charles: there he is, jay powell. >> good afternoon. my colleagues and i are strongly committed to bringing inflation back down and we're moving expeditiously to do so. we have both the tools we need and the resolve it will take to restore price stability on behalf of american families and businesses. the economy and the country have been through a lot over the past two-and-a-half nears and have proved resilient. it is essential that we bring inflation down to our 2% goal if we are to have a sustained period of strong labor market conditions that benefit all from the standpoint of our congressional mandate to promote maximum employment and price stability the current picture is plain to see. the labor market is extremely tight and inflation is much too high. against this backdrop today the fomc raised its policy interest rate by 3/4 of a percentage point and anticipates that ongoing increases in the target range for the federal funds rate will be appropriate. in addition we are continuing the process of significantly reducing the size o

that's what jay powell said. you could get another mega hike at the next meeting in september or you may get a slowdown. at some. point, there will be a slowdown of the hikes was jay powell's call. they will go meeting by meeting, data dependent. the bloomberg dollar index fell yesterday, down a little over 0.1%. that yield inversion continues between the 2's and the 10's. coming up, meta miss and for the first quarter ever, the facebook owner's sales declined. tech earnings in focus, next. this is bloomberg. ♪ ♪ tom: welcome back to "bloomberg daybreak: europe." i am tom mackenzie in london. coming up right here on bloomberg tv, on the biggest earnings day of the season, we will be speaking to the ceo's of shell and plenty of other companies. top executives from dr, stellantis, accor and anglo american join us. don't miss those conversations right here on bloomberg tv. meta platforms, the social media giant that includes facebook and instagram, reported its first ever quarterly sales decline, setting adverti

jay powell hiking 75 basis points. that was not unexpected, it was the guidance again and the views. the divergence between the economists who said this was a hawkish fed and the emphasis on looking back six weeks to dot polot -- plots. that is not how the markets are interpreting the guidance that we got from jay powell. the spanish ibex up 0.7%. there is optimism around the asian session as well. gains of about 0.8%. spanish ibex up around 0.7%. here in the u.k., the ftse 100 up 0.6%. oil is higher today. we will talk about the shale story, speaking to the ceo. whether or not you can see a build out of the gains we saw yesterday on wall street. nasdaq ending up more than 4%. the drawdown in terms of the yields. nasdaq futures pointing lower by 0.5%. the two-year stateside, not a lot of movement. one or two basis points. the divergence still remains. the bloomberg dollar index, some softness yesterday. some relief across the surrency -- currency space. the end of the short move of the yen is the question. elevated pri

david: the other side to that argument, jeff gundlach praising the fed saying jeff powell -- jay powell has regained credibility and is no longer behind the curve. i will use the analogy of neutral, is the credibility of the fed back in neutral? >> i would say that if the 10 year yield is close to the longer run neutral rate, then it seems everything is lined up. if that is the measure of whether the fed's angle is working, then it says yes. i don't think they ever really lost it. i think the market valuation is not wrong. the market is telling you that the fed's credibility and the inflation is completely intact. obviously we can overshoot and undershooting around that central tendency, but i think everything is just fine. in the meantime, that had to deliver some pretty difficult rate moves, because there was a time when they might've been somewhat behind the curve. but i think we are past that now. yvonne: is the ecb past it? i don't think so. given the energy crisis we are seeing in europe right now, what can the ecb do, and what options do they have at this point? >> the ecb has so

this will have senator says -- jay powell has strong concerns. he has access to sensitive information and will undergo a comprehensive background check. a global outlook for a third time as inflation rises in the central bank. expect the expansion to go even further to 2.9% next year. the imf expects the global consumer price gauge to be up by 8.3%. that will be the biggest jump since 1996. set in, new ceo according to the financial times, this will be a long effort to turn around the struggling under. china runs the bank asset management division. an announcement is expected later on. russia says it will opt out of the international space station after 2034 and focus on building its own orbiting outpost. russia will fulfill its obligations to other partners before it leaves the project. the decision comes as relations are strained over the war in ukraine. twitter and elon musk are fighting about the start date of their delaware trial. elon musk once in april started but twitter was october 10. global news, 24 hours a day on air and on quicktake,

how bad, it will be the man of the hour jay powell. maybe he can invoke actions, maybe not actions to go along with the swagger of paul volcker. many say he is not up to the challenge. i'm asking she will lay bear in a moment. he -- she la bear. the white house acting for more spending. republicans also. larry kudlow is here. apple we'll handicap not just the results but reaction to the stock. why joe biden should listen to candidate bill clinton on how he felt americans pain when he became president. that and so much more on making morning -- making money. >> initial gdp release down .9 of a percent, making it back-to-back negative quarters. we did not want to see this. we actually got it. the report though to me, it is worrisome, the source of weakness. personal consumption. 1.0. this was the lowest since fourth quarter of 2019. this is a two-year low. people aren't spending money. that is pretty bad. particularly on durable goods. that was down 4.4%. domestic investment also very, very scared. this is a huge, huge red flag, down 13

i think jay powell. i'm rarely defend this man you know that charles, but i think that jay powell is actually relieved right now that he is not being pressed upon to print more money. that right now fiscal policy is on hold so that he can try to get this inflation under control. >> he might not be pressed to print more money and i agree with that but he was pressed by the president last month when he was at the oval office and pointed at him, the president said the job of bringing inflation down is to the federal reserve. so jay, go make it go away. so you could argue the question was right, does he have the tools he can do something about it? maybe, maybe not but he can't say, i can't do anything about it. the president just ordered him to. >> jay cannot create a pipeline. charles: if you're paying attention on sunday elizabeth warren wrote an op-ed in the journal essentially saying she will blame jay powell when everyone has feels pain that he was ordered to inflict upon us. >> bless her heart. charles

here's what jay powell said. listen to this, he's really questioning all kinds of data that he's seen but this was a shocker to us and you get to say whether you see a recession. here's jay powell. >> we don't say there's now a recession and that kind of thing. that wouldn't be something we do. we would look at the data tomorrow and no doubt we'll look at it very carefully and draw whatever implications we (&.k as i mentioned though, if you think about what inflation -- sorry, what a recession really .s it's a broad based decline across many industries that's sustained for more than a couple of months and a bunch of specific tests and this doesn't seem like that now. what we have right now doesn't seem like that and the real reason is that the labor market is just sending such a strong signal of economic strength that is makes you really question the gdp data. >> question the gdp -- do you, brian? are you questioning the gdp data? are we in a recession or not by this time tomorrow? jimmy graham think a lot of peo

before the news a big rally the markets rallied on the jay powell comments. stocks finished higher across-the-board the nasdaq up 4% on the session. a big day the dow industrial 436 on the close and the nasdaq was up 469 better than 4% higher yesterday. the s&p higher by 102 at 4:00 o'clock on wall street all closing at or near session highs. interest rates ahead of the gdp report, the tenure and the two year treasuries looking like this the two-year traveling below 3% and now down 1.1% on the tenure at a level at 2.779%. the two-year downpour and have basis points. were waiting on jobless claims this morning crossing the tape at 8:30 a.m. eastern we will get you all those numbers coming up. this is also by the way the busiest week so far of second-quarter earnings from apple and amazon will be the closest later on reporting "after the bell" it will give us a big window into consumerism right now. take a look at the hero zone at 200 in london right now showing a decline of 13 the dax index in germany lower by two and a quarter, asia overnight the market finis

forward guidance full get squished into jay powell's news conference wednesday. the left couple of eating's, he said we could do 50 or 75. i do not think he wants to get that specific. some numbers show insulation they beat he. -- may be peaked. that university of michigan number, inflation expectations fell. if inflation has peaked, maybe they do not need to go as hard and that avoid session. jon: the other factor out there is how far ultimately the fed is willing to go with actual rate hikes. you have mike wilson who feels that equity investors may be prematurely tried to predict when you might see that he. -- peak. for those watching jay powell this week and trying to determine how far the fed will go, what you be watching for? mike: we will not have a new forecast. powell is probably not going to give us anything different in terms of a terminal rate. the fed thinks it should just over 3%. he will probably tell us that date will go at least to neutral. he will not say consequently may want to stop and look around at that point. the problem is that nobody real

meanwhile, fed chair jay powell may have made another communications error, and now everyone else is trying to clean it up. that's next. ♪ ♪ jive talking ♪♪ your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire hi, my name is cherrie. i'm 76 and i live on the oregon coast. matching your job description. my husband, sam, we've been married 53 years. we love to walk on the beach. i have two daughters and then two granddaughters. i noticed that memories were not there like they were when i was much younger. since taking prevagen, my memory has gotten better and it's like the puzzle pieces have all been [click] put together. prevagen. healthier brain. better life. ♪♪ choosing miracle-ear was a great decision. like when i decided to host family movie nights. miracle-ear made it easy. i just booked an appointment and a certified hearing care professional evaluated my hearing loss and helped me find the rig

jay powell offered something to the market yesterday which was somewhat unexpected. basically a dovish pivot in the sense that suddenly he throughout all guidance. i think this is explaining a lot of equity rally we are seeing in the last couple of days. we will see next week if the fed is going to taper down these optimistic expectations again as they have been with doug since of speeches during the summer. -- dozens of speeches during the summer. >> how does that inform your strategies at the moment when it comes to this market given that with every selloff we see, it feels like there is a distinct lack of conviction? >> this one is different. we have been bullish since mid june. we saw some of the most oversold ratings since the financial crisis. then there was the 10 year yield which has been key chart this year. it hit 3.5% which was exceeding what we saw in 2018 at 3.2% when the fed ultimately was forced to pivot because the bond market already signaled that the construct we have been building with free money over the past 15 or 20 years cannot handle sustained

one has to wonder if jay powell sometimes mutters that to himself, particularly of late. this man is a sitting duck right now. by the end of the summer he will be known as powell the pinata, only a soft landing might help him guest away otherwise, someone will be upset with him. there will be general disdain for the chairman of the federal reserve. joining me trend macro -- >> macro. charles: i don't understand why they spelled it differently. i feel like the guy from the movie who reads whatever the hell is in the prompter. >> you mean the president? charles: [laughter]. i wasn't ready for that. i say you look better and better. you're also sharper and sharper every time i see you. you saw the thing from elizabeth warren in the journal, essentially jay powell's fed pursue as painful and ineffective inflation cure. now she is noting that more aggressive interest rate hikes will cost millions of jobs and won't address the cost of high prices. she added, bloodless language economists refer to this thing as dampening demand. she says it's a lot worse than that, crushes a lot

speaking -- there, jay powell speaking. no doubt people will be paying attention. jon: mike mckee on the economic scorecard. let's bring in some market perspective, troy gayeski, fs chief market strategist. we will share the popcorn with you too. the broader story of investors during this time of turmoil has made people's head spin. how are you navigating everything in front of us and the investing strategy alongside that? kriti: looks like we -- troy: it depends on the objectives. first of all, if you are satisfied with the mid to high single digit return, there has been an excellent performer your to date, up north of 3%, fairly resilient -- very resilient. that's been a big place for people to not only hide out during this bear market but continue to outperform plane fixed income. it is still down north of 8% year to date. secondarily, there are multi-strategy approaches that have a blend of correlated and non-correlated trades. an example of a trade that's sensitive to the economy would belong dividend futures. dividend

elect -- i'm not trying to get anybody elected here it's going jay powell's way. >> right >> he can now go away. i mean, when you listen to the meta call, i'm serious, the layoffs are not where you thought, because we're so used to those companies being secular growers and suddenly there's mark zuckerberg saying it turned out we're a big, cyclical business and it's not good, it's getting worse. if i worked at meta today, it would be kind of like, hey, you got anything for me? >> polishing your cv >> i can take a nice pay cut i'm in the metaverse right now i want to be in a tool and die company. there, that's the economy. >> so how about apple and amazon tonight? how important is operating income on amazon to. >> i don't know. the qualcomm call, which was not nearly as bad as people think. they're out for cristiano too. he didn't guide down that much, kind of like bill mcdermott. not as good as bill with servicenow, but when he was asked about how apple is doing, it was strictly no comment they don't ever mention that some of your other customers besides samsung, with an extension, a

key messaging from jay powell, clearly the market is trying to find anything positive they could. kathleen: they were and you can't blame them. all kinds of investors want to get back in. jay powell made it clear he might want you to do that, but right now, inflation is much too high. it's essential to get it back to the 2% target, it's 9.1% right now. over 6% on the fed's key measure. he also said in answer, yes, an unusually large rate increases hospital -- possible, but no decision made and he did not want to give any signals on that. they are moving away from forward guidance, back to the fed where you watch the data, it will depend on the data comes in by september. >> we are going to be guided by the data. you can think of the destination as probably in-line because it's only six weeks old. sometimes they can get old really quick. probably the best guide we have as to where the committee thinks they need to be. i will point you to that. kathleen: the dot plot shows at the june meeting, the fed was looking to get to 3.5% by the end of this year. 50 more basis next year. a lon

it will promise to be smaller than the last two, but i have long been a jay powell fan. i am on his side. i wanted to do a couple hundred, but i will take 275. that is pretty perfect, hence the rally. the market would've been crushed if powell said the economy is red-hot. they need an emergency rate hike next month to stamp out inflation immediately. don't take that off the table. it doesn't sound like it will. we are being a little theoretical, and you know that i don't like theories. in today's session, a lot of bears were caught, trapped, filleted, and put on the wall. kind of like one of those museum exhibits. the bears were caught looking the wrong way. look. it could be a fine way to make money, but it can also lead you astray. lately, i've seen a lot of extrapolations done wrong, and very little done right. not long ago, a distinctly second-rate company, snap, recorded a horrendous quarter. calling out tremendous weakness. what happens? the web gets absolutely crushed. after snap, i think it is impossible that anything good can come from an internet stock. that is

that is what jay powell was pointing to. >> the trouble is many people will tell you the unemployment is lagging -- is a lagging indicator. naysayers may point to jobless claims, which has been creeping up. it is also true that officials like jay powell or janet yellen are never actually going to say we are in a recession. until it is absolutely clear. they are both institutionalis ts. they may wait for the nba are. if they are ahead of it, the question becomes, what are you going to do about it? mark: -- manus: isn't the biggest risk that you have all this copywritten, the fed is going to step out, the terminal rate is here, the whole point is if they pause or hint at any kind of applause, you undo this very deflationary pain they have to inflict upon us all to try to cap inflation. it could be the biggest folly of all. if they were behind the curve last year they could double smack themselves if they pause or show signs of pausing at all. >> if you listen to the entirety of jay powell's press conference on wednesday, this is not a guy who sounds remotely like he is done. it is only

today the fed decision and jay powell news conference. that will be crucial. earnings, on the semiconductor space and what's happening in the auto sector. amid those constraints. >> we get u.s. gdp read, you've goldman sachs raising its expectation on better-than-expected trade balance inventories that we got today. we get the earnings, amazon and pfizer. in europe we have barclays and santander. when the first big ones to report. it will throw off a lot of money plus german inflation data. always wonderful spending time with you. thank you for joining us. coming up, stephen stanley will be joining david westin. i'm headed to radio as well. good earnings coming out after the bell in europe. we will break those down. this is bloomberg. ♪ millions have made the switch from the big three to xfinity mobile. that means millions are saving hundreds a year on their wireless bill. and all of those millions are on the nation's most reliable 5g network, with the carrier rated #1 in customer satisfaction. that's a whole lot of happy campers out there. and it's never to

paul: federal reserve chairman jay powell at a news conference this afternoon. chair powell: restoring price stability is just something we have to do. there isn't an option to fail to do that, because that is the thing that enables you to have a strong labor market over time. you have payroll jobs averaging 450,000 per month. that's a remarkably strong level for this state of affairs. paul: i asked economist nela richardson for her take. nela: it's a weird time. it's a weird time. but what is certain is inflation is just too high. paul: richardson means "weird" in that inflation is soaring because of factors outside the fed's control, the war in ukraine driving up energy and food prices, the pandemic causing supply chain snags as consumers lurch from goods to services and back again, no buying to hyperbuying, suppliers cutting back and then suddenly ramping up -- think airplanes. in response, the fed has lurched from no rate hikes to big ones. nela: everybody's really taking big actions, but they're taking big actions based on historical trends a lot of the tim

federal reserve chairman jay powell at a news conference this afternoon. chair powell: restoring price stability is just something we have to do. there isn't an option to fail to do that because that is the thing that enables you to have a strong labor market over time. you have payroll jobs averaging 450,000 per month. that's a remarkably strong level for this state of affairs. paul: i asked economist nela richardson for her take. nela: it's a weird time. it's a weird time. but what is certain is inflation is just too high. paul: richardson means "weird" in that inflation is soaring because of factors outside the fed's control, the war in ukraine driving up energy and food prices; the pandemic causing supply chain snags as consumers lurch from goods to services and back again, no buying to hyperbuying; suppliers cutting back and then suddenly ramping up -- think airplanes. in response, the fed, lurching from no rate hikes to big ones. nela: everybody's really taking big actions, but they're taking big actions based on historical trends a lot of the times.

jay powell is clear that they're not done yet. here's the irony. the last three times the fed has had these meetings, the market was up big on those days. it went down more the next day. they have gotten hammered the next day. so i say with it until the next session. let wall street sleep on this before we can determine whether or not it was great news for the market. having said that, you know, it's really tough when the federal reserve says -- jay powell said listen, the economy is where he wanted it to be. he wrote a paper in 2020 saying that he wanted a new role for the federal reserve, more social justice role. in the past, they make decisions based on things like unemployment being 4%. but when they took a granular look at it, white employment was 3%, hispanic 10% and black 8%. he wanted all of them to come down. that was his goal. that's why he kept saying for a long time, we're going to let inflation go higher than we normally would to achieve the social goals. he addressed that today. he admitted, he said racial gender and participation, w

. >> fed chair jay powell wrapping up his news conference after hiking interest rates three-quarters of a percentage point. 75 basis points. we are at the highs of the day on stocks. dow up almost 500 points the s&p 500 surging about 2.5% the nasdaq higher by more than 4% right now why? fed chair powell acknowledged the softness in the economy. we got that first in his statement. he really did drive home what he's seeing in terms of consumer spending, business investment, housing weakness, even acknowledged some of the weakness right now in the labor market and importantly he did not precommit to what the fed would do on rate hikes for september. i thought one of the key moments when he said it will depend on the data the next meeting is in september and there will be more data between now and then joining us now on fed days, former national economic director gary cohn welcome. >> thanks, sara. glad to be here. >> it's the gary cohn rally, the market rallies was it just a lot of the hiking news is baked in and now it goes the other way? >> i think the news was baked in, the market an

>> all right well, first of all, jay powell must be forward looking. honestly the statistics we're getting are very backward-looking i'm with jim cramer on this. listen, you've heard me say i've been saying the housing, the way that the government does the housing inflation is so lag, we already had 20% increases in prices and rents it's only recorded 6 and 7 and 8 and it's going to get in there over the next 12 months. and it is a very big fraction. so the printed numbers are going to remain bad, even though the actual numbers are going to be getting much better. so i just -- i presume that powell knows this if he just looks at theprinted numbers, it's still going to be -- it's going to go down this could be the peak print that was when oil was over -- gasoline was over $5 a gallon. it's come way down so the energy part will be much lower when we get the july print. but really i think most of our inflation is behind us i think, yes, they'll do 75. and they have to turn around, because the economy is really slowing. i said we're in a recession. and by

i am not giving up on jay powell people have given up on jay powell the way they've given up on the washington nationals, you know >> that's a love affair that will go on forever. >> me? >> yeah. >> our viewers are well aware. >> i think he was caught up in a public health problem. i think the chinese are still caught up in it. >> there's a war that came out of nowhere >> you're going to hang him on things like the war and the chinese covid policy >> i did not say i was >> i was in the 100 basis points camp so early people latched at me >> they laughed at you >> they're not laughing anymore. >> gershwin, they all latched, right, at christopher columbus >> died at 36. >> i know. >> did you know he had brain cancer and he said his brain smelled like burnt tires >> tragic. imagine what he could have done if we had him longer >>> when we come back, we'll look at chips. big stories today, taiwan semi, intel reportedly planning price hikes. lots of calls -- costco, twitter, amd, ibm. >> positive, positive, positive. (vo) hi. we're visible. a different kind of wireless company... ...running on a big

it is believed fed chair jay powell has a controversial belief we are getting closer to neutral. but there is a risk that we are going too far or maybe not far enough. these are some of the reasons people are giving. i don't know if i buy it. how could you get a knee-jerk rally that was the biggest with the nasdaq going back to november 2020. jonathon: chair powell, we had a list of stock market indices in front of us here, do you think that is the outcome he wanted to see? lisa: market rally is 5% to 10%. i assume he was talking about the s&p, not the nasdaq. that would go against what the fed is trying to do. others would push back and say there has already been so much bad news and the rally is actually a sign of optimism. tom: john is looking at the ac milan futures. i've actually doing technical analysis. unequivocally looking at what's called a point and figure chart, we really haven't had a bear market breakout. it was a big top yesterday. today, and is a big now what echo jonathon: futures on the s&p negative. we declined on the nasdaq hundred. to the point of little late

you can ask fed chair jay powell, he'll give you a completely different answer. jay. >> i don't think the u.s. is currently in a recession. the reason is there's just too many areas of the economy that are performing, you know, too well. >> so if we're not heading into a recession, why hike interest rates? let's get into it with tonight's party panel, washington times opinion and editor and fox contributor charlie hurt is back. radio host, democrat strategist also a fox news contributor in luscious hot pink andy marshal and antiwar.com editorial director scott horton. yes, yes, and triple yes for all three of you. so they keep citing these economic metrics, which show the economy is doing great. they keep talking about the jobs numbers, but jerome powell said the job market is un-sustainably hot. that means employers will continue to have to raise wages in order to attract workers, which will only raise prices further, which just makes inflation worse and the looming recession that much more certain, charlie. >> yeah, no, it's -- the only thing that's worse than

you throw jay powell and the federal reserve in the mix. this is where we finished the session. the nasdaq 100 up 3.4%, best day since april 2020. philadelphia semi conductor index surging, supported by the fed raising by 75 basis points -- as expected, fed chair jay powell saying there is no current recession, although the data telling the fed is we are seeing some slow down in the economy, but right now the focus is on fighting inflation. little movement in the 10 year yield. on other ends of the curve we saw movement. bitcoin surging. when i woke up wednesday morning bitcoin was down around 20,000 u.s. dollars a token, now we are at 28,000, $23,000 per token. i just want to make one point finally. before you get into the main story of the day, what a weird week it has been. remember when snap on july 23 basically scrapped guidance, the world changed? this is meta. it drops off because of concerns the ad market is doing badly. i walk across the screen. we go back up. alphabet, parent company of google, gives us confidence that the ad market remains intact. i guarantee that cha

jay powell and his colleagues are specked to approve another 75 basis point interest rate hike this week and they are likely to signal their intent to move higher in the months ahead. joining us now is the u.s. -- thank you for joining us. let's start with the question of the day which is what are your odds at this point of a recession as we note that data across the screen in terms of the dallas fed manufacturing index falling. underlying the softness of the economic data coming out of the u.s. tiffany: thank you for having me. we think of the next 12 months, recession is more likely than not and there are three things that i would point to, supporting that view. the first is economic data has clearly deteriorated lately. we've also seen purchasing managers and elsewhere deteriorate to a point that is more consistent with the contraction in real growth. we've also seen inflationary supply shocks. obviously the geopolitical turmoil and the war in ukraine have resulted in a bigger reduction in energy flows to europe than we previously expected. that sort of supply shop is going to have st

larry: jay powell said things that, to be blunt, were analytically indefensible. he claimed twice in his press conference that the fed was now at the neutral interest-rate, calling it 2.5. alix: the fed's current target outlook is now 2.25% between 2.5%. larry summers says a neutral setting would be higher because it has to take into account where inflation is. for the full interview, tune in to "wall street week" at 6:00 p.m. wall street time. nancy pelosi is set to leave on a trip today and the question is whether she still plans to stop in taiwan. yesterday, there was a conversation between joe biden and xi jinping. we want to go to annmarie hordern for the latest. if you going to go? annmarie: we don't know yet. she says she does not talk about foreign travel because of security concerns. we know she will likely stop in singapore, malaysia, japan, but all eyes are on whether she lands in taipei or not, and this was the issue on the call yesterday. we got more details on the china side from their readout, which said that she had said to president biden on the c

is that justified based on what jay powell was saying? >> to be honest with you, wilford, i think it was an overreaction. it was great to see the green tickertape, but a 75 basis point jump was expected. it took us to neutral 2.5. he talked about next meeting possibly being another 50 to 75, which could take us to three or 3.25, so i don't look at it quite as devilishly. i think we need to continue to be careful, because the problem is we don't know if what the fed is trying to do is going to work in six to nine months. enjoying that time period, i think investors need to remain cautious. so far, wilford, retail investors seem to be getting it right. last week was the fourth week in a row where investor sentiment had a lead below 30, which is really bearish. they are right to be bearish because we are in a bear market even with the old rally through a bear market cycle. but the idea that some investors is so bearish is becoming a little scary. i think some of them are even going to cash, and that begins to show signs of a bottoming proces

fed chief jay powell said this. >> the fed doesn't make a judgment on that. we don't say there is now a recession and that kind of thing. if you think about what a recession really is, a broad based decline across many industries that sustain for more than a couple of months. what we have right now doesn't seem like that. >> the clown car of spin is chock full of them. listen to this. >> how worried should americans be that we could be in a recession? >> president biden: we're not in a recession. >> this is not an economy that's in relegs. >> we're not in a recession or pre-recession at this time. >> the data over the second quarter is not consistent with an economy in recession. >> the evidence is strong we're not in a recessionary period. >> if things are going so great, why is it white house officials are trying to redefine recession? >> we are not redefining recession. >> a headline says this quote, the biden administration appears to be preparing for a recession or rather for news of one rather than tackling the underlying economic problem. the white hou

the spending out of the white house, and then the jay powell central bank that was just come again topping up all the spending and using the economy. they want more that clearly gives the federal reserve to fight inflation but at the same time, just in the last week, the chips bill in the schumer mansion in richmond grain monstrosity combined more than $700 billion in additional spending. additional stimulus. so, you are feeding the beast at the inflation. you are not helping the feds fight it. also, extending the student moratorium on student loan payment, again inflationary handout to wealthy doctors and lawyers. the more that the biden administration keep spending and feeding inflation, the harder it is for the central bank jay powell to fight it. and the higher the rates go. we are looking at like a leveraged economy entering armageddon where you have a collapse in housing and a collapse in all assets. you have a recession that doesn't run two quarters but runs literally years. instead of a recession, inflation recession, i call it the never ending circle of sucker to do. >> katie: at

the federal reserve chair jay powell is likely to slow the pace of interest rate hikes after a 75 basis point hike next week. inflation remains front and center in the minds of investors. the white house director of the national economic council speaking about that strategy. >> our strategy is to go everywhere to bring prices down. to do so in a way that folks don't have to give up economic gains we have made. kriti: for more on this topic let's bring in our very own anna wong, chief economist for bloomberg economics. such a huge and monumental we coming up next week. i'm curious about the 75 basis point story. talk about the difference between 75 basis points and what some wall street strategists are calling for, 100 basis points. anne: i don't see the pace 100 versus 75 making a huge difference for inflation this year. if the fed goes 75, if they go 100 bits, 25 in september. i think what the fed aims to achieve is to get the 3.5% by the end of this year. kriti: what other things are they watching? you have a housing market extremely tight. a labor market that is extreme we tight here

jay powell strikes me as better suited for the age of transparency and in terms of personal demeanor. one thing that paul volker had was the backing of the political establishment in washington and new york. they were able to take the pain and cultivate an appreciation of the pain needed to withstand in order to get inflation down. i think jay powell seems to have abundant political connections, and abundant skill in managing the fed's political connections. so he seems pretty well-suited on those grounds. jonathan: this is a delicate subject so you touched on this, how political business fed right now? jeffrey: so, i think they understand that there is nothing that could damage their credibility more than sustained inflation. they can take all the hits that they want on unemployment, labor, and climate change and what have you, but job number one is inflation. if you do not get that down they realize that they are political toast, in some sense. i think that is true of any fed no matter what they say. jonathan: are you convinced that they are willing to tolerate a recession to get in

it possibly that jay powell knows the number. the point is that we have this very strong labor market. we're in this weird situation. the fed is supposedly according to the markets, they're going to raise rates rapidly before the end of the year and then amazingly next year he's going to start bringing them down again. i don't think anybody believes -- >> neil: that's what he's betting on. that might be a leap. >> that's what the fed is saying. that's what they believe. i don't think it's credible. >> neil: steve moore, i do want your quick take. technology stocks advanced. the nasdaq up over 4% that is despite grim numbers that we're getting out of the microsofts and all of these other big players including google. if we can show how the nasdaq did today. they were all up smartly. i'm wondering if that is because they were beaten down so much. this group is sensitive to rate hikes. but now we're starting to see that maybe, maybe it was overdone and they're going to come back and this is the news that helps them come back what do

jay powell is obviously at fault. janet yellen, all of the fiscal stimulus that was pumped in to the economy, there's a lot of people that are at fault right now. but the one thing that we have seen is that with this administration, with jay powell, with janet yellen, there's no account ability. >> martha: nobody loses their job. it doesn't happen that way in the rest of the world. thanks, mark the upper joining us on "the story." and big concern from experts surrounding a housing market crash as home prices and mortgage rates surge and americans get priced out of buying. madison allworth with new numbers. hi, madison. >> the housing market is slowing down. take this five bedroom house. it's listed for just under 2.5 million. they've been on the market three weeks. they have a lot of interest but no offers yet. that is a sign that things are changing. >> so a house like this, which is in really beautiful condition with a pool and everything, i'd say a couple months ago, i would have expected it to go within the first

it looked like it would be weak and then it came back because as jay powell said yesterday, it feels like it tastes right it's the goldilocks scenario and that we may be in a recession. he said unlikely but if the second quarter was a slowdown and the first quarter negatives two in a row, you need a few other factors. but if we're having a recession and things aren't falling off a cliff, that's pretty good news we're having earningsnot as ba as expected. that's the big catch phrase, that we're all seeing numbers that are week, but they're not horribly weak for the most part. a few very disappointing like snap, netflix bad, but not too bad. google bad, but again the market liked it if we can continue on that trajectory and get through this weakness in the conomy, i thin that says that perhaps by the end of the year we'll have run the course, meaning inflation will be down, interest rates have come down already employment may be down, but that may be -- as serat said, wages may be down and that's a better picture. the market, by the way, is showing some support at the 50-day moving ave

you can appreciate complicated corners that jay powell has to handle going over it at a time the market increasingly has been talking about when rates start coming down heading into next year. max: yeah. when we are racing there is always this variable of the unknown. that is something i think powell is dealing with now. there is a lot of variables the fed does not know. what they should do is what a good race driver is due, not signal their strategy too much. when i have someone in front of me and i know they are trying to predict where i'm going to go left or right, i tried to surprise them. with the markets that might be a good idea. if the market knows it will be too restrictive, they will have a negative reaction. the fed should be more careful without signaling -- about signaling expressively. kriti: there are calls for 100 basis points tomorrow. we will dive into all of that with representatives of those banks tomorrow. what kind of difference does those potential 25 basis wins make? -- points make? max: i don't believe the fed will do a 100 basis point hike. they have been good

powell will show up for the press conference will it be the fire-breathes, dragon-slaying jay powell or someone in between we don't know. what the goals desperately want is powell to have a recession, and the battle against inflation hasn't won and that will be august 25th and it might be the opportunity to note that inflation is improving and the economy is indeed slowing or going for a pause in rate hikes and that's what's going to happen maybe, we'll see apple and microsoft are the most important earnings this week everyone is afraid of a slower spending environment and the effect of the strong dollar. yet bulls are insisting that iphone demand is feared and expect to hear about managing expenses and the bulls have a better fourth quarter and a better 2023. want an example? dan ives, as of now we believe iphone demand is holding up better than expected that said, the street is well aware of weakness this quarter and ultimately is looking past june numbers to the september and december quarters with all eyes with the i-phone in production for the fall staying on track he said that

jay powell is going to be speaking at 2:30 p.m. eastern as second quarter earnings reflect a slowdown. google parent alphabet reporting the slowest sales growth in two years, microsoft reporting the slowest earnings growth since the pandemic began but still both stocks are higher this morning, microsoft higher an a strong sales forecast, expecting 2023 full year revenue to grows in the double digits. both stocks up about 3% right now. this morning we are waiting on durable a goods orders out in an hour and-a-half, 8:30 a.m. eastern. we'll get home sales out this morning at 10:00 a.m. eastern. second quarter gdp of course out tomorrow morning at 8:30 a.m. after a contraction of 1.6% in the first quarter, most economists are expecting growth in the second quarter of five tenths of a percent. the atlanta federal reserve is expecting a contraction in the second quarter which would mean we're in a recession right now. the biden administration is playing word games, trying to redefine what a recession is. here's white house national econ

the fed agreed at 2% in a very positive thing when they did that in 2012 jay powell has committed to that, as well, and it's not good enough to get inflation coming down from nine to four and the markets have to be convinced >> that's a real problem right now, not that inflation is going to be near 9%. we're not in the 70s, but we are in a situation where inflation will come down and unless the fed has credibility and does its job properly it will be a long way to get down to wotwo and they're targeting exercise would not have been done properly and the fed made a mistake with the way they executed the average inflation target that even it's a good idea to do it right, they weakened the commitment because ■■they never talked about it, a so there really are serious problems that they fell into and that's why they have to be very tough and have to raise rates and probably a lot more than people expect. >> well, we appreciate your time we love guests who come on and say something and you've just said it, made the case and frederick, we appreciate your time today >> my pleasure >> we

no mention of jay powelled to. it does seem ironic that she had a better feeling for this economy than the people who are running monetary policy. how nuts is that? >> hey, of course she has a better feeling for it, because the people running monetary policy have a terrible feeling for it. they're the worst possible people we could have selected another this job. look, i'm going to give jay powell a little bit of credit for his humility in saying that we don't understand anything about inflation. but then he turns around and says, oh, well, we don't understand what caused it, we didn't predict it, but we have all the tools mess to fix it. and if we have to throw a million and a half people out of work in order to hopefully fix something that we admit we don't even understand, hey, we'll just do that. well, of course you will, jay, because you're not going to be the guy who has to sign the pink slips on 1.5 million people to move the unemployment rate from 3.6% to even 4.6, right? you still consider that very full e

powell and his colleagues, and that would mean the fed would have to drive rates even higher. so i think not that they can totally relax, they need to go 75 at the next meeting, but i think this will be consistent with that other than a push toward a full percentage point. kriti: for more in today's economic data and what it means for the fed's rate hike, joining us now is mike mckee. thank you as always for joining us. some pretty great data coming out today. it doesn't -- does it change anything? mike: it doesn't change anything, and it is a matter of interpretation whether you think it is great or not. retail sales came in better than forecast, but when you deflate them they are not adjusted for inflation. when you deflate them the retail sales numbers for the month of june were negative. in much of that came from gasoline prices. with gasoline prices going down in july. we will see if people can move their cash from their gas tanks over to other things that they want to buy. it may be also that people are spending more on services right now. we will find that out at the en

people calling it my -- jay powell said last week, the ecb conference saying the biggest mistake the fed can make isn't causing a recession, is not hiking rates -- hiking rates enough now to bring down inflation. >> arguably compared to the pads of the ecb is a lot more break -- less straightforward. they have to demonstrate some economies in the euro zone can handle higher rates. yvonne: the ukraine war is a much bigger influence. will these minutes open the door as people think christine lagarde may have a bit to a 50's -- 50 basis point rate hike in september. when you look at inflation, you can see it is skyrocketing. a lot because of energy and food prices, the core inflation rate well above their 2% target. they are winning the debate at the ecb, concerns over inflation trumping concerns over recession. we see a 25 basis point hike in july, 15 september, 25 at each of the next two meetings. as of the kinds of things we will be looking for. a lot of focus on the medium-term outlook. that could be the trigger, for the 50 basis point hike. those are the things people are looking f

jay powell and the team, mind set is to prepare the markets ahead of time. they almost want to make threats without having to do anything. sort of like parent tells kids in the back seat, you guys, behave, quiet, you don't want me to have to stop this car. the way jay powell is thinking hopes the threats mean he doesn't in fact have to stop the car. liz: as we broaden the aperture here we know technology is obviously getting hit. we know there are layoffs. you do believe the of course the semiconductor industry is one of those must-haves. taiwan semi came out with very strong numbers which might indicate hopefully we're at the tail end of the chip shortage but why lam research? >> lam research is a little bit of a contrarian play but that said the headlines have been for the last several months there is massive shortages of semiconductors. that mean as lost these players like taiwan semi, like a lot of their peers are having to invest in new capacity and lam research, they basically have a 50% market share in wafer etching. you love the strong market share f

judging from comment last time when jay powell went to congress felt like republicans want the fed to douse this inflation fire, democrats say, hey, it would be cruel. somehow engineer something slower but don't push us into recession. do we have a choice right now? >> no. i think democrats are sort of overestimating the amount of control the fed has over the economy. they're not that precise with their tools and their methods. when they act like we're choosing between recession and inflation i think that is false choice. if inflation goes on like this we still have 9% inflation, everyone becomes poorer, then they spend less. interest rates go up, we end up with a recession anyway or worse one. so i think the hope is that the fed does raise rates you know, we might still have a recession, hopefully not but it would be a much more mild recession because the longer inflation sticks around the more damage it does to the economy. charles: all right. allison, i really appreciate you coming on. thank you very much. >> anytime. >> see you soon. still to come, folks, a look at this whacky way

powell central bank. it was just again sopping up all the spending and juicing the economy. so they want more of it. clearly you have the federal reserve is trying to fight this inflation, but at the same time, just in the last week, the chip bill and then this schumer mansion enrichment grainne monstrosity combined, that's more than 700 billion dollars in additional spending ,additional stimulus. so you're feeding the beast of inflation. you're not helping the fed fight. also extending the student the moratorium on student loan payments. again, inflationary handouts to wealthy doctors and lawyers. the more that the bidart administration keeps spending and feeding inflation, the harder it is for the central bank jay powell and the fed to fight it and the higher rates go . you're looking at like a leveraged economy entering armageddon where you have a collapse in housing, you have a collapse in all assets. you have a recession that doesn't run two quarters, but that runs literally years instead of recessio