dallas fed president robert kaplan minutes ago released a detailed essay on what is wrong with the u.se go to dallas with michael mckee. thank you very much. we would like to welcome rob kaplan to bloomberg television and radio. thanks for being with us this morning. you released an essay on the economy and monetary policy, in which you say, "at this juncture, having adjusted the policy rate twice this year, it is my intention to take some time to carefully monitor economic of elements." that sums like you are not convinced you need to cut rates -- that sounds like you are not convinced you need to cut rates october 30. robert: i will reserve judgment until right before the meeting. i was an advocate of the september cut. the reason i was in favor of those cuts is i feel that decelerating global growth, weakness in manufacturing, weakness in business investment, there's a risk that those weaknesses may intensify and spread to other parts of the u.s. economy, and i felt it was appropriate for us to take some action. now that we've acted twice, i'm going to withhold judgment here. we've

robert kaplan is a centrist. he is not considered a dove or hawk.portant to listen to a fed official like this, as always. this limited support for more will -- more rate cuts is what got the fed here. he said the fed can avert a more significant slowdown if it occurs, but the jury is still out what the fed needs to do. he basically made the argument, rates are already low, you only have so much room to cut. here is what he said? that's what he said. >> i think we are i fragile period, which is why i'm glad the fed has taken action in july and september, but i think this could go either way. we can avert a more severe slowdown, but i think the jury is out right now. kathleen: he also talked about needing to move now and move quickly. gold prices fell when mr. kaplan argued for limited rate cuts. so much uncertainty and so much policy uncertainty, i think it would be wise for us not to over telegraph where we are in the cycle. this cutting we are doing should be limited, restrained, and modest, and not the start of a full-fledged cutting cycle. kathl

the head of the dallas fed is in favor of a near-term rate cut but it does not mean robert kaplan is . kathleen hays joins us with the takeaways from his exclusive interview with bloomberg. we saw gold's move as kaplan spoke. what drove the reaction? kathleen: rob kaplan is neither a dove who will always vote for lower rates or a hawk. he says it will take a lot for me to cut them. i do not want to do it. when he spoke to bloomberg tv, he noted the economy is in a fragile period, and it needed, the fed could do more to avert a severe slowdown. period, in this fragile he seems to say, if the fed is going to move now, it should move now. it is still going to have an impact. let's listen. now think moving modestly gives us the best chance to avoid a more severe slowing, and that is why i want to use the ammunition now, even though it means we will have a little less ammunition later. tom: you would think -- kathleen: you would think of gold trader would like that. cut rates now. traders wasd gold robert kaplan also said he thinks the fed has to show some restraint while it tries to figur

and an exclusive conversation with robert kaplan shedding more light on monetary policy. >> it should be limited, restrained, and modest. host: it is all straight ahead on "bloomberg best." host: hello and welcome, i am nejra cehic and this is "bloomberg best." let us start with a day by day look at the top headlines. with the u.s. and china set to talk trade in washington this week, investors were optimistic there would be progress towards a deal. what a bloomberg report threw some cold water on those hopes. chinese and u.s. negotiators are preparing to restart long stalled trade talks this week and washington. china is going into the talks with new reluctance about a broader trade deal. going to talkt about industrial policy or subsidies. those of you that if all of this for a long time will say to yourself -- is in that the core of the u.s. complaint? you are right. this sort of signals that china is looking for not big deal or deal or no little deal. the grand ambition on the talks seems to have muted a little bit. or isbert lighthouse realistic about what he can achieve in these

robert kaplan released a detailed essay on what is wrong with the u.s.nomy and what he thinks the fed's next moves should be. bloomberg spoke with him exclusively about where he sees growth heading. our forecast for this year, for the second half is 1.7%. maybe it will be in that neighborhood for 2020. i am not sure what we see that will make it better. most businesses i talk to you want to stay nimble and realize there could be new policy pronouncements any time, and with that amount of uncertainty, they are not cutting back their business, but they are putting new projects on hold. the other thing they are doing is watching carefully if there is a broader slowing, and if there is a slowing in the consumer, they are on their toes that they will take further action. that would cause a further slowing. ,e are in a fragile period which is why i am glad the fed has taken some action, but this could go either way. we can avert a more severe slow down, but the jury is out. michael: in the minutes, you got a report on what happened with repo just a day or two

david: we are talking with robert kaplan of the eurasia group.a a challenge or opportunity for western europe? specifically, germany. it is basically an export economy. if china is growing, they will buy more things. germany exports a fair amount to china. is that a challenge or opportunity? robert: both. especially germany, don't want to move that close to china as the regime goes from soft and light authoritarianism to a harder edge, suffocating form of authoritarianism. but they have no option. this is where the money is. this is where the growth is. even as we are in a period where the u.s. appears less and less dependable. david: as you talk about suffocation, mike pence was giving a speech in washington. one of the things he said was it looks like the nba was a wholly owned subsidiary with beijing. did they overplay their hand because of that one general managers tweet? it sent a message to companies that you have to go along with what china wants, including we don't want you tweeting things. robert: i believe it overplayed its hand. on the

dallas fed president robert kaplan talked to bloomberg yesterday about just this topic. : most businesses i talked to right now want to stay nimble, and they realize there could be new policy pronouncements anytime, and with that amount of uncertainty, they are not cutting back their business, but they are putting new projects on hold. the other thing they are doing is watching very carefully if there is a broader slowing. alix: katie of northern trust also here -- katie nixon of northern trust also here. what does the fed do? katie: i think the fed is in a tough spot right now because talking about the trade uncertainty as being part of their calculus would suggest that if we get this mini deal, maybe they won't act. i agree with henrietta that this is a sort of pause and a much longer battle. i'm interested in hearing about the conversations with some of the manufacturers because i don't think that manufacturers are going to think that this is just back to normal. i think this is a new normal. they are going to have to make different decisions regardless of what happens

instead, it is still growth, according to robert kaplan.he idea we will becauset -- fall short uncertainty created by trade wars and slowing mobile glove -- slowingmobile chloro -- global growth. the issue for him is do we get some kind of a trade deal in the short run? if not, he said he might vote for another rate cut or approve another rate cut at the end of this month. if so, he might hold off. for right now, here is what he had to say about where he is. >> we have so much uncertainty and so much policy uncertainty, i think it would be wise for us not to over telegraph where we are in the cycle. this cutting we are doing should be limited, restraint, and modest, and not the start of a full-fledged cutting cycle. notael: one reason he does want a full-fledged cutting cycle is if we do go into a recession, that would leave the fed with very little ammunition. he did say one thing we will get soon. powellirmed chairman jay -- we will find out something about what the fed plans to do about expanding its balance sheet to help control the rep

francine: that was robert kaplan speaking to bloomberg. s the concern is how many insurance cuts does the u.s. really need? is that the question we need to ask ourselves? robert: in a way, yes. behind the question, you need to make a decision of whether you think the risks are going to disappear within the next 3-6 months. what a listen to mr. kaplan what he has in mind is waking up in the next three or six months with a deal between president .rump and president xi jinping we removed from the world economy a big source of uncertainty and discover the fed did not need to cut that much. it is probably a rational baseline the problem is we cannot be sure. new source of uncertainty has emerged. another problem which was recognized in the minutes is continue,onger this the slide in growth, the higher the probability that we see the downturn spread to the services sector. once this is started, it is hard to reverse. francine: until that person holds, are we ok? as the labor market is holding firm, we're probably spendinge consumer will remain th

slowdown will turn more severe, that's according to robert kaplan, who said at this point, any rate adjustmentuld be restrained and modest. he spoke exclusively to bloomberg. robert: i think moving modestly now gives us the best chance to avoid a more severe slowing, and that's why i want to use the ammunition now, even though yes, it will have a little less ammunition for later. nejra: the end of the fed rate cuts might be coming a little closer than many investors are expecting. neel kashkari says the case for half percentage rate point cuts have declined, and another argues policymakers should wait for fresh economic data before deciding their next move. joseph little is still with us. you were saying to as earlier we it in marketson is overdone. do you think the fed perhaps needs just one more rate cut? and then it can be done? joseph: yeah, that's the kind of scenario i'd expect. you never say never. the facts are always changing. give got to continue to monitor the data closely. -- you've got to continue to monitor the data closely. we have seen a lot of headlines and concern around the

. -- the dallasr on fed president robert kaplan.his is bloomberg. ♪ ,avid: let's talk about the nba it's on the ropes in this part of the world, in china, after losing almost all of its sponsors and the fallout from the protests here in hong kong. yvonne: let's look at the potential damage. tell us about the partners that withdrew and who else is left. >> it's just within a matter of latest, have seen the , china'snt venture , andst sportswear maker together with the mobile phone maker, all these brands say they are pulling out from nba partnerships. cctv said they would stop broadcasting the preseason games of nba and tencent also pulled out. with all this going on in china, consumers now have no way to watch the nba games. david: that's a good point to bring up because consumers love their basketball. when you look at the idols that a lot of these aspiring basketball players look up to, a lot of the nba players are actually sponsored. you have clay thompson, what should we be following closely as far as that part of the story is c

romaine: that was robert kaplan speaking exclusively on bloomberg today.ore monetary policy, let's bring in our guest. i feel like most of this year, the past year and a half, the market in the fed have been far apart. i guess that gap has narrowed somewhat, but when you hear comments from others, it is not clear the fed will keep using, or that bet can't be fully priced in, despite the fact the market continues to price that income so somebody will be disappointed, either the fed or the market. where do you think that will align? >> in terms of the minutes they came out, this question about guidance and stopping easing, that was notable. if you are doing that, you are saying to the market that we are not doing a series of cuts. the minutes also highlighted the market may be too far ahead. another attempt to pull those expectations back with the view of the economy isn't so bad after all, but the market has been pretty right about, not just how gdp has slowed down the past year, but what this trade war is all about, a global trade war that has a big impact

coming up, robert kaplan joins us for an exclusive interview. don't miss that at 1:00 this afternoon london time. you are traveling to work, you know where to go. bloomberg radio live on your mobile device or dab digital in the london area. there is the team with your first word. all getting ready. with a live shot of london. varadkar and boris meet today. is today the defining moment for a brexit deal? ♪ from the couldn't be prouders to the wait did we just win-ners. everyone uses their phone differently. that's why xfinity mobile let's you design your own data. now you can share it between lines. mix with unlimited, and switch it up at anytime so you only pay for what you need. it's a different kind of wireless network designed to save you money. save up to $400 a year on your wireless bill. plus get $250 back when you buy an eligible phone. call, click, or visit a store today. nejra: this is "bloomberg daybreak: europe." nejra cehic in london. manus: i'm manus cranny in dubai. the un security council will meet later to discuss turkey's incurs

the dallas fed president robert kaplan introduced caution to investor enthusiasm.ained why he believes the fed should take a measured approach to cutting rates. >> one thing you've heard me say before, market expectations can change on a dime and i don't think my job is to satisfy the markets. it is to figure out whether we've got the right policy setting, specifically one that fosters economic growth. the other part of my job is to call out -- it is not just monetary policy that has been a cause of this slowdown. ise than monetary policy going to be needed if we are going to grow faster. i'm talking about growing the and force, improving trade the escalating trade tensions. trade skills that would increase our ability to move. >> the minutes of your september meeting show a discussion about whether to publicly suggest when you would end this cutting cycle. do we get something like that? >> i'm not necessarily sure that is appropriate. when you hear people saying i'm agnostic about whether we move from here, that would tell you that if nothing changes, we are going

we speak exclusively to dallas fed president robert kaplan. and pg&e's meltdown.ny is dealt a blow in court, losing exclusive control of its bankruptcy. welcome to "bloomberg daybreak" on this thursday, october 10. i'm alix steel. ernie's coming out now -- earnings coming out now. delta down by 0.6%. a bit better than they had guided. they were looking at the top

liz: robert kaplan, dallas federal reserve president, said today he's agnostic about an october rate way. again, folks, what you use rate cuts for are emergency situations. so i'm just interested to know what the emergency is. >> it's funny, i was for the last cut because to me, it was an unwind of the december raise they shouldn't have done. so i think it just kind of offset. but i think you hold the fed to a steady state until it's needed. you use it when it's needed. i wasn't for qe3 and i'm not -- i wasn't for ten cuts in a row. liz: how about qe forever? >> exactly. liz: we might be there. good to see you. >> thanks for having me on. liz: robert wolf. thumbs down to censorship. facebook's mark zuckerberg refusing to ban political ads from the social media site, but find out what he thinks about taking away president trump's twitter. don't miss this week's everyone talks to liz podcast. what an incredible story. he's the voice behind hundreds of voices in cartoons and commercials, specifically the teenaged mutant ninja turtles. howe went from fighting off these criminal creatures

in the u.s., we will be watching with charles evans discussing monetary policy while robert kaplan speaksin. the u.s. ambassador to the eu, gordon sondland, is expected to test a guy before the committee investigating trump and -- is expected to testify before the committee investigating trump and ukraine. do not miss our exclusive interview with a ceo at 6:40 p. marksdon time, and today 10 years, how time flies, since the government said it was in serious trouble, and the debt crisis that followed. and christine lagarde. this is bloomberg. ♪ this is "bloomberg daybreak: europe." i am nejra cehic. manus: i am manus cranny. ago, it was said there was serious trouble, and there was unprecedented fiscal derailment, and the euro zone debt crisis followed. >> 10 years ago, greece unveiled a black hole in the nation's finances, a budget deficit twice as big as expected. and then anollowed, unprecedented debt restructuring, and it did not stop at greece. there were a five euro-area nations to be bailed out, calling into question the very fabric of the single currency, but it has held together. m

c we have heard from others today including robert kaplan who said the fed will do what they need to do, and he is saying that. this is a markets guy after all. he is saying that in the knowledge that there is about a 90% probability priced into the market for the october meeting for a cut, so i think we will get that quarter-point cut. what i think has been difficult is that it has been pretty clear for some months that the economy needs a bigger jolt than match. 50 basis point cut would be more effective and for that reason, the market has gotten what it wanted or what it expected, rather, but they react with disappointment anyway. now, it seems that it is turning more into the story of what the market need given that we continue to see this weakness spreading not only for the manufacturing side of things that play into other different sectors, especially surfaces. chris: not as may be the most troubling. the ism service index that came out today, as you mentioned, a three year low. three years ago, what that was was august of 2016 and a series so looking pasto that, you have to go

steve, what are you seeing >> dallas federal reserve president robert kaplan out with an essay this morninglast year. he's behind the last two rate cuts the fed did, but wants to take a little time now he said he's concerned -- he said it is appropriate before the july and september meetings to have lowered rates. concern recent weakness could spread he's a little bit concerned about the consumer here. says if we wait till the data or the weakness was up in the consumer, it's too late. but he wants to reserve judgment on the need for future rate cuts kaplan is not a voter this year. looks like he's a voter next year from what i can tell. and just fy i, i will be interviewing minneapolis fed president tomorrow at the foreign relations. >> who is voting it's either this year or next year he's a voting member? >> i have neal voting next year. he's an alternate this year. same with kaplan >> seeing fed bank presidents putting out statements like this, i mean it's a little interesting the jockeying before the next meeting everybody is trying to get out there where they're coming before they get