Senate Pulls All-Nighter on Tax Bill; Trump Takes Aim at Musk
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Let's talk about.

Some other decliners. It's your short audio report on the day's winners and losers in the stock market. Second biggest driver in terms of points for the S&P 500. Subscribe to the Stock Movers Report on Apple Podcasts, Spotify, or wherever you listen. Bloomberg Audio Studios. Podcasts. Radio. News.

Good morning, I'm Nathan Hager. And I'm Karen Moscow. Here are the stories we're following today. Karen, we begin on Capitol Hill where debate continues on President Trump's $3.3 trillion tax and spending cut bill. Senators have been up all night and into this morning voting on amendments to the legislation, including clean energy and Medicaid provisions that could upset fiscal conservatives. But Kansas Republican Roger Marshall says he is confident the bill will get over the line.

I sure think we do have the votes. I think we cannot let this moment pass to have the largest tax savings in American history. The average American family back home is going to save $1,000 a month. But Democrats like Mark Kelly of Arizona are trying to slow the process.

We'll be here as long as it takes for us to show the American people that this is bad policy. This is going to kick 17 million people off of their health care to give a big, giant tax cut to the wealthiest Americans. Well, right now, eight Republicans are holding out their votes on the bill. Two of them, Rand Paul and Tom Tillis, are solidly against it.

Senate Majority Leader John Thune can afford to lose only one more and advance the bill back to the House before President Trump's July 4th deadline. Meanwhile, Nathan, a new analysis of the Senate's tax cut bill points to a potential benefit gap in the legislation. Economists at Yale University's Budget Lab have found the bill would cost the bottom 20 percent of taxpayers.

an average of $560 a year, while the top 20% would see a boost of $6,055. The analysis finds the poorest Americans would bear the brunt of cuts to Medicaid and food stamps, while higher earners would see the biggest benefit from tax cuts and an expanded state and local tax deduction. Well, Karen, Treasury Secretary Scott Besant is optimistic that the tax bill will get done in time. He spoke with Bloomberg's Shanali Basik.

I'm confident that the bill is going to progress as is over the next few hours and it'll be on the

the president's desk to sign on July 4th. So the Senate will vote, pass it over to the House. We've seen incredible leadership, and this is what leadership looks like. That was Treasury Secretary Scott Besson speaking with Bloomberg's Shalini Basik yesterday. And for the full conversation, head to the Bloomberg podcast channel on YouTube. Nathan, the war of words between President Trump and Elon Musk has exploded into public

Public View once again. I'm Bloomberg's John Tucker following that story for us. John, good morning. Good morning, Karen. Well, overnight, President Trump posted on social media, Elon may get more subsidy than any human being in history by far. And without subsidies, Elon would probably have to close up shop and head back to South Africa.

He went on to post,

Well, this all comes after Musk slammed the Senate's latest version of Trump's multi-trillion dollar tax bill, warning that cuts to EV and other clean energy credits would be incredibly destructive to the country. And not to be outdone, Musk is threatening to target nearly every sitting Republican in Congress who has signaled support for President Trump's multi-trillion dollar tax bill. Members of the GOP may be asking themselves who they're more afraid of, the President of the United States or the world's richest man.

And for now, investors are the ones suffering. Pre-market, the shares of Tesla, they are most active right now, down four and a half percent. In New York, I'm John Tucker, Bloomberg Radio. All right, John, thanks for that. Now the latest on the trade front. Bloomberg News has learned that the European Union may be willing to accept a trade arrangement with the U.S. ahead of President Trump's deadline. Let's go to London, get the latest of Bloomberg's Ewan Potts. Good morning, Ewan.

Nathan and Karen, it's the world's most important bilateral trading relationship. And now Bloomberg has learned that the European Union is willing to accept a trade arrangement with the US that includes Donald Trump's universal 10% tariff on many of his exports. But it does want lower rates on key sectors, including pharmaceuticals, alcohol, semiconductors and commercial aircraft.

We're told the European Commission views the deal as slightly favoring the U.S., but it's still something that it could agree to. Without a deal, it's just eight days until all European Union exports are set to be hit with a tariff of 50 percent. In London, I'm Ewan Potts, Bloomberg Radio. Ewan, thanks. Meanwhile, President Trump is threatening to ramp up tariffs on Japan. We get more with Bloomberg trade czar Brendan Murray. He's kind of calling Japan's bluff here and saying you won't take our rice exports anymore.

Therefore, you're just going to have to accept the reciprocal tariff that I'm going to impose on you. Now, whether that's going to motivate Japan to get a better offer on the table between now and July 9th is a whole other question, and people would doubt that Japan is going to cave on that. The big issue for Japan is getting around those 25% auto tariffs. Japan is obviously a big exporter.

to the US of automobiles and something like 80% of the US's trade deficit with Japan is tied to automobiles. So Trump really wants to bring that down and Japan is not willing to give that up very easily.

Bloomberg's Brendan Murray says talks between the U.S. and Japan are expected to continue despite the president's latest threat. All right, Karen, let's turn to markets now. The S&P 500 is coming off its best quarter since 2023 as we head into the second half of this year. The index is trading at an all-time high, soaring 25 percent from its early April low. Tali Leger is chief market strategist at the Wealth Consulting Group.

I know it sounds silly and I'm a wild eyed optimist, but by the dips has worked since the inception of the S and P 500 folks. And we know that because the chart goes from the lower left to the upper right across time. It depends on your

holding period and our horizon tends to be pretty long. So I think it's always a good time, even at all-time highs like this, to put new money to work in stocks. Charlie Leger with the Wealth Consulting Group. Meantime, this has been the worst half of a year for the dollar since 1973. The U.S. currency is down 10

So far this year.

But is there much new he can say until the administration makes its policies clear? In Japan, Kajio Ueda is trying to navigate a tricky corridor, raising interest rates while trying to keep the economy on course. Bank of England Governor Andrew Bailey is dealing with stubborn inflation and signs of weakening growth. And ECB President Christine Lagarde is facing headwinds from U.S. policies and European defense spending needs.

Odds are we'll learn more about all of their problems than what the solutions may be. Michael McKee, Bloomberg Radio.

Time now for a look at some of the other stories making news in New York and around the world. And for that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Karen. A jury returns to deliberate for a second day today at the sex trafficking trial of music mogul Sean Diddy Combs. Yesterday got off to a rugged start. An hour into deliberations, the four persons sent a note saying they were concerned one of the jurors could not follow the judge's instructions.

Eventually, jurors deliberated over five hours on Monday. They are deciding whether prosecutors have proven racketeering conspiracy and sex trafficking charges. Former prosecutor Bernarda Villalona. The jury is asking if an individual asks for a controlled substance and the person hands it over, is it distribution? I would be concerned if I was Sean Combs because you don't get to that predicate act unless you have already found that there's a racketeering conspiracy. The

The defense says this was all part of the Swinger's lifestyle and that he committed no crimes.

The largest city workers union in Philadelphia is now on strike. About 9,000 workers represented by District Council 33 walked off the job at midnight after negotiators failed to reach a new deal with the city. The union has been asking for 8% raises each year for four years. Union head Greg Boulware says the city's offer of a 7% raise spread out over three years isn't enough.

When inflation is up and the cost of living is up, 2% raises and 3% raises don't change the narrative for our people. Things like trash service have been interrupted. Look for a rent hike. The New York City Rent Guidelines Board last night approved a 3% price increase for one-year leases and 4.5% for two-year leases, affecting roughly 1 million rent-stabilized apartments. The increases are expected to begin on October 1st.

Global News, 24 hours a day and whenever you want it. With Bloomberg News Now, I'm Michael Barr and this is Bloomberg, Karen. All right, Michael Barr, thank you. For enterprise organizations, managing all your food needs is a tall order. But with Easy Cater, you get a single workplace food vendor with the tools and resources to make it easy. Giving teams across your organization an easy way to order from a huge variety of restaurants.

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The data that matters for your investments. The entire auto sector is higher today. And analysis on the companies making news on Wall Street. Tesla's been a stock that's been in focus. Shares have really been all over the map this morning. Listen to the Stock Movers Report from Bloomberg. Let's talk.

Talk about some other decliners. It's your short audio report on the day's winners and losers in the stock market. Second biggest driver in terms of points for the S&P 500. Subscribe to the Stock Movers Report on Apple Podcasts, Spotify, or wherever you listen.

Time now for the Bloomberg Sports Update brought to you by Flushing Bank. Here's John Stashower. John, good morning. Good morning, Karen. Yankees in Toronto. First to four before they come back to New York to play the Mets this weekend. Jazz Chisholm, another home run, his fourth in five games. Yanks led 2-0, later 3-1. It came apart. Sixth inning, Blue Jays put up four runs on three Yankee pitchers, and Anthony Volpe throwing error was costly. Toronto won 5-4. Yanks in June had a losing month. Their manager is Aaron Boone.

We had a really tough week that lent itself to this record. So we know we've got to be a little bit better and feel like overall we've just got to find a way to finish some of these games. Tampa Bay loss of the Yanks' main game and a half ahead. Phillies won 4-0 behind Zach Wheeler, who in five starts in June allowed only two earned runs in the fills. Now two games ahead of the Mets, who are at Citi Field tonight to play Milwaukee. The Mets have lost.

13 of their last 16 games. The Knicks still don't have a coach, but they've added a player, veteran guard Jordan Clarkson got bought out in Utah, so he first needs to clear free agent waivers, but Clarkson expected to join the Knicks and help their bench, which was thin.

for most of last season. As for the new coach, Mike Brown, the first to have a second interview. Brown, two years ago, Coach of the Year in Sacramento. The Kings fired him during this past season. An NFL trade of three-time All-Pro defensive backs. Minka Fitzpatrick goes...

Back to Miami, where he began his career. Jalen Ramsey goes to Pittsburgh with tight end Johnny Smith. Day two at Wimbledon, we'll have early starts for Americans Tommy Paul and Jess Pegula. Top seed Yannick Sinner plays today. So does Novak Djokovic and Coco Ga. John Stasiewicz, Bloomberg Sports.

Coast to coast on Bloomberg Radio. Nationwide on Sirius XM. And around the world on Bloomberg.com and the Bloomberg Business App. This is Bloomberg Daybreak. Good morning. I'm Nathan Hager. The Senate has been pulling an all-nighter of amendment votes to President Donald Trump's big tax and spending cut bill. It continues this morning. Right now, eight Republicans are holding out support for the legislation, but White House economic advisor Kevin Hassett is keeping the pressure on.

I would counsel people very much against voting against the bill. And I don't expect that there are going to be many people who do that because the bill makes so much sense. That was National Economic Council Director Kevin Hassett. Joining us this morning is Terry Haynes, the founder of Pangea Policy.

Terry, good morning. The White House is sounding confident this bill is going to get done. How do you see things? Good morning. Good morning, Nathan. This is the time where you you project the result you want. So the White House is projecting confidence. The Democrats are projecting scorn and ugliness.

the eight Republican senators that want things are projecting uncertainty. So people want things. And we're about to the point, my view is ultimately this thing passes. My bogey for three months has been that it's going to happen on or around July 4th, so here we are. But there's going to be a lot of deals done here in the next few hours and a lot of votes to happen in the next few hours.

How do you see those deals shaking out? There's been a lot of focus, particularly on the clean energy tax credits, the cuts to Medicaid. How could this bill reshape? Do you see significant reshaping to the legislation? Well, I don't see significant. I would say not significant. The reason why is because the core of this thing are tax provisions and manufacturing provisions. What we're talking about here are important provisions, but they're ancillary to the core of the bill. But I see...

fundamentally accommodation. I see, you know, things they've probably gone about as far as they're going to go on Medicaid and probably even walk back. And this is we're talking before Senator Scott's amendment about the federal match happens. But and Senator Murkowski, Senator Collins and others want some things. So I think the bill ultimately moderates some

We've talked about the pressure that the White House is putting to bear. There's a new analysis from Yale's budget lab that shows a pretty disproportionate benefit for upper earners compared to lower earners from this legislation. Is there a potential political downside for Republicans to passing this?

Not particularly. You know, the Yale folks are a lot of things, but they're pretty partisan in orientation. Certainly the polling is negative towards Republicans right now, but what Republicans are focusing on is, you know, if they can get the fundamental tax and manufacturing policy right, then they wager the economic effects result from a positive

result into a positive polling balance into 2026 and into the midterms. And, you know, and whatever else you have to say about what the Republicans are doing, one thing they are counting on is the kind of the relative scramble that the Democrats are in right now. So you buy the White House analysis that the CBO scoring on this doesn't factor in the economic benefit. They're talking about something like a 3 percent boost to GDP from this legislation.

well you know that they've gone back to uh... certainly going back to president obama in twenty twelve i remember this very clearly but i think it goes back much farther there's always been complaint from any oc to the white house that the the c_b_o_ scoring is artificial does not take growth into account

As Secretary Besson points out, it doesn't take tariff revenues into account. And when you have a world where, as the Wall Street Journal points out, where the CBO score on extending SALT turns out to lower the deficit, you've got a fairly wacky and artificial system, whatever else you have to say about it.

Okay, just quickly, yay, nay on whether this bill passes out of the Senate today? As we speak, yay. Yay.

This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond. Look for us on your podcast feed by 6 a.m. Eastern each morning on Apple, Spotify, or anywhere else you listen. You can also listen live each morning starting at 5 a.m. Wall Street time on Bloomberg 1130 in New York, Bloomberg 99.1 in Washington, Bloomberg 92.9 in Boston, and nationwide on Sirius XM Channel 121.

Plus, listen coast to coast on the Bloomberg Business app now with Apple CarPlay and Android Auto interfaces. And don't forget to subscribe to Bloomberg News Now. It's the latest news whenever you want it, in five minutes or less. Search Bloomberg News Now on your favorite podcast platform to stay informed all day long. I'm Karen Moscow. And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

The data that matters for your investments. The entire auto sector is higher today. And analysis on the companies making news on Wall Street. Tesla's been a stock that's been in focus. Shares have really been all over the map this morning. Listen to the Stock Movers Report from Bloomberg. Let's talk.

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