rosengren so aggressive.iend said maybe they're not data dependent and want to hike rates even if the data isn't that great. >> trying to do that, they're ruining the credibility. put away the textbooks and listen to what's out there and stop being afraid of what they don't know. come on, guys. it is market dependent. stability. you want to make an environment for growth and for growth employment and gdp, focus on making things run. >> you agree with the idea they're not soda that focused and more focused on maintaining -- >> i think they're doing that. looking for excuses. a world they created. that something could be fiscal policy. we are not getting that until after the election. once the dust settles. good luck with that. but that's the way out. certainly not rate -- cutting rates or the fed doing more qe. that's not the way to do it. we have to see. they stick to the story. >> do you think they should be raising rates now? >> no, i don't. if you want pure macro economics they should have raised them in 2

why rosengren broke ranks to leave the triple dissent at the fed meeting.g ahead to "surveillance." we'll get thoughts from the chief executive of the international rescue committee, david melamed. -- david miliband. big day coming up today. ♪ mark: let's get to the bloomberg. we have the market outlook. nejra: european stocks higher for a second day. the stoxx 600 up 0.8%, heading for its first back-to-back games in more than two weeks -- back to back gains. it is the materials stocks and the energy stocks leading gains. materials up 1.6^. of course, we're seeing commodities higher today. metals heading higher as well as oil. it is very much a risk on day in equities and commodities markets. here is oil. $45 ave got twti above barrel. seeing oil extending its gains after government data shows u.s. inventory dropping to the lowest since february. to put this in context, those stockpiles near their highest seasonal level in at least three decades. then, of course, very much what is driving these markets is the fed decision. the bloomberg dollar index versus

yet rosengren and friends seem to really, really want to hike rates. what's going on? it may be that the fed is not worried about data, that they're more worried about losing credibility if they do nothing. so we are in a hole. all we can do is maintain a heightened state of alert until september 21st said meeting. bob pasani at the new york stock exchange. >>> while the fed's eric rosengren thinks a hike can be near, not everybody agrees. daniel tarullo says he needs to see more ee the economy is ready. steve liesman spoke to him. >> reporter: in this exclusive interview, he says he has substantial questions about the economy,g some pause of raising rates. >> i have been characterized of being in the show me camp, i would like more tangible evidence of inflation given background context of unemployment continuing to increase without unemployment rate going down. the fact we are not running a hot economy. the fact we don't have as many tools to respond to a potential recession as we would if growth were to pick up. >> reporter: tarullo wouldn't say there would be a hik

well, tyler, that's what was concerning about rosengren's comments. this didn't sound like get one or two outd of the way in 2016. this sounded like the fed is talking about some endemic inflation problems, which a lot of people can make that argument for and that this is a rate hike cycle. but as john's pointing out, you can't have it both ways. the people that have been bearish on stocks have been people say rates are going lower, the global economy's nikkei and if anything this is endorsement for -- yes, we may have bubbles in certain asset prices, obviously what the fed was trying to engineer. is the fed going to suddenly go to the other spectrum of being overly extreme when no one thinks they should be an economy can withstand five or six or zempb ra seven rate hikes. >> so, you sound sanguine. >> yeah. >> and yet if i'm going to make a choice about sectors, you see the way utilities are acting today at this minor whiff, if we really start to think this is going to be reality, should you avoid those sectors now? >> we've been underweight utilitie

i think rosengren puts it on the table today. a lot of people saying maybe not this year for a rate hike. on the margins, the idea interest rate for banks pick up this year that's pushing them into the grave. >> maybe 2.5%, 3% gdp, loan growth, and margin and operating leverage. >> and the price target goes to 70 today -- from 72. >> not surprising. >> say it's our valuation challenging rate environment remains even if rates go up a quarter point. not like they're going out of control unless the fed completely loses control of the curve. >> it's barely down on that news today and if the yield curve starts to go in favor of this group, then jpmorgan will participate. it will be more defensive versus say a bnk of america much more beta and more tied to rates. but i think this is a quality company. quality balance sheet. great yield. this is what you want in financials, and so i think if this pulls back you want to buy t. charles schwab in that category? >> etrade, schwab, all of them. >> you own wells. the stink on that one is fier

a confluence of things going on here today, not just rosengren himself. sectors, the impact the comments have been having. interest rate sensitive groups, utilities which compete for yield are down, consumer staples similar situation are down. generally bank stocks are outperforming the bank index, the kbe, etf down a bit. take a look at the major bank stocks, bank of america, at least at the open, bank of america, citigroup are on the upside. jpmorgan slightly down and wells fargo only down fractionally despite the large fine levied against them. banks have done terrific this quarter. despite the fact that interest rates haven't moved up much, better loan growth, higher fee levels have been helping them. look at morgan stanley and bank of america and goldman sachs and citigroup. jpmorgan is up about 8%. the question is, is there much room left for these stocks to move up even if interest rates move up. because they made the call on jpmorgan. they downgraded jpmorgan this morning, mccarey did to neutral saying it's a premium company and valuation but the

rosengren is worried about bubbles.bout leaning against the wind, which is a throwback that if we raise rates, we can derail some of what david mentioned earlier, the concern about bubbles. and it is not clear what that will do if we actually derail bub bubbles. we don't know. we're in unchartered waters. >> interesting, diane says she refers to trichet. that was a massive mistake. >> to rosengren's point, and bubble blowing and commercial real estate and he's very republican in his concerns, the train pulled out of the station. a rate hike could go the other way in terms of inflicting damage on the economy. >> before we get to the -- >> can we look at gold, gold is -- you like gold, gold is up big. and the gold miners, it is a big market move. >> i want to point out that there is language in here that kind of plays right into the fed's critics here had it says the case for an increase in the rate has strengthened but decided to wait for further evidence of continued progress. there is not an excuse there. there is not

eric rosengren was making the case for maintaining. said, basing it on the idea there are financial markets and balances happening. >> he has indicated he thinks it is time to hike. important the balance of risk is back in the statement. they took it out after the december meeting. we should see the probability dressed up. >> the december rate increase going up to 53 percent. mike: bringing in erik schatzker. the first timek: since december the 2014 that three of the voting members defended the majority. also, rosengren first hawkish defense. non-surprise only in that group for free. blog.king at the top live planning to raise rates very soon. what would have to happen for the fed to consider raising rates in november? i think that is a very long shot for the reason we described. anythingas not done yet the sheer. they can persuade themselves to wait. the dissent, the language. they think they have to hike at least once this year, and they will. mike: we are members looking at the raise -- rates rising in december. yet the sheer. they

what could rosengren be seeing? >> that's the million-dollar question, trillion-dollar question. so much uncertainty and the market hates the uncertainty and what we hear from market participants, what concerns them so much about this is there is this wondering what's the strategy? what's the endgame? do they know what their strategy is? it seems to be such a divided fed to begin with, very unsettling for investors. what to we do? we're waiting and seeing, what is the data point that's going to swing in the opposite direction. charles: there's no point they boxed up thousands of dollars. down almost 400 dow points today. the vix which is a gauge on fear, five days up 46%, investors calling it up. they want to know what to do. a tough weekend for you. what are you thinking on monday? >> well, i think that this is a big overreaction from fed officials who should not be allowed to speak any longer. clearly irresponsible and incapable of creating confidence to make a decision. it's amazing that the government goes out and hurts the same economy they want to do well with just their st

going back to friday, we had just begun let, mario draghi, rosengren.ok at this reversal, how much of a surprise was it to you? >> at least stocks are exciting again after a summer of going nowhere. it is almost a mirror image today of what we saw on friday. only recovered a little more than half of the losses on friday. the sectors that were leading the way down are now leading the way up. as julie pointed out, dividends, telecoms, verizon, coke all having big moves. it is all back to this defensive leadership. the interesting thing about lael brainard's speech is how much anticipation there was going into it. she had not spoken in a few months and the market was really inferring a lot about the timing of the speech. she is the last one to speak for the fed members enter a quiet period before the meeting at the end of the month. the thinking was, she has been dovish. if she is the last to speak and is a little hawkish, the thinking was, is that why they are sending her out at this time? lo and behold, she is very lot aboute speaks a esoteric things lik

rosengren is a voter on the fomc this year. as for earnings, look for results from kroger. that should be interesting in light of deflation comments. >> the new york stock exchange will implement changes to opening procedure on monday to speed up trading and efficiency. even on volatile days. the new procedures will eliminate rule 48 which allows market makers though delay the stock. the fcc approved the changes in july. the new york stock exchange asked for the new rules in the wake of flash crash in august of last year when the dough dropped 100 points in a 10 minute period. >>> still to come, economies in limbo. euro group finance ministers gathering today. we'll tell you what they're saying about the future of the european block. stay with us. we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? more of a spokes metaphor. get organized at voya.com. >>> welcome back to "world wide exchange." very good morning to you. let's get you up to speed on the mar

all came at once after rosengren's comments this morning. but at end of the day we had ism that was horrible. look at our last jobs number. where is so-called economic strength coming from to make the people say what they're saying? i think it is ridiculous. i don't care if they raise interest rates. we don't have interest rates problem. the fed has interest rate problem, not the economy. david: veronica, the fact is interest rates are going up regardless what the fed is doing. might the markets move no matter what the fed does? >> they will move no matter what the fed does but to scott's point, we haven't seen meaningful wage growth. you have plenty of people underemployed. in terms of growth in the economy it has been basically not so good for a long time. so what is that going to mean? i think there is so much uncertainty for investors right now with the elections, geopolitics, an interest rates. it is just very confusing, disturbing time for the average investor sitting out here watching us. david: jack, disconnect between main street an

i think eric rosengren's comments chains perspective. scarlet: and people are wondering if she will move the needle. we have more coming up with markets and etf's in the next 10 minutes. this is bloomberg. ♪ scarlet: live from bloomberg world headquarters in new york, i am scarlet fu. i am matt miller. this is bloomberg markets. let's start out with headlines from first word news. mark crumpton has more. the united nations security council has scheduled an emergency meeting on north korea's latest nuclear attacks. expectingmbers are discussions on further measures, including sanctions. the 15 members are expected to meet behind closed doors late today. the council strongly condemned the latest missile launches and hinted at quote significant measures if they refused to stop the test. what could be a pivotal phase of the present election begins today in north carolina. allowrst state to balloting by mail. crashed off a bridge in eastern india today. at least 21 people were killed and another 30 injured. authorities say the driver lost con

saysresident rosengren waiting too long to raise rates threatens the economy. shares jumping the most in two months, t

saysresident rosengren waiting too long to raise rates threatens the economy. deutsche bank shares jumping the most in two months, with the news they are reaching a settlement deal with the u.s. on mortgages. is there light at the end of the tunnel? mark: looking at european equities, is a down day. is the global macro movers. bit, weipulated this a theseeing declines currencies are falling against the dollar and the second screen. these are rising yields today. commodities down by 1.2%, the most since august 2. are not too pleased with mario draghi. didn'tnot even the -- even talk about raising. monsanto is that be pushing for a price closer to $130. , the price oneek the table was 12750. 130 would bemed as the price. with a huge premium relative to current share price is in with the virus offering, $127.50. it seems hundred $30 is the magical number, according to people familiar with the matter. that deal is in the final stretch. one of the big brewers and public owners, shares falling. uncertainty is translating into the softening of some economic indicators

. >> obviously rosengren is the tip of the spear on this one.coordinated effort to do something? >> not yet. i mean, if you actually read the text of what rosengren said, it's not terribly ay grgressive. meeting in september but can't raise rates in early november. if they don't raise rates in september the only chance is raise them in december meaning we get 25 pacbasis points this r like last year. now, 25 basis points per jeer njeer -- year is not normalization. too slow. worried the bond market doesn't take them seriously and might raise rates and why we might be seeing this rhetoric. >> do they need to go higher or not? >> yes, they do need to go higher. more likely than not they'll raise rates in september. >> really? >> i'm looking at all the economic numbers and can't see when they would expect to have a more calm environment in which growth is accelerating in the second half of the year. the labor market tightening. inflation is moving up. seeing oil prices stabilized, and we haven't had much reaction to brexit. so when are they going t

this is all one federal reserve head, that would be eric rosengren of boston say, guys, grow up, it isme we may see another rate hike possibly september. that is september 21st. do you think it is that or something else? >> i question whether it is really just one statement from a fed official. we've had many statements from fed officials saying that they want to raise rates. and the fed continues to hold off. i like to say that a boxer is rarely felled by the punch he expects and the fed has been telling us for two years to expect rate increases. besides when they do raise rates, they will do so by one quarter of one point. i don't really see what the big deal is. i think we've gone too long without any kind of digestion of gains. as i wrote on tuesday, historically, by going for more than 50 days without a decline of 1% or more, that traditionally leads us into a bit of a selloff. liz: very narrow trading range for more than 40 days. we're posting a brand new session low for the dow. it had been 332, now down 333 and going lower, folks. train our eye on the nasdaq which is down 112,

president rosengren was concerned about the prolonged nature of low interest rates and dislocations that might go with it. it is not that he became a hawk at all. he is just concern about dislocations. i think that is part of what is playing on the minds of the fed people now. they want to get back to normal. vonnie: well, yesterday didn't help because we have the 10-year yield get 1.2%. i wonder where you see it by the end of the year. robert: i think the effects on rates will be dependent not only about what markets think will happen here in the u.s., but what happens in the rest of the world as well. there is a great arbitrage opportunity that has been set up when you have the bank of japan and the other central banks having 10-year yields as the target at negative and your your choicefor -- is either investing in negative spreads in japan or positive spreads in the united states. that is going to bid up prices and put down pressure on overall term structure, particularly on the long end. this is not only what is going on in the u.s. and what people think about markets here, but world

same time, because of what's happening in the bond market, rosengren saying we could go ahead and raise rates. we are seeing a steeping of the yield curve. doesn't this mean that the economy may be is strong enough that the fed will raise rates? wouldn't that be a good thing? lisa: it is a complicated story. yes, bonds seems to be leaving the selloff, but thus deepening in the curve signify something different. isn't inflation expectations? perhaps. we are seeing in indication of inflation expectations increasing as well, so there seems to be increased expectations, but in japan there is a technical effect going on where many investors believe the japanese government will start to allow 30 year bond yields to rise by ratcheting back the purchases of those bonds in favor of shorter maturity debt. that very well could be influencing the west market. there are some more complicated dynamics going on behind the scenes but it does show the possibility of a fed rate hike is not necessarily the entire story. to your point, julie, if this were just but the rate hike, you would expect to see a f

eric rosengren has been in the dove cap, so you might not need -- we were talking about the dove on theed to get to her if you want to make the case. he has also said he thinks rates might need to rise because we are may be seeing some distortions in capital markets because of fed policy. ellen: eric rosengren is a good example of a swing voter on the fed but usually on the dove or side that has also ramped up rhetoric around the need to hike rates further. being careful like janet yellen was at jackson hole. but you are seeing the shift on the fed, and clearly before the data last week, the voices were all making a concerted effort to talk about, yes, lower for longer, but that does not mean that we don't hike rates today. toare getting very itchy move. they do not like sitting on their heels for one full year without another rate hike. markets start to become too complacent and assume that you are never going to hike rates, and they do not want that. they want some risk priced in that they could go at any time. mike: are you getting stir crazy? do you think we have distortions? your c

they got it with rosengren, they're not going to get it today. bra brainard is very much a dove.derstand it's going to be gradual, no one's going to light a fire under it. neither one of them said it, i don't think she's going to say it's happening in september next week at all. >> this is garden variety, taper -- we've been here before? >> yeah, i think the markets have been so complacent, stuck in a tight range, they needed a reason to take money off the table. they got it from mario draghi on thursday, he didn't take it away, he didn't enlarge it or increase it. and then rosengren comes out who's really a dove and all of a sudden he says -- and he doesn't talk a lot by the way. he's not one that runs out looking for an interview, so when he does talk the markets listen. >> so you don't buy the doomsday scenario that qe is over, bond yields around the world have hit their lows and are going up from here and the addiction and the froth needs to come out and it's going to be a painful adjustment? >> listen, i agree it is going to be painful when it happens, but i don't think qe i

this morning that has picked up again after comments from rosengren.is where it's trading. we can kate stockton on this morning who said if oil could close above $46.60 that would feel more comfortable in energy stocks. but it's at $46.69. >>> let's look at stocks to watch this morning. mattress firm reported quarterly profit estimates by 8 cents. revenue also falling short of forecast. comp store sales fell by 1.1%. >> how do you think they came up with that name? >> clever. we sell mattresses. >> what if you said mattress firm mattress. they changed it for you. mattress retailer mattress firm for the lack of confusion. we should tell you deutsche bank is expected to settle several mortgage backed security cases for more than $2.4 billion. according to a german magazine, the report says the justice department will send a formal agreement to that bank next week. and samsung electronics is reportedly considering selling its printer business to hp inc. that's according to a newspaper report in seoul who says the deal could be worth $1.8 billion. >>> our

the dissenters were rosengren and lemmas sister from cleveland and es store george from kansas city. trish. trish: you say case has strengthened for them to raise rates? >> compared to the first half of the year the economy is getting stronger in the second half he despite some numbers we've seen recently. retail sales a little softer. jobs report a little softer. they took the growth forecast for gdp in 2016 from 2% in june to 1.8%. so a slight downgrade. trish: peter barnes. neil: thank you very much. i am joined on set by ashley webster, our own ashley webster. kathleen witt is from donald trump's economic team. steve cortez an economic advisor to donald trump. also at bgc capital. as well as our own lori rothman down on the exchange. i can see, lori, the markets are trading up higher on this news. the market was up about 20. now we're up nearly 60 points. perhaps some people breathing a sigh of relief there is no rate hike today? >> breathing a sigh of relief, there was no rate hike but a hawkish report as well. three dissenters as peter reported. talking about the case for raisi

jonathan, we will hear from fed president rosengren.he idea of that on a a late entryan see in terms of speeches, before the blackout theory, the narrative that the doves turned somewhat hawkish and set us up for a rate hike? i'm not saying it won't happen, but i wonder what it is based on. david: the work function, they they'reong way to go getting ready for a hike in september. it is around 24% or 25%. jonathan: let's go to guy johnson, and talk about the post draghi fallout. what do you make of the action? guy: i cannot believe you even said that, he needs to work. jonathan: i'm going to get into trouble. we wille will -- guy: move on. let's talk about what mario draghi said. i think what he is doing is he is listening. the ecb is listening to tokyo. you highlighted what is happening in tokyo. the boj is having a review. the curve's steepening, and that this is maybe what we will focus on. we saw wobble where there is an idea that may be the boj would not go to the back end of the curve. maybe this is what draghi will deliver. you ge

rosengren of course a dove saying maybe we ought to raise rates.rybody said oh, my heavens, maybe something really is going to happen. and that turned out to be the most volatile event. a lot of people were thinking that the election debates would be a volatile event. turned out not to be. or the fed itself the meeting being a volatile event. both of those events were not nearly as volatile as the comments by rosengren. that moved the overall markets. if you look at the month of september and what stocks had a tough time, which sectors had a particularly tough time, home builders, oil and gas exploration companies, material names, all had a very tough time. much of this because the dollar moved. so we put up the chart here you can see the under performers were companys that have problems as the dollar moved to the upside. so home builders, oil and gas, exploration companies and material names all to the downside. there you see retail also had a tough time for the month. and all of the problems with these sectors can be priced to what happened on ro

we talked about rosengren on friday with the ten-year note little changed on friday.t was the rise in long-term interest rates that started a month ago with the rising ggb yields and spilled into europe and is now spilling over into the u.s. >> what is that telling you? >> it's telling you that central bankers -- yes, we can see they are potentially losing control, but they are reaching their lodgistic logistical limits. they are acknowledging the flattening yield is damaging their banking system. dragge acknowledged there are limits to how far you can push sovereign buying in qe. this is a global bond bubble. we are all in this bed together. and the u.s. yields which are moving higher are following in lock-step with what is happening in japan and europe. that's the northeast noteworthy thing. short a month ago in japan. >> i know we're sick of hearing about the fed, but what do you tell people to do at this point? volatility spiked by 45% last week. people are wondering, is this a big pull-back or more of what we have seen of the tiny dip and then we're back to -- >>

and i think right now if you see -- we saw rosengren, the fed chief from boston came out just a week ago and talked about just a quarter point rate hike and the market was down 400 points. now, a quarter point is not that big a deal. it's what their language is going forward. they're talking about raising interest rates over 2% by 2018. that is going to be tough for the next president to deal with. if they do it next week, that helps donald trump. >> gary b., rate hike would be good or bad for trump? >> i agree fully with john. i think he's made some very astute points. i want to approach it from a different perspective, kind of a macro economic perspective. you know, i think the economy is really treading water right now at best. we have such slow growth. so really the only thing that people see as positive, and it has been, has been the stock market. why has it been positive though? we've had these ultralow interest rates seeming for an interminable amount of time, if the fed raises rates -- i actually think they'll probably hold off, but if they do, i think john's right. the marke

boston fed president, eric rosengren, said that leaving rates too low might lead to a recession.e's concerned that a rate hike now would avoid a lot of increases in the future, which, ifhawere to happen, he says would shorten the recovery. >>> the federal reserve is proposing an aggressive new rule on wall street's commodity holdings. central ban outlined a plan that would force companies like goldman sachs and morgan stanley to hold capital against physical commodity investments. offis estimate the proposal would mean about $4 billion in total additional capital. that is based on current activity. >> wells fargo's board has reportedly hired a law firm to advise it on execuve compensation and potential clawbacks. that report comes on the same day an investor group called on wells fargo to claw back an executive's bonuses. in a letter to the bank's board as reviewed by the "wall street jour ctw investment group also wants an independent review conducted. ctw is asking the board to claw back at least part of the pay from 2011 to 2016 received by former retail banking head, kari tol

eric rosengrens, has decided to come out and push back.eric has made his career academically in research on financial institutions. he understands the link between monetary policy and the financial sector, the banks, and he understands the continuing risks of inflating bubbles. that is a very significant outcome, mainly because he has consistently been such a dove. we are just getting news that the treasury secretary, jim o'neill, has just resigned from goldman sachs. what is your take on brexit? charles: i argued at the time that brexit would not be a big story globally, and i turned out to be right about that. reasonht that the main for that is that there are not a lot of alternatives to london as a global financial center within europe. i think it is a joke that ireland or frankfurt could become a substitute. there are some major issues for the u k, but globally i did not see it as a big deal. i thought it was an inflated rhetorical discussion, a little bit like the current election campaign. tom: rosengren on the left, calomiris on the

eric rosengren also gave a hawkish tone saying hawkish tone seemed very certain to raise rates. it would be interesting to see if she follows to sleep. if we go into the quiet. >> your absolute right, nicole. governor brenner's speech will be very close. she is the most dovish. if she does indicate a rate hike, it probably will continue. we've got to keep it in it. we've had 42 straight trading sessions for it didn't move a percent. we've had a very long period of low volatility to be dead. >> do you think of a signal to the market that they will hike rates next week? >> lauren, they are continuing to press the markets and could hide their rate next week. historically the fed has been. i still tend to believe the earliest we will see as december. that they are trying to prep the market certainly. >> they support your theory because 24% the rate hike in more than 50% for the december raid type. not seeing monetary policy stimulus. we didn't see it in europe and now we will watch that appeared >> i think that is certainly being lost in this conversation with would have a fed hike

rosengren joined in december. in sports, adrian peterson said to have surgery.t of the season now a question. we'll see just how close they were to winning. the highlights of the latest on the wild-card race. u.s. stock market futures the thought that there is across the board. dow futures of 42, nasdaq futures of 14 after record yesterday. oil gaining a spot. keep it right here, "fbn:am," your first look at morning markets and breaking news. the microsoft cloud helps us stay connected. the microsoft cloud offers infinite scalability. the microsoft cloud helps our customers get up and running, anywhere in the planet. wherever there's a phone, you've got a bank, and we could never do that before. the cloud gave us a single platform to reach across our entire organization. it helps us communicate better. we use the microsoft cloud's advanced analytics tools to track down cybercriminals. this cloud helps transform business. this is the microsoft cloud. cheryl: welcome back. 5:45 a.m. on the east coast. the latest in the world of sports. minnesota vikings adrian pet

. >> that is what rosengren is afraid of. rosengren is a dove who voted for hike because he said the biggest bubble we have is commercial real estate. neil: i tried to wake the world up here but if you guys don't follow me that, donald trump has new line of attack right now. the best way to help you follow it is to follow that money. there is lots of it too. >> everything you need to know about hillary clinton can be understood with this simple phrase, follow the money. the wealthy donors who want to shut down american energy, they're donating to hillary clinton. follow the money. the wall street investors who have rigged the regulations against the middle class, they're donating to hillary clinton. follow the money. neil: all right, something tells me that this has been time-tested in some internal polls within the trump camp but this money issue and clinton foundation and hillary and bill clinton how they became multigazillion nays after they left office it is resonating. i expect the next debate it will be something for do

we have fed president rosengren saying we should be concerned about this. we had alan greenspan on this program saying inflation is coming sooner or later. do you see indications of that? dan: to be frank, i have been much too early on that. you see the pressures building essentially the cost of people overall. labor.st of however you want to measure it. new york city is not a good place to measure that sort of thing because of the swings both ways. across the country, the employment, the skill requirement, has gone up. there is a shortage developing. boston is an extreme example. the more in demand skills in the modern world. that is getting severe. that starts to drive prices. if you take out essentially the gas, youfuel, oil, and look at and say things are starting to move up. david: unit labor cost is what alan greenspan talked about and warned about. he sees that going up more than 4% per year. in your core inflation, north of two now. dan: as reported, yes. david: yet we do not see inflation expectations picking up. why is that? dan: darned if i know.

eric rosengren, loretta mester, and esther george voted to raise interest rates to half a point at the matt: did you think we got what we expected? torsten: i think the major breaking news is definitely the dissents. for a long time, we have been interpreting all kinds of fed speak. some have moved in one direction and more in the other direction, but at the end of the day, the vote matters. matt: but didn't we know that? they each had given a speech in the past few weeks indicating that's what would happen. torsten: previously, we have had speeches where they have not dissented. so i think the fact they are voting for this makes a huge difference, and it sets us up for expectations in the future because part of the committee has said, "i have been loyal, but now i feel it's time to go," and i think it's an important development that we should pay attention to. ♪ matt: hedge fund manager leon cooperman is being accused of insider trading by u.s. regulators over his buying and selling of atlas pipeline partners shares before material event. the sec is charging that he used his status as

up 400 points in response to comments from a top federal reserve official boston fed chair eric rosengrenthat the reasonable case could be made for a rate hike because of growing risk of overheating in the economy in financial markets. his concerns and observations include the jobs market reaching or actually exceeding full employment over the next year. he says that the sluggish growth in the first half of the year is

alix: take on rosengren's view -- where might those in balances the if the fed stays lower for longer: yeah, i think it is -- i personally do not see the risk that president rosengren does. he has been talking a little commercial real estate. i do not see the spillover from that into the global economy -- excuse me, into the fuller domestic economy, affecting the mandate of variables of an planet and prices. i do not see that spillover going on. andink there are other ways -- that the fed could dampen down those risks and using the blunt tool of monetary policy to go after those. that would be my own take on the financial stability side. i just don't see -- when you look at the more -- you want to -- if you are the fed making monetary policy, you want to see risks that will spill over into inflation and employment. that is what you are charged with focusing on, and i just do not see those kinds of risks at this time. david: narayana kocherlakota, former indianapolis fed president. thank you for joining us from rochester. alix: coming up next, ceo of the world's largest asset manager,

it was not just rosengren, but the coming speech this monday just made everyone freak out and think,his is an uber dub that has to speak to warn people ahead of the fed speak. >> i just wonder if there's too much emphasis on fed speak. you have to remember when they speak, maybe the governor is different, she's part of the core inner circle, always a voting member, they could be lobbying themselves for their own opinions. i mean, the fed chairman, janet yellen, is who matters. the last time we heard from her, she said the case for raising interest rates is strength anything. she did not give a timetable and the market is still not expecting september. it would come as a big surprise, but the fed fund future is pricing it at 30%. december firmly being price matched. >> if we did see a hike next week, on that note, the three speakers today to focus on dennis lockhart is at 8:05 eastern time. then he takes question from the media as well. at 1:00 p.m. eastern neel kashkari will take about the u.s. economy. and the speech everyone is talking about, lael brainard at 1:00 p.m. eastern. >>>

i believe rosengren and william both speaking. listen to both of those guys carefully and waiting to get a finalist of speakers next week. still have time to telegrapher and blackout period a week from tuesday and watch the data. retail sales and cpi to help lead the way, on the cusp, the number could have gone either way. >> didn't you say it would be better if we heard from yellen today rather than later? >> i don't want to treereact to every number. they want to set a -- >> basically where we were last week at this time? >> remember, fischer said possibility in september, if data cooperates. now we got have a debate. is this cooperation or not? >> quanti cooperative or not? >> last thing. i want to move. >> any time they're close to a big level in the market they flowed tightening out there. when they don't, almost like an e. >> a credibility issue. one thing in the column of possibly raising rates. >> oh, that one again. steve, thanks. >>> here's what else is coming up on the "halftime report" -- >> announcer: if you're long l

. >> i was going to say, if i asked you a month ago if rosengren would bring a 400 point down draft,ou might have laughed at me. >> although the idea of a violent or dramatic increase in interest rates, that was a plausible one and i don't think you can now say all of a sudden bond yields are going to be continuing to lift and we're going to have to adjust to a new scenario there, but i think it creates an opportunity for a gut check, because the interest rate sensitive sectors of the market are now bigger than the financial sector, so i think you have a lot of premise of a lot of the recent rallies and the new highs was lower for longer interest rates, economy improving, fed basically sidelined until december, so some of that got complicated in the last couple of weeks. >> tobias, are we looking for things to worry about and looking in the wrong places? after the earnings season that we had, it was better than some people expected, but still the growth wasn't gang busters. are there different things that we should be looking at as potential potholes that we should worry about more t

you take a look at what rosengren said. not just his comments here, but on august 31st in china he said we're going. >> i thahey, that's great. then it came out softer and changed people's minds. >> the fed is not that short-term. they're look at a longer display of the data. they're looking at a rolling three months. the jobs numbers was 150 k. fisher said 100 would be good enough. i believe that they do go. i think it's an easy set for the trade. i bought some metlife. even when brainerd spok on the 12th, the financials have opened up nicely higher, right? they traded down, and that day that you spoke they closed higher than where they opened. i believe they go. i think it's a low risk trade and it's a great setup, and i believe they should go. as we saw with japan today, monetary stimulus has run its course, and it's time for them to push the burden on to the administration for fiscal stimulus and what better time to do than when you change the administration to a new one. >> well, you can bet our next guest has an opini

tremendous bubble, and that's a thought that was somewhat echoed, i think, this week by i think eric rosengrene it was one of the other fed officials who said it. the point was made about these bubbles and rates. what's the right call here? >> i think they should do it because you don't know. right now you can do it. the market has essentially done it for you with backing up rates globally. it's almost like the fed has a freebie. that there's -- even though the odds of doing it according to fed funds futures have come down dramatically, i don't think the market would be surprised if you did it. 25 bips isn't going to throw anybody over the edge. it's not going to impact any real asset class. 25 bits, you are at historically rock bottom rates. i say do it. >> this comment that he made, in other words, you are walking on a ledge, and you might make it to the end, but you fall off that ledge, you're going to really see trouble. i think that could well be. >> it's not that big of a drop. i'm just going to ek tend metaphor and what steve was saying here is what you are implying and i am agreeing wi

and i'm not sure how much this is discussed at the table, but i'm very sure that eric rosengren givenis background and a couple people at the table are well aware of this and quite worried about it. including stan fisher is not at the table. >> that could be dealing with a product of the bernanke era that has continued on for a very long time. everybody, you and i know, becky, in the marketplace this is sustained at artificial levels as long as the fed keeps monetary policy accommodative. one other thing to point out, which is very important, everyone is worried about them raise i raising -- this is the way they invest the portfolio that has held the system open market account by the fed. and janet yellen has talked about this in her speeches. it is not really the short-term basis point and whether it increased or not. but all the commentary we were receiving and hearing through cnbc, from the different people we talk to, is so my onicly focused on quarter point increases. the real issue is how they reinvest the portfolio. and then the real underlying issue is when do they come to rea