i am kathleen hays and you are in new york.rewing trade tensions are beginning to take their toll on u.s. company's forcing some to moves -- move productions elsewhere. but spring in kyle weinberg. mr. with a very broad question. personally estimates of what a full-blown trade war could do to the global economy. 1% for u.s.. can we even do that question mark >> i think it's possible. we don't really have a precedent with terrorists at this level of integration of the global economy. global supply chains are much more mixed up in the 1930's. all we need to know is it is bad. however bet it is it will cause the reallocation of resources. >> we know it has been banned for the chinese currency. it's interesting when you can contrast the united states. i have seen so much written and are about chinese, the pboc letting the bad currency weaken on purpose. i would say fundamentals are pushing the currency down. who's hand is at play here. >> if we look year-over-year, the one is in the same place where it was a year ago. they don't ca

betty: i'm kathleen hays and -- kathleen: i'm kathleen hays in new york.rade tensions go higher and the u.s. announced sanctions on russia. oil tumbled and treasury rose. jeff bowie joins us now. -- truck bowie joins us now -- chuck bowie joins us now. you think this could go to or three more years. at this point in time, how much concern, uncertainty is the escalating trade war causing when you look at the stock market? chuck: thank you for having me, kathleen. if you look at the overall fundamental background in terms and fundamentals, it is quite positive when it comes to economic growth rates and earnings. when it comes to inflation and interest rates, they are still at a fairly low level even though they moved up a little over the last year or so. like rising interest rates could potentially put a ceiling on the economic equity market. rising trade tensions and a some point, although it is difficult to determine when that will happen and i don't think we are there yet, but at some point, trade tensions could cause problems in the equity markets. throu

this is bloomberg. ♪ kathleen: i am kathleen hays in new york.vonne: i am yvonne man in hong kong. u.s. stocks in the trade helpednt with mexico has the peso and the canadian loonie on the rise as well. su keenan joining us with more on the market recap. su: it was her much risk on this monday and wall street. of hislar was weaker deal, but we did have treasuries falling and yields rising. ands&p closing in on 2900 look at the nasdaq 100. it's a concentration at tech stocks. that one was up as was the russell 2000. it continues to be on a record-breaking streak in terms of setting all-time highs. let's go into the currency pa re of the u.s. dollar and the mexican peso. the peso strengthening on this deal, which is bringing a lot of optimism. not just to the major carmakers like gm that was up, but let's look at some of the big movers. was up 5%. the auto parts maker was up almost as much. automakers, auto parts makers, truckers, all raising on this deal. we saw biofarma as a sector. game stock taking us the drop. gamestop taking a's the drop. thi

kathleen hays. stock market u.s., it's all deal. a a trade deal, u.s. and mexico, donald trump announced today, see the dow jones industrial average, by the close, up more than a percent, points. s&p 500 get up 22 points. nasdaq, nearly 72 points. optimism that the trade war dominos are starting to fall. lead to progress on other fronts, heidi? heidi: yeah. suppose, if you look at all he strategies, warning, don't extrapolate this deal with any sort of optimism when it comes to china and the u.s. trump saying now is not the time to talk to children on those trade issues but take a setup in asia with those record highs in the u.s., bit of positive activity through to the asian section. the moment. at percent about a half decline overnight as the safe of mood seemed to recede with a little more risk taking. look positive to build on the previous days' gains and the some , 73.49 giving back of those gains that came through yesterday.ally let's get you the first news with jessica. >> thanks, heidi. $5 farmers will get almost billion of direct government aid

will weigh in on what has been happening here with our own, kathleen hays. interesting things to say. former bank of england monetary policy committee member will also be joining a there with kathleen, so there is lots to talk about. and howconomic growth, policymakers set themselves up for that. of course, we had the movement of the pound, showing that exit could create some price rises when it comes to the united kingdom, in the aftermath. so there is lots to talk about their from jackson hole, our very own kathleen hays will be joining us with a great lineup of conversations. you don't want to miss out on the coverage. on friday, we will be hearing from u.s. fed governors as well. this is bloomberg. ♪ i'm all about my bed. this mattress is dangerously comfortable. when i get in, i literally say ahh. introducing the leesa mattress. a better place to sleep. this bed hugs my body. i'm now a morning person. the leesa mattress is designed to provide strong support, relieve pressure and optimize airflow to keep you cool. hello bed of my dreams. order online, we

kathleen: from bloomberg's local -- global headquarters i'm kathleen hays. trade tensions may be affecting companies with supply chains in china. an elephant starting to run. the booming opportunities in india. kathleen: one thing notable in the last couple weeks is the fact that the trade tensions of asian markets hit china so hard and the u.s. seems to be impervious. is upping the ante and hasn't stepped back. losing some close, ground in the final 15 minutes of trading. read on the dow jones, but even if you look at the 10 year yield on the nasdaq you can say basically flat. a good auction for u.s. treasuries. , that seems to have taken the wind out of the sale of stocks. maybe a sign that investors aren't giving up on bonds and yet. haidi: we are still within striking distance. basically at record highs. you have the most saying going up to 10% for u.s. stocks. let's look at the set up here in asia. next as you can see. turning mildly positive. his looking to extend the decade high that the market is sitting there at the moment. come upnikkei futures we a

this is bloomberg. ♪ kathleen: i'm kathleen hays in new york.and i'm haidi start marvin sydney. validatingtimates disney's decision to buy into fox. let's get to bloomberg entertainment reporter. give us the headlines and some of the background. so, yesterday fox the the estimates on profit and earnings. pretty strong performance across the lord. highlighting to strength of the cable business and their sports. forms. as well as a turnaround in the movie studio which has been struggling a little bit. as you said, with films like that pulled to it has had a massive growth. that's important for disney who is getting a studio and the look. but they also took the what newty to lay out fox will be as part of this deal with disney. company.ill run a new they will be made up mainly of the fox news channel, fox broadcast, and fox sports. really they spent a lot of the core analysts afterwards which will be that last call. relate laying out the strength andhe nfl content they have inspiring investors around the new fox that will be coming out next year. k

kathleen hays joining us. michael simi,'s as it strategist at bnp paribas. asset strategist at bnp paribas. there will be a lot of focus on the political dimension. we heard from esther george. the political pressure will have no impact on their decision-making. is that the messaging you were expecting to hear? michael: the markets built up a lot of focus on this after trump tweets earlier in the week. i think what is really important going and it's kind of weather markets expectations have now got to. there is the case that the panel needs to outright dismiss those comments or is it if he says nothing at all, people might view that that he is viewing towards being more dovish? over-interpret the recent news flow. the panel will be optimistic. maybe a little bit cautious on the outlook. probably going to be pointing towards two more rate hikes this year. as esther george said, that is not a commitment. they need to see the data for the rest of this year before they would look to raise rates in december in addition to the one in september. in terms of market

yvonne: kathleen hays watching all the central-bank action for us.cing moderate declines. the fed did little to alter expectations for two more rate hikes this year. we have seen u.s. china trade tensions continue. joining us now is ayaz ebrahim, co-head of the asia-pacific regional team. we talked about all the central banks but it seems like it is one central-bank driving bond markets, the boj. if we continue the steep declines in the bond markets, is there a sense that perhaps there will be more volatility in the bond market? ayaz: the thing about the japanese, bank, the widening of the band allowing bond yields to move, it has more or less moved in expectations. although have seen decline, i don't think it is i think to get too worried about. other announcements might be more interesting. services,from the etf that could actually have an impact on certain sectors in the japanese equity markets such as financials and autos and so on, which actually complies a large amount. i would not be too worried about a yield move. i think the bank of japan ha

kathleen hays spoke to esther george about that and more. >> wages are very important obviously.age inflation relative to more general price inflation, i'm not sure you can connect them so tightly as to say we see wages performing runway -- one way, which of the about our project of the core inflation the same way. it's one ofeasons the topics is to understand what structural forces may be affecting that wage performance. do withhave summoned to cyclical factors or are there more structural regions -- reasons we see them not moving at the pace you might expect? is the trade war entering into your view of inflation at this point? our import prices a greater risk in the risk of a tight labor market? esther: that would be a good question whether the pressures we see around inflation are temporary or whether they can be more persistent. in my own region we will get anecdotes from people saying i have this price pressure and i'm passing it on. will that be broad-based? will it be a one off and should we look through that or will we begin to see more broad instances of wage pressures -

kathleen hays, joining us with more right now. what exactly does the president that, kathleen? kathleen: it's interesting because this is something we have been so focused on, the trade issues and many of the technical issues around autos and what part is made in each country, but this is something i think was not expected, that president trump saying is part of this agreement, and the two nations should agree on more transparency and currency matters. our news team did an interview with the mexichem economy thister, and he said that is intended to actually send a signal to nations that might be currency manipulators. isn't that interesting? many of them are in asia, at least many of them that could be labeled such. he said the u.s. mexico deal could include a system for resolution that is in essence something that is already in the nafta agreement. currency has been battered by a lot of forces. it's been very strong at times and very weak. a year or so ago, when the bongo to mexico was raising interest rates, it was very strong. what matters is the weakness of other nations cu

kathleen hays is in wyoming. she gets around, certainly. set the stage a jackson hole, kathleen.athleen: one thing we learned his confirmation of what markets expect, fed watchers expect, september rate hike is all but a done deal. another rate hike would be appropriate soon when it comes making people conclude the federal reserve is headed that direction unless something really dramatic happens. jay powell, chairman of the federal reserve in that role, the fed chair typically kicks off the official opening of the sessions on friday morning in jackson hole. the kansas city fed in posey him and often uses the speech to send asap -- a policy signal. will his word reinforce what we got from the minutes and make more sense of the neutral rate and whether or not you should stop when you get to neutral. how much will these tensions and emerging markets play into discussions being held where you are? kathleen: well, there are two kinds of discussions and the name -- the theme of the changing market structure and the implications for monetary policy. this is more about things like amazon

nejra: for more on this, our global economics and policy editor kathleen hays joins us from wyoming. great to see you, kathleen, and thanks for your fantastic coverage. waiting to hear from jay powell, what is the world waiting to hear in what could be a surprise from his beach -- speech? let'sen: first of all, set the stage by saying traditionally, the chair of the federal reserve kicks off the friday morning proceedings, panelists and papers, etc., by giving some remarks about the economy, the conference and for jay powell, given what we saw in the minutes from the august meeting where he said another rate hike would be appropriate soon and further rate hikes would be needed, that seems to point to december, people think you will get echoing of that from jay powell. the fedportant that if chair wants to give a dramatic message on policy, it has been done in the past. ben bernanke in the august of 2012, argued for more stimulus after q1 and q2. on the 13th, the fed announced qe3. alan blinder spoke to us earlier. a former vice chair of the federal reserve, and a long time jackson hol

you, our global economics and policy editor kathleen hays. the center of strategic and international studies, with four decades of experience, our guest. the kind of bearishness that has taken another turn, and to carry on from our conversation with kathleen, are these idiosyncratic stories within each of these economies, or is it much more of a systemic -- i guess, without the threat of contagion? thank you for an excellent question. i think one needs to think about emerging markets as a highly diversified group. crisis,after the asia many countries around the world put in place much better policy and built up buffers, -- policy frameworks and built up buffers, and i think they are well adjusted to deal with it. some idiosyncratic stories out think to be sure, but i they have been slowly differentiating. i think you are right. i feel there has been more contagion than i would have expected a few weeks ago, but i am still of the belief that we should be thinking about idiosyncrasies. you know, turkey's vulnerabilities are extremely well known

kathleen hays is there with another special guest. kathleen, take it away.een: kristin forbes has .ong been a professor she has worn a lot of different hats. she was a member of the bank of england monetary policy board. she is a former treasury 2012, you gave the league paper on international financial contagion. fast-forward and here we are with not only contagion but plenty of emerging-market stresses and strains. turkey has become a bit of a poster child. and south africa having troubles. should we be worried today? we know on the unofficial agenda people will be talking about this area -- about this. contagion know about from 2012 and since is that turkey does not meet the criteria to be terribly worried about contagion. there is a checklist of what to worry about. there are not many countries with connection. most countries do not have substantial finance exposure. it is manageable. of the most important lessons we talked about in 2012 is leverage. when you have banking systems that are more leveraged they can to contagion. one benefit is the reforms o

global economics and policy editor kathleen hays is here.t could change about the fed or their mind, about one or two hikes before this year is out? it seems like the september rate hike is more than ever a done deal. the only surprise would have been had they hikes because there is no cap -- no press conference following that. we won't have to wait for any press conference is because there will be one at every meeting next year. this one more of a summer's news. important indicators in the policy statement because the fed has -- because it is a central bank, it upgraded its view of the economy. let's take a look at the first tendons of the five paragraph statement. information received since the committee met in june indicates the labor market has continued and the economic activity is rising at a strong rate. before it was described as solid, now it is strong. recent months, unemployment has been low, spending looking good. what could stop them? the yield curve has gotten flat. there are concerns about it in birding. one thing we could say

haidi: thank you so much for that, kathleen hays.tarkump message for google and other social media companies. he is accusing them of liberal bias and is warning them to be very careful. >> google and twitter and facebook, they are really treading on troubled territory and they have to be careful. it is not fair to large portions of the population. haidi: let's bring in than brodie. presidentsator in -- criticism fair? >> it does not really seen that there is a lot of merit. google news has sort of double on established mainstream publications on the left and right and has gotten rid of some of those new media sites that you might have seen in its efforts to get rid of disinformation and conspiracy theories. you can find fox news easily in those areas. we do not moderate content based on political affiliation, and we .o not do it there is not a lot of evidence for it although there have been a lot of claims, usually from the conservative side, but sometimes from the liberal side as well. ramy: is this an isolated issue? ben: no. you h

kathleen hays in tokyo, thank you.head, how trumps trade war could undermine china's leadership it we will discuss political implications with award-winning author richard mcgregor. haidi: is it time for a pause on the hike path? eric ames tells us why the central bank needs to keep home mortgages in mind. this is bloomberg. ♪ is bloomberg. ♪ china resources 40% partnering a holding company, heineken and china resources reaching this fact. there has been rumors of reports going back to march this year this was a deal and talks underway. china's largest brewer, talks tolly, was in get the heineken china business. this is part of a broader trend as we see the likes of heineken seeing above -- abinbev rivals, domestic challenges very strongly. ramy: consolidation, trying to be part of the game. looking at previous reporting, back in march, that is when this first had been rumored to have started. the shares jumped 14%. it will be interesting to see what happens with those shares once the markets open. let's get back to th

thank you very much, kathleen hays. very early in the morning in jackson hole, wyoming. begin to the details of why we think jackson hole could be important, i want to bring up this chart. this is the extreme position we have. it makes the market a little more vulnerable,. >> it is interesting, you have the short positioning in treasuries. been putting on bearish bets expecting the yield to go back to 3%. if you look at the patent, you could be --it puts yields back above 3%. what is interesting, if the position is right, that is not consistent. normally, you would see a consolidation phase, positions as the market, volume dies down, liquidity gets decreased. we have seen the opposite in this case. pattern is not typical. at the moment, we are at the lower end of that range. i think it is right to look to this. guy: i went to my charts earlier today, and this was the sneddon chart. this is one we talked about a number of weeks back when you were on then. what has changed since then? channel in terms of yields, it looks like we have woken out of it at the top. david: what

kathleen hays asked the kansas city fed president for her outlook on the hikes. they spoke at the jackson hole symposium in wyoming. take a listen. >> i agree the economy is doing well and based on what i see today, i think that two more hikes this year could be appropriate. but i am also mindful that that is not a commitment. that each meeting you have to reassess and understand what you see in the data, what are you hearing from constituents that you talk to, and make the decision at that time, so hopefully evident holds together as we get toward the end of the year. >> would you say that the committee has coalesced around the? is there a strong consensus? >> if you look at the dot plot, read the minutes, the statements that have come out, it was a just that there is a degree of consensus around the state of the economy, but obviously within the committee you look at differences on how many rate hikes are appropriate at this stage. >> earlier, you were worried about inflation picking up, with concern that fed policy would have to move faster, is that what you a

over to kathleen hays in tokyo. the r.b.i. hike was not a surprise, but some of the comments were. about the impact of the rupee and what it will him fly for future rate hikes your 25 basis points to 655%, they have high inflation about target. a currency that has been battered this year as trade war tensions continue to increase. chart from the a bloomberg library. you've got the blue line along the ball on -- the bottom. the right-hand side has moved up 5% and change. the target is 4%. well about target. oil prices is the yellow line. the white line, far right-hand side, that key rate for the 6.5%, to rateo hikes and 25 basis points since april. of it is clear that he sees the risks are still there to the economy, to the rupee, which is now asia's worst performer. specifically, he is worried about currency wars. let's listen to what he said. >> we have already had a few months of turbulence behind us. like this is likely to continue. i do not know for how long. the trade war has turned into tariff war's and now we are possibly at the beginning of currency wars. kathleen: it is no

kathleen hays is here with the preview. the rba being the dullest central bank in this part of the world. lots more reasons, perhaps more than ever, to sit on your hands for a bit. kathleen: it is always good to know why it is sitting on its hands for so long. it is not as though its economy is not doing well, not as though inflation has not moved higher. when you put it together, you can understand why again there is no reason for them to take the key rate off 1.5% yet. one of the biggest things, very important not just to the reserve bank of australia, but the australian policymakers who are in control of the government right now. wage growth remains on the flat side. let's jump into the bloomberg library and look at one of our gtv charts. you are going to see a yellow line, wage price index. flat at 2.1%. you can see the cpi, which has moved up a bit, but still not as high as the rba would like to see it. meanwhile, the cash trade holding steady at 1.5%. they move along in this story. the inflation rate at 2.1% is barely

our global economics and policy editor kathleen hays has a rundown on all of this. ay? kathleen: broadly, the labor market remains tight. industrial production has a little bit of a setback. that's not expected to go away right away. let's start with the job list -- jobless numbers. it picked up 2.5% from 2.4% in june. it is just above a record low, at 2.3%. when you look at the job to applicant ratio, that is impressive. it continues to get higher, 1.63 jobs available in july for every one worker. that is up 1.62 in june. if you look back at me telling you these numbers, every month it seems to move higher. bloomberg economics in tokyo is saying this is gradually going to boost labor demand. it will be economic expansion. in a tight labor market, on the supply side not so many workers. it will help wages rise slowly, but not fast enough to get the 2% bpr target from the bank of japan. that core cpi from fresh food prices, anytime soon. all the people have walked to work, we got news on industrial production in japan. the number was expected to be weak. there has bee

kathleen hays is here with more on the boe rate hike. of course, mark carney has so judicious and careful in his moves on monetary policy, tolerating a big rise in inflation above target. even though inflation is starting to come down, mark carney still sees rates coming down further than they are now. take a look at one of our gtd charts. -- go tv charts. you can get the picture of what happened in the last 24 hours for the bank of england. you can see the white line along the bottom. flat rates were down. core inflation down to 1.9%. headline still 2.4 percent above target. in fact, after this decision that he is keeping rate hikes on the agenda even as brexit , the economy is growing, unemployment is low, wages will rise, and that is the reason for this. he told bloomberg television earlier today that the door is open and rate hikes could happen. >> important thing is this is the right decision for the economy given the track that it's on. obviously, there is a wide range of outcomes possible. we all hope that by the end of the year w

kathleen hays is here in the studio with me. what did we learn?hink we learned this underscores what we saw on the policy statement for the bank of japan and heard from governor kuroda at the press conference. the boj have not made much of a change until they made this tweak to yield curve control policy. one boj member says it is essential to pay close attention to side effects. remember, the boj has been buying so many bonds, there have been times liquidity has completely dried up in the jgb, japanese government bond market. it was getting to be more of a problem, maybe a lot more of a problem. broadly, another one, the boj overall saying it is vital to make easing policy sustainable, by making it possible for the bank of japan to keep buying bonds by widening your range. one boj member said the long-term yield range of 0.25% will the appropriate. right now it is 0.2% on either side of zero. they talked about introducing forward guidance, that they would keep the easing policy and stimulus for an extended time. another member saying even more fl

and kathleen hays.a for bank of england governor mark carney as he counts down his final year in the job. what he has to say about the program. that is underway. this is bloomberg. ♪ rishaad: you are back with "bloomberg markets." i am rishaad salamat. mark carney will not rule that out again before he leaves the bank of england next june, but he'd knowledges that brexit could change of -- acknowledges brexit could change everything. francine lacqua asks whether it would be risky to reverse course. as ae situation, not fundamentally changes. the important thing is this is the right decision for the economy given the track that it is on. obviously, there is a wide range of brexit outcomes that are possible. endwe all hope that by the of the year, we will be much better informed on which path areu.k. and the e.u. taking. in a variety of those potential would be they consistent with rates at the current level, if not higher. certainly, there could be circumstances where it would make sense to adjust policy

kathleen hays is in wyoming. what are we looking at?are looking at an where in the past the fed chair increasingly over the years beginning with alan greenspan have used the opening day comments from the fed chair to perhaps give a signal about some important policy step that might be taken, the first steps towards quantitative easing, for example. not necessarily take signals, but important ones to markets. that is why the speech is being watched so closely. he will give a speech that focuses mostly on the u.s. domestic economy and repeat the things we heard in the minutes from the fed's last meeting. furthermore, it will say growth is strong, labor markets are at target,ation is and there is uncertainty over trade, but no damage to the economy yet. underscoring a rate hike in september, and another at the end of the year. interview, one bank president is on board. that is what people are waiting to hear. what would be the surprise? if there is short-term hesitation, that if he says anything that signals policy, it will be more rate hi

our global economics and policy editor kathleen hays is here now. kathleen, it seems like mr.is not going to be byerred by inversion or rising trade tensions could kathleen: certainly not over uncertainty for longtime used monetary indicators. which he was putting in this great metaphor for, you can guiding your boat by the stars, what about guiding it by policy stars? he also started out i saying employee or -- employment is at a 20 year low. no sense he is worried about the economy that would deter him from rate hikes. then he gets into this thing about past errors in the system of guiding by the stars. not sure what the nature of unemployment is he says navigating by stars is sometimes straightforward. he tried to guide policy by the stars when the stars are changing. he goes on. i think this is the part that markets care about. fed must avoid moving too quickly and hurting the expansion or moving too slowly and allowing inflation to get out of control and then you get overheating. he also said at the same time, he sees no elevated risk of overheating right now because he d

with the goode work of our michael mckee and kathleen hays.izuho securities. with us of credit suisse. the atlanta gdp numbers are superb. do you have a belief in those kinds of numbers? assumptions built in about where we are going. i would look at the data we have and the data says we have an economy running 2%. that is where we have been on average. within that is your work on .nalyzing the american consumer what is the -- what does the american consumer look like into autumn? growth. running at 2% it is hard to get much beyond that. bit from little investment spending, a little bit from trade, from inventory and that is where the economy is. guy: good morning. guy johnson in london. we had a piece over the weekend that talks about september is a done deal. december looks more difficult to factor in. there are a whole bunch of factors and the policy environment becomes more difficult. he is pointing us to an environment where the fed has a think about what is happening around the world and waits until march. is that what gradually means? st

kathleen hays has this story. definitely the immediate victim here. en: it is not just what has been happening recently. argentine pesos and the country was go back to earlier in the year. tv had to be the raised earlier in the year. now what they have done is asked to speed up the monetary payments. their first payment was made in june and now they need to ensure investors that they can survive the financial crisis that hangs over the country. me asnto the library with we look at this chart. the one-day percentage change going back to march. it was bad enough in may, but look what happened today. nearly 8%. what is going on? justresident was elected three years ago, replacing a socialist government coming into rebuilding economy. instead, argentina is facing its second recession in three years. to a recordeso down of 33.8 to the dollar, inflation is rising. there are big problems. confidence is dropping after such high hopes in that election three years ago. it is seen as a way to reassure investors that argentina will not be forced to default on its

kathleen hays there. jackson hole. let's talk about inversion. gap is atng curve 18.75 points.o what degree is this a concern to us now as it gets ever closer to inversion? keep oursomething to eye on. i tend to concur with what kathleen was talking about. the biggest risk factor to the global economy is global trade. if we look at why global growth was so good in 2017, it is because global trade was really strong in the second half of 2017. -- wobal trade weekends eakens, that will be bad for the global growth outlook. they are saying do not look at the em. to what degree -- them they are saying to not to look at the em. is something that jay powell is trying to do very hard. successfully slotting the discussion of trade and tariffs. if we see the other $200 billion in u.s. tariffs, if we see that go forward, it will be more difficult because you will see further reports from executives .nd economists ramy: his comments were interpreted as more passive. the same away from this? we are still looking at a september rate hike and a 60% chance for december. four have been expectin

we go to kathleen hays with a preview. you are in tokyo -- tokyo at the moment.s have to acknowledge the federal isn't planning to do any more rate hikes because there is no press conference after this year. federal reserve chair powell said every federal reserve meeting will be a press conference. the fourth quarter gdp number topped 4%. inflation is close enough to target and growth is strong. one thing they cannot get into with her policy statement is what is going on with the yield curve. it got a lot flatter. the fed is watching closely. what we all take a look at this bloomberg chart. -- why don't we all take a look at this bloomberg chart. it shows how the spread has definitely narrowed. that was calls for a recession in the past. the lower chart shows nominal gdp. shows a growing economy. low,t that yield curve you cannot be headed toward a recession. the point is that a flatter yield curve causes a recession. there is the thought that the fed could be too tight, pushing down long-term rates. when you have a flatter yield curve, it makes it harder for ban