who support the politicians who print the money i mean that's that's either inflationary deflationary t