tom: michael mckee with us as well. michael pond of barclays with us.a joy for the white house. markets celebrate, up 68 on the s&p. nasdaq up 1.2%. michael mckee has had a few minutes to dive into the report. you are making a joke about spirits at home. that is the degree of granularity you can go to. what is another item that sticks out? mike: one thing i was interested in is what happened with medical care, new legislation that was just past. prescription drugs were up .3% after a .1 gain. that is a fairly high move, so something that could be affected if the administration is able to get something in place to negotiate for medicare, if the company don't raise the prices on people who don't get medicare. nonprescription drugs up 1.3%. if you are taking tylenol because you had too many distilled spirits, tom, you are paying more for that. the recreation component up .2. commodities with declining prices, as we have seen for television, video clement, etc. some of the inflation dynamics we are used to are coming into play here. tom: if you are just joi

with beautiful scenery on the ground, bloomberg international economics and policy correspondent michael mckee. you as always for joining us. what is the move there? what can chairman powell actually successfully delivered tomorrow? -- delivered tomorrow? michael: the mood is good and the sun has come out. the talk so far as the massive rainstorm he had last night. which blew all the -- down and swatted a lot of places in the park. we are all in this untried now. wait to see if jay powell prevents -- he will say what he said before, the fed is vigilant on inflation and they will keep raising rates until inflation comes down. they will not be cutting rates despite what wall street may think. they will keep looking at the data to decide where they are and how far they have to go. the question is, does wall street want to listen at this point? kriti: it is interesting because it feels like there is such a hawkish tilt going into chairman powell's speech tomorrow. you talk about this yesterday, almost feels term and powell is set up to fail but i have to ask, what can you say in this arena where y

taylor: it is always ok having a two-handed my economist -- economist when it is michael mckee. as within about the reaction in the reaction and equity markets here, to talk all about that, market appeals asset management ceo, michael shaoul here with me. if you want to because eight when he percent gain off of the low of the market, does a signal may be the all clear in your world of equities? michael: i don't think so. one of the tricky things his the long bear market values of the beginning of the bull market ultimately looks very similar. the question is always have you really addressed the issue which took you lower and your conversation with michael mckee said no, we are in the middle of what is a very rapid period of monetary tightening. it is in response to inflation -- is it in response to inflation? think you can make the argument that headline inflation rates will be quickly in europe. there's a bit of belief in commodity pricing, which will make a difference to the headline numbers, but unfortunately we do have pretty embedded inflation in the u.s. away from commoditi

michael mckee has on that and some of the meeting history. he fed chair's speech is the main event friday. thursday, the talk in the conference was liquidity, but not the wall street kind. a massive storm hit grand teton national park, flooding the roads, and blowing down the tv tents, creating its own inverted yield curve. jay powell's speech may not have an impact on the markets quite as dramatic, as investors have already priced in a hawkish message. even if he says nothing new, they will probably take it that way. meanwhile, we have had requests for a sequel to our history lesson on how the federal reserve ended up here, how did grand teton become a national park? a higher power took care of the mountains. scientists think about 2.2 billion years ago. fast-forward to 1929, a small portion of this area became in national park. then came john d rockefeller. he was so enchanted with the area, he basically bought almost all the land between here and the town of jackson. then in 1943, he donated 43,000 acres to add to the national park. now, th

michael mckee, what a legend. we thank him for staying late on his birthday. look at the market impact with the macro man. cameron, you have great notes today to put this into context. the market reaction was pretty obvious and so was the reading overall. but what -- jay powell cannot get enthusiastic yet. is this compelling evidence of the moderation in inflation? cameron: no, because it is only one data point. we do not know what the future holds. from a statistical perspective, you need more than one observation to render definitive or compelling judgment. if you want to look on the sour side of things, the fed meeting cpi, which lines up every piece of stuff and ranks them from the top to the bottom, that reached a new high. 6.2% year on year, albeit receding from 0.27%. that is above what anyone would consider to be price stability or where the fed needs inflation to go. jon: as we continue to chew on these data points, i saw you writing today you are interested in looking ahead to the next retail sales reading. how come? cameron: one of the issues along

michael mckee, we thank you for your coverage with the team over the next two days. let's get to the story of positioning. joining us is priya misra from td securities. let me put to you the question i put to michael mckee, is chairman powell set up to fail given how hawkish the market is? priya: thanks for having me. i think the market is setting up for a hawkish message. if the market is looking for chair powell to tell us if this is a 50 or 75 basis point hike, i think you are going to be disappointed. chair powell is going to say they are data tended -- they are data dependent. there is still another report before that meeting. i think what the market is setting up for is that the fed is not relenting on its inflation credibility or a clear commitment to slowdown the hike. the market has been struggling with the threshold, what is the threshold to stop the hike and then cut rates? we have already priced in all of these events. i don't think we get a lot of clarity. the market is setting up for a hawkish message for the fed to say the data remains strong, we remai

here to give perspective on the high-frequency claims data is michael mckee. on thursdays. michael: frequently, we talk on thursday when we get jobless claims numbers. we are looking at 262,000 four last week, in terms of jobless claims, which is higher than the previous number. i am waiting for the release to load to see what the revision is to see if it is a major change. continuing claims, 1,428,000. up by 12,000 from last month, not a huge level of ongoing claims which tells you people are still able to get jobs. they are on on a plummet claims for a brief period of time. ppi, interesting news. final demand ppi, which is what companies get for their products down .5% during the month of july. that pushes the year-over-year rate from 11.3 to 9.8%. that is interesting. x food and energy, sort of the traditional core, is up .2%. the forecast was .4%. x food energy and trade, up .2%. that was forecast to be up .4%. the annual core rate, 7.6%, down from eight .2%. energy food and trade, 5.8%, down from six point 4%. a weakening of inflation. tom: the markets lif

i want to listen to michael mckee.important is what he doesn't say, what he will not address is the international economy. it is ugly in europe. jonathan: will he address this market? lisa: does he feel comfortable how much it has rallied? still hanging in. is this ok for him? will he go back to the line we heard last month that even though the market has rallied -- it has had enough to get it done or do we need something more hawkish to keep things where they are because people are expecting hawkish nests? jonathan: the ecb, looking for another 50 basis points and maybe after that another 50. the euro is weaker. lisa: even a one percentage point increase in european rates is not enough to strengthen this europe which raises -- this euro which raises the theme we will hear, has monetary policy lost its potency in an era of supply chain disruption? how does the european project deal with that when inflation is becoming a spiral with the importation through a weaker euro? tom: the smartest app -- sai saw today, sir howar

kriti: always reassuring, bloomberg's michael mckee. let's push now to market reaction. the libor rate rose for the fourth straight session, now the highest since november of 2008 following the hawkish comments from the fed reserve officials. alex, thank you for joining us. you have a long history of reporting on these markets. walk us through the market reaction. how justified is this? will we see more of that bond volatility? alex: the interesting thing is that libor i don't think is a leading indicator anymore. the way the methodology has been restructured in the post manipulation years, it's using a trait to underlie. one day fed bets are going higher, those will feed back into the life or fixing so libor will then move higher. i think it's more of a trailing indicator. the interesting thing is that we watch very closely. what that is telling me is that as traders bet on treasury, betting on the fed be in more hawkish. you will see a demand for overnight borrowing. that is actually going to push repo rates lower. and that we also need to keep watching as well. june 3

joining us from jackson hole is michael mckee way understand the weather is better and the view is stilliful. what happened between now -- what happens between now and 10:00 a.m. tomorrow when the chairman speaks? michael: after we finished mopping up the rain. this blew down a bunch of trees and other stuff. there's a dinner tonight that kicks off for the host of the meeting, the president of the kansas city fed will give a short speech which is a welcome to jackson hole. then tomorrow morning we get the main event which is the keynote speech, first thing on the agenda from jay powell. after that they get into various papers that are prevented presented, this is an academic conference. the fed chairman speaking here. most of this will be theoretical and they help these guys think about things and long-run but not about policymaking. guy: you would've thought with some sort of rainstorm going on that some sort of hat would be a good idea. i'm sure you've got it covered. how abnormal is it that this speech is allowed to be broadcast live to the world? this is normally a quiet academic eve

michael mckee bloomberg, jackson hole, wyoming.us: let me show you how the markets are braced for this jackson hole meeting. equities are stoic, nasdaq down to 13,130. you'd think higher wages are good news but they will chip away at the margins. and we have a little bit of an obsession with cpi and the next 50 basis point move. that is the longer duration rate that matters. the dax down .4%. showing you the bond markets. henrietta was with me moments ago, get rid of the rate cut narrative in 2023 is what jay powell needs to achieve today. 2's and 10's are at -33, that means a mild rather than a deep recession. you are seeing a narrative in the yuan market which is a clariion call for cuts to crude for the coalition of the willing. output cuts in the oil market. and cable still plummeting at 1.1806. did you like our clariion call alliteration. so, mark, do you want to start with bonds or oil what takes your fancy? >> let's talk about something at jackson hole which you probably haven't covered so far. there is actually a very inter

kailey: michael mckee, bloomberg international economics and policy correspondent. as the market digests those headlines, we are seeing yield headlines, five basis points on the 10 year, back up to 2.62 and the dollar is at a high as well. in addition to watching the fed speak today and the market reaction, we are keeping a close eye on taiwan. we are waiting for the plane carrying house speaker nancy pelosi to land in taiwan and see what china's reaction will be, and how investors hedge that risk. our guest discusses, coming up next. this is bloomberg. ♪ >> everything you need to know to get ready for the start of u.s. trading. kailey: we are still watching taiwan, awaiting house speaker nancy pelosi's expected arrival there. potential military action if she does indeed make the trip, raising the possibility of geopolitical risk and raising tensions between the u.s. and china. that brings us to our question of the day -- how do you hedge taiwan risk? joining us now is our guest. lisa, if you can, how do you do it? lisa: geopolitical risk is one of the most impossib

let's get to bloomberg's international economic correspondent michael mckee. l, you preview the minutes and you have to feel it is a

kailey: kansas city fed president with michael mckee and kathleen hays.rs are set to purse through fed chair jay powell speech from jackson hole. marcus ashworth will be listening for one more sentiment. he writes "the track record of central bank economic forecasting is in tatters as confidence that are monetary overlords know what they are doing. missteps this week triggering -- risk triggering market dislocations." marcus, it's a great point. do you think chairman powell would be that honest? marcus: not a chance but we can always hope. he did say something, central banks in portugal, he said they understand now how little they understand about inflation. not very reassuring but they are perhaps aware that some of the models aren't always as perfect as they might expect to be. and christine lagarde came out and said exactly the same thing. reminds me, why did no one see this coming. it's a bit like that for central banks. powell this time last year essentially said with transitory inflation we've got this covered. it's not all their fault. governments

let's discuss this with anna won g and michael mckee. we are primed for weakness in the u.s.obs market and we are seeing that today. the market was not as red-hot as some say it would be. how weak doesn't have to get? how weak does it have to get to way down inflation? >> the most optimistic case, let's look at what the fed wrote down back in june. they see the unemployment rate has to eventually rise to 4.1 percent in 2024. that's about one million job losses from today's number. that's the optimistic case. our team is thinking more that inflation would be more of a persistent problem and the fed will eventually have to hike rates 5% and that would correspond to an on appointment rate of about 5% in 2024. that would mean 2.5 million job losses from today's unemployment figures. alix: is the fed prepared for something like that? michael: companies are always laying off people. it's the company that's doing badly and not the economy in this case. successful companies are making money and they feel they have to lay all people because they don't have enough business. the fed thi

we bring in michael mckee. are investors too optimistic?t's been a very uneven july there is low volatility in the earnings season looks oh k, optimistic or too optimistic? >> goes back to whether we are seeing key inflation and we will get more data tomorrow but the interesting data point from yesterday survey is that consumer inflation expectations have dropped step that's a good sign that if the fed was worried about expectations becoming anchored because the question for the market -- the earnings season has not been too bad but will the monetary tightening the real economic growth? other strategists are warning that investors are still too optimistic about the earnings season and going into next year. katie: a lot of this depends on maybe peak inflation being behind us and maybe of bed pivot approaching from hawkish to may be less hawkish. how much actual data is backing this up. is the fed approaching a pivot? [no audio] guy: let me jump in because i think we may have an issue with your microphone. we will come back and fix that. is t

joining us is michael mckee. what can we expect on thursday or for september? questions that are separate. for thursday, nothing. alix: fair enough. mike: when you look at the balance sheet, it looks like not much has happened. but there are technical reasons for that. the balance sheet is about $9 trillion but it is going down. here's what is happening. on thursday, technically it is september. the caps are going to rise on roelofs to $60 billion for treasuries, $30 billion for mortgage-backed securities. double what they are right now. only $43.6 billion rolling often september. the fed will have to sell bills as well. that should mean lower use of the repo facility. here's the thing going on. maturity and settlement dates for the treasury is midmonth in the end of the month. you will see impacts on the balance sheet about the middle of september and the end of september. that is when we will start to see things -- not as much in the middle as we will toward the end. anna: there is a lot of focus on the use of bills and the way they will be used in the qt pro

. >> michael mckee, thank you so much for joining us. we will continue the conversation on the fed and the market. almost like the last three months did not even happen. this is bloomberg. ♪ >> i would like to see the policy rate gets a 4% this year. i think that inflation has come in hotter than what i would have expected during the second quarter, so now that it has happened, behind to go a little bit higher than what i was saying before. >> he made headlines earlier today saying they are still some distance away. that brings us back to our question of the day. joining us to answer that question is our chief strategist. >> right now, the market is saying that inflation has already peaked and you see that in the 10 year and the yield curve. the fed is also seeing, we are not done yet. there is a little bit of a headwind. they want the yield curve to be higher. that is why they said, we are nowhere near neutral. the market has said, we think that inflation has already passed and we think that the fed is going to end up cutting labor. >>

tom: the one and only michael mckee.we are joined by kit juckes , head of ethics strategy at socgen -- fx strategy at socgen. let's start with the u.s. dollar as we lead up to this each from jay powell. how much should we read into the price action today? kit: it is still affecting risk sentiment on a day-to-day basis. the story from yesterday, maybe someone was saying that the easiest trade on the market is ahead of what is left. people saying that nothing is supposed to be easy, so it is a rallies and equity markets, but of a selloff in the dollar. tom: still the best game in town? kit: i think it is going to stay strong for a long time, not necessarily go another 10%. in terms of the price story, the price for gas, the fact that the u.s. has turned into an energy exporter, is a game changer for what this means for the dollar. but this has not spotted how bad the energy crisis is in europe and how much gas is needed for energy. tom: the euro-dollar now is driven by energy. kit: i think so this cycle because the terms o

michael mckee bloomberg, jackson hole, wyoming.history lesson from wyoming and jackson hole once again, that's symposium getting underway, and we will have that each at rear clock p.m. across bloomberg tv. we also spoke to the kansas city fed president esther george. she says they will have to take interest rates above 4% at a time as current rates are not weighing on the economy. >> the chairman will deliver the opening remarks. i haven't previewed his remarks so i cannot tell you what is in there. but i will tell you from my own perspective, it is important we are clear in our communication about the destination we are headed, and that destination is important. we have to get interest rates higher to slow down demand and bring patient back to our target reverse some period of time here. >> let me ask you in particular, are you willing to keep hiking rates? if you see the economy slipping towards what could be a recession, could you stand up half an for inflation is still too high? >> we have to, by mandate, bring that inflation d

we welcome someone who will be there, michael mckee. what is he facing? >> he will face a

we turned to michael mckee, bloomberg international economics and policy responded. use whatever

michael mckee, you be digesting this over the hours. would you explain how smart people like you get this so wrong? for mere mortals out there on radio and tv, why do we get this report so wrong? mike: in this case, you look at the contributing data, the data points that tell you something about employment, and you try to figure out from there where it may end up. you look at past history. past history is that july numbers have underperformed the forecast since 2017 until this year. you have models in terms of what you know about various industries, and it is really hard, and it is even harder now given the fact that we are coming out of pandemic. tom: right now, i am doing that three-month moving average with revisions. 437,000 jobs over the last 90 days. that is a wow statistic. lisa: it is a labor market boom. average hourly earnings revised upward in the prior month's, state at the same level of 5.2%. it comes as the participation rate continues to fall. what do you make of this? how does this signal the tightness or looseness of a

let's touch a swiss mike mckee. michael: we are waiting for numbers to cross.g me down here to do a weather report. the rain just started to let up. maybe you can join me in a few minutes. jobless claims coming out this money, i am losing my connection. i will get the numbers in a second. initial jobless claims coming for the last week, it is crazy. the elements are conspiring against us. jon, if you have the number in front of you, you can give that. jonathan: i do not know why we made you do this. it is pouring rain outside of jackson hole. forgive me for that. tom: ♪ jonathan: ok. claims come in as a drop to the previous number, 250. it is a better number. 243. personal consumption, one point 5% in the second quarter. the gdp price index, look at that. tom: wow. lisa: the fact the price index for the second read of second-quarter gdp was revised upward tells you something. to me, that starts to raise a question about where we end the year. what happens if we in the are at 8% cpi? what does that do for fed policy? jonathan: underlying gdp, the estimate negati

michael mckee and marcus will join me on the radio if you want further analysis of what's happening,une in to the cable a little later on. kailey: i can't get enough of this question of the day so we'll talk more about it when we come back. is europe toast? kim forest, founder of boca capital partners will be joining us with her thoughts on what her preferred breakfast is. plus as we head to break, we weigh in on the debate over the fed and bank of england and take a listen to this. >> being the most honest of the central banks and predicts a recession that will last for five quarters so a prolonged recession and yet they feel the need to hike 50 basis points with more to come. that's the reality facing the central banks and the fed is like we can avoid recession, it will be a slow down but no recession. come on. we're going into recession, major economies will go into recession. ♪ >> this rise in energy prices has exacerbated the fall in real incomes and led to another significant relyization for the outlook for u.k. and the rest of europe. g.d.p. growth in the u.s. slowed and the e

michael mckee and katie greifeld , thank you. we will probably see you back here tomorrow. we will ask someone else the question of the day who happens to be working as we care for jay powell's speech. we will talk about what to expect and where the catalyst could come from with kevin gordon of charles schwab and what he will be listening for. this is bloomberg. ♪ [drone speaking] technology lets drones deliver pizza. no,no,no! have a nice day. but to deliver powerful insights that are on target you need more than technology. you need cdw. we can help transform and manage your it environment with a dell technology solution, so you can use your data to innovate. wooh pizza is here! i'm still gonna eat it. me too. tip please. dell technologies makes data driven insights possible. cdw makes it powerful. >> my hope is that we will get clarity. that policy is not yet restrictive. that it needs to be restrictive if we are going to contain inflation. and that we need to accept the consequences of that. kailey: that was larry summers, telling bloomberg's david westin on wall street

we are pleased to tell you that we will be at jackson hole with michael mckee joining us as well, reallyor contact with the federal reserve of kansas city and their academic meeting. we hope to make it more academic for you. we look for that in 15 days. kailey leinz in for jon ferro. i'm tom keene and think you for joining us. futures ever so slightly doing an advance, of 19. make that up 20 points on the standard force dow futures, up 139. this is the conversation of the day for every american family on radio, tv, overwhelmed by the cost of airfare. helane becker brings good news, senior research analyst at calwood. you do definitive work that you invented, measuring the airfare percent change. you detect a crack. is it possible airfare's could collapse come the ottoman winter? >> i would not say collapse but deftly come down. we are already seeing them declined. it looks like june and july was the peak and we have seen what you call proposed ash promotional fares come down after labor day. they are not as low as they were last fall. last fall we saw them as low as $39 one-way. we are s

joining us is michael mckee. ome ways, the markets is not listening to hawkish rhetoric, but the number comes down, market responds we had a soft landing in the fed has to chalk it up more. michael: and then something else will happen that was send the market in the other direction. we have retail sales next week, maybe it is weak or strong, but we will have a lot of volatility until we get to september when the fed is actually going to make a decision. what is interesting is in the cpi report today, even though it is still unacceptably high, according to charlie evans, the transitory categories that the fed had been watching so long ago are finally proving to be a little transitory. used cars, car rental, airline fares, hotels, motels, all down significantly. so, there is some evidence that what they were waiting for is happening. the problem is there are a lot of things that are not so transitory that they are still going up. food went up. housing went up. new cars. i just picked a random -- laundry and dry clea

kailey: thanks very much to bloomberg's michael mckee with that president loretta mester in jackson holeicting on -- loretta mester saying she thinks rates may need to go above 4% and be there next year. a consistent message from the federal reserve speakers today, including chairman powell. coming up, we will have more reaction to these remarks and get the latest on europe's energy prices, as well as prices surge yet again. i let hand or grinned all will be joining us next. this is bloomberg. ritika: this is bloomberg markets. we were looking at a live shot of the principal room. coming up, the imf deputy managing director. this is bloomberg. kailey: chairman powell has spoken, and these markets are reacting. it is a downside move for equities after the fed chairman said they are going to get restrict. they're going to stay there for some time. that is taking equity down collectively. the s&p right now down about 2%, that it is those tech-heavy indices that are more sensitive higher rates feeling the brunt of the pain. the nasdaq and nasdaq 100 down about 2.5 percent as we see action in

we welcome back michael mckee.you keep bringing these numbers we will keep asking you back

michael mckee is with us. mike: i am the messenger but i don't know what the message is.-new survey that's been retooled, does not depend on models. it is a snapshot of the labor market during the month based on the payrolls they process. 132,000 jobs. 22,000 in the goods producing sector, although there was no change in manufacturing jobs. service providing jobs rose 110,000. what does this mean for friday? the adp people say this is a standalone indicator, unique snapshot of the economy. i bet everyone on wall street will be plucking these numbers into friday's number. the consensus number is 300,000. also a new report on pay. according to this, and you will pay at a 12-month rate was at 7.6% rate of increase in the month of august, which is high but stabilized. hard to know what stabilized is because we don't have the numbers. in theory they are releasing those today. we will try to put it all together for you. tom: nasdaq up eight points. mike mckee, i will not mince words, this has been a busted data point for so many years. they brought in so many people, writing ab

tom: surveillance archives, this is a great image of kathleen hays and michael mckee moving from thef past wyoming on their way to jackson hole. jonathan: are you driving? tom: kathleen, she is driving. tom: kathleen, she is driving. what if you were a global bank who wanted to supercharge your audit system? so you tap ibm to un-silo your data. and start crunching a year's worth of transactions against thousands of compliance controls with the help of ai. now you're making smarter decisions faster. operating costs are lower. and everyone from your auditors to your bankers feels like a million bucks. let's create smarter ways of putting your data to work. ibm. let's create jonathan: live from new york, good morning to you. futures positive 1/10 of one person on the s&p. yields higher by three basis points, 3.0. call it 3.05%. if you look at foreign exchange, the dollar stronger against the euro. tom: there is a way to this. -- weight to this. jonathan: we saw that yesterday. i think by the end of the day, we had a move that was almost four percentage points. tom:tom: for those keeping

tom: michael mckee is the expert on the schedule.is there is an eight foot grizzly bear and you waive as you go by. jonathan: a family photo in front of that grizzly bear. appropriate for this program. tom: mckee tried to interview the bear wants. it was 2:00 in the morning. jonathan: i do not want to know how that night was going. mike bell of jp morgan will join us later. bank of america pointing out we are no longer apocalyptic lee bearish. there you go. lisa: i love that. jonathan: will do this in a moment. we'll catch up with annmarie hordern. this is bloomberg. leigh-ann: keeping you up-to-date with news from around the world, with the first word news i am re--- i am leigh-ann gerrans. iran is signaling it may be closer to a deal with the u.s. that could restore iranian oil exports to global markets. iran has sent the european union its response to the blocks proposal to reviving the 2015 nuclear accord. it expects to hear back from negotiators in the next few days. singapore's prime minister warns the u.s. and china may sleepw

jobless claims figures, mike mckee. michaelor the week last week. that is significantly lower then the initial 262,000. we are waiting for revisions to come in. continuing claims, 1,437,000, that is a little gain of 900,000 more than last month. it suggests we are not seeing people who lose their jobs staying unemployed for long. you are able to get off the unemployment rolls very quickly. philadelphia fed comes in at 6.2. last month, it was at -12.3. we had earlier, the empire index and a major collapse there at down 42 points. the philadelphia fed changes the other direction and goes positive. philadelphia fed new orders index is at negative five, compared to -24.8. that is an improvement, even if it is still showing a little contraction. the other thing about the philly fed, prices paid is jumping around on my screen here. prices paid is 43.6 versus 54.2. prices paid came down significantly. another signal that may be inflation is backing off a little bit and we will have to see how this translates to the ism the week after

with your economic data, here's mike mckee. michael: good morning. the fed is on the phone for you.to go shopping because retail sales came in flat for the month of july. no change in the retail sales figures overall, and the retail sales control group, that one has not come in yet, but autos up .4%, and that is down. and autos and gas up .7%, so i am guessing, and i'll look quickly, that gasoline played a big role. gasoline stations down 1.8%. we did see prices fall during the month and retail sales are calculated in dollar terms. so, overall, that is good news. motor vehicles down 1.6%. we will talk a little bit about that on the open coming up. furniture and home builders up just .2% after a bigger game last month. it looks like reasonably healthy in some areas. building materials up 1.5%. we saw good results from home depot the other day. grocery stores just .2% higher and clothing and accessory stores, the people who are not buying the balenciaga, down .6%. tom keene helped out, food places up .1% rate tom, you have more work to do. jonathan: food and drinking, the nasdaq 100 d

mckee joins us. the one and only vincent as well with us. any sign the market is beginning to fear the fed? michael: it is a combination. some of the talk from the ecb and the fed was piling on. i am in the opposite camp. i am not afraid of an institution that cannot get a forecast right. of an institution that has been wrong for the past 25 years. [laughter] when i was trading, they said goldman sachs was selling. thank you. i don't think you can look at this fed with credibility from the transient on. yesterday, looking for 75, in the neighborhood of 325 for the upper band of the target. you're not giving monetary policy an opportunity to work the market, which we are starting to see in terms of home sales and prices and other metrics where things have turned lower. they are not stopping at any red lights. they are a little too aggressive for me. after september the data will prove they have been too aggressive. alix: vincent isn't paying attention to the fed. he doesn't care. powell will not like people like vince. they need to make a markets care. how does he convince them? michael: i'm trying