former federal reserve chairman ben bernanke is my special guest today. first weave have the big headlines from wall street to main street and of course it was a busy week. reporter:ed dow had its worst day in 8 months, dropping 400 points to wednesday. and the worst day during the trump presidency. stocks did bounce back at the ends of the week. sr the a & p and nasdaq all -- the s & p also finishing down. political turmoil in washington can delay the president's plans for tax reform. the white house disclosing a plan that would balance the tbhijt a decade, but it would entail deep cuts to many programs including food stamps and medicaid. a global cyber attack left businesses, banks, scrambling to protect its files. one company caught up in this, the media giant disney. the hackers threatening to release "pay roots of the caribbean." the ceo says they refuse to pay ransom. maria: some investors are wondering if the economy will be strong enough for the federal reserve to raise interest rates two more times this year. joining me is the former federal rese

the federal reserve releases minutes.e watching and listening to "bloomberg real yield." ♪ ♪ jonathan: from new york city, i'm jonathan ferro. this is "bloomberg real yield." it is time now for the final spread. president trump makes its first -- makes his first overseas trip, which includes nato and g7 meetings. the fed will come out with meeting minutes from its last meeting, and we will of course get a g7 summit a little bit later in the week as well. back with us for our roundtable, matt hornbach, lisa abramowicz, and jim barrineau. matt, next week, we had the opec meeting, and the fed minutes. e d minutes, what are you looking from that? matt: we are looking for more details on w the fed intends to wind down its balance sheet. will they go at treasuries and mortgages? will they cease reinvestment on only mortgages? we will get more details. hopefully, we will get more details on the pace at which people are expecting that balance sheet to come down. lisa: everyone is focused on the balance sheet. perhaps they will be

when you factor in your unfolding view from the federal reserve, do you see a complacency from the federaleserve and the amount of moves this year? james: i do not. the key asset nice and emerging markets -- asset price in emerging markets is the u.s. dollar. we have been somewhat aggressive with the u.s. dollar. a weaker dollar historically is always great for emerging markets. this is a virtuous cycle period where inflows are coming in, currencies are appreciating, central banks are lowering interest rates, growth prospects are improving, so we are in a good spot. jonathan: lisa. lisa: i am struck by the optimism not reflected in some of the numbers from the first quarter. i am looking at the household debt numbers we saw yesterday, showing consumer debt has reached an all-time high, $12.7 trillion in this chart on the bloomberg. this is important at a time when we see the liquid sees and loss of increases -- liquid sees -- delinquincies. this will signal slower growth going for it. this should factor into expectations. jonathan: let's get to the president of the st. louis fed. the finan

let's check in with michael mckee who is sending by a they federal reserve in washington. michael? michael: no surprise. no move today. federal officials cut their basic interest rate unchanged. they did technology obvious. the economy has slowed in recent months. they go on to stay in their statement that that is going to change. and growth during the first quarter is likely to be transitory. the economy remains roughly balanced. there is a significant change to the inflation assessment. it has been running close to the committees 2% longer run objective. the statement says although they acknowledge the decline in core inflation in march. the slowdown on consumer spending which they say rose only modestly, but supporting their view is a temporary cause, the statement notes the fundamentals underpinning the continued growth of consumption remain solid. and business fixed investment firm. what is not in the statement is any hint of future policy moves. and there is nothing on balance sheet policy. we go back to the idea of being data dependent if the fed is going to move in the futur

the federal reserve kicks off its two—day meeting. will be looking for clues on how many more us rate hikes could be in store this year. that is the same day that tech giant, apple, will give its financial report card. facebook follows the next day. and on thursday, the australian prime minister, malcolm turnbull, meets us president donald trump in new york. what can we expect from this busy week? i asked a guest what he is expecting from japan and china. the relationship between japan expecting from japan and china. the relationship betweenjapan and china at the political level is a very sensitive one. there are deep roots to that and i won't dwell on them. but i think this is symbolic of xi jinping moving to calm things down in the neighbourhood. this is a good time forjapan and china to have constructive dialogue on something other than north korea. so, hopefully, you know, it is a positive for the region, and, of course, china being such an important economic engine for the world, hopefully it is a positive for the economy of the

th the federal reserve bank is pretty much okay on in part with increasing the interest rate.i think when you look at the dollar today we have not seen any big move in the dollar. and then it is consolidating. i'm less concerned about that the euros just strengthened by a penny in the last i checked. to the federal reserve features and where they bet on the chances of a rate hike in june it's a 83% right now. let's just talk quickly about stocks and how they might be affected. >> clearly looking at that opec's numbers that are coming out we clearly have been watching that. we are heading into a long weekend. with a lot of economic data coming next week. we've always looked at this dependent number. they were close to sealing the deal to extend the output cuts. they do believe that. it will be extended by nine months. they absolutely had that. he does is not stand a chance. what is quite intriguing right now. you are stuck for six months and nine months and 12 months. set the question that we are looking for. opec often allies by the way. that is very important for us. that the

we will get insight on the federal reserve policy from a former federal reserve governor, that is kevinarsh. that is next. this is bloomberg. ♪ vonnie: live from bloomberg world headquarters in new york, i am vonnie. mark: counting it down to the european close. vonnie: let's get to the hoover institution and california, they are hosting their economic conference. michael mckee is there with a special guest. >> thank you. kevin warsh was the member of the federal board of reserve governors until 2012. he is a member here at stanford. thank you for joining us. mr. warsh: thank you for being here. >> you are on everyone's shortlist to be the next chairman of the board of the federal reserve. mr. warsh: no warming up with you. we are here to do a serious big picture study of monetary policy, and you are going to the media. i did 10 years of hard time. i did six years with the financial crisis and government. i did plenty. my guess is the president makes his decision six months from now. more important than who is running the fed is what does the decision do. what i'm going to talk about is

they wanted to see the reaction from the federal reserve about this really low growth numbers., that is not very good. we see the fed's interpretation that this isa the fed's interpretation that this is a blip in the system. what the fed has emphasised as some of the good things happening in the us economy, namely the labour market, that we are seeing strong climate numbers. the second thing that people will look for is if we don't see a rate rise now and we're pretty much expecting two rate rises from now until the end of the year, when will we see the next one? the fact that the federal reserve is downplaying the bad growth numbers and playing up the good, solid numbers we are seeing from the labour market, it is possible we could see a rate rise come as early as nextjune. could see a rate rise come as early as next june. we have 20 seconds, any response about the trump effect? i cannot answer that because i have not seen anything like that, but i can't know for sure. thank you very much. no doubt soon people will begin to hear exactly what it is, about what mr trump might be

your view onor in the federal reserve, looking at em's pacific lee, -- >> the key is the u.s.ollar. when you take the reflation trade out, as matt has been discussing on the treasury market, we have also done so aggressively in the u.s. dollar. a weaker dollar historically is always great for emerging markets. a virtual cycle kind of. in emerging markets, where inflo a coming in currencies are appreciating, growth aspects are improving. we are in a pretty good spot, actually. optimismtruck by the not reflected in some of the numbers we have seen in the first quarter. i am looking at particular -- in particular at the household numbers we saw from the fed that showed consumer debt has reached an all-time high, $12.7 trillion that you can see on this chart. this is important, especially at a time that we are saying .elinquencies in auto loans if it does not signify some kind of broader economic demise, it certainly will signify slower go -- slower growth going forward. this should factor into people's expectations. thethan: let's get to what president of the st. louis fed said.

if we are below what the federal reserve signaled as what is likely to be full employment, why on earth are we not seeing? faster wage growth? a quarter of the jobs generated last month was the done in leisure and hospitality. that is a x or sector and that helped hold down the overall wage gains. we expected to see some weakness in this month around the pace we saw, 2.5% from year ago. we are set up well to see reacts elevation as we move forward -- re-acceleration as we move forward. run weoved out of the 2% were stuck in almost the entire recovery, we moved out of that last year and a little bit the year prior. now the move is closer to 3%. we will see that by the end of the year but we need to see it to believe it. vonnie: earlier it was written that the labor market is getting busted tighter than a lug nut. is the labor market starting to get tight? diane: it is getting tighter, and even though the participation rate ticked off of it, we saw a moving up in key areas. even teenagers saw a little bit of an uptick in participation. that is assigned you are starting to see them show up

the pce will be the data of choice for the federal reserve. that comes on tuesday.terms of data sweeps, it's a big week. is this phil or kill in terms of the reflation story on the pce for you? data, ink all of this don't think any data is fill or kill these days. i think they look at the broad spectrum of things they can. economists in general do that nowadays. we get much more data points, we look at the data as well, that the reality is the u.s. economy does seem to be recovering well. we are seeing people more confident and that is going to turn itself into the inflation as we get that shortage of jobs coming through. i think a lot of people need to be watching the average wage and how that is rising and whether that's continuing to rise because we still have the feeling that there are people at the edge of the workforce that haven't come back get that could come back that's going to remain a concern for the fed, as well. >> that comes tech to the discussion of does the full employment number, where is the ever-changing number? one thing that struck me was the l

former federal reserve chairman ben bernanke is my special guest today. first weave have the big headlines from wall street to main street and of course it was a busy week. rerter:ed dow had its worst day in 8 months, dropping 400 points to wednesday. and the worst day during the trump presidency. stocks did bounce back at the ends of the week. sr the a & p and nasdaq all -- the s & p also finishing down. political turmoil in washington can delay the president's plans for tax reform. the white house disclosing a plan that would balance the tbhijt a decade, but it would entail deep cuts to many programs including food stamps and medicaid. a global cyber attack left businesses, banks, scrambling to protect its files. one company caught up in this, the media giant disney. the hackers threatening to release "pay roots of the caribbean." the ceo says they refuse to pay ransom. maria: some investors are wondering if the economy will be strong enough for the federal reserve to raise interest rates two more times this year. joining me is the former federal reserv

jonathan: for em more broadly, is it a favorable environment from the federal reserve?hen you factor in your view on the federal reserve, looking at em specifically, do you see a complacency? jim: no, i do not. the key asset price for us in emerging markets is the u.s. dollar. when you take the reflation trade out of the treasury market, we have also done so aggressively in the u.s. dollar. a weaker dollar historically is always great for emerging markets. this is actually a virtual cycle kind of period in emerging markets where inflows are coming in, currencies are appreciating, central banks are lowering interest rates, growth prospects are improving. we are in a pretty good spot, actually. lisa: i am struck by the optimism not reflected in some of the numbers we have seen in the first quarter. i am looking in particular at some of the household debt numbers we saw out yesterday from the new york fed that showed consumer debt has reached an all-time high, $12.7 trillion that you can see on this chart. i think this is important especially at a time that we are , seeing

former federal reserve chairman ben bernanke is my special guest today. first weave have the big headlines from wall street to main street and of course it was a busy week. reporter:ed dow had its worst day in 8 months, dropping 400 points to wednesday. and the worst day during the trump presidency. stocks did bounce back at the ends of the week. sr the a & p and nasdaq all -- the s & p also finishing down. political turmoil in washington can delay the president's plans for tax reform. the white house disclosing a plan that would balance the tbhijt a decade, but it would entail deep cuts to many programs including food stamps and medicaid. a global cyber attack left businesses, banks, scrambling to protect its files. one company caught up in this, the media giant disney. the hackers threatening to release "pay roots of the caribbean." the ceo says they refuse to pay ransom. maria: some investors are wondering if the economy will be strong enough for the federal reserve to raise interest rates two more times this year. joining me is the former federal rese

is the federal reserve about to boldly go where no central bank has gone before? those stories and more tonight on "nightly business report" for tuesday, may 16th. >>> good evening, everybody, welcome. the retail slump isn't letting up. it's been one of the defining trends of the market this year. today the turmoil was evident, although there was a bright spot. first, the retail rout. not even tjx was immune from the downswing. the parent company of home goods and t.j. maxx reported weaker than expected revenue and issued short guidance. dick's sporting goods saw sluggish sales in the most recent quarter and said its revenue outlook remains week. staples no better, the office supply store missed estimates because of weak demand for technology products, ink, and toner. and route 21, the teen retailer, plans to close about a third of its 1200 stores, many of them in shopping malls. as for the shares of these retailers, all fel in trading today. >>> after the closing bell, teen retailer urban outfitter missed estimates siting high markdowns. shares were volatile. >>

the designation grants the federal reserve dfederal reservo management authority over such institutions exposing huge swaths of the econom economies e federal government's production and gives them a competitive advantage. financial choice act to designate the cities going forward. the financial institutions and financial well-being of consumers and societies therefore the plan imposes the toughest penalties in history for the financial fraud and deception. the reform plan has to overrule that made capital markets less liquid which was even confirmed by the recent federal reserve report. in addition, they've made the markets were fragile in underlining the financial stability. financial choice act includes provisions to unleash opportunities for economic growth including numerous provisions that will help foster the formation of the job creators with regulatory relief. we will never again bailout of wall street bank, period. the big bank bailout is over. [applause] for anyone that engages in fraud and deception, tough penalties await the gang you're due process rights will be restored a

investors brushed off the housing data and the lousy retail results and instead looked to the federal reserve and its possible plan for interest rates. we'll have more on that in just a moment. >>> by the close, the dow jones industrial average had advanced 74 points to 21,012. nasdaq rose 24 and the s&p 500 added nearly six. >>> the white house budget director is warning that the government could run out of cash sooner than expected. mick mulvaney says that tax receipts are coming in slower than expected. so here's how it works. the government spends more money than it brings in, and it borrows to cover the difference by issuing debt. but there is a limit, which is why the treasury secretary urged lawmakers today to increase that limit. >> i urge you to raise the debt limit before you leave for the summer. it is absolutely critical that where we spent money, that we keep the credit of the united states as the most critical issue. >> in the past, republicans have tried to pare debt limit increases with spending cuts. >>> most federal reserve policymakers say an increase in interest rates is c

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the federal reserve released its u.s.t report on the economy at 2:00 eastern. colleague tom keene sat kaplan.h robert they spoke at the council on foreign relations here in new york. >> somebody has been observing the fed now for 30 years. that's me. useful.it's very because it gives me pretty good idea about what every participant around that table is thinking. when there are differences it give us a bases. my own view just my dot has been gdp growth. this year, would be between two percent.ter unemployment rate will decline further. not the only employment measure i look at. i look at called u6. my own view is inflation will graduate over the next two or three years. not immediately. >> within your wonderful book on leadership, there's implied books, all these confidence. greatness of yourss of thiss district where is business investment? where is the confidence to move forward? let me start with a mapping. people thate the you used to talk to at hbs, they can't figure out -- >> let's take the first part. now iss confidence right high. there's a lot of busine

we start off with the us federal reserve and its meeting in washington on tuesday.is not expected to move interest rates but investors will watch for clues about the next rate hike. there is a backdrop of political uncertainty with tensions running high between the us and north korea. i spoke to oui’ the us and north korea. i spoke to our guest in sydney to see what he was expecting. two more rate hikes this year are on the cards. what they have become good at in the last few years is signalling its intention down the road. there has been an interesting shift away from talking about just the been an interesting shift away from talking aboutjust the rate hike to actually talking about its balance sheet. we will see a lot of speculation today and in the next few weeks about what it is going to do with this massive balance sheet worth about $1 trillion, and how it will unwind that. if we think about this year, a rate hike at the start of the year, one in the middle, one near the end, that is three we think will happen this year. but on the table in the second half of t

the federal reserve would certainly be nice for john cryan to get out of the way.they are more than halfway through the major things they need to get through on the major issues, but still a lot to be done. >> let's talk a little bit about this u.k. election. campaigning begins today -- resumes today after pausing to respect to the victims of the manchester bombing. a new coal conducted shows a dramatic narrowing in the race with conservatives on the 43% of the vote and labor on 38%. >> i think there is real evidence to suggest there could be some sort of loosening in that power of theresa may and that comes back to the -- she had about a week ago about the funding of care for the elderly. that was a very unpopular measure. people are saying -- that doesn't bode well for her status which -- status which he goes into negotiations for brexit. ♪ ♪ jonathan: you are watching "bloomberg best." i am jonathan ferro. president donald trump visited saudi arabia last week and it coincided with a major business conference. a host of a listers defended on riyadh to take part i

the federal reserve would certainly be nice for john cryan to get out of the way.they are more than halfway through the major things they need to get through on their legal issues, but still, a lot to be done. >> let's talk a little bit about the u.k. and the u.k. election. campaign resumes today after pausing to respect to the victims of monday night's manchester bombing. a new poll conducted shows a dramatic narrowing in the race with the conservatives on 43% of the vote, and labor on 38%. >> i think there is some real evidence to suggest there could be some sort of loosening in that power of theresa may, and that of course comes back to what she had to do a week ago , about the funding of care for the elderly. that was a very unpopular measure. u-turned on that. people are saying that the u-turn does not bode well for her status when she goes into negotiations for brexit. ♪ ♪ jonathan: you are watching "bloomberg best." i am jonathan ferro. president trump's visit to saudi arabia coincided with a business conference. a host of corporate a-listers. jamie dimon wa

moments, thefew federal reserve will release minutes from the main meeting.s is the meeting where officials left rates unchanged and signaled they were not alarmed by the weakness and first quarter gdp. >> we learned two things today. number one, at the may meeting, they were on course. not committed, but on course for a june rate hike. number two, there was wide agreement they should not cease from one month to the next the reinvestment of assets on the balance sheet when they begin to reduce the balance sheet. the existing eight -- the end -- the interesting thing is we are balancerogress on the sheet. the minutes say almost everybody agreed on that and the other thing they agree on is the idea of caps or monthly limits. they want it to be regular and predictable and they also want it to be -- they want to taper it. cany: can you -- jonathan: you unwind for a half billion dollars to some extent and make it boring? , do itmake it a nonevent very slowly and i think they end up doing that. jonathan: opec extended oil production cuts for nine more months after

sta rts turn to how the federal reserve starts to unwind its balance sheet. of bonds to try to underpin the economy. it has two let them role off an reversed that easing policy. in the meantime you have the snp closing on a high, the ftse 100, meantime you have the snp closing on a high, the ftse100, it would suggest markets are on the up? yes, markets are looking at not rising interest rates, but the reason why interest rates, but the reason why interest rates, but the reason why interest rates are rising. the reason why the feds feel relaxed about pushing rate is because the global economy is picking up pace and that is what markets are focused on. for now, thank you. retail shopping disasters, have a ponder on back. still to come... box office on a budget. i meet the man who makes some of hollywood's biggest movies, on a tiny budget. and without the big money pressure, jason blum tells me it means he can make a better movie. you're with business live from bbc news. bicycle and motoring chain halfords saw a 10% drop in profits, despite revenues rising 7.2%.

and this isn't even expected to be the big the federal reserve one.ing into this, but also the doj and the doj is the one investors are really focused on because that could be the biggest fine, and the more concert one-to-one given that deutsche bank is already operating under a deferred prosecution agreement. so, that is the one people are focused on. the federal reserve would certainly be nice for john cryan to get out of the way. they said they are more than halfway through the major things they need to get through on the ir legal issues, but still, a lot to be done. >> let's talk a little bit about the u.k. election. campaign resumes today after pausing to respect to the victims of the manchester bombing. a new poll conducted shows a dramatic narrowing in the race with the conservatives on 43% of the vote and labor on 38%. , >> i think there is real evidence to suggest there could be some sort of loosening in that power of theresa may and what she hadck to to do a week ago about the funding of care for the elderly. that was a very unpopular measur

this adjustment in terms of whether the market is gravitating toward federal reserve, is the federal push things against? >> probably not. probably a three rate hike this year. i do not know there is a cabinet -- appetite to speed up the process given it sounds like officials want to get it going and not be raising rates exactly . it looks like three is a reasonable asked -- estimate is year. jonathan: you say 24 hour news cycle maybe makes too much out of it. what may or may not do over the next several years? what everything is all about if you are running an investment business and making those kinds of decisions. i have not been a big fan of quantitative easing. i think the fed has been too easy for the last few years and it has can should be to two hour slower than expected growth. rates create a sense of urgency. lack of rates don't. there has been no penalty for delay. was supposed to make the investment on monday and then i say let's not make a total six months from monday, with zero interest rates, it ain't very high. i think getting our rates closer to normal, in the world

the federal reserve would like to move it higher. was a good piece of data friday to indicate that may be the case. it is the employment cost index. since it is the best 2007. they will show probably a 4% .ain year-over-year seem a bit of underway. nothing big we still have the productivity gains to boost demands and services. as you look at the market, are there still signs of complacency around? >> with the break even on the 1.9%, that isar the market saying the fed will be short of its goal. almost a half point lower. we would suggest the inflation rate likely up 2%. we are basically given up on the 3.5% growth? it is very difficult to achieve because there are not as laboruman beings in the force. a lot of people are retiring. productivity would typically grow at two. it looks like the low twos are still well intact. optimistic about it, especially corporate profits. new don't but against the normal. jonathan: we talk about the inflation component. bonds, 30 basis points. do you have to look at the economics versus a fixed income

. >> deutsche bank has agreed to pay $41 million to settle federal reserve allegations that its u.s. ations fell to maintain adequate protections against money laundering. the fed said the price fell short of complying with the bank secrecy act that requires lenders to help federal agencies prevent illegal transactions. the regulator imposed a cease-and-desist order on the bank that requires it to address unsafe practices. the ireland has fired the starting gun for the initial public offering of allied irish banks, laying out a plan to sell to 5% of the nationalized lender. the government plans to sell the stake in a share offering in london and dublin with terms to be set in. according to previous government estimates, the cell may raise about 3 billion euros. manchester united for premier league season has taught the list of football wealthiest clubs. wanted to 2013 that kpmg said value has risen to 3.1 billion euros. clubsurvey 32 leading with a combined value of almost 30 billion euros. 30 that comes from three teams. that is your bloomberg business flash. manus: i want to ask you

the federal reserve reports that once dodd-frank qualified mortgage role fully kicks in, an estimated one-third of black and hispanic borrowers will be denied mortgages due to its rigid debt to income ratio, yet many on the left remain silent. university of maryland researchers in a september 2016 report found found that while quote dodd-frank aimed at reducing mortgage fees and abuses against vulnerable borrowers, it's leading regulation actually triggered a substantial redistribution of credit from the middle-class households to wealthy househol households. as result of dodd-frank regulations, they said middle-class held folks not only did not obtain cheaper mortgages but were cut out of the mortgage market altogether. but again, i suspect you already know this. it is no surprise that many of you have told me that qme doesn't stand for qualified mortgages at your bank. stands for quitting mortgages. regrettably that's what many of you have had to do. that's just wrong. and you know what else is wrong? anytime you have to lay off a loan officer to make room for a compliance officer.

-u.s.facing the federal reserve. is the s&p beginning to split? arriving in vienna as opec cuts oil production. good morning, everyone. this is "bloomberg surveillance ." i am francine lacqua in london.

how that a conversation with bill gross on your federal reserve system?cine: this is the city of london, tom's favorite landscape. we have a way of naming our landscape in the u.k. the brexit secretary has flatly rejected a reported no of his much -- bill of as much as 100 billion euros. he said he will walk away from the bloc if provoked. the game at its best, people threatening to walk away. tom: it is off our radar. i am good -- glad we continue to push the brexit dori. -- story. after the election on sunday, on we go to the united kingdom. taylor: we are sticking with grexit, -- brexit, tough talk on both sides. david davis has a warning for the european union, he is willing to walk away without a pay, and the u.k. will not $110 billion. the brexit negotiators says the e.u. wants to reach a deal but warned the clock is ticking. jpmorgan is preparing for the u.k. to lose access the single market and they plan to move hundreds of tankers from london -- bankers from london to frankfurt and other places. begin will probably relocation next year. jay clayt

the federal reserve bank of san francisco president john williams says three rate hikes this year make sense, because the u.s. economy is close to the twin goals, and the central bank needs to aim for growth that is "not too hot, not too cold." >> with our attainment of our goals close at hand, it is more important than ever for monetary policy to work toward the goldilocks economy. not too hot, not too cold. we want the porridge to be just right. matt: joining us for more is mark cudmore. mark, is the amount of tightening underpriced by the market? overpriced? or is it just the right amount? >> i think it is nearly the goldilocks price. we're definitely pricing in one hike in june. the comments back to that up. it's the next one the market is still debating. the fed are guiding toward three hikes, but it's important to remember that three hikes will be more than the whole previous decade put together. so i can see what the market is taking a little while to fully grasp in and price this hike, even if it is likely to come. manus: looking sharp this morning. like the blue and white coll

later, in about a minute we will get the last meeting of the federal reserve.lle: we will move on, stephen. the price of oil has continued to rise. stephen: we're closer to a deal to expand cuts to supply to another nine months. ministers in ecuador support the plan. producers agreed last year to cap production in an effort to boost oil prices. the oil markets, international benchmark has risen .2% to over $54 a barrel. rochelle: next in the u.s., the white house has unveiled donald trump's budget, stephen. trillionit is a 4.1 dollar plan that includes massive cuts to spending on social welfare as well as reduction in taxes. it comes with a 10% boost in defense spending, already announced by donald trump, and $1.6 billion to fund the wall on the mexican border. also massive cuts to education and health care spending would eliminate the u.s. budget deficit in 10 years. the plan is likely to face fierce opposition on capitol hill, though, including from a public is good listen to senate majority leader mitch mcconnell. president'sll: the budget, as we all know, i

keene. -- federal reserve robert kaplan speaking to bloomberg's tom keene.at lineup of guests to reaction of u.s. payroll reports. friday withng up on the countdown to payrolls. from new york, you are watching bloomberg tv. ♪ alix: you have dallas fed president robert kaplan taking the spotlight with tom keene in new york. recent headlines, n saying there is not that much left in the labor market but he sees global overcapacity creates a headwind for inflation, but inflation will rise slowly at 2% over the next years. with us is james sweeney and david katzen. where do you see slack right now and where is it most, james? james: there are two sources of slack. neither of them are really slack in the sense were slack means potential to restrain inflation, even when the economy is going well. one is the have an older population and it basically is baby boomers started turning 65 in 2010. if you adjust things like the ratio of total employment to the population size and the aging of the population, we are back at the levels of the last cycle, 2005-2006 cap level

lauren: what message does that send to the federal reserve? >> they have to stay on track. i don't think the height this week. this comes on the back of the soft gdp number and other numbers have been a little bit on the weaker side. june in september they will hike. tumor hikes this year. nicole: chase chief economist, thank you for joining us. tranter hacker has released upcoming seasons of orange is the new black. >> just like the hamptons only horrible. lauren: the hacker who goes by the name of the dark overlord posted the first 10 seasons and the pirate bay, a popular filesharing site. they were stolen from a post production company late last year trying to ask toward money from netflix. the fbi now investigating. the hacker threatened to post under this tv episodes from other networks including fox, nacchio and abc. netflix shares have been a terrific year of more than 62% in the past 62 weeks. nicole: true via media is that of bidding war. some of the nation's biggest markets and sources say 20th century fox is talking to private equity firm blackstone. fox had 28 t

the federal reserve wrapped up its latest policy meeting and decided to leave interest rates as is, but the fed signaled it expects to raise rates later this year. in a statement the federal reserve board of governors noted the economy slowed sharply in the first quarter but expects things to pick back up. analysts still expect two more rate hikes this year, the next one possibly in june. >>> well, the news from the feds send bond yields and bank stocks higher. the dow gained 8 points, the s&p added 6 and the nasdaq fell 2. >>> puerto rico has returned to federal bankruptcy court to protect itself from creditors. puerto rico's governor turned to negotiations on spending and new taxes failed. puerto rico's defaulted on several of its bonds and has a $73 billion public debt. >>> and facebook says it's hiring another 3,000 employees to review questionable content. this is a response to recent murders, suicides, and other incidents broadcast live or posted later on the site. facebook already has about 4,500 people viewing posts. videos and posts that glorify violence are against facebook's

nicole: the federal reserve indicated central bankers were not in a hurry to raise interest rates. hike raised next month? our next guest will weigh in. lea: make sure you grab your relative if you're anywhere close to where we are. above the runway for the memorial day weekend. senior meteorologist janice dean will have your forecast. nicole: seeing green on the board this morning. dow futures higher by 82. as to be higher by eight, nasdaq higher by 21. a look at a right now lower by 41 cents at $50.95 a barrel. you are watching "fbn:am," your first look at morning markets and breaking news. stay with us. ♪ next! come on, come on. i haven't got all day here! it doesn't come with peppers! you know you told me you wanted mustard. back of the line! excuse me! what! great sandwich. thanks. ♪you didn't have to be so nice♪ get outta here. ♪i would have liked you anyway♪ ♪i would have liked you anyway♪ and sometimes i struggle to sleep at night,blind. and stay awake during the day. this is called non-24. learn more by calling 844-824-2424. or visit your24info.com. nicole: 5:45 a.m. in ne

although wages grew compared to a year ago, the federal reserve wants them to pick up even more. hampton pearson has more on the employment picture. >> reporter: from 79,000 jobs in march, more than doubling to 211,000 workers added to payroll last month. at 4.4%, the unemployment rate is the lowest in a decade. >> the real story here is the tightness in the labor markets. it didn't really show up this month in the year over year figures. the base effects are pretty strong there. but the fed is going to pay attention here. >> reporter: there are still more than 5.5 million job openings nationwide, with a shortage in many skill professions triggering competition and higher wages, and a mini boom for job creators. the porter group, headquartered in columbia, maryland, specializes in corporate clients from new york city to the washington, dc area. a spike in business now has the firm getting 2400 new applicants per month. the median salary and benefits for those who get placed, around $85,000 a year. >> it's really a war for talent, if you will, going on right now. and people, at le

the federal reserve releases its beige book, an anecdotal look at economic conditions across the country. a report on pending home sales will tell us how many homebuyers signed contracts in april to buy existing homes. we'll also get the latest read on mortgage application volume. that's what to watch for on wednesday. >>> it was the unofficial start of summer. but for hollywood, the usually hot movie weekend was unseasonably cold. julia boorstin has more on tinseltown's box office blues. >> everybody is talking about you guys. >> reporter: this weekend was the worst memorial day in 18 years at the box office. despite starring "the rock," this film disappointed with $27 million in the u.s. since it opened wednesday. >> it's a disappointing start, of course. when we see a weekend like this, a prime movie going weekend, not live up to the expectations, we all get a bit nervous. >> reporter: disney's "pirates of the caribbean: dead men tell no tales" won the weekend but had the lowest u.s. opening for all but the first of the "pirates" film. the opening overseas was bols r bolstered by chin

as we've been reporting, investors will be watching for information on how and when the federal reserve unwinds its bond holdings, because the effect could be similar to an interest rate hike. >>> winding down the fed's bond portfolio would eliminate a major source of demand for long term treasury and other securities. an asset class warren buffett says as a terrible investment choice over stocks. here is what he told becky quick about bonds in an interview we aired for you yesterday. >> anybody that prefers bonds today to stocks is making a big mistake. i've been saying that year after year after year. >> dan heckman, senior fixed income strategist at u.s. bank wealth management, is here to discuss what you should do. a lot of people idolize warren buffett, dan. they think he knows a great deal, and certainly he does. and they might well think, well, gosh, maybe i should sell all my bonds. should they? >> no. we don't believe they should. obviously we have tremendous respect for mr. buffett, he's the greatest investors in equities of all time. we don't think it's an all or none type of

this is bloomberg. ♪ for the: decision day federal reserve.n at 2:00 eastern time with economists expecting no change in rates. the treasury watching as they are studying the cost of benefits of ultralong bonds. still with us is paul hickey. when the statement comes out today they forgot to tread the fine line to his knowledge the weaker data we have seen and keep june alive. >> that's going to be the most interesting part of the statement. you have odds being priced with the hike. officials suggest some of the weakness is temporary. that there iss some transient element to it. we will have a couple of data points. end of have payrolls the this week and on may 12 you will have cpi and individual sales. jonathan: there is a narrative that they are on autopilot and they are not data dependent at all. they give us the balance sheet at the end of the year. what will stop them from coming on autopilot and pulling back from that? i don't necessarily agree they are on autopilot. the bar for them to move away from that plan is somewhat high. convicted

on wednesday, the federal reserve releases its minutes from the may meeting when the committee decided to keep interest rates unchanged. on thursday, members of the opec oil cartel will meet to decide whether to extend a production cut deal. that's what to watch for next week. >>> a record number of americans have auto loans. according to data released this week by the new york federal reserve, 107 million americans are financing their cars with loans. that's more than 40% of the adult population. and it's up from 80 million back in 2012. car sales in 2016 hit an all-time high. and today, the number of auto loans outpaces home loans. >>> which means demand for gasoline. but it's been weaker than expected this year. that is expected to change. the energy industry is expecting record demand this summer as the economy grows and gasoline prices remain relatively cheap. the u.s. gasoline market accounts for roughly 10% of the global oil consumption. >>> earlier this week, we told you about the art auctions happening in new york. we also told you that the sales were seen as a test of the mar

historically, the federal reserve bank has offset some of this by expanding the money supply to meetthe needs of trade, and they've created enough liquid ditty so that the net government borrowing has been 1.4%. but now they've quadrupled their balance sheet with all of the monetary easing programs, so when interest rates rise, banks are holding over $12 of reserves over $1 they're required to hold. the fed is paying them interest so they've really turned these reserves into a treasury note, a treasury security. but if we get a full-blown recovery, interest rates start to rise, banks are going to start to lend. and when banks start to lend, the money supply's going to start to grow. and so despite all the fed's reassurances about all the things they can do, they can sell securities, they can pay higher interest on deposits, they can let the securities they hold mature on their balance sheets, they can borrow against the securities with reverse repos. all of those things have the same thing in common, and that is they're all competing with a private sector for available capital. when