it is a challenge to talk about what they meanations and why th rate is meaningful to the fmoc thosellenges in normal times. what he will end up having to do is explain how they are doing their job in the face of criticism of the fed and i know a lot of the members of fmoc, these are people who are really focused on their job. they are trying to do it and not be responsive just to what they are hearing from shouts from any corner, not just the white house. but that is not broadly shared there are people on the margins, market participants, i see it when i'm in new york, people who think that the fed is going to -- is to some degree being led by the bully pulpit shouting from the white house that is not a great place for the fed to be. i know chairman powell is going to try to be as consistent with h previous comments as he can, but it is not an easy job that he has. >> thank you very much, tony fratto we appreciate the thoughts as always >>> a big analyst call just crossing now on dow component 3 m. analysts downgrading to a sector perform or more neutral rating from a prior buy or o

louis and director of research, but what it says is that if you look back at 2018, you had fmoc unanimousvery move the fed made and it might be good to have actually some different perspectives and thoughts on the economy on the fmoc economy if you believe like i do that they made some grave errors in 2018, i believe having some dissent will be good. >> thank you very much for taking the time to chat with us. brett ewing from first franklin financial services all morning we have been talking about the huge radical transformation plan announced by deutsche bank over the weekend i want to flag that the shares have now turned negative on the session down .7 percentage points up 4% at one point could be a bit of profit taking after 6% jump last week. >>> that is it for our show today. i'm joumanna bercetche. >> i'm julianna tatelbaum. thank you very much for watching (client's voice) remember that degree you got in taxation? (danny) of course you don't because you didn't! your job isn't understanding tax code... it's understanding why that... will get him a body like that... move! ...that. yo

and jay powell and the fmoc are expected to cut rates for the first time since 2000 eight.ill also publish its final that of economic forecast before the october brexit deadline. on friday, watch out for the u.s. jobs report. earnings forecast to gain 3.1%. has called for hong kong to punish those behind violent protest. an rare briefing follows eighth straight brief -- straight weekend of protest. talk us through the weekend events. something weekend is very new. the dispersion of protests of across the city. protesters ataw the airport. on saturday, they were in the new territories. on sunday, they had a protest that here in central spread out to causeway bay, a main shopping center about a telemarketer -- about a kilometer to the east. last night's protest was dispersed with a lot of tear gas. one of the things that have happened is we are seeing a lot of unpredictability from the protesters. the police do not really know where exactly they will be going and what they will be doing when they get there. it makes their job very difficult. i think that is why we are seeing

when we do this at the fmoc we always have presentations that call out those disparities. and ultimately if we were to face another -- your question really is do we have the tools to address another severe downturn. we don't expect a severe downturn. if we had one we would use your tools as aggressively as we needed toto do that. that would include all the tools in our toolkit, interest rates, balance sheet and whatever else we could devise. and i do think our tools would be adequate. >> if we had another recession and interest would be lower and then cut to zero and we flounder, should we expect it will take another ten years for unemployment to recover should the people in my district expect to wait for a decade for a job. we see this shift in certain parts not just in detroit but the wayne community area surrounding the city of detroit. >> i would think not. the rumor that the great recession was the most severe in a very long time and we saw unemployment go to 10%. we hadn't seen that since the early '80s. you're starting now at 3. 7%. if you take a typical recession,

fmoc participants have raised concerns about a more prolonged shortfall, inflation below the 2% targetery: let's bring in bond veteran, the vice chairman and portfolio manager for the firm's flagship bond fund which has an annualized return of almost 9% since its inception in 1991. we are also joined by our global economics and policy editor kathleen hays. welcome both. dan, at least for today, we saw yields higher. u.s. retail sales. can this be more than a blip if we have an idea of where the fed is going this year and where the state of the economy is? dan: i think it is a blip. there are some technicals in the market every day, all the time but this was small. powell did make a point in his maybe thelking about effect of the trade war was going to be a bit more. keep an eye on that. all the more reason to expect and cut. kathleen: i want to pull up a chart because one of the things the fed has been appetizing, particularly chairman powell -- global indexes and the u.s. 10 year yield. the u.s. 10 year yield is the blue line. you can see it as backup to 2.1%. if you look at j.p. morg

they were from academic speech on 20 years of research, not potential policy action at the upcoming fmoc. will the fed take a small step or a giant leap this july? join the debate. we judge to the mliv team on your bloomberg. joining us now, viraj patel, fx & global macro strategist, arkera inc. as we celebrate 50 years of the moon landing, small step or giant leap for the fed? viraj: i think there are two twice five basis point cut coming. when i look at the rationale for the cause, let's look at what williams said. dichotomyere was some in interest-rate policy in 2018 when the fed was hiking interest rates against the backdrop of the fallen neutral rate. in effect, he is saying they ,eed to take some hikes back and maybe do a little bit more. that is contingent on the state of the u.s. economy. there is a scenario where u.s. investment is down by trade war uncertainty. that could give fuel for further rate cuts heading into 2020, and potentially qe. i think we are away from pricing in that scenario. you may see a bounce in rates before positioning for that tail risk. nejra: it is an in

>> that's my worry i think the miscommunication and the lack of focus by the fmoc on the shortened ofhe curve, what is happening there every day runs the chance of repeating december >> repeating december. so down 20% or so. >> yes, and also more importantly a complete drop-off in new issuance, corporates, abs. abs didn't come back corporates and mortgage came back, thanks god, but the one thing i will remind everybody about my banks is that, yeah, they have big volumes on mortgage but they're not making money on those loans the only loans they make money on are refinances. the purchase mortgages are dead loss. >> sounds like you are in the bunker, chris. >> i'm a credit card coal makes it go up, credit makes it go down remember that. >> what do we see on the bond side of things in what you are predicting could be a 20% in equity -- >> it will go back down below two on the ten year. >> i thought you were going to be more than that. >> i thought you were -- >> exactly. >> it is a strong bid anyway for that that's what took us back down the tube, right, remember? >> if you are a credit

in june, the june fmoc minutes for example that was written, that participants generally agreed that a downside risk was a sharp reduction in government spending and all told, if congress doesn't reach an agreement, there's a potential for $120 billion immediate reduction in federal spending for national security and a host of domestic programs would you just elaborate a little bit on what you believe, what kind of risk does this represent to the economy and how is the fed processing this risk? >> so i think that it's essential that congress raise the debt ceiling in a timely way, by which i mean, in a way that allows the united states government to pay all of its bills when and as they're do that is essential. any other outcome is unthinkable. we've always paid our bills. and it simply must happen that congress raises the debt ceiling in time to allow that to happen. the consequences of failing to do so would be highly unpredictable and no one should assume that the fed or any other agency can be relieied upon to shield our economy from the short, medium, long-term and negative cons

the fmoc is widely expected to lower rates.resident said the fed made all the wrong moves, but we will win anyway. leaders in hong kong have dismissed the latest criticism from china over antigovernment protests. a in a briefing to the meeting -- to the media, they said violence would not be tolerated. it criticized foreign interference to step contention in the city. >> some politicians and western countries have made unwarranted remarks. at the end of the day, the purpose is to stoke unrest in hong kong and turn the city into trouble for china in an attempt to contain chinese development. >> the u.s. treasury is expected to double borrowing in the third quarter issuing $33 billion in net market debt in three months through september. that is more than we saw in april. the house passed a bill last week and the senate is expected to vote in the coming days. the ims says venezuela's economic decline will reach 65%, one of the steepest climbs in any country of the last 50 years. in thel is unprecedented western hemisphere and is

they get to attend the fmoc meetings every six weeks.e minutes, christopher waller was certainly there for some of those meetings. julie shelton has some somewhat unconventional views, but again, none of the incendiary extracurricular baggage that some previous two had. these two probably have a better shot. paul: dan, to what extent do these two nominations send across the bow of jay powell? might beably less than initially imagined. again, waller is a senior official at a fed district bank. if we take a step back, one thing i learned in my years of being responsible for fed and new york is the federal reserve is essentially run by five people. the chair, the vice chair, the head of the new york fed, and two folks who are not household names. the person who runs the system open market desk at the new york runs thethe chap who powerful staff at the division of monetary fair -- fed. divisions at the fed hq are referred to as barony. right now he is enormously influential. these five people are the core of fed decision-making. others manne

. >> we are waiting for the fmoc drift to kick in that's the tendency for the market to move up in theay before the fed meeting defensive tone today the consumer staples up, proctor is up, coke is up. defensive here, as i mentioned, wreaths doing well semis, growth indicator, slightly on the weak, industrials also slightly weak cummings, caterpillar, global industries a little bit on the weak side. transports within the industrials, rider had lowered guidance the trucks generally on the weak side halfway through earnings seasons. more than 250 companies reported in the s&p 500 76% have beat. about ample for the last four quarters let's say thepgs things are not unusual. flat is the word i have been using more than a month. flat is essentially what we are seeing that is better than dire predictions we had two months ago in may when they said numbers were going to come down because of global growth we don't have clarity on global growth and we have central bank back stop. when i say flattish. here's what it looks like for 2019 earnings numbers. basically up 1.6%, flat, .6 down .6% this i

listen >> many fmoc part pants judged at the time of our most recent meeting in june that the combinationour factors strengthens the case for a somewhat more accommodative stance of policy >> i think that a little more accommodation would be helpful for ensuring that we confidently get above 2% >> research shows don't keep your powder dry, that is move more quickly to add monetary stimulus but not long after that, fed comments said that it was academic and not about potential policy action. >> we didn't ease at the june meeting, but signals were that we were highly likely to ease at the july meeting so now that is priced in the market so if you try to take that out, i think that it would be very difficult at this stage. >> right now it is all on the up side, but i think as long as the economy is doing well, if that continues, we don't need accommodation. >> nine have spoken in favor of a rate cut five suggested that they are against a rate cut >> it will be a good debate inside that room next week joining nous tw to discuss, stephanie erickson and also kevin nicholson. welcome to both of