when i first joined the fomc, our policy rate was still below 1%. in the three meetings since, we have moved expeditiously by raising rates 75 basis points at every meeting. as we move forward in these uncertain times, policy should remain focused on returning price -- on restoring price stability which will set the foundation for sustainably strong labor markets. with inflation running well above our 2% goal, reached restoring price stability will likely restore ongoing wage hikes until we are confident that inflation is firmly on the path toward air 2% goal. at some point, as we continue to tighten monetary policy, it will become appropriate to close the increases while we assess the effect of our accumulative tightening on her he economy and inflation. in any case, the path of policy should depend on how quickly we make progress toward our inflation goal. in sum, inflation is too high and we will keep at it until the job is done. thank you. [applause] >> thank you very much, governor put. again, we are very led you chose this venue for your first

we've got fomc minutes coming out from september meeting 2 pm eastern. >> i do expect, to be a year it, to use that word, i am -- first of all 3% while it has been a sense of shock coming from the.25% in march, it is still mildly restrictive compared to where -- where it will be, to get this inflation down we're talking, projections 4 1/2% by er ianed 4, 4 1/2 per by year-end when you get more restrictive, and if that doesn't do it they have to go higher then that means more stress on the economy. i am thinking in the second quarter if they do raise rates to 5% or so in the first part of the year in january meeting, for example, second quarter your recession will get more serious, i don't know how you avoid that inflation of 8%, as well as 9%, 8%. >> remain you are not doing it without pretty strong retreaty in the economy, in terms of scope i think likelihood of a recession, is very high. if they are going to have inflation back down to 2% in 25 or 2025, 2026, that is how i look at it. dagen: as you look at it thomas are we living in a world where fed just has to tolerate high inflati

charles: gary, right now someone on the fomc opens their mouth the market probably stumbles, right?here will be a point where the talking heads keep talking and market calls their bluff. is that one of the things you're looking for? >> we watch reactions to everything and unfortunately they don't stop talking. to us it is not the news, it is reaction to the news and if we start seeing good reactions to what we perceive to be bad news, that is good news for the market and for me with the fomc, i put them on the side as i told you. we're watching yields. when yields went back up above 4% on friday we got worried. we're something to watch. that is something to watch closely. i think it has been dictating policy all year. charles: right. you mentioned you are nibbling at some things. what are some of the things you are nibbling at and some things you are spying right now. >> i'm broad-based. there are only 4 or 5,000 companies reporting in the next few weeks. what i will looking for great reactions by companies with great earnings and revenue growth. so i'm not ready to go because you g

are you buying anything ahead of this fomc decision?ybe some of the indices, because it is possible that we get a felt-up here, charles. by that i mean, if the fed doesn't say anything hawkish, it doesn't apply, the language of some, anything to do with stepping down or anything to do with terminal rate being anything, i think eventually it will take that they're not messaging enough, which means they're probably not going to tell us maybe december they will step down they don't want see the market go up, the market interprets that as being bullish. so much money on the sidelines. if you buy calls on one of the bench marks spy, qqq, wim, you get a crash, melt-up crash you will make some money on this. that is certainly one way to play it. >> charles: eddie, you've been bear return, right, you have saved people a lot of money, when would you be ready to pivot? >> i don't think we think bottom in the market until the first quarter, second quarter of next year. this week from the short term perspective, the fed gives indication of a pivot,

does set the stage for the fomc meeting the kicks off tomorrow.get a check of other headlines we are following this era. bloomberg has learned that credit suisse has invited 20 banks intimates for morale issue. wells fargo and jp morgan are among those being courted to join the consortium. the bank' is new cfo was set up for due diligence on friday. cathay pacific will start using rusted airspace again months after russian apostrophes were in ukraine upended global flight best. this makes cathay pacific earliest of major allies to do so. it has attributed its decision to strong headwinds and payout issues. binance is looking at ways that cryptocurrency can help the social media platforms. it is an investor in elon musk's takeover of twitter. it says changes could help some of twitter a bunch of his injuries including the growth of accounts. hong kong kicks off a big week of fintech. we take you to the summit next as vive -- vivien khoo joins us. this is bloomberg. ♪ haidi: we do have australian retail sales and private sector numbers crossing the

if one of the previous hawks within the fomc is looking at a pause in 2023, is that an opportunity onhe sidelines? hugh: the change is the fed needs to start bringing growth considerations back to their mandate. their message has been clear throughout 2022, frankly, we will do whatever it takes to bring inflation down. and if that means we weakened the economy, then so be it. if anything, they want to weaken the economy to bring inflation under control. at this stage, you look at the fed and bank, what data matters to them? it is headline inflation, they want to get it down and aside from that they don't worry about weakening the labor market or slowing activity. as we move into q1, that should start to change provided that the fed is seeing enough encouragement that inflation is trending lower. at least going from nine to 8, 7, rather than the world we have been in the past few months. that should give the fed confidence to pause in q1, that is where markets can look at the terminal rate and say, i now feel more comfortable about where the fed is going to stop. until you know that, i

what can we expect from the fomc minutes and numbers out of the ppi reports this morning? michael: i don't thick we will have to square a lot because the ppi is telling you what neel kashkari told you, that rates will continue to go up, somewhat dramatically, until they get to a restricted point where they think is somewhere around 5.5%. we are still 100 when he five basis points below that. i think what the minutes will do is maybe summarize their views on how long they think inflation might be sticky or whether they even know how long inflation might be sticky. but underline the fact they will be focused on getting it down by raising rates. kriti: speaking of raising rates, we have to talk about the make of england. i want to ask about the contagion effect we might see in the u.s. bond market. the federal reserve might be taking note of, is that something they should be taking worried about -- should be worried about? michael: not something they should be worried about. the problem for the u.k. is a credibility problem with the government, the fiscal agent, that the bond

fed officials entering the blackout period before november's fomc meeting but fef getting in some lastnute dovish comments last week helping boost sentiment. is a pause or pivot really on the table over the next few meetings, whatever those things might mean let's bring in pimco chief economist paul mcculley to talk about all of it. it's great to have you weigh in here look, fed officials have for some time characterized what they're doing this year as front loading this program of tightening to fight inflation. it would seem six or seven months getting rates from close to 0 to four percentage points, that's about where we'll be in nine days would seem like a fair bit of front loading where is that going to leave us on november 2nd, do you think. >> i certainly agree with you you can't front load an entire campaign, unless you've got an ox psy moron on your hands i think we are at a juncture, we're about to have an inflection point i hesitate to use the word pivot because i'm not sure what it means anymore, but i think we are approaching an inflection point where we're going to have ki

last week's big moves now selling around 4% as the fomc plans to meet tomorrow and come out with theecision on wednesday. the bloomberg index higher for a third day. it is strong against all major currencies except the brazil royale. stocks up 1.4%. the former president is now the new president. does that matter at all or do investors only care about a peaceful transfer of power? we're going to check in at sao paulo for more. jon: looking forward to that. in terms of individual stock performers today, certainly the technology group has been lagging. within that group, some commentary on semiconductors off about 7% right now. a somewhat mixed outlook. that was the market reaction. we just got that update the ap report about a possible windfall tax on energy producers. there has been so much for the energy investor to digest on this monday, including the price of oil itself. we have seen some choppy trading in the names like phillips 66. it is one of the names we will be watching on earnings front this week. another company acquiring 6%. to the downside, barclays with a bearish view. t

my next guest came up with the bright idea with muting members of the fomc.s. i got your thing. figured out a way to minimize misinformation in my news feed, enter muted feeds, kashkari, bostick, mester, smart move but still moving the markets. i think they're making mistakes. yesterday, atlanta fed bostick gave a speech. here is the title, staying purposeful and resolute in the bat bell against inflation. he says the committee, fomc, they will not overreact but he admitted it would guarranty if they did react he guaranteed it would send us into deep recession. they know the stakes. what are your thoughts? they keep saying they will go hard and hard, not stop, knowing we could go into deep recession? >> hi, charles. this is classic cognitive dissonance on one hand, recognizing we're going into the most aggressive rate hike cycle in decades with the highest debt construct ever. it is by definition dangerous. in my view they actually should slow down, pause, reassess because as bostick himself said, they don't know what the lag effects are. yet we have all the

result of the fence hiking, and do you expect the fed to continue to hike in the november and december fomceetings? brian: the good news is the second part of your question is an easy one. as you know. part of respecting the independence of the fed is leaving to them -- david: i asked if you expect. brian: market expects that. i don't have any wisdom beyond that. if you look at most of the data points in the last couple of months, we have seen headline inflation on the month over month basis slow dramatically. basically it has been flat the last couple of months. we have seen energy prices come down, and gas prices and that has offset price increases elsewhere. if you look across a continent, you are seeing a shift in the transition happen in real time. you have seen that in a number of durable goods segments. at the same time, this process operates with some lags. that is why even in the last couple of months, you have got to really, even at a moment of heightened uncertainty that we are in right now, have to do whatever we can to lift up from individual monthly data points. david: when i

result of the fed's hiking and you expect the fed to continue to hike in the november and december fomc meetings? brian: part of respecting the independence of the fed is leaving them alone. i do not have any wisdom beyond that. but if you look at most of the data points over the course, of the last couple of months we have seen headline inflation on a month over month basis. basically, it has been flat for the next couple of months. that is a function of the fact we have seen energy prices come down, gas prices, and that has offset prices elsewhere. if you look broadly across the economy, you are seeing a number of places where you are seeing this shift happen in real time. commodity prices have come off. you see that in a number of durable goods segments. this process operates with some wags, that is -- lags. even at a moment of heightened uncertainty that we are in right now, we have to do everything we can. david: when i went to college many years ago, standard textbooks said that inflation was 3%. for the last few years it has been 2% inflation. my grandchildren have never seen hig

. >> the fomc meeting, lots to dial into. it for us, this is bloomberg. ♪ to finally lose 80 pounds and keep it off with golo is amazing. i've been maintaining. the weight is gone and it's never coming back. with golo, i've not only kept off the weight but i'm happier, i'm healthier, and i have a new lease on life. golo is the only thing that will let you lose weight and keep it off. who loses 138 pounds in nine months? i did! golo's a lifestyle change and you make the change and it stays off. (soft music) >> this is a balance of power with david westin.

we are about seeing them as entry points and that will depend on the future fomc meetings.e saw the markets rise, that was because we thought that inflation was getting under control. paul: who are looking to deploy cash when opportunities arise. where do you suspect you will see those opportunities cropping up? eva: we are seeing netflix after hours, above 10%. we are seeing surgical and other necessary health care companies are up 11%. we see more of these. the market has realized that in volatile times it is better to act to stable securities and when they are necessary to people, that is even better. netflix will do very well all in a slowdown because people will not get outside of that -- outside much. we saw in covid-19 pandemic. again, it is hard to find the bottom are investors should be cautious about rallies. -- and investors should be cautious about rallies. paul: the market did not seem to mind, you have a sense that all of the worst-case scenarios are priced in now? eva: a lot of it is priced in. we are down 30% on the nasdaq. that is pricing in a recession and

then at 7:00 p.m., the fomc minutes.very fed official we have heard from has said we will continue to hike. later, we will have central-bank speakers. coming up on the program, we will be discussing the energy crisis with the deutsche bank chief economist. they believe the rules will come in handily -- in handy. plus, lvmh sales soared. we will dive deeper into the luxury sector. this is bloomberg. ♪ dani: germany and the netherlands will put forward a multipronged approach to bring energy costs down. the plan includes focusing on joint purchases of gas to prevent countries from joining together. we have deutsche bank chief economist stefan schneider. can you break this down? >> if they are trying to prevent them from getting together, we are looking for ways to have them avoid what other countries are looking to do which is a price cap. they are skeptical that it will supply to the region and want there to be joint purchases with all the countries. the hard part is to get everyone to agree on these purchases. how can yo

she told cnn that the fomc must follow through with rate hikes. traders began to anticipate a slowing of fed tightening in u.s. equities then saw the best today rally in more than two years. perhaps adding a little bit of enthusiasm into this market. the italian paper finance milan saying volkswagen is eying a potential lamborghini ipo after a pretty successful porsche ipo. volkswagen looking at another potential ipo but this time of lamborghini. it's go back to the overall market story. joining us now is rupert thompson. the mood music in the past two days changing, but i wonder what you make of this pivot party that markets have been undergoing so far this week. >> i agree with all the commentators that this talk is overdone. the fed is not going to change direction any time. maybe rates do end up going slightly lower than the market expected a couple of weeks or days ago. pivoting any time soon i don't think is going to happen. none of the economic data, the isn came a bit weaker than expected. dani: in the meantime, it's been remarkable volati

about macro, as you can see, from the last couple of weeks up trading post the inflation data and fomceeting. david: i'm looking at the top holdings in your fund. tencent, samsung, alibaba. you guys probably did not do too well, and i'm not saying that to call you out, but i'm just wondering, in the third quarter, your thoughts on if investors should be shifting or changing their exposure to hydration bonds -- hi duration bonds -- high-duration bonds? >> we see that they are more exposed to rates outside, particularly in deposit-rich economies like singapore where there will be a more direct link to topline growth because of the interest margin improvement and also not a lot of concern on the asset quality front because the large provisions taken to prepare for the pandemic are still physically offering their balance sheets at this point in time. asset quality in general has stayed very undervalued in asia. david: part of that is the part of asean that has outperformed. indonesia is a big part of that. do you still think that group can outperform, or is it starting to look like it will

they writes that powell will likely note that the fomc aims to move deliberately but more cautiouslyow that fund rates artisan and restrictive territory and that the full impact of the economy on the very large tightening and financial conditions to date is not clear. they wrap this up by saying that the peak will be higher at 5%. what do you make of that? will this be a slower but higher peak fed? yves: i think so, although i am not sure that this is a straightforward manner. the fed wants to tighten. they understand a lag between tightening of the transmission of the tightening to the system. so far the system has been resilient, far more than i ever expected in terms of absorbing such a rapid cost because of capital. i think the fed will deliver what the markets expect as it usually does. the question is what then? then the market is pricing a range of 5% for fund rates. this is a massive tightening cycle, one of the fastest and essentially it is in the prime right now. do not forget that above and beyond federal rates, qt continues. even if the fed polls, the tightening continues

tying into that story bring chief economist goldman sachs says he thinks jerome powell will note the fomc aims to move deliberately but more cautiously not the funds rate is in restrictive territory. he says the full impact on the u.s. economy of the very large tightening today is not yet clear. joining us is the among the head of multi-asset. good morning and thanks for joining us, let's get your take on that call by goldman sachs that 5% is now the terminal rate from the fed by march and yet 75 basis points this month will be the last jumbo hike. they moved 50 in december. does that align with your view? >> we buy into that rate in the u.s.. this is been a slow motion event and risky event if you think about how rate expectations have evolved over the last 12 months. we spend a lot of time talking about fed pivot and fed actions. we must recall only this time last year the debate in markets was how many fed hikes would we have in 2022 and the choice was between two 25 basis point hikes or three. so you'll forgive me if i don't want to pin my shirt to the mast to clearly. the direction o

not stop, but definitely slow down i take it incredibly seriously i think the fomc does as well. you can't say that three-month to ten-year is just the market doing what it does no, the fed put the three-month where they're putting it. >> we're hearing a lot of stuff about inflation, report -- by the way, every industry has record profits, because they had record demand and didn't have to discount to what -- if i had to say one thing was the reason for inflation, how would you answer? >> only one thing, brian >> yeah, i'm stingy, i'm a scrooge. [ laughter ] >> actually i will go with the supply side of the economy if you constrain me on that question, if that people think of terms of monetary and fiscal policy, it stimulated the demand side i think that's true, but even if we had more temperate monetary and fiscal stimulus particularly fiscal stimulus, i think that we would have had an inflationary response because of the supply side, which is why i'm optimistic as we are moving out and it corrects itself and demand slows, this inflation surge will end in the fullness of time, pr

but bloomberg economics now saying perhaps the december fomc meeting could be at play depending on the inflation numbers you see on the board coming out thursday. haidi: too little action, too much action seems to be driving the u.k. gilt market as well. have you got motion sickness from this volatility? i am feeling queasy given how the ones they session started. longer maturity debt really starting off in the red and we saw losses picking up in the afternoon. the 30 year yield with about 5% at one point. then we saw that reversal a few hours later because we see bonds making that dramatic comeback. the boe snapping up 4.6 billion pounds worth. we continue to see huge volatility which has been playing out since we saw that package of unfunded tax cuts being reviewed. we will know more going into the end of the month but until things that until that it is set up for u.k. asset volatility continuing. shery: for more let's bring in kathleen hays in washington, and emily griffey out here in new york. we got more caution coming from these fed minutes but at the same time neon cash gary tal

for get the responsibility to promote maximum employment and that the decisions you make at the next fomceeting reflect your commitment to the dual mandate. sherrod brown says they must avoid having short-term advances in the economy and strong labor markets get overwhelmed by the consequences of aggressive monetary actions he also said that higher interest rates have not prompted companies to bring down prices of course, it's important to remember we are two weeks out from the midterm elections democrats are trying to sharpen their message on inflation now we have the chairman of the senate banking committee asking jay powell to not forget the impact that rate hikes could have on the job market contessa. >> ilan, can i jump in for a second >> sure. >> we were talking the last hour about jay powell i made an offhand comment and lael brainard. powell has a contract. people say they can't force him out. you can't force him out. he's got a deal. however, as we have seen in the past, in the 1970s, powell is not immune to political or human pressure you can make life uncomfortable enough for h

so we had the fed with tough talk coming out of jackson hole, reiterated that tough talk at the fomc meeting at the 20th and 21st in the presser and the negtive the news last week that you talked about, this concern about credit suisse and we had a really bad week for stocks last week. now there is this notion-so yields spiked. we saw the 10 10 year go above % for the first the time in over a decade, the two year about 4 and-a-half percent in the last couple of days, yields have come down substantially, that helped stocks to rally yesterday and what we're seeing in futures today and there's a narrative out there. we went from the fed pivot that was talked about back in july and early august and now a fed pause. edgar denny, a respected economist, believes now that november will be the last rate hike if in this cycle and then we had these other noted analysts and professors coming out and really attacking the fed hard for this aggressive rate hike policy. maria: yeah. and stephanie pomboy who initially was thinking about a pivot, she's been talking about that for a couple of years. i

particularly some members of the fomc are getting increasingly nervous about that but i do believe theint message will be delivered with a very, very hawkish tone so the sort of talk of the pivot that the market is desperately trying to latch onto i think is very misplaced. this is a fed where the inflation target is miles away from where it needs to be and where, frankly, the labor market remains far too robust. i mean, we just had gdp data. we have nominal gdp growing at 9 and-a-half percent. that's double anything we've seen over the last decade. however you switch those divisions around between real and inflation, real growth and inflation, those numbers are just simply too high so the fed has to keep going. they can't afford a repeat of the summer where we had the risk-on melt-up in risk which eased financial conditions again. maria: yeah but what is the impact of all of this? yesterday we spoke with jeremy siegel from wharton. he's looking for serious impact on the economy in 2023. here's jeremy siegel with me yesterday. >> the fed won't say, you know what, we have made progress,

the fomc minutes coming out on wednesday and that'll be important so we can understand the fed's thinkingor the last week -- last month rather and the imf and world bank meetings happening on monday and larry summers says this will be the last stop before an economic storm. those two meetings, world bank and imf meeting. i want to get your take overall on how you want to be positioned in this market, stephanie, going into this week, ahead with so much in terms of third quarter earnings coming out and inflation data and weather terms of the portfolio today. francis seems to be reading from the same himm hymnal and there s continued downside room here and i want to get back to what she was eluding to in terms of corporate quality and again, even if the fed stops raising rates, junk yields gone from 4 to over 9% just since the end of last year. these companies will have to roll their paper more than twice the interest rate prior and there's a whole huge swath of companies that couldn't afford to service their debt at 4%. how are they going to do it at 9%? they're not going to be able to so w

but we did see then news come out, of course, the fomc is what we're expecting now next week as the federe by around 75 basis points, too. the market is going to focus on that. indeed the tech giants are the ones to really keep a clean eye on. they're the reasons the market looks lower and might even be heading lower today. >> good note on the stronger than expected gdp. the economy is not colonelly in a recession. you're right. tech companies really taking a beating here. one exception, apple. reported fiscal fourth quarter earning that's beat wall street expectations. but did come up short on iphone sales. tell us, give us the state of play on one of the biggest companies out there. >> as i said, the tech companies were really quite hard hit. the iphone sales won't be keet worry. they maintained that as their key sort of element in -- within the business. but they did manage to grow their mac sales. that means a little bit more computing numbers do come through. we also saw the likes of amazon as well bring up their sort of earnings as well yesterday. that stock lost around 20%. holid

we probably would have to get a behind of that at the next fomc gathering.f the market gets more traction, investors have to make a move. they are woefully out of this market. mute all funds have the most cash ever. portfolio managers have the weakest positions ever. right now more than usual they're beating the street this is the irony, right? they're beating wall street. they normally miss. they don't want to get in the market because heavy less losses. will that be enough to take off? in fact many manager will have to probably get away from being on the sidelines getting in. a lot is predicated on earnings, right? so far i got to tell you, they're going the way of the old economy names. we can see that today. doesn't necessarily mean the big tech rally is dead, if you look at meta, some of these other names. it is hard to argue they will ever regain the old swagger. with that in mind, some cash looking for bigger bangs for the buck. forget about tech. they skip that, go to small caps. i talked about this earlier in the week. russell 2000 is looking pretty

because they have made it very clear pretty much across the board that everybody's a hawk on the fomc board, and they feel that a bigger mistake would be to stop and the snake suddenly digests more quickly and then the next thing you know, the snake is hungry again, and we have inflation that hasn't been beaten down enough. >> when i was a boy, a long, long time ago in a world far, far away -- [laughter] milton friedman correctly said that the fed shouldn't try to fiddle with interest rates to project what would happen to the future but, instead, focus slowly on the. quantity of the money supply. he was right then. money supply's harder to figure out, but it's basically right now x. they don't even have a clue what they're going to do 3, 6 months from now. the fact of the matter is they shouldn't try to do this kind of tough that they always try to do. what will they do? probably what people think they will. what should they do? sit on their hands more. liz: interesting. so you're in the camp of jeremy siegel who, of course, told neil cavuto, the same thing, you've got to wait because

>> well the next big catalyst is next week, the next fomc meeting. expectation that we'll have a probably 75 basis points rate hike but we believe that the fed will signal that inflation is getting under control and probably in december, those will scale back from the 75 basis points rate hikes and already next year, if we're going to have any additional fed rate hikes, that, those will also be below even 50 basis points. charles: okay, great. you're on the step down bandwagon. trying to get more people on that one, ann. [laughter] >> i think market is going south, charles. charles: really? >> i do. i think it is going south. i think we haven't priced in the full impact of global demand declines. i'm worried about that still. charles: those numbers as they come in, all the negative gdp, all the negative economic numbers wouldn't that start to get the food, that is what the fed is aiming for to a degree? >> i think we have predictionability around that. we haven't seen earnings reports which are going reasonably well. we haven't seen demand kick in ye

here's a quote from her speech saying being cautious means the fomc should persevere and taking policy actions to return the economy to price stability >> i want you to stay with me. i want to show everybody what the markets are doing. we had come off the lows of the session at least for the moment. we're sitting there. dow is in the green as is the s&p. maybe some of that due as well to that new york fed survey that showed near-term consumer inflation expectations have cooled so maybe that was helping just a bit, but, steve, you know, as i come back to you and let me also let everybody know of course we have the investment committee with me here today stephanie link is here with me on the set today i hear these hawkish questions they contradict somewhat as you noted brainard a bit and maybe others as late who have sounded a little more measured are we setting up for a fractured fed of sorts, steve? we've been pretty much enamored of policy in most recent meetings and i wonder if we're looking into different territory? >> i think we're setting up for more normal things i think the unan

market is really about the federal reserve, which of course, has empowered every single member of the fomc with the ability to talk the market up or down, especially these days. it's the latter, down. of course, that was the case yesterday when the markets actually came out the gate with a little bit of vigor, right? reacting to better-than-expected results and a number of data points and then philly fed president harker made some remarks and well his comments were picked up by the media and it sparked a major reversal to the downside. the main point that was picked up is this quote. given our frankly disappointing lack of progress and curtailing inflation, i expect we will be well-above 4% by the end of the year. joining me now satori fund founder portfolio manager dan niles and dan, i want to start with the fed because markets up right now at this very moment and scuttlebut, maybe they slow it down a little bit. i'm not sure if that means on a rhetoric which by the way be a welcome relief, but what are your thoughts about taking the bait yet again, because obviously, the markets want so

given us a number of brushback pitches that sent the major averages lower and i fear with another fomcanother stern talking to by chairman powell. neil: part of the stern talking to we're told is another 3/4 point hike. you assume that is given? >> that is a given at this point. what happens after that? neil: december, 50% chance, if you look at fed fund futures of another 3/4 hike. do you buy that? >> i think the fed is pretty much set on a course they will keep raising interest rates. neil: do you think they're overdoing it? >> they could be, neil. but i think their approach here is they're willing to err by going too far because they can always bring down interest rates. neil: by then we're knee deep in recession. >> no question about it. neil we have to think about what will happen in this upcoming election any believe a lot of what has been going on economically, self-inflicted based upon policy. if the republicans are successful as it seems like they may be, the last few days a lot of talk, neil, does that force the white house to change direction? neil: so you're saying a lot of

this was the last big spike after the fomc rate hike.ce point, support be. where do you think we could go here? two we have to go up to retest the recent high? >> thank you, charles. i think we'll push higher into the latter part of october before we peak out. this trend line is very well defined. dollar is trending up nicely against the yen, also against . sterling. i don't think it will last forever. i do see relief october through december as economic weakness gets more pronounced. jolts data directly coincided with rates and helped the stock market rally. charles: when it finally breaks down where do you think it will go? >> i think we'll pull back down 105, 103. after couple months of weakness, likely next year will have to revisit. europe is so weak the u.s. is in much better position. charles: by default almost. dollar is king particularly with the rest of the world in disarray? >> difficult to fight the dollar. near term pullback next couple months will likely lead higher into next year. charles: talk about market breadth, not ju

the street, of course buying that the fomc, listen, let's face it they have been laying it on prettyignore that particularly when the market moves in one direction like this. let's bring in nancy tengler and in your note this week, you traced this problem back to two years ago at jackson hole when powell said the fed will move away from forecasting and becoming data-dependent and then of course they missed the inflation bubble and now they are trying to coral this whole thing in, so where is the mistake now? is it being data dependent particularly when some of the data is very rear view mirror stuff? >> yeah, completely, charles at least that's my view and i think the market shares it and that's why there's been so much volatility on every word spoken by any member or anyone near the federal reserve. i think one of the things we have to remember is that back in 2021, they were sort of ignoring the inflation, they were ignoring the inflation mandate and laser focused on jobs, while this federal government was paying supplement all benefits to people staying on the couch or out of the

it's a hands-on, six rate, where it's just the members of the board of governors, after the fomc meeting, the ones they have eight times a year to decide interest rate policy, they say this is the rate we are going to pay on the reserve. these are cash accounts. depository accounts of commercial banking institutions. they keep this money, cash accounted at the fed, like a checking account. that amount, was thought in the chart that david showed, -- we saw in the chart that david showed, on august 2008, bank reserves were less than 2 billion. they are now 3 trillion. it's not that they went up 100 times or even a thousand times. it's a completely different operating management approach for banks. those cash reserves that are buying nothing, investing in nothing are essentially risk-free government guaranteed interest bearing accounts. they're currently paying 3.15%. by november 3. with 75 basis point increase as we are expecting. they will be earning 3.9% on a cash account. if they do another 75, by december 14, that is 4.65%. >> i want to make sure people understand what you're saying. t

in the latest fomc minutes, policymakers noted it would be important to calibrate the face of -- thehtening to mitigate risks of global uncertainty but many felt the cost of doing too little to fight inflation was fight that -- was worse than taking too much action. in russia, president putin said the explosions in the nord stream gas pipeline set they most dangerous president. speaking at a moscow energy forum, he blamed the act of terror on the u.s., ukraine, and poland, calling them beneficiaries of the blesseds -- the blasts. he showed any critically important equipment of infrastructure is under threat. bloomberg has learned americans and players are starting to pull back staff from tough chinese chipmakers, firms including applied materials, and kla, are doing so in the way company was regulations -- in the wake of u.s. regulations. restricting as well as ability to buy american technology. the first paying tourists to space will go back to orbit with spacex for a trip around the moon. dennis teedo and his wife paid to fly on the starship once the vehicle is complete. they will

fomc meeting in two weeks, that will be interesting.- is whether there is a case of fed pivot, or if there is a policy calibration. the tug-of-war between calibration and pivot is going to keep markets moving back and forth. the case of calibration is such that they are just going to slow the pace of rate hikes, but the rate is still going higher. having said that, it means the latitude of the dollar strength, the banks should moderate. that potentially is a point i am watching going forward. haidi: we heard from the deputy governor of the bank of england saying how weedy it is to lose credibility. when it comes to trading in the pound, the historic gain when it comes to u.k. guilt as well. is the worst over? how lead to bcf path back to credibility echo -- >> we get a little bit of momentum now with chancellor hunt. and with new p.m.. the question is how sustainable it is going to be? the medium-term budget on monday is going to be critical. following that on thursday we've got the boe meeting. what they need to do is they need to prov

today, the fed is clearly focused on price stability and listening to recent fomc committee members,ost of them want to get policy too restrictive which is 4% to keep it there for a prolonged period of time to fully stamp out inflation and achieve their 2% inflation goal on a sustainable basis. if the fed isn't likely going to pivot, it might not be a year or longer for them to cut rates. you may not see that v-shaped recovery, what we have been accustomed to come over the last number of cycles. it could be a choppy environment for a longer period than people are anticipating. paul: one of the things we have come to rely on during this period of enhanced inflation and fed tightening is a strong u.s. dollar. is this precluding you from looking at any global markets outside of the u.s. right now? jeffrey: global valuations are very cheap especially compared to their twenty-year medians, whether you're looking at the u.k., the eurozone, japan, for example. obviously getting more insight on china. obviously, the zero covid tolerance policies are going to be with us for at least the next

a restrictive policy for some time from the fomc. the st.hink differently about his officials -- it's officials participating in private events. bullard's appearance could be seen as a violation of federal rules on communications that aim to avoid providing a profit-making firm with any advantage. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i'm vonnie quinn. this is bloomberg. ♪ sherry? >> we have more on the breaking news earlier, sources telling us the biden administration is discussing whether the u.s. should subject some of elon musk's ventures to national security reviews, including the deal for twitter. let's get more from su keenan. what are officials worried about? >> they have become increasingly uncomfortable about what they view as a not so russia friendly stance and a recent threat he made over twitter to withdraw supply -- withdraw the supplying of starling satellites, to ukraine. he said it was costing him $80 million so far an

fomc minutes at 2:00 p.m.l be right back. >>> this is realtime insights, i'm joined by ey america's people advisory services leader. thanks so much for being here. amidst all the market disruption we're seeing, companies have to transform their businesses what are you seeing that's working? >> ey did a study with the oxford school of business. transformation success needle hasn't moved that much over the last 20 years. less than 50% are successful people are focused on the rational side of transformation of technology and process. if you put humans at the center, your likelihood of success more than doubles >> how do companies focus on humans at the center. >> our study has discovered six very specific levers those are vision, collaboration, technology, process, leadership is a big one and also creating psychological safety when you do that, you start to turn it to a transformation eq which actually is driving those programs far beyond success. >> how are you applying for levers to your clients >> we find two

we regularly monitor financial conditions quarterly we have a financial stability discussion at the fomceport, you know, we look at every indication that markets are having trouble digesting certain parts of this, events that you talked about, you know, the spring of 2020 and before that in 2019, we saw some of it, well, we saw some of that coming with the fact that reserves weren't as large as they needed to be, and we started adding reserves then covid hit in the midst of all of that, the accumulation of the assets we had to provide more accommodations, support market functioning those were extraordinary events. at the moment, we don't see anything like extraordinary events, though we are tightening quite expeditiously. that's making everybody nervous, but you go back to the events we looked at and they were really much larger than what we're currently looking at if anything, it's a little bit closer to the december 2018 episode where markets were more nervous about our quantitative tightening and interest rate increases and, you know, at that point, we did a risk management adjustment

. >> inflation is far from the fomc's goal of 2%, and not likely to fall quickly this is not the inflationutcome that i am looking for to support a slower pace of rate hikes or a lower terminal policy rate in my view we haven't yet made meaningful progress on inflation, and until that progress is both meaningful and persistent, i support continued rate increases, along with ongoing reductions in the fed's balance sheet to help restrain aggregate demand >> he had this interesting analog with pumpkins on october 31st, liquidity for pumpkins is very high, but on november 1, market goes to zero. >> right but what people -- i mean, two months ago, powell wasn't working hard, wasn't tightening fast enough. now, he's tightening and there are things going on that we don't realize underneath that are going to hurt, but they're not that bad i mean, look the economy's red-hot. it is. and inflation's going up, say, 8%, and the working person's making 4%, and powell is uniquely attuned to the working person i wish he would sell more bonds, but why do people not understand that jay powell is worried abo

that's the pause and then he went on to talk about how the impact is affecting things the fomc's tighteninged the housing -- moves in the housing market. so, there's a pause. now, again, he's not a voting member let's see if he can get people to move along to his point of view earnings season is starting, and it's a rather cautious start, but i'm encouraged by the fact that the three big reporters affirmed their guidance. remember, guys, everyone was expecting, oh my god, they're going to start cutting, cutting, cutting. well, look at the big three. these are all big consumer names that are out there conagra beat the estimates they had big price hikes that helped the margins they reaffirmed their guidance jim was talking about constellation. the beer sales were astonishing for them, and they had price hikes. why is it down here? i think the guidance was only fair here. they were at -- their guidance is $11.20 to $11.60. they had $11.20. these numbers are great. why didn't they push the numbers up more? i think that's the reason it's trading down a little bit. but jim's right. the numbers we

tom: bring that over to the fed and we will bring up the fomc screen on the bloomberg.is and i go up a long ways away from december 14, february 1, and then march. where are we march of next year? lisa: the market is saying 5% and we are going to stay there for a while. tom: what does that do to the dollar? lisa: that is what you are seeing, strengthening against everything and torpedo. tom: the team coming off of yesterday's festivities and fireworks in the united kingdom. a great lineup. leslie falconio will join us. it's even major will also join us. -- stephen major will also join us. stay with us. ♪ tom: bloomberg surveillance movers coming up. one is the government of the united kingdom. jonathan ferro is off we have had hundreds of emails. what is the likelihood of a ferro sighting monday? lisa: it depends on if there is a sighting of a new prime minister. tom: it is hinged on a new prime minister he will be back with us. lisa: he will be back. tom: thanks to tom mackenzie at parliament this morning. this is a movable feast. ben wallace, the secretary of defense,

had of them all but the reserve bank of australia tomorrow gives their policy decision to stop the fomc rate decision will be wednesday. where is the optimism about the comey and the bank of england decision thursday will be interesting as well as two year yields around the world continue to climb and hover near the highest levels since the financial crisis. we also get a slew of economic data. the jolt data comes tomorrow. i'm interested how long jobs will plummet. they are trying to look for a way to pair back without cutting jobs. jonathan: freezing is the new firing. that's been the story of the last 12 months. it will be interesting to see if we do damage to the labor market on the unemployment for. have we seen that in the official data? jonathan: not when it comes to jobless claims in the jolt data, yes. one third of the s&p 500, 160 companies will be reporting this week gloating pfizer, uber and a whole host of them at a time when the consumer is in question. how long can they hang in there but also the inflation that is being felt reducing their buying power? jonathan: we talke

lisa: i was reading through the minutes of yesterday's fomc meeting and there was a slight nod to the u.s. economy and causing issues domestically. how much is that gaining traction at this time where i'm seeing the euro fall and the dollar strength becoming pervasive in the face of persistent inflation? mike: it's obviously a major topic of conversation around here most of the central bankers i have spoken with the said they understood the fed had a domestic mandate, as do they and they can't do a lot of about it. they have to let it go. so the fed is going to take this into consideration. one thing they have to take into consideration is how much is global tightening affecting the policy in the united states and they don't have to do as much of it goes up but at this point they know they are in the rest of the world is but everybody has to do their own thing. lisa: as always the selloff is continuing to accelerate into the open, the nasdaq is down near 3%. dollar strength with yields higher, bond prices lower. two year yield hitting 4.5%. solidly north of 4%. highest levels going ba