Markets Rally as Powell and Policy Uncertainty Loom
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This is the Bloomberg Surveillance Podcast. Catch us live weekdays at 7 a.m. Eastern on Apple CarPlay or Android Auto with the Bloomberg Business app. Listen on demand wherever you get your podcasts or watch us live on YouTube. In the game of getting your message out, you wander into late May and you have a meeting over some stale Sanka coffee and you go, this is what the outlook looks like.

And then you blow it up 10 times on the way to June 30, 2000, whatever. Jeffrey Rosenberg set a record. They had to rewrite their bond quarterly here with the events going on something like 14 times. Are you on speaking terms with Rick Reeder or is it just forever broken? Oh, no, it's all good. Yes, it's all good. What in this report?

How does it differ from where it would have been 30 days ago? Yeah, that's I mean, so much has happened between, you know, where we were 60 days ago and the tariffs and the concerns and bonds. You know, the outlook has had to change a lot. And you've seen it in terms of, you know, what you're talking about and in terms of the number of contributors to that piece and trying to get the trying to get the tone right.

But the big issue there is still that it's relatively sanguine in terms of the rate range bound, in terms of the biggest impact. And what we talk about in fixed income outlook for the 10 years, not as much volatility as what you've seen in, say, the equity market. Paul's been great on this. I mean, Paul's led the way on this. But the bottom line, Paul, is it's bringing in duration, right? Yep, absolutely. I'm just looking at something coming off the Bloomberg News Desk.

The treasury market is wrapping up its best monthly return since February. I did not know that. And its biggest first half stretch in five years. So you guys aren't, I mean, people want to talk to you guys now, right? Yeah, you know, bonds have been okay. And the big story, and Rick's talked so much about this, is the restoration of income.

And, you know, part of that is just where the Fed is and the rest since to say even cut rates. But that you brought interest rates back up above the level of inflation. And for a very long time period, you just didn't have that. You had very negative real interest rates. And that was a penalty to fixed income because it propagated out the curve. And so it's a very different environment. And that, you know, over all,

all in terms of interest rate moves, it's just the starting point. Fixed income is about yield and yield is the driver of returns. It's a little bit different than equities. It's a little bit simpler that you're starting yield is your best predictor of your future return. And that's the big story is that we've returned. It's like old days. Old days, exactly right. It's like when the Mets won. Buy them and hold them.

How about credit risk here? What are we doing on the credit side here? So there's two sides of the credit risk story, which it's been for a long time. And that is you've got the pricing of credit risk, which is not particularly attractive in terms of is there a...

an entry point here from timing. But again, it comes back to the difference between price return and income. And the income piece is the bigger story from credit where yield plus spread is attractive. Spread on its own is a little bit less attractive in terms of like you're pricing in, you know, very, very benign conditions. But newsflash,

it is a very benign outlook in terms of what's going on in terms of fundamentals. Now, that's what we've realized. Now, going forward, that may change. Markets are pricing in a

a very benign credit environment. So there's a little bit of asymmetric downside. You see that, you know, most of the time in, in credits, a little bit exacerbated this time. So you want to be kind of more up in quality and a little bit more up in defensiveness, just given where the, where the asymmetry is. But credit has been the dog here that hasn't, hasn't barked.

there's all these manufactured products i'm going to say folks are collared out and manipulated and maybe somebody makes a bigger fee just cut to the you know fabozzi chase the markowitz chase does a 60 40 portfolio work here that is definitely cutting to the chase and you know i think you have to rethink that idea and and what made 60 40 really work for a very long period of time very simple idea that we lived in an environment of

too little inflation. And when you live in an environment of too little inflation, the Fed has no constraint on its ability to be accommodative when you need them to be. That's really important. That cascades down into a thing we call the divine coincidence of monetary policy. Basically says when there isn't

an inflation risk the only thing the Fed has to focus on is growth that means it's really good for your equity drinking the Kool-Aid here of Ellen Meltzer and Marvin Jordan I mean it's just so Carnegie Mellon exactly I'm looking at the IN go function on the Bloomberg Terminal Bloomberg index browser the best performance in U.S fixed income has been U.S corporate high yield

I mean, people don't mind taking the risk, it seems like. They don't. And again, that's because it's been a very benign environment for what we've seen realized in terms of corporations. Cash flows, default risk. And the pricing there got a little bit concerned.

around the April 9th, April 2nd tariff piece. And so you had a big recovery from credit spread-wise. And every environment so far, it's been one where widenings have been, you know, purchase buying opportunities. Again, you got to take a little bit of a bigger picture there to remember this is a credit cycle. And if all of these concerns around economic slowdown

eventually manifest themselves, then you're gonna see an uptick in defaults. But that's forward-looking, you haven't seen any of that so far. That's why I've seen the really strong performance in corporations today. - They're forcing me, the media people here are forcing me to rewrite my bio. And it's torture, folks, I can tell you. And it's about the conversation with Jeff Rosenberg and others. The first name I mentioned in the bio is Alan Meltzer, one of yours and my heroes at Carnegie Mellon. And Professor Meltzer told me

aggregate data for America. Can we do that now, Jeff Rosenberg? Is the template at BlackRock a glass half full in this wild barbell America? Yeah, your term is exactly right. You know, barbell America, K-shaped America. The aggregation of data is very problematic in that it masks over a lot of the really underlying issues of

inside the economy. And that's really important, especially when you're thinking about not kind of, you know, the direction, a macro variable like the 10-year interest rate really can kind of map to the aggregate. But when you talk about the corporate bond market, or you talk about the equity market, where the cross-section of performance is much more important, taking into account things like the distributional aspect underneath the economic data becomes much more important.

What's our Federal Reserve going to do here today, this year? I'm looking at the WIRP function, kind of pricing and maybe two, maybe a little bit more than two rate cuts this year. What do you think they should do?

So that's been where we've been for a while, around two cuts. I think they should be in a wait and see mode, as Powell has discussed, because we're in this interim period where we don't really know what the impact to the macro data is going to be of the policy and policy uncertainty. So far, it's been better than feared.

And we've had four or five in a row better than feared inflation reports. This is the time and, you know, this is the week prior to payrolls. And so that becomes a really important input because we're starting to see some slowdown. You can see in the Bloomberg the consensus for Friday, you know, slowing. I think it's around 110. You know, it's a significant slowdown, but it's still a pretty strong market. So they've got the room to wait.

And I think that's the right thing to do. But wait for what? Wait for whether or not this inflation in terms of the tariffs really shows up in a more significant way that's going to validate them holding off. Or this slowdown in jobs accelerates and then the waiting will be proven wrong. But they'll pivot. And I think that's the key is that they'll pivot to the data.

Jeffrey, thank you so much. Jeffrey Rosenberg, out with a 6.30 view for BlackRock. You can run, but you can't hedge the bond market's warning shot. Get that from BlackRock, please. You protect the copyright of all of our guests. If this government spending in defense goes towards things like R&D that have dual-use civilian purposes, you could get spillovers that actually end up enhancing productivity significantly.

in Europe and so have a more long-lasting impact on growth.

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CarPlay and Android Auto with the Bloomberg Business app. Or watch us live on YouTube. Henrietta Trace has been just fabulous at VEDA Partners. Henrietta, I just use Google Gemini because I'm hip and I do AI. And I typed in, what is Votorama? And it exploded. The servers exploded at Google. What in God's name, Coach Trace, is Votorama?

- Oh, it's so exciting. Gear up to watch "Case Pan 2" all day long. It will be nothing short of riveting. It's actually really cool. You know, the Senate is a highly scripted, very regimented body, and Voterama is like our free-for-all. So all amendments are germane. You can throw anything at the wall here, and they will be voting all day, all night, maybe even into tomorrow. So it's really exciting if you're into that kind of thing. - Are any important?

Yes, they're critically important. There are millions of individuals at risk of losing Medicaid in this package, and that will be a big amendment vote from Rick Scott, Republican of Florida, that will need to pass. Otherwise, it could risk as many as four Republican senators defecting away from this bill. However, if it is passed, it may fail in the House. So it's a very delicate balance that Republicans need to walk here. The most important one is

is gonna be a procedural change that fundamentally undermines and effectively removes the filibuster from the United States Senate for the rest of all time. This is a massive deficit increasing provision, and it authorizes the use of current policy baseline by overriding the parliamentarian, our referee, and it will pave the way for increase in the deficit by $4 trillion.

without paying for it in this package. So a lot is very heavy stuff on the line today. Is there any political fallout for anybody, Henrietta, for raising these deficits by, I don't know, the $4 trillion you just mentioned?

Yeah, I think that there are. You don't often see this without an election happening. But Tom Tillis, for example, Republican of North Carolina, has decided this bill is so atrocious he's quitting the entire Senate. And so he's going to vote against the package and he's moving on with his life, which is a shame. He's an excellent senator with some incredible staff that we've worked with and been lucky to work with now for years. But yeah,

This is real ramifications in real time. And the next time you hear someone say, you know, Rome died because of its deficits and debt, ask them how they voted on this bill. President Trump is on one heck of a winning streak here. Do the Democrats recognize this? Is there any pushback, any sense of we want to get our message out? What message? I mean, this bill is filled with

literally trillions of dollars worth of messages. And the Republican package is so massive that they've sort of just been washed over by the flood of it. So if you follow an individual member's statements, you can catch where they stand on Medicaid and things along those lines. But it's really hard to get a message through. I was actually with a doctor friend of mine this weekend who, and I cover this bill now for the entire year. And I just learned that 65% of Republicans

birth in Louisiana come from Medicaid patients. And this is cutting millions of people off of Medicaid nationwide, 12 million. So it's pretty substantial. - It's 60,000 feet and I've got a nodding memory of this. Is this a pullback of the great society? Is what we're really talking here, I gotta do the math, 40 and 20, 60 years on, we're slamming ourselves back to Pleasantville and Dwight David Eisenhower?

- Yeah, I mean, this is the end of caring about deficits. This is the end of paying for legislation on a go forward basis. So for example, any tax provision that you like right now that's on the books can be extended into perpetuity without ever paying for it ever again.

So any short-term provision you put in there, the SALT cap, the IRA tax credits, the child tax credit, whatever it may be, these are hundreds of billions of dollars on a line-by-line basis. But perhaps the biggest component of this bill is the wealth transfer. Think about the tariffs that have been put on by this Trump administration. I don't think that's a win, but the president has made

It appears though he's really strong army, but it's $400 billion in tariff revenue collection. The entirety of the president's campaign agenda, no taxes on tips, no taxes on retirement payments and things like that, is $163 billion worth of this package, and the tariffs are $400 billion in revenue. So we are passing a massively regressive tax bill that does not return what the –

the president is giving you on the tell us that. How many pages will this legislation be? I'm asking for John Tucker. He's going to read it at the beach. It is already read aloud. It took something like 15 and a half hours and it's 940 pages. 900.

940 pages of love. There you go. Okay. Henrietta Trace, thank you so much. This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at 7 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. You can also listen live on Amazon Alexa from our flagship New York station. Just say, Alexa, play Bloomberg 1130.

With Parkrun out of Oxford University and LBS, Ibrahim Mubari joins us. Iconic at Citigroup with Willem Bauder, Catherine Mann, and others, Nathan Sheets. And now with Absolute Strategy Research and working with Tina Fordham, Fordham Global Foresight, for a terrific brief. Ibrahim, first of all, your notes are way too long. Can you cut it in half? I mean, just for starters.

The heritage of Rabari economics, and this plays off Willem Bauder, is an old world respect for the balance sheet. It's very non-American to me. It's not foreign. It's just a different view across the water. The state of the American balance sheet or the guests on that balance sheet three or five years out.

Well, I think the state of the American balance sheet is a tale of two stories. And I think that's what's allowed asset prices to continue to do so well as they continue even as we enter this week. Private sector balance sheets are the best we've seen for decades. And that's given the public sector a bit of an excuse to maybe use that financial capital.

Our concerns, my concerns are predominantly about the health of the public sector balance sheet, to some degree how we can keep the two together in a way that keeps the economy running and pumping. But if I'm honest with you, I am concerned. I do think we will run into a major point of tension in the next couple of years. And what we've heard from Congress over the last week or so probably adds to these concerns rather than reduces them.

Given that backdrop here, at least in the near term, it feels like the market is expecting this Fed to cut rates. Maybe not a lot, but maybe a couple of times this year. Does that seem reasonable to you? It does. It does seem reasonable. Now, I should say I came into the year thinking the Fed is going to cut a lot. And because it was going to face a perfect storm from much weaker growth than people expected, a very weak stock market, which, of course, at the beginning of the year we had, and

one point that often comes up, the Fed nominally is still very restrictive. So it's starting at a very high point. Now, most of these things have played out with one big exception, of course, which is that the stock market rebounded with a vengeance, as you already remarked upon. Now, the reason why I think the Fed is probably wise to cut

at least from an insurance standpoint a little bit, is because the economy has been showing signs of slowing, more signs of slowing than we've seen for a while. In some areas, pretty concerning signs of slowing in the labor market and the housing market. So again, if you start from one, one and a half points above neutral, you're probably better off cutting a little bit and then seeing where you are in a couple months' time.

You know, I don't know, the economy's slowing, but I think we've taken recession off the table. I haven't heard that discussed in the last four or five months. Inflation, I think surprisingly to most people, we've not seen that really creep too much into the economy. So it seems like maybe the Fed's kind of got this continued soft landing, I guess. I think there is a narrow path, and I think you're...

Your remarks are very much on point. We're facing a bimodal outlook for the US economy, for financial markets. What's maybe the single most interesting thing across financial markets right now is how differently equity markets and the bond market are looking at the economy. And I don't just mean at the headline level, but

the evolution of interest rates over the last couple of weeks versus how cyclicals have done within equities. It's one of the bigger divergences. And one of the reasons I highlight, other than that I think people haven't taken enough notice of it, is that that diversion does sometimes show up at cyclical inflection points. So it's...

It's not totally clear, but bonds on average are a better predictor of what happens at these inflection points. So when I hear you speak, in my head I'm playing through, is this Goldilocks scenario going to continue to play out, or are we facing a scenario where actually we're facing a bit of a cliff not too far from now? Extended conversation with Ibrahim Mubari of Absolute Strategy Research. We welcome all of you on your commute here, last day of the second quarter commute.

across America. Good morning 99.1 FM in Washington. Was Nathan in today?

I mean, you know. Yes, he's in. Oh, he was in today. Okay, he darkened the door. Nathan Hager at 99.1 FM in Washington. On YouTube, subscribe to Bloomberg Podcast. Absolutely humbled by the last six months of the YouTube build-out. I'm learning every day about this strange digital ballet. I want to go back to the Fed, which I usually don't want to do, but I think it's so important, Ibrahim. They are trapped today.

at this cyclical inflection point and maybe bimodal ambiguous outcome by having to justify a trend of rate cuts. Why can't they just do one and done and the chairman come out and say we're cutting interest rates at the next meeting, we're not sure where we're going, but we're just bringing it in for one. Where did that surgical view disappear to?

Oh, I think they should take your advice, to be quite frank. And if you go back to the last two press conferences at least,

perspective they had to defend and justify was not considering cutting, not easing. And I think that's both because the way they've been communicating over the last six months is very different from how Chair Powell used to communicate, including of course a year ago where they suddenly started cutting rates pretty sharply. But I think the right thing to do would be exactly as you say, take restrictive rates,

and the slowing of the economy, say I'm cutting now, but if we see inflation pick up, we can migrate again. Where in our history do we blame John Taylor out of Stanford? Who do we blame for this idiocy that if we raise or cut, we're establishing a trend?

I just don't get it. I don't have the answer, but I've had that conversation with central bankers many times. I've had a very similar conversation with the ECB earlier in the year. Would you like to give us any names?

What would Philip Lane say working with the guarded ECB? I think at some level they're open to the idea of you can reverse when the facts change, they can change their mind. In practice, that does tend to come with a loss of credibility that they all fear. They're accused of flip-flopping, of changing the narrative. I think it's the other way around. Again, maybe because of my tutelage with Willem, who was never shy to change his mind when the facts changed.

So I think that's what Chair Powell would do. I think it would, in fact, improve his credibility, which I think has suffered a little bit because he has had difficulty to explain why the Fed has been somewhat slow. Right. Bloomberg dollar index, it's down almost 10% from its earlier this year high. What's going on with the dollar?

So we had a perfect storm for the dollar early on in the year. And again, it's a similar story to what I said about the US economy and rates. You started from a very high starting point. You had disruptive policy. And then investors globally just had to diversify and to some degree re-rate the riskiness of US investments. Now, that's gone a fair amount of the way, and FX hedging has played its part. Where we are now is a lot more what I would call cross-currents.

Because what you're actually seeing the last couple of weeks of dollar weakening, that's been alongside US rates. It's the bond market pricing in weaker growth in the US. It's no longer US equities underperforming global equities. It's no longer the riskiness of the US that stands out. It's really the cyclical slowdown. And therefore, again, we're in a bimodal near-term outlook.

I see dollar weakness, I would be a lot more selective in how I would express it within markets. And we'll learn a bit more this week. So I think that'll have an impact on the dollar. - I mean, Ibrahim, I'm looking at a 13-year dollar trend. Folks, you can do this on the Bloomberg Professional Service, BBDXY index GPL space M space roll. Did I say that too quickly? - Yeah, perfectly. - For those driving? - Yep. - The answer is I got a strong dollar trend

I'm down 1.5 standard deviations off the trend back 13 years. Have we finally broken the strong dollar trend? That's my view right now. And I think...

quoting Chair Powell, you have to be humble and nimble in a world where we wake up to news pretty commonly. But my view is we have reached that inflection point in the dollar. And actually, depending on the measure that you use, we may have reached it in 2022 or we reached it earlier this year. So I do think we're at the beginning of a long-term significant downtrend. We probably have another 10% or so to go at least.

The question is, is that going to continue as consistently as it happened so far this year? I have my doubts, but over a longer period of time, I think there's a lot more to come. How do you respond to stagflation or to a persistent higher nominal GDP? So I...

I see a near-term threat. It's Siam, you have to talk on radio. We're toast if there's silence. I would say I see a near-term threat, including what we may face in the US in the next six months. Again, the real side, weak. Inflation is going to pick up.

maybe half a percent, maybe a percent over the next year. As a durable phenomenon, I don't think it really, it is likely to play out. I think weaker growth will weigh on prices. Is American exceptionalism, is that a thing of the past?

I think in some ways, yes. And I think it's for good reasons and for bad. I think at this moment, we should acknowledge that the impact it has had on the rest of the world, the administrations and the policy impacts have been partly benign. My own country, Germany, waking up to the need to upgrade its infrastructure, to spend more on defense. So the changing balance of fiscal spending globally, I think that's an element of changing impacts on U.S. exceptionalism. What's the biggest challenge for this Federal Reserve right here? Where's the mistake?

you think they could make here? So the biggest mistake from my point of view is that they stay as data independent as they have been and that they don't communicate why they operate differently from where they were in 2024. And as a result, maybe act too late.

So, Chair Powell's greatest fear throughout most of his tenure was that the Fed would be too late in acting. I think they're at risk of that again. That's not to dismiss that we have a bubbling inflation problem. But again, they can address that by then reacting as they face more of it. You're mentioning your Germany. Your Germany has stepped up in a big way in terms of stated plans to invest in its military and in its infrastructure.

Do you think other European countries can do the same? We have confidence that Germany can do it. How about some of the other countries in Europe? It seems-- I don't know. I think Germany, if I can use that word again, is a little exceptional in that regard. And that's both because it faces a bigger deficit. So it's underinvested in infrastructure and in defense.

And it has a still healthier balance sheet, even though it's a little flatter by how we treat pension spending in Europe. So I think it's much more of a German story. When it comes to financial markets, it has its spillover. So it does mean that spreads between German bonds and the rest of the European bond market are going to continue to narrow. And it is at sea change in the European bond market.

Help me with the dollar then. Paul's got us in a trend of weaker dollar, 9%. Should we, I mean, is it a harmonic average now we go down 4.5%? I mean, is the trend in place? I think the trend is in place. In the short term, I think we need to watch what happens with U.S. data to reinforce it.

But also I see more opportunity in special places in the riskier part of the spectrum. If the world is okay, the dollar will sell off more against the Australian dollar. We don't care. We're going to Europe. Euro 120? I think we'll see Euro 120 this year. At this very moment, I would not buy euros.

I don't know. I mean, Tom, we're one spot, one seven already. What happened to your parity? I was looking for the Tom Keene parity there on the year. Those days are over. Those days are over, I think. It has really changed. I mean, folks, to look at the Bloomberg launchpad, the red and green blinking, it is, I can assure you, I had no concept the first week of January that we'd be looking at this parity.

Now, particular levels on futures, 6,200, 6,250 on SPX, 44,300, and 22,800, up six-tenths of a percent. Ibram Mubarak, thank you so much. Just brilliant. Absolute strategy at Research. Also working at Fordham Global Foresight.

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This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at 7 a.m. Eastern on Apple CarPlay and Android Auto with the Bloomberg Business App. You can also watch us live every weekday on YouTube and always on the Bloomberg Terminal. A really important conversation. We are focused on capitalism. We are focused on all that we do in economics, finance and investment.

And to have someone with a pedigree of Hampshire College in the new school in lower Manhattan is important. Heather Boucher showed public service with President Biden, among others. She's president and CEO of the Washington Center for Equitable Growth. I can't say enough right now about the mystery of her Democratic Party. On her website, how the economic and political geography of the United States changed.

fuels right-wing populism and what the Democratic Party can do about it. Heather, why are the Democrats silent in this June of 2025? - Democrats silent. Well, I hear a lot coming from Democrats right now.

I mean, certainly the thing that we have all been watching over the past week and of course nonstop all weekend is what the Republicans have been doing with their budget bill that is going to give massive tax cuts at the top and strip income and benefits from folks in the bottom half of the income distribution.

I know that, you know, for example, Chuck Schumer made them actually read that bill out loud and hopefully have to think about each and every action that they're doing. But, you know, this is a huge, huge, huge moment for the country, a huge moment for the U.S. economy. But Heather, what's so important to me here is, does the Democratic Party witness Schumer's comments this weekend?

Does it move to the left and liberal progressive, or does it try to move to a Democratic Party center of old? So here's the thing. When I look at what this legislation that the Republicans are jamming through the Senate right now will do, let's say that this passes.

We're going to be left with a world where not only have you stripped the federal government of enormous human capital and talent and capacity, but we will put the U.S. economy on a long-term trajectory of lack of competitiveness, where we're going to see falling investment in the United States.

And so Democrats, let me just finish this point. Democrats are going to be faced with an economy that will be in many ways in shambles. And so I think that's where we need to start our conversation. What do we need to do? What will we need to do to get the economy back on track? And that's going to require thinking about some fundamental things.

The crisis of climate change is not going away. I know, but Heather, you didn't answer my question. Should the Democrats witness the election in New York City for mayor? Should they move towards Mamdani and a liberal progressive Democratic Party? Or do they need to refine the center?

They need to find a place where they can obviously get enough votes, but that is going to be going back to economic basics, making sure that we have an economy that thrives and delivers for the broad middle, which is exactly what won't be happening.

So when you think about what they're gonna need to do, we're gonna need to make significant investments in clean energy, for example. We're gonna be needing to make significant investments in education and healthcare, because right now we're about to throw somewhere between 12 and upwards of maybe 17 million people off of Medicaid. That's gonna require significant public investment. That's what Democrats are going to be facing as they confront the midterms and the 2028 election.

So whether or not that is super progressive or centrist, that's where the party's gonna need to be because this Republican budget bill

puts the economy and the humans in this country on a downward spiral. Right. And so how we're going to reconfigure and come back from that, that has to be job number one. Heather, what did you and let me put another. How did the Democratic Party nationally in Washington, D.C., view the Democratic primary here in New York City with Mr. Mom Domini having that surprising win over Governor Cuomo?

But I mean, I wasn't following so much. I was really following closely what was happening with the budget bill. But I think that they see that as, or at least what I have read, they see that as an indication that, oh, the Democrats are perhaps going too left. But here's the thing.

New York City is, you know, it's an important Democratic constituency. The people in New York, one of the most exciting things that I saw coming out of that election was how many young people got out and voted and how excited they were about a candidate that they could believe in. And he was focusing, Mandame was focusing on bread and butter kitchen table issues, lowering the cost of housing, making sure that groceries are affordable, making sure that child care is accessible. These are exactly the kinds of things that we saw at the...

level in the last election. President Trump ran, wait, let me just finish. President Trump ran on a platform of lowering costs for Americans. Instead, what he is doing is making our health care more unaffordable. He's making it likely inaccessible for rural Americans to access health care at all, making our energy costs more.

And so I think that what you saw in New York City was those kitchen table bread and butter economic issues coming to the fore with an enthusiasm for, you know, for a new candidate there. Heather, one final question quickly. Will the rich people leave New York City as the rich people are leaving the United Kingdom right now?

Well, it's unclear to me where those rich people are going to go. Manhattan is amazing. Here's the thing. If you are basically saying that people in a community need to accept no health care, no nutrition assistance for the poor, no good jobs just so they can have some rich people in their community, what are those rich people doing for them? That is the question that we are asking. What are they giving back?

back? Are they investing in good jobs in their community? Are they making sure that that community has access to the things they need? So that is the question that I think all of us should be asking of America's wealthiest. We live in one of the richest countries the world has ever seen. There are all of these billionaires, but

are they actually doing anything that is good for the economy and improving middle-class incomes? Heather, thank you so much. And Dr. Boucher, of course, with the Washington Center for Equitable Growth through public service to the Biden administration. This is the Bloomberg Surveillance Podcast. Listen live each weekday starting at 7 a.m. Eastern on Apple Podcasts.

carplay and android auto with the bloomberg business app you can also listen live on amazon alexa from our flagship new york station just say alexa play bloomberg 11 30. for the newspapers only lisa mateo can do it lisa good morning good morning all right we'll start with the wall street journal so they're talking about halloween fans they just can't wait till october so there's this new holiday tradition

It starts this month. It's called Summerween. Okay, so it first started to cash on last summer. It's grown even bigger. But the thing is, retailers are really starting to cash in on this Summerween. So you have, for example, TJ Maxx has decorations. It's Frankenstein on a beach chair. They have some skeletons.

It's an excuse to people to spend money in the retailers. So they have blankets with like skeletons and bikinis. And towns are getting into it, doing these summer ween holla celebrations. Like they're carving watermelons like jack-o'-lanterns. They're having parades and people dressing up. So it's starting to become a thing. I don't know. I haven't.

I've seen it in the stores. I haven't seen it in the community as much. I know people like this, though, that are just so into Halloween. Yes. Like crazy. Yes, they're fanatics. They have a huge following. So they're saying this is going to start becoming something bigger. But they're also saying because of uncertainty around tariffs and pricing, people want to buy these things earlier because they don't know how much the prices on some of these Halloween items are going to increase.

So that's another strategy they have. But it could be coming soon. All right. This one, Paul, is up your alley because I know you're a fan of the Cracker Barrel. I am. Okay. This is the Wall Street Journal. You know, right? It's known for the old country charm. People like it because they have the decor. Like, you feel like you're in grandma's house. Right. It has, like, the antiques and the bottles and the farming tools, all the tchotchkes everywhere. But...

Cracker Barrel saying, you know what? We want to declutter and we want to make things different. Yeah, this photo they have in there of the remodeled one in Tennessee. Holy cow, that's different. Same audience? Are they going for a new audience? I don't know. It's a good question. I mean, they're trying. Maybe they're trying to attract a younger audience. I don't know if that's part of it. What, under 70? Exactly. Maybe that's what they're trying to do. But they're just saying that it's this debate between workers,

um and people go to the restaurant they're saying they don't want it some are people saying well you know what it cleans things up a bit you know makes things less cluttered yeah it does i mean it looks good but boy is it different but it's completely because i mean you walk into a cracker barrel and you know there's like clutter everywhere like that's their thing though yep that's why people love it but i'm guessing this is a audience that does not like change so we'll see how this plays out yes exactly exactly next

okay and oh and they're getting rid of the rocking chairs and they're putting i know i had to go there um squid game i don't know if either of you i am not at the speed on this and the offspring watch it really okay okay see my kids watch it too for me yes oh i i thought it was kind of violent

But OK, so this is the third season. So it premiered this past Friday. It topped like, you know, global rankings on Netflix in all countries. Did great. But the thing is, is that they had rankings about how the audience liked it and the audience didn't like it as much for this season. So that's why you have Squid Game stocks. They're starting to sink.

You know, I have like Artist Studios, South Korea-based firm, Dexter Studios. They're all sinking. But it's still, I mean, it's still the most watched show of all time for Netflix. Into the summer, does streaming have momentum?

Yes. It's just, it's secular momentum. It's not seasonal. This is just secular change taking place, just like cable television, you know, displaced broadcast television to some degree. It's even more pronounced here with streaming versus kind of what most people grew up with was a basic cable and broadcast and all that kind of stuff. Absolutely fascinating. Yep.

I have no idea where we are in five years. We're doing the digital thing here, folks. And I've got an immense respect for people thinking as hard as they can. Like, what is the impact of YouTube out five years? Well, I mean, just the fact that, like Lisa was saying, Squid Game's the biggest thing in the world. I don't even know what it is. I mean, a generation ago, you couldn't say that. Whatever it was, you know, that was...

It's just so dispersed. The newspapers, Lisa Mateo, thank you so much. This is the Bloomberg Surveillance Podcast, available on Apple, Spotify, and anywhere else you get your podcasts. Listen live each weekday, 7 to 10 a.m. Eastern, on Bloomberg.com, the iHeartRadio app, TuneIn, and the Bloomberg Business app. You can also watch us live every weekday on YouTube and always on the Bloomberg Terminal. ♪

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