pce continues to stay low and i think powell alluded to the fact that the forecasts are just forecaststhey are no better or worse than anybody else. i did find it intriguing when you look at the dots and you saw one who had a terminal rate of 480, i thought that was pretty impressive. but the bottom line is i think we will see the data to continue to be moderate and disappoint and i think that powell really laid it out that they made one move, one decision at this meeting, and it was to raise rates by five basis points, and everything else just gets made in furtheron meetings. jonathan: for most people, there is no downside risk. not many people calling for one more this year. what do you make of that argument? ms. aronov: let me throw some stats out there. it's really interesting. over the past two years, from march of 2016 to march of 2018, we have seen $300 billion fallen to core non-strategies, more than ever in the history of this as a class are arguably any other asset class. the return for the benchmark has been barely over 1%. 1.1%. this happened over a time when the fed was at

core pce, and then broken out the blue line's financial services.o have the pink line, which is health care and hospital services. we are paying more for health care, and then there is a big related to financial services that is extra cost. it. does this -- explain matt: that rebound in the yellow line, you can see 60 basis points is accounted by these two categories, more than all of that is accounted for. some are saying don't look at these your to your inflation rates because that bad march is about to drop out of next month's inflation number and core pce is going to automatically jump up. the problem is all of the strength we had has come from these two categories over the last year or so. lisa: which makes it is getting more expensive to be sick and they are essentially getting ripped off by the banks. matt: the financial services component -- what is going on is banks aren't raising deposit rates even though the fed is going up, and it shows inflation for deposit services. it is not a real price consumers paid by it is boosting the index. on

mark: something we have not talked about today, due to the news flow is the core pce deflator.ow does this fit into the narrative? >> it was pretty much as expected. it underscores that nothing has really changed. the interesting thing will be next quarter. last year, verizon cut the price of its cell phone plan with the unlimited data which had -- which led to a very sharp decline in the price of cell phone services which knocked about 2/10 of 1% off most inflation measures including the core pce deflator. equal, you will see inflation on a core level and a headline level go up. in one fell swoop, we are halfway there and close only counts in horseshoes and hand grenades but in some accounts, they count for monetary policy as well. vonnie: we will leave it there. cameron crise. volatility, what forted out as a strong year wall street trading -- michael moore is here. michael: what we are hearing is a lot more optimistic -- a lot less optimistic. you had jpmorgan, citigroup, even credit suisse come out in the middle to late february to talk about trading revenue being up, year-

one thing that might factor into the testimony today, the pce data we got today. fed's preferred inflation indicator. 0.4 on the headline, 0.3 on the core unchanged, 1.7 year over year on the headline and 1.5 on the core bmo saying stable core inflation could temper the fed's tightening enthusiasm. hfe says the opposite. one side is looking at the year-over-year rate. the other sat the three-month annualized core. we'll listen closely today to see how powell looks at it guys >> okay. steve, thank you steve liesman. as we of course watch chairman powell focus on rising interest rates here in the u.s., its impact on, for example, the housing market joining us now is the ceo of zillow spencer, nice to have you in the house. >> great to be here. >> let's start off on that macro point. we have changes in mortgage deductibility under the tax code how do you see the impact on the macro housing environment? >> housing still is very, very hot. the big picture is home value has decreased 25% through the recession. they're back now 5% above the last peak. home value is appre

and halftime to digest that overtime, if in fact, and i hope it doesn't, materialize. 1.7% --: the pceat that explains the dots, they go where you can see a a lot fewer people doubting will get three great hikes this year. there's almost as many people seeing four rate hikes. there putting emphasis on their forecast for higher inflation. is it a sound forecast? bob: i don't see how they can get their, particularly if they pursue that rate path. they are arguing that the twolibrium rate is close to .75, and our talking of a path that takes them to 3.4 by 2020. that seems to be too much tightening for the kind of economy with a slow growth they are projecting at this point in time. i think those that are reading too much into the number of rate hikes -- that is my take on this. i would be surprised to see if it goes through that path. kathleen: you think the recession risk will rise? is that maybe why the consensus is so narrow for three or four this year? bob: i think that is exactly right. they don't really know at this point. the model is not producing the kind of results they would l

pce -- this is no surprise.t seeing any real change here in the inflation numbers, i tried to call up my chart here of that, numbers move the up just a little bit and stay there. that was expected because of the nature of the year ago effects on the numbers. that we are going to see a lot of the numbers fall out. we will not get some reports till april. and then you will see the numbers go closer to 2%. david: what about the fiscal stimulus? mike says we are starting to see the tax cuts. is this fully expressed in the economy or will it take some time? how long? rick: it will take some time. whenever you get a bunch of the data that comes through and this traffic of data that comes through, you try to parse through it. inflations a favorite metric for the fed. when people say the fed is behind the curve, the fed is doing the right thing. they will move three, maybe four times this year. is% core pce, and the target two. it is moving up, and the base effect from a year ago, of course cpi will head up to two 2.25,

pce, the fed target is two and it is not that scary.as printed on their brain a phillips curve -- maybe it is slow to rise but it is not a bad type of inflation that suggests an overheating or over levered market were prices are out of control. this is because of better growth. toif we rolled the camera years from now, will have a lot more stimulation, particularly in the united states because of becausebill and also liquidities -- we are going to be in a park were central banks are going to have a problem getting it right. jonathan: joining us is henry and coming to us from boston is lori, great to have you with me, and i want to begin with you, henry. what happened to the low rates guide the president nominated? henry: it is a change in narrative and we have to get used to that. bear in mind that markets are leaning that way a little bit and is a acknowledgment -- the storyline and narrative is changing and is going to take a while for the market to adjust to that and move to a higher rate, higher inflation regime. i think ever person

we don't have core pce. the inflation has been in asset prices.verybody thinks that is a great thing. as au define goldilocks buoyant economy, which i agree with bob, we have a buoyant economy in the u.s. and globally. we have very little pressure's on consumer prices. we do have asset prices that are robust. bank sees theal asset inflation pay why are we fighting this? why don't we embrace the ecb? they have moderate growth, inflation, asset prices inflating -- why change interest rates? let us enjoy it until it spills over into the real economy. doug: how to that work for japan? bob: it did not work out well. they have asset inflation going on. have often yield control. it is spilling through. jonathan: the 10 year on tuesday was traded and it killed the market. bob: 0.0. kathy: asset price inflation reaches a price where it is dangerous. jonathan: are we there? we arein some markets close. it is always in how do you time it. how high does the rate have to go to get there? i would argue we are not there yet because it is lower than inflation. mi

they will probably move four times this year. 1.5% core pce, the fed target is two and it is not thatcary. inflation is moving up. >> the fed has imprinted on their brain the phillips curve. maybe it is slow to rise but it is not a bad type of inflation that is suggestive of an overheating or overleveraged market were prices are out of control. this is because of better growth. >> if we rolled the camera to two years from now, will have a lot more stimulation, particularly in the united stimulationve more because of the tax bill and also because liquidities -- we are going to be in a park were central banks are going to have a problem getting it right. jonathan: joining us is henry peabody, and coming to us from boston is lori, great to have you with me, and i want to begin with you, henry. what happened to the low rates guide the president nominated? henry: it is a change in narrative and we have to get used to that. they're in mind, what we had was an acknowledgment of the data coming into the meeting. i think the market was already leaning that way a little bit. it is an acknowledg

people are looking at the wrong place at inflation, we don't have much consumer price inflation or core pceit is an asset prices. -- in asset prices. if you define goldilocks as a buoyant economy, and i think i agree with ball, we not only have a buoyant economy in the u.s. but globally. we have very little treasures on consumer prices, but we do have asset prices that are robust. bob: that is what is so great. the central banks see the asset price inflation also. why are we fighting this? why don't we embrace the ecb? they have moderate growth, moderate inflation, they have asset prices inflation -- asset prices inflating, why not enjoy the asset prices inflating? douglas: how did that work for japan in the late 1980's and 1990's? bob: they are still figuring it out. douglas: it did not work out. bob: they have optimal yield control and it is spilling through. 10-year: jake peavy traded. -- 70%: between 70 print and 80% of jgb's. kathy: i think it's dangerous. i think in some markets we are close to the bubble popping. but how do you time that? how high do the fed fund rates have to go? i

they finished the regular session down .923%t higher selling pces helped kb home, the home builders. earnings rose and were stronger than expected. investorsocn fussed late. shares were down. dardenen said an increase in the number of restaurants in operation helped increase earnings. they raised earnings guidance for the rest of the sales were a sore spot for this quarter. they rose less than anticipated. dardeneneahares offy 8% to $85.94i new proct launches kept g 3 apparel grow sales and profit above street expectations. but the owner of brands like tommy hilfiger and calvin klein gave guidance for 2019 below street estimates. shares% plunged to 33.01. carnival said a rise in online spending helped that cruiseline top sales. demand remains stroel. shares f 1% to om.20. >>> cg up, at&t spars with the u.s. government. at stake, $85 billion, and time warner. we head to court next. >>> the biggest anti trust case in a generation is finally gotten underway. the justice department as you know is suing to block at&t's $85illion merger with time warner. hampton pearson is at the courthous

people are looking in the wrong place at inflation, we don't have much consumer price inflation or core pceerever the fed is. inflation is in asset prices. everybody thinks that is a great thing. if you define goldilocks as a buoyant economy, and i think i agree with bob, we not only have a buoyant economy in the u.s. but globally. we have very little pressures on consumer prices, but we do have asset prices that are robust. jonathan: bob? bob: that is what is so great. the central banks see the asset price inflation also. why are we fighting this? why don't we embrace the ecb? they have moderate growth, moderate inflation, they have asset prices inflating, why not enjoy the asset price inflation until it spills over into the real economy and you see an inflation surge? douglas: how did that work for japan in the late 1980's and 1990's? bob: they are still figuring it out. douglas: it did not work out. bob: but they have the asset price inflation going on right now. they have optimal yield curve control and it is spilling through. jonathan: not a single jgb 10-year traded. it killed the mar

. >> i love the idea of thinking about these pces in many other people's homes. l ite a grand recycling. >> reporter: aside from being the yard sale of the century, it's also a wear window into a family that for all of its public good has maintained almost obsessi privacy. david rockefeller was the grandson of john d. rockefeller, the conoversial oil tycoon who became america's first billionaire in 1916. vid was the shareman and ceo of chase bank and servedn countless charity its, museum, and educational boards. that many of the buyers will have that sense that they are buying stories andyi taste, and buying something homey as well as something very beautiful. >> reporter: their unmatched flat wear collection includes napoleon's favorite sugar bowl and dessert service. there are rare asian buddhas, porcelain collections and carved birdy plus fam heirlooms including a 3th century syrian incense burner that sat on david rockefeller's desk at chase manhattan. >> he probably liked to bur incense everybody day to set the mood. >> it would be great to think . th >> thi

tickeixin to the sixers trheust pce just heartfelt >> reporter: they wrote we want to thank you for teachingup, even when life hits rock bottom to come from juniors in high school, that are 16, 17 years old, as a parent, you know, what is going on in this world , and on the news, media, it was pretty amazing to see some young adults do that and show that kind of compassion and empathy. >> reporter: trying to find a way to thank them, he also, took to social media and through donors and a few contacts was able to make this surprise announcement. >> sixers are giving me 22 tickets for a game. >> reporter: for channel six "action news" i'm alycia vitarelli. >>> sixers have upped that to 30 tickets and somebody offered balcony suite for chaperones. they call this a experience they will never forget and teachable moment for kids and themselves. great story there. >>> time for a check of sports jeff skversky, flyers trying to come off a bad loss. >> they are down in florida where they have played well, on the road, and they have not lost on the road since february the first. big weekend for the bo

pce deflator is supposed to hit 2% in 2019. it is at 2.7% now.is supposed to get to 2.1% in 2019. it is much lower, 1.5% now. jay powell does not see any reason this economy is getting stronger, here is what he said. market remains a strong and the economy continues to expand. inflation appears to be moving toward the fomc's longer running goal. kathleen: when asked by the reporters in the 45 minute long press conference, he does not see inflation and -- inflation acceleration. he mentioned the fiscal impact is a significant factor in the boost in the gdp outlook for next year. our globalleen hays, economic editor, from the fed to facebook. mark zuckerberg has broken the silence over the cambridge analytica scandal, promising to audit and restricted data collected by these apps, as well as being more transparent with of the users. in a facebook post he wrote, we have a responsibility to protect your data. we are by selina wang, our tech reporter. i am waking up in asia today, a lot of our viewers, as well. what do i need to know, what is the key

core pce coming in line, too, 1.9. we also have some other data.th on month, expectations, half a percent. we came in at 1.1%. a bit higher in terms of inventory data. back to the annualized figure for gdp, the final take, stronger than expected, coming in at 2.9%. we have had two revisions already. a touch better-than-expected. let's get a quick look at the instant take of the markets as we look at the numbers. a little bit higher for the dollar index. not much of a reaction. remember, this is the final take of the gdp number. let's get some reaction down to that data. we have the evercore managing director for senior research and john bellows is still with us. john, your take on that snapshot of data? john: a touch stronger. the real thing is this is q4 data. q1 is really more interesting. you mentioned pce. in the first quarter, tracking 1.5%. that is a notable step down. disappointing retail sales reports, no acceleration in sales. i think the burden is on the optimist show is where the growth acceleration will come from. we are not seeing it i

inflation is the lowest 2% target at 1.5% on the headline -- on the core pce. we tell sales. of people see first-quarter growth maybe even below 2%. how about tariffs and trade uncertainty. this is becoming a headwind potentially for the economy, and importantly, the fed is trying -- trump wants to boost growth with tax cuts and so do republicans. the fed does not want to look like they are trying to sub -- subvert that goal. what if the fed moves its consensus metaphor rate hikes and 2018? by june, september, it says we had better move our consensus back down. people say that would be embarrassing, difficult. another reason in march just to wait and see if it is better just to stick with the conservative safe number three or is it is time to get out on a lamb and oh-fer four. haidi: thank you so much, kathleen hays. the first ever rate decision and news conference that proceeds right here on bloomberg. we will be speaking with former fed officials, plus jeffrey rosenberg joining us from grant thornton. special coverage begins on thursday at 4:00 a.m. sydney time, 1:00 p.m. w

economic data points, including personal spending, housing, and a look at inflation through core pce.th me as oksana from jpmorgan, colin robertson from northern trust and jim cielinski from just henderson group -- janus henderson group. at the show is a re-airs, there will be a lot of noise coming from washington, d.c., whether it's about white house palace intrigue or trade wars. set me up for your framework for thinking about what is happening in the nation's capital in the united rates and how you draw a line between noise and news. if youertson: i do think look forward to next week, it's less about the data and quieter on the central bank front. it's going to be about the news and in particular, trade is the key element to watch. i think what we have is fear of retaliation and we will get some from china. mr. cielinski: i think they are and lookingr cards longer-term and i think we may begin to get a sense of whether trump is trying to get china to behave better pertaining to north korea, and those negotiations that are coming up, whether he is willing to pull back a little bit i

inflation and you of course having been vice chair at fed can see the fed's preferred inflation level, the pce is getting within striking distance of its target rate of 2%. make your case as to why the president should be listening more to economists like you? >> well, i think take where you just were about federal reserve policy in the state of the macroeconomy. monetary policy part of that, not the fiscal policy part of that is left to technocrats. mostly economists, though as you know jay powell himself is not an economist. janet yellen, ben bernanke and so on were. this one is of the few aspects of economic policy where the politicians pull away and leave it to the technocrats do, what you think is best within the law. lots of legal constraints what they can do. fiscal policy is left to the congress and to the president. liz: i need predictions from you, assuming you have been focusing on these things. what weak house of cards is built right now that you see could eventually tumble that's a problem on the economic level? >> i think we're worried about a few things happening. i don't want t

i had better pce when i had the light sentence still on. >> and we are so proud of you the way you haveined and stayed focused. but we don't want to keep talking about that right now. we want to talk about you when you get out of here. >> first thing is we're going to have a fish fry. >> we're going to have a party. >> worth while. >> that's only right, but i know one thing, i want everybody back there to see that, yeah, you come from some -- from the pits to the pinnacle, to the top. i'm going to show them that. i mean, because you only got one crack at life. >> that's right. and it's so real. it feels like her and she's giving me a hug. why did it have happened to our family? why did it have to happen to michelle? why that day? lester holt: a young nursing student disappears. she was still dressed in her white hospital scrubs. something drew her out to her car. lester holt: the cousin she grew up with, the brother she raised, desperate to find her. they were able to do what a lot of other families have never been able to do. lester holt: text messages, security monitors,

overall consumer prices as measured by the price index for pce inflation as we say increased 1.7% in the 12 months ending in december, about the same as in 2016. the core pce price index, which excludes the prices of energy and food items and is a better indicator of future inflation , rose 1.5% over the same period , somewhat less than in the previous year. we continue to view some of the shortfall in inflation last year as likely reflecting transitory influences that we do not expect will repeat. consistent with this view, the monthly readings were a little bit higher toward the end of the year than in earlier months. after substantially easing during 2017, financial conditions in the united states have reversed some of that easing over the past month. at this point, we do not see these developments as weighing heavily on the outlook for economic activity, the labor market, or inflation. indeed, the economic outlook remains strong. the robust job market should continue to support growth and household incomes and consumer spending. solid economic growth among our trading partners sh

that's a great gem pce o satire. you look at people who just get it. they get what it is.y don't try to make it too big. they don't try to go too broad with it. they stay close to the bone and twist it a little bit. >> it's an undisputed fact that a woman's value is mostly determined by her looks. >> as it should be. >> the verdict is in. the jury agreed they would bang you. >> yes. >> you're hot enough for basic cable television. >> thank you, your honor. thank you so much. >> you earn the right to be transgressive by being funny really funny, and making sure you're not making fun of the victims. satire is comedy aimed at the powerful. >> is that who i think it is? >> yes, it's adolf hitler in a home movie. >> looks like mel brooks. >> in terms of parody and satire, there really is mel brooks and then there's everybody else. when i was a kid, vhs tapes were invented so we had "the godfather" and then we had every mel brooks movie and he was the funniest. >> i would like to get back to your television days because, i mean, you were in television for something like 20 years

and vin goszla, veringhe case hes cover a numbe othem anwe willi to hi pce titl "in reaty winn's casedense sees upon fb testony to bster motn to ppress stement" n 1961, aeack, 18ear-old afcan-amican stent walk out othe camp of theniversitof geoia and to the htory boo. segregatg the unersity o geora. her namecharlaynhunter-glt . in a moment, we will speak to her about surviving the school segregion. ♪ [music break] amy: this is democracy now!, democracynow.org, the war and peace report. i'm amy goodman. from school desegregation to #neveragain. as a student-led movement for gun control sweeps the country, led by the marjory stoneman douglas high school students who survived the mass shooting that killed 17 of their classmates and teachers, we're going to spend the rest of the hour looking back at one of the history, another historic student movement -- desegregation. thats january 9, 1961, students charlayne hunter-gault and hamilton holmes walked onto the campus of the university of georgia to register for classes, as a howling mob of white students screamed racial epithets at them. i

context of inflation running above the 2% target, that is part of the projection at least for core pceext year. how do you define sim is metric relative to the experience of the past five years? would the fed be willing to accept the type of overshoot of its target as it has seen during the you know shoot? how high above 2% is too high to maintain a target that is semitic? is it 2 and a quarter, 2 1/2, 2 and 3/4 and for how long? >> as you noted in longer run statement of goals in monetary policy we would be concerned with sustained or persistent deviations of inflation either above or below. we said in minutes and speeches, things like that, that is a asymmetric objective and that is how we think of it. i think, i wouldn't characterize what we've done over the last five years as tolerating an undershoot of inflation. we were always pushing towards 2% and i think that is how we look at it. i can't give you an exact number. we haven't agreed on that. it just is we're always seeking 2% inflation and in doing that we'll be considering, by the way the other side of the mandate. we have to

in terms of big items on the agenda, pce inflation out of the united states. inflation numbers out of various markets. manus, what have you got? anna: a very good day -- manus: a very good day to you. 6%.u.s. lost where do you want to go? this is the sixth time we have seen a serious hit to markets in a decade. protection, optionality. by the reaction. when i got for you here is a very interesting moment in the market. we have a huge issuance of bonds. what you got in your white lined is six month t-bills delivering more than the s&p 500. this is the first time we have 2008.his since is that the torch paper of a bigger rebasing for risk? partners say cash is the alternative. bond traders, $300 billion worth of auctions coming to the market this week. the largest two-year paper since 2014. we should not have that much indigestion. the question for markets in a short week was is it 10 halftime or -- tin-hat time? anna: many cliches. we heard both of those views at the end of last week. those are the views we get from our guests. we'll see what chinese appetite w

but if you say inflation is pce, below target, core 1.5% average for three years.s charlie evans now say well, i'm no getting on board with a march rate hike then when i dissented on the december hike or in february, when you expressed the same kind of caution. charles: i think the economy is doing very well. inflation will pick up, so that is a good thing. on a tactical basis, i can see the merits of arguments where we continue our gradual increase in rates. what tips it for me, at least as i am thinking about this, is in a more strategic level, along inflationa period of below our level has been consistent with current times, and the time we spent at the lower bound was painful. the fund rate was close to zero for so many years, and that was a sign that the economy was not performing as well as we wanted it to. in the future, at some point years from now the economy is going to have a difficult spell. if we go into a recession, normally the fed has to lower the fund rate by 500 basis points. i think it is important that we have as much monetary capacity to respon

the pce. this is what the fed looks at, okay, year over year >> you had a benign read on inflation. >> benign? i don't even know what the word is to use. 1.7% and he's talking about 2.5% >> i would like to represent the economics community as well as i can here but i can't do that in this instance because of the following. there are two very different ways people are looking at this inflation number this morning. the 1.7 is the way -- >> or the 0.4. >> or the three-month annualized it is january, it's also some of the cooler months are dropping out of the three months. i'm just saying let's wait a little bit on that i think powell is going to wait a little bit >> joey, how do you see things, given everything we need to be concerned about? >> i see it as a very academic argument we have confirmation over the last few days that central banks have removed the risks for investors. they've mitigated risk by providing incredibly massive liquidity. >> there was a question the other day whether powell

component but we're not seeing it strongly, mike, show up in at least the overall year over year rate of pce inflation. there are a bunch of economists looking at that three month average and seeing it above 2% and the fed, by the way, the yellen fed, also looked at it that way i'll be interested to see if powell likes that number which would be reason for more concern here that the three month average annualized inflation is 2% or above. >> all right steve, thank you for thafrmet. we'll continue to let you put the testimony into context the then there is the tariff story this one truly has developed >> yeah, carl. that's right this one is developing all morning. here's where we are. the event we were expecting to happen at 11:00 is happening at 11:00-ish. i just spotted the treasury secretary walking into the we have wing. so presumably they're getting ready for this meeting if it's not happening already. what is not going happen though is an announcement of new tariffs that had been expected on steel and aluminum. that was on the schedule as of this morning i was told that. and then i was

the closest think we can thing we can get to as the fed looks at this later in the week t 1.5%.ing at pcehould we be concerned about inflation? yes. imminent?he -- no. we need this market to grow. we don't need to have those fears that we extrapolate into runaway inflation. that happened in the january jobs report. that did not happen in the last jobs report. it reversed a little bit. we would like to see a modicum of inflation. it is important for growth. i don't think we should be concerned about it. out, we have a lot coming a three-year and a 10 year, and a 30 year, do we test 3% this week on that supply? art: that is a great question. , whatas been the gobi man happens -- the bogeyman, what happens at 3%? we will have to get used to a very large schedule on a monthly basis of treasuries because we have a much larger deficit. part of that concern is that will push prices down and yields up. that could be some problem for the equity markets. into 2.85 a settled nd 2.95. i don't think that is the concern. the concern is when we get to 3%, treasuries get more attractive, and i think ther

if you look at core pce inflation for example, i think it is important to keep in mind inflation 1995has been a tight range of 130 basis points, between 1%-one 1.23%. we were in that range last summer. we were talking about inflation. and it is also important to keep in mind that the last 23 years encompasses three business cycles, so unemployment at 10%, 3.8%, it covers increases in the dollar, declines for the dollar, oil prices going from $20 to $160, back down to $30. it is a range. you can ask why, but it is because inflation expeditions are a low into stable and it is the only driver in the long run. so where are they today? expectations have been in a near were range -- narrower range, they have fallen below the range they have been in for the last 23 years. so yes, i am hawkish on inflation. every indicator points to it moving up. we should not get carried away. in terms of cost and a trade-off, growth is good already, stimulus has not kicked in, the risk is growth will be even better in inflation will normalize as opposed to explode. i would argue in many ways the best part o

we are only at one point 5% core pce in the u.s.had the lowest inflation since either of -- employment since either one of us has been alive. at what point do the get to two? 30% away from where they want to be. inflation has taken time to react to changes. look at a 18 to 24 month horizon. that is where they can influence inflation outcomes. anna: i have this chart that says how the euro has been doing pretty well, even inflation expectations have been coming down. inflation catch up with the euro or bring it down? you look at the slope of two slides, that is the expectation that policy will tighten over the horizon. if we do not get inflation, there is a lot of slack in the economy in europe. if we do not get inflation, it will be hard for the ecb to deliver in line with market expectations. they would be more caution on the european side. ,nna: thank you very much staying with us on the program. the u.k. blames russia in the poisoning of an and warns of reprisals. we also heard from the u.s. on this. how will russia respond, will

i haven't seen it come anywhere. >> well, i think we will cross 2% in core pce later this year. i'm not one of these people worried about a sudden snap in fed policy or indeed in long-term rates, which would be the sum of inflation on the real rate. >> glenn, your thoughts on this deal with south korea. it eases the exchange and steel motives from steel exports from south korea. there's a provision as well that neither country devalues the currency for a trade advantage. what do you think of this new deal with south korea this morning. >> i don't think it's a bad deal. i think that there was a lot of uncertainty going into it because people didn't know what the administration was trying to accomplish. but i think it did make some marginal improvements for the united states. i don't think we were even selling cars quite our quota before, so i'm not sure what the expected gain would be. what i would urge the administration to do is be clear about what the goals are when you go in for trades so that you don't create so much uncertainty. >> yeah, i don't agree with that at all. agai

i have to look into the details as to where the pce is different from the cpi, less housing, is that i this i is treated differently as well, so there are some key things. medical did go up in the cpi it's a detail i can go into later. i like by the way, the savings rate ticking back up it had come down in december now it's 3.2%. that was the result of greet rick said. you had income up 04 wages up 0.5 which is rather nice, spending 0.2. one place it goes is savings that could be a quick reaction from households, or it could be the data is noisy and it goes up and down >> it would be weird if it was that quebec of a reaction. >> it had come down consequentially. you can imagine it going back up the beginning of the year a start of the year effect. >> steve, let me point out, the futures look, they were down triple digits, now dow 75 points for the dow. if you had to point to one thing, you would say inflation was not stronger than anticipated, meaning all of these people prognosticating thinking we will get rate hikes, that was premature >> i think so. on tuesday, powell said he will

as you just heard personal income coming in, up 4/10 personal spending up 2/10 of a percent the core pce.6% in line with expectations, joining me global chief investment officer fixed income 1.7 trillion dollars assets under management great to see you now thanks for joining us we had economic data do you one of pce? how focused in terms of what it tells us about fla is. >> very, very importantly. >> as you described the fed is that is the fed number one metric one of the things that i think people don't recognize enough, the feds not that far behind curve 1.6%, fed target 2 feds, core cpi 1.8 we have very, very closely if we start we think will happen this year accelerate over 2 not that scary a number fed will keep modifying in no race no rush to do it. >> talk about that yesterday, i was surprised to see new speculation that fed might raise rates five times this year is that what you think. >> no, so part of this number -- the fed is going to keep going they are going to move in some ambiguity three times, four times, i think one of the things markets focused on not necessarily the sp

we do not have much consumer price inflation or core pce. the inflation has been in asset prices.ryone thinks that is a great thing. a you defined goldilocks as boy and economy which i agree we not only have a buoyant economy and in the u.s., we have a buoyant economy globally and we have very little pressure is on consumer prices but we have asset prices that are robust. >> this is what is so great. central banks see the asset price inflation. why are we fighting this, why don't we embrace the ecb? they have a moderate growth, moderate inflation, asset prices inflating, why change interest rates? let us enjoy the asset price inflation until it spells over into the real economy and you see and inflation surge. >> hundred that work for japan and the 1980's, 1990's? did not work out very well. >> they have the asset price inflation going. they half off to mount yield curve control. they traded and killed the market. >> it was -- >> is that a good thing? inflation reaches a point where it is dangerous. it is a bubble that pops. timing that. how high does the fed funds rate have to go