rosengren dissented at the september meeting in favor of a hike. it will be interesting to hear from him, particularly before he speaks in boston. fed chair janet yellen speaks at 1:30 p.m. eastern time. her comments will be live on cnbc. >>> switching to the corporate front, an important day for financials. citigroup, jpmorgan, wells fargo and pnc report results before today's opening bell. are you ready? >> i am ready, i think. let's -- >> lots of coffee? >> exactly. let's have a preview of what to expect from the banks. heading into q3 earnings, one key thing is the same as q1 and q2, expectations for the banks are fairly low and could be beaten. but one key thing is different. bank shares have already outperformed in the past quarter, rallying around 10%, despite stocks specific underperformers. three areas to focus on, loan growth. having surprised to the upside there q1 and q2, there's room to disappoint this quarter, particularly on the commercial side. number two, capital markets, having been slow in the first half, there's room for seasona

we did get to talk to eric rosengren about rates earlier.et is going to be thinking about. here's one thing he said about hikes. >> my hope is that we do it slowly and gradually. the longer we wait, the more likely it is that we're going to have to do it more quickly. obviously you don't set one monetary policy to asset class. but it's symptomatic. whether it shows up in inflation or asset prices, it's a little bit hard to determine. that's why i'd like to have an economy that is at a sustainable unemployment rate over a long period of time. so. >> just a quick word, guys. rick is right that the producer prices were a touch hotter than expected. when you look at a year over year rate of 0.7%. it's hard to get excited about inflation coming from the wholesale level. price gains have been very muted. and it's hard to think that there's a whole lot of push coming from the wholesale level. maybe a touch of pressure on earnings and mortgages right there. >> you know, steve, one question about the producer price index. is that really just goods? o

rosengren is stunning with a descent last meeting. city and cleveland.:00 hour, radio and television. on the labor economy and for america. good morning. ♪ jonathan: good morning. here is the tone of the markets. futures are up 89. we have a huge upside on treaty revenues. jpmorgan is listing those. janet yellen's speech is a little bit later. yields are up for basis points to 178. alix: this is what you need to know. ap. morgan chase posted profit as bond revenue rises. we will hear from wells fargo and citigroup in just about our. we will get the september read on retail sales. janetl be followed by yellen is speaking in boston this afternoon. we are 25 days away from the election. donald trump goes on the offensive. david: let's dig deeper into this j.p. morgan's

speaking to cnbc on friday, rosengren said the december rate hike seemed appropriate. >> my views haven't changed. what's changed is the economic conditions. so when we have an unemployment rate that is around 10%, we should be very aggressive in our monetary stimulus. when we have conditions like we have right now, which is we're very close to low employment, the unemployment rate is at 5%. and current inflation is still below the 2% target. those conditions are very different. at this point the concern about overshooting on what is the sustainable unemployment rate. at that point i have to be concerned about whether if we did overshoot significantly on the unemployment rate, whether we would end up tightening much faster and probably short anything the recovery. >> now banco popolare shareholders are giving the green light to merge with banca popola popolare. >> this merger has been talked about for months. there are issues regarding the satisfaction with the deal. but it did go through with the 72% of the shareholders approving top merger. 99% of shareholders approve ed this deal from

with the busiest agenda so far for big banks with earnings, macro week on data running hot, muster, rosengrenyellen all set to speak, china's cpi comes in hotter than expected as well. watch the ten-year, yellen speaks just after lunchtime east coast time. road map begins with the parade of bank earnings. wells fargo, j.p. morgan, citi all beating estimates, but it's not all good news from those financials. we'll dig through the reports and hear what the ceos are saying. >>> the samsung saga continues. the company saying billions more in losses are expected. and now some airlines are using fire containment bags for overheating phones. >> like an airsick bag? are you kidding me? where's the tsa? >> and honeywell ceo telling jim on "mad money" last night he was astounded by the market reaction to the company's presentation earlier this month. we'll get the latest. first up, wells fargo out of the first earnings report since the bank's unauthorized account scandal. quarterly results beating the street despite drop in net income. in the company's earnings release new ceo tim sloan says, quote, i'

rosengren is on exclusively today, and here's what he told our steve liesman. this is the boston fed president, eric rosengrin. "there is a higher probability in december that seems appropriate. the market seems to think there's a high probability. we'll see how the economic data actually comes in, but i think it is priced appropriately." so the market is okay. >> you would have thought after the economic data came out that the banks would have taken another leg up. they actually didn't. they came down somewhat. the high of the day for the banks was after jp morgan reported and then after -- after the economic news came out and rosengren -- >> maybe it's the word cross-selling that comes up again. these words cross-selling, and it scares people a little bit. the regulatory environment over the banks is fairly prohibitive, people would say. it's more of a variable than where interest rates go. rates have backed up. banks have not performed. >> nobody believes the fed is going to go through with it until they do it now. they've got so many of these fake moves. oh

the banks president eric rosengren spoke this morning.e is doing humans work for us in boston todayl ahead of those remarks. what we arense of listening from janet yellen today. you have been a ton of speeches from policy makers. we have not heard from chair yellen in a while. what are we listening for? ise: the conference is what going on with the economic recovery and why it is going so slowly. there'll be some theorizing on her part in my productivity has fallen off in the last several years. it's one of the reasons we are not seeing a lot of growth. interest rates, which is why all the traders are staying at their desks, it will probably be a message of study as she goes. we are open to the idea of a rate increase sooner rather than later suggesting there was never another press conference at the december meeting. there has not been any change in the economy or in the data that would move up or delay the idea of a december rate increase. she will probably want to leave markets about where they were going into this when she is done. da

eric rosengren favored raising rates at the central bank's last policy meeting and in an interview todaysaid his views have not cha >> my hope is that we do it slowly and gradually. but that the longer we wait, the more likely it is that we're going to have to do it more quickly. obviousl you don't set monetary policy to one asset class. but i thk it's symptomatic of what happens when things become less sustainable. whether it shows up in inflation or asset prices, it's a little bit hard to determine. but that's why i would like to have an economy that is at a sustaie unemployme rate over a long period of time. so we can make sure we have as long a recovery as possible. >> in a separate speech, the head of the new york fed, bill dudley, said he would expect a rate h occur this year. >> in washington, senator elizabet warren is calling on presid to replace the chair of the securities and exchange in a letter, senator warren writes that mary jo white has corporations to new rules disclose det of their politi spending. eamon javer is in washington fo the story for us. good to see you, eamon

regional bank president esther george of kansas city and eric rosengren fro boston wanted the fed to raise rates at that meeting. the central bank will wait until its last meeting of the year in december before raising rates, the next meeting in early november comes just one week tifore the presidential for "nightly busine" i'm hampton pearson in >>> the president of the new york fed says the american economy is on track to expand at a moderate pace for at least five years. speaking at the business council of new york state, dudley said the best way to do this is to -- use general it will interest rate hikes >> i think we're at a point where the economic expansion has plenty of room to run. inflation is a little bit lower target rather th above our i t we can be quite gentle as we go, in terms of gradually removing monetary i think this economic expansion can last a good while longer. >> mr. dudley also said there is still slack in the labor market, and that is one of the reasons why the central bank has been patient, some would say too patient, in raising interes >>> the number of j

eric rosengren, boston fed president. used to be one of the doves.the other side. >> stick around, steve. let's bring in mike ryan chief investment strategist wealth management on the americas for ubs. good to have you both on board. all this back and forth about the fed and yet it is still probably the central question for investors, right? >> it's certainly one of the three. i think what you've seen is these kind of series of setting the markets up for rate hikes only to kind of basically step back at the last moment. what i think the fed is doing now, i think bill dudley categorized it appropriately. what they're doing is going to take a prudent approach to raises rates. i think what they want to do is also send signals around the ability to communicate better with press conferences. that's why i think the probability of november is so low and why december is so much higher. not only do you have the ability to communicate better in december, let's also not forget -- not that this matters at all. we have an election right after the november meeting

want them to be moving sooner rather than later, and what is very interesting is someone like eric rosengrenas been very disposed to keeping rates low for such a long time is now dissenting and saying that we need to move. are some of the labor market issues you discussed are the pressure points, but there are other points eric has raised that i have concerns about. >> we don't see a lot of inflation, and we have not seen inflation rear its ugly head in so long that i think a lot of people, not necessarily as sophisticated as federal reserve economists, but a lot of market participants find it hard to believe that we could see the economy over huge, even if rates were kept lower for longer. >> for sure. right now, we are seeing inflation below the fed's 2% target. it has been there for a while. expectations have come down. the best type of central-bank policy is one that is looking through the front window of the car rather than looking to the rearview window of what has happened in e past. they want to be ready, but i some of is not only these inflation pressures, but also some of the finan

. >> rosengren talking about financial stability. >> blowing bubbles and having to backtrack later onclearly the consensus is moving to a hike coming very soon. >> or just the fact that normalization should be taking infant steps right now, getting back to at least a little bit of what it should be like given the economic picture. nobody is saying the u.s. economy is going full steam, just that things are in crisis mode. >> and the low interest rate world underpins, look at the deal we're seeing. >> some would argue a product of the low interest rate environment. >> it helps. >>> in global news as well, we'll talk about britain. the after-effects of the brexit as well. the sunday times reports the uk could slash the corporate rate to 10% if the european union refuses to agree to a post-brexit trade deal. the tax exchanges could occur if the u.s. banks are blocked from accessing the eu's market. according to "the sunday times," the idea of having the rate from 20% has been put forward by teresa may's advisor. so we're talking about the macro fiscal picture in the uk as well. >>> the eu

. >> the boston fed president, eric rosengren will speak to cnbc later. tune in for that. that's at 1:30 p.m. cet. u.s. futures, we're indicating higher on the open. the implied open on the right-hand side of the screen. >> that's it for today's show. i'm nancy hungerford. >> i'm louisa bojesen. "worldwide exchange" is up next. have a fantastic weekend. guess what guys, i switched to rint. spri? i'm hearing good things about the network. all the networks are great now. we'rtaing within a 1% difference in reliality of each oth. and, sprint saves you 50% on most current national carrier rates. save meyn your phone bill, invest it in your all busiss. wouldn't you love more customers? i would definitely love some new customers. sprint will help you add customers and cut your costs. switch your business to sprint and save 50% on most current verin, at&t and t-mobile rates. don't let a 1% difference cost you twice as much. whoooo! for people with hearing loss, visit sprintrelay.com. >>> good morning. jpmorgan, wells fargo and citigroup ready to roll out quarterly results. >>> an

the kind of moves in rates, be careful what bankers are saying -- rosengren yesterday. these guys are basically telling you, they think they're very behind the curve. rates are what it's all about here. >> let's frame it this way. let's say we believe the majority of the polls. and we take the average of the polls. do you buy stocks today, if you think that hillary clinton is going to be the next president of the united states, and that you'll have a republican congress still, and you'll have that balance? do you buy the market today? >> in a vacuum scott? seriously. we have to think about valuations now, we have to think about the rates markets. if you're asking me purely -- if clinton is elected with a republican congress, is that the best outcome for the market? absolutely, it is. absolutely. >> so -- >> it's the ability to control certain parts of the spend or the taxation and i think that's interesting. but that's not what we're voting for. effectively in the market. the markets are -- i think dealing with bigger dynamics. that are really a function of what the nex

plus don't miss an exclusive interview with boston fed president eric rosengren tomorrow on squawk ata.m. with damic perfoance, to help you hold the curve... and bold styling to stay ahead of the curve. the lexus rx, rx hybrid anrx f sport. this is the rx, elevated. this is the pursuit of perfection. i am benedict arnold, the infamous traitor. and i know a thing or two about trading. so i trade with e*trade, where true traders trade on a trademarked trade platform that has all the... get off the mputer traitor! i won't. (cannon sound) >>> we're back on the halftime report. copper's fall tog a one-month low hey, jackie. >> good afternoon. that's right. a 2.5% drop down in copper prices today. that's on the weak export data, not the mention the fact golden sax is out with a note that says it excepects accelerating oversupply. what do you make? >> it's about demand in china. they imported less copper for the six b months in a roechlt their imports are as low as they've been since february 2015, so, until he get economic growth in china and europe, copper's going to continue to have a rea

rosengren is also there. as theyment on the fmc get ready for the conference.banks and retail sales ahead of janet yellen, and what is happening with new rules taking effect for prime money market funds. they must have more liquidity buffers and use floating any be -- neb asset values. there is a spike if you bring over the libor chart. basically, what it means is you have a prime money market that they do not buy short-term debt from banks. they buy short-term debt from government tanks. you can see the libor move higher because of that. pegged to$7 trillion libor. this change has used implications -- has huge implications. this will show the rush out of the prime money market funds. look at what happened in the last few weeks. on average, prime funds lost $6 billion per week in september. last week, they lost as much as $110 billion. the assets are below $500 billion for the first time ever. do notes that do if you have a lot of investors into it? yields are rising. government yields versus money market yields in the last few weeks. white is prime any market

we heard from boston fed president rosengren this morning, one of the dissenters, who was talking aboutost and benefits of where they are right now with very low interest rates with very accommodative policy and how it is prudent to get started. so i think you have a growing voice within the fomc, who wants to get going with this hiking cycle and there is a general acceptance of -- >> michelle -- >> yeah, go ahead, yeah. >> michelle, i'm wondering if i can play devil's advocate here and talk about a fed chair who just talked about this issue of having given the economy a little room to run. this notion of running a high pressured economy and the potential benefits of it kind of play into that. what are we lacking here, capital spending, want to bring people in from the -- get the full screen, we have low productivity gains. so the idea that she says here is this high pressured economy that maybe we should be running or theoretically running and just so happens that the three things that would -- that are the things that are most wrong with the economy would be addressed by that, i'm jus

and i think that that kind of speaks to eric rosengren and his stance that the cost of waiting too long is going to be another burst of financial instability and that is where he had his focus. >> flip side, we're getting split messages from the bond and stock markets. it looked like the stock market would worry about a democratic sweep and what it means in washington is potentially higher taxes and even stiffer regulations, that would slow the economy. >> yesterday's sell-off because of politics? >> i think part of it, yeah. and -- >> the rising dollar, or rising rates, wasn't -- >> no, no, i think that is the part is the fact that rates were going up. for no apparent reason. >> let's say the data keep doing what the data have been doing, slow growth, moderate job growth, and so on and so forth. but the stock and bond markets react violently to whatever the election result is. does the fed do anything in december? >> i would say no. >> they won't move a hair in december if there is disruption. it is not the -- >> why are we discounting november? >> a lame duck meeting. >> why? >> if th

we have had rosengren who is a dove is more on the hawkish side but he would not call himself that.more fed's big leads us to believe it is coming sooner rather than later. fx markets are the preemptive market and will not wait until after the hike. they will get on board straight away and i think that's what you are seeing now. david: thanks to our bloomberg team. let's get an update of what's making headlines outside the business world. : donald trump is not disputing the report of his taxes but he seems to be embracing it. he addressed speculation that he may have avoided federal taxes for more than a decade. he told a crowd in colorado that he brilliantly used the tax laws. clinton said that donald trump represents the same rigged system he claims he will change. she said he has taken corporate excess and made a business model out of it. the two vice presidential nominees square off tonight in their only debate and is being held at longwood university in virginia. fireworks are not expected and they are both considered two of america's most mild-mannered the lyrical figures. you

it turned out to be a little bit of a bust other than some comments by a couple of fed officials, rosengrenn particular, that were unexpected. it didn't move markets that much in terms of volatility. october is far and away the most volatile month overall. there's a couple stats that have always been floating around, it's the month with the most 1% moves in the s&p 500. in it i think about 30% of the trading days see moves of 1% or more. we'll see. obviously the election's coming up, we've got two more presidential debates as well. but so far bets on selling volatility have not worked out very well. buying volatility rather has not worked out very well overall. guys, and melissa, we're talking about this deal with henderson and the deal with janus. i think this is a very interesting deal. remember, this is the home of bill gross. and this is billed as a merger of equals, theoretically, but this is very much about the fact that indexing is gaining rather dramatical dramatically. and janus is one of the very well known active management companies out there. they don't do a lot of passive mana

just like rosengren the day before? >> we're building in a rate hike.hat's one of the reasons i felt the bank stocks shopt have come down on friday. building a rate hike that's the group to own. but again, i do feel very strongly that wells fargo makes it feel like that the government's back. and the government -- the combination it was like we had a bernie sanders tweet at quarter of 4:00 that hurt the drug group. i mean, twitter, geez, it's so much easier to just pound companies with twitter than anything else. but, look, i think pepsico already reported, it was a great quarter. not thinking about them, but yes, going ahead we are going to have to worry about the dollar particularly for companies with giant european exposure, which there are many. >> cramer's mad dash, take one and make alternatives a core part of their portfolios. translation? goodbye 60/40, hello 50/30/20. ♪ thosthey are.sses? do i look smarter? yeah, a little. you're making money now, are you investing? well, i've been doing some research. let me introduce you to our broker. how mu

and what did rosengren said on friday, i have not raised conditions.hey are not going to raise -- >> do you think we're in a recession and we don't know it? >> it would be kind of like -- i hate to say walking pneumonia, but you don't even know you have it but you sort of are in one. i don't know. we're muddling along, but better than anybody else. but the s&p has done absolutely nothing for four months. it's just like watching paint dry. watching grass dry. you can't even do that. or paint grow. let's move on. >>> while we're at it, we're bring in a couple people to talk about the fed and what happened. it's another big week of earnings. i'm sort of interested in netflix for some reason. it's something other than bank earnings. i never get that excited about that. >> did you see the wall street journal piece about netflix? >> i haven't read the whole thing. >> they were very down on netflix. >> anybody can do it if you pay the content providers, right? >> this is true. >> here's a quick round-up of the big ones to watch. we mentioned bank of america i

chair janet yellen is under eric rosengren who has supported ultralow rates.ill the minutes provide the clues? the likelihood of a 2016 hike. --'s welcome gilles moes moec. to what extent is the dissent in the fed? gilles: the minutes are likely to reveal a hike in december is on a natural slope. that is a change in what we had at the beginning of the year. things are much more hawkish. your craft here, -- your graph here, getting closer and closer to their definition of stability. if you look at the labor markets, it makes not a lot of sense to continue to do that. this is the message we will get. there are indications the need between. sales later this week. it is the natural slope. mark: there seems to be a view that some in the fed will want to see the eyes of inflation. is that the eyes of inflation? 1.7%? preferred measure or does it have to be 2%? gilles: there would be a case for excepting inflation overshooting in the u.s. physically the view would not just be we need to be closer to the old -- we would like to see inflation overshooting the target fo

what is very interesting that someone like eric rosengren who was favorably disposed that keeping ratesw one of the p dissenting and saying we really do need to move. not only the labor market issues you were discussing, but broader issues on financial stability that eric has raised and i also have concerns about. matt: we don't see a lot of inflation. we have not seen inflation rare its ugly head in so long, that a lot of people, not necessarily federal economist, but market participants find it hard to believe we can see the economy overheat if rates were kept lower for longer. >> we see the inflation below the 2% target. expectations have come down. one that is looking through the front window of the car rather than the rearview window of the past. they want to be ready, but it is not only the inflation pressures, but financial stability considerations. thinking about the consequences of having interest rates low for so long. when i was there we brought rates to zero. including the phrase for some time. nobody thought that would mean3 2016 and 2017. >> when we talk about that, there

from financial institutions about negative interest rates are starting to have some affect often rosengrene, he sort of did a 180 with the addition of the doj and ecb -- boj and ecb may be less policies will move to dovish and a little more price bullish. tom: good morning from washington. you are terribly missed here and never but he wants to know what you will do. the inflation of nonfarm plate -- payrolls moving averages to three-month off the bloomberg, 190,000, 2000, 200-4000 and for the first time i took a presidential moving average of nonfarm plate -- payrolls and what a success, 212,000. i have never seen the conflation in of the trend in job formation. why are we so miserable if we are generating a good number of jobs every month? question. is the old i have my moving averages and they are right on the money in terms of what you mentioned. they are gradually coming down, that is what happens during recovery. i think the unhappiness comes from wages. i think the unhappiness comes from the real nature of wages over a 5-10, 15 period of time and i think labor is beginning necessaril