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Bloomberg's Condon on China Asking Timing of Fed Hikes (Audio) · Bloomberg Intelligence

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  Speaker 1: Broadcasting live to New York Bloomberg eleven Brio to Washington,
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  Speaker 1: d C. Bloomberg to Boston Bloomberg twelve hundreds, to San
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  Speaker 1: Francisco Bloomberg nine to the Country's Julie's Exam Channel one
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  Speaker 1: ninet and around the globe the Bloomberg Radio plus Appen
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  Speaker 1: Bloomberg got gone. This is taking stock, you know, Kathleen.
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  Speaker 1: Everyone wants to know when the Federal Reserve will raise
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  Speaker 1: interest rates. And there's a new chorus of questions and
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  Speaker 1: it's coming from overseas. The Chinese want to know too.
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  Speaker 1: This is something new him. But I wonder, I wonder
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  Speaker 1: someday they're gonna just the the feble does plug in
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  Speaker 1: a computer and get the answer that way, and the
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  Speaker 1: Chinese can find out a well, maybe the robot. Yellen,
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  Speaker 1: We're going to talk about computers, the Federal Reserve and
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  Speaker 1: the Chinese. It's all coming up with Christopher Condent, Federal
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  Speaker 1: Reserve reporter from Bloomberg News. But right now, let's go
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  Speaker 1: to Charlie Pellet in the Bloomberg news room for Bloomberg
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  Speaker 1: Business Fun And I thank you very much, Pim, thank you, Kathleen.
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  Speaker 1: Happy Wednesday. The dal the SMP nez DAK halls surging today.
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  Speaker 1: Stocks are on the way to the strongest today rally
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  Speaker 1: and nearly three months. The signs of a stronger economy
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  Speaker 1: spurs speculation that can withstand higher interest rates. Oil trading
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  Speaker 1: close to fifty dollars of barrel for sixty six right now,
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  Speaker 1: up two point one percent. On West Texas Intermediate Brent
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  Speaker 1: crude four it is up by two and a half percent.
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  Speaker 1: Gold dropping to US seven week low, is equities rally
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  Speaker 1: amid signs the US economy is resilient enough to withstand
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  Speaker 1: an increase in borrowing costs. Bill Baruk is senior market
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  Speaker 1: strategist at II trader dot com. He was interviewed this
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  Speaker 1: morning on Bloomberg Television. We've been telling our clients is
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  Speaker 1: it's not as much about the Fed as it is
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  Speaker 1: about yields. We do not see yields and treasuries going
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  Speaker 1: higher for longer. So right now you're seeing you're you're
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  Speaker 1: seeing gold take a move and take a bath because
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  Speaker 1: of the FED pricing and an interest ry hike. However,
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  Speaker 1: we do think gold has been extremely constructive all year long,
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  Speaker 1: and I don't think that will change, especially if we
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  Speaker 1: hold twelve hundred on this move down, on this move
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  Speaker 1: that we've seen down, and right now gold is a
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  Speaker 1: twelve twenty four seventy down four or fifty the ounce,
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  Speaker 1: falling four tenths of one percent. The US home prices
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  Speaker 1: up five point seven percent in the first quarter from
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  Speaker 1: a year earlier as buyers competed for a limited supply
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  Speaker 1: The now up one seventies seven, a gain of one percent,
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  Speaker 1: SMP five hundred, index of eighteen a gain of nine
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  Speaker 1: tenths of one percent, and as stack up thirty eight
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  Speaker 1: a gain of eight tenths of one percent three thirty
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  Speaker 1: to taking stock with Bim Box and Kathleen Hayes on
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  Speaker 1: Bloomberg Radio. Are you wondering when the Federal Reserve is
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  Speaker 1: going to raise its key rate again this year? June July,
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  Speaker 1: said Timber, like so many investors and traders, Well, you
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  Speaker 1: know what, there's another group joining this camp, and that
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  Speaker 1: is Chinese officials According to our Bloomberg News story today,
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  Speaker 1: they plan to ask the FED to reserve in annual
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  Speaker 1: talks next month about the chance of a FED rate
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  Speaker 1: hike in June. Now, of course, the FED is probably
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  Speaker 1: going to say, well, we don't know exactly what we're
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  Speaker 1: going to do, but it's a fascinating story, and here
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  Speaker 1: to talk about that, and maybe even tell us if
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  Speaker 1: in the future the FED will just plug the question
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  Speaker 1: into its computer and spit out an answer to get
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  Speaker 1: to the Chinese. Is Chris Condon, Federal Reserve reporter for
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  Speaker 1: Bloomberg News, joining us from our Washington d c C
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  Speaker 1: studio that is home, of course of Bloomberg and one.
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  Speaker 1: So Chris, let's start with the Chinese. Uh. And we
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  Speaker 1: think in the past officials would have said, quietly behind
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  Speaker 1: the scenes, what are you gonna do? How did the
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  Speaker 1: story get public? Well? Um, Uh, some of our reporting
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  Speaker 1: shows that they're they're as interested as everyone else is
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  Speaker 1: in asking the FAT there's a meeting coming up, quite
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  Speaker 1: a prominent meeting between American and Chinese officials, uh, to
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  Speaker 1: discuss economic relations and in other things. And uh, it's
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  Speaker 1: it's simply been revealed that they are as interested as
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  Speaker 1: everyone else. Well, are they asking because they want some
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  Speaker 1: advanced notice or they just want to get the same
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  Speaker 1: word that everybody else gets. Well, I really think they
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  Speaker 1: were just in the same boat as everyone else. I'm
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  Speaker 1: not sure realistically how much they can expect to get
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  Speaker 1: from US officials. As you noted, Kathleen, it may be
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  Speaker 1: just as likely that the FIT is not um decided
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  Speaker 1: at all yet what it's going to do at its
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  Speaker 1: June meeting. And of course Janet Yellen speaks this week
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  Speaker 1: and next week, a very big speech, and I guess
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  Speaker 1: you could learn as much from her speaking as as
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  Speaker 1: as anything that's right. She's got two dates coming up,
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  Speaker 1: one next week in Boston, then a speech schedule for
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  Speaker 1: June six, and that, notably is the last day before
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  Speaker 1: the Fed enters what they call their blackout period period
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  Speaker 1: of seven days before their policy meeting where they do
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  Speaker 1: not do any public speaking. So that would be her
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  Speaker 1: last chance to give any signals to the markets or
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  Speaker 1: to anyone else about what she thinks, what direction she
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  Speaker 1: thinks she's going. Now, the other meeting you're talking about,
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  Speaker 1: that's the US China Strategic Economic Dialogue, right, Those are
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  Speaker 1: scheduled for economic dialogue that's right, right, the sixth and
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  Speaker 1: the seventh in Beijing. Well, if you don't want to
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  Speaker 1: go to Beijing, and you'd rather just press a computer
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  Speaker 1: button to find out when to raise or what to
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  Speaker 1: raise interest rates, to tell us about robo well, let's
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  Speaker 1: just say robo advising for the Federal Reserve. What is
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  Speaker 1: this about the Laboratory for Financial Engineering at the m
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  Speaker 1: i T. Well, that that's where where that's the home
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  Speaker 1: of Dr Andrew low He's the director of that department
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  Speaker 1: m i T. He's one of the scientists that I
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  Speaker 1: spoke to for this story that examines um when and
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  Speaker 1: whether computers that use artificial intelligence might get to the
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  Speaker 1: point where they can do a better job than humans
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  Speaker 1: at economic forecasting and even monetary policy setting. Well, of course,
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  Speaker 1: and Andrew Lowe told you that the capability to do
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  Speaker 1: this is is here. And the biggest roller is hurdle,
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  Speaker 1: I should say, is cultural because central bankers, he says,
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  Speaker 1: aren't open to technology. But a lot of central bankers
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  Speaker 1: are economists there, and they a lot of them do
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  Speaker 1: a lot of modeling. They're just skeptical that a machine
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  Speaker 1: could possibly put all that complexity into something and come
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  Speaker 1: up with an answer that the FED would just follow right. Well, this,
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  Speaker 1: it's important to make a distinction between the use of
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  Speaker 1: technology in computer economic modeling. That's most federal and most
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  Speaker 1: central banks do that to a great extent, but models
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  Speaker 1: as it is don't really do well. They don't apply
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  Speaker 1: what's called machine learning. That is, the the type of
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  Speaker 1: technology that allows a computer to solve problems by itself,
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  Speaker 1: to actually acquire knowledge and skills without being explicitly programmed
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  Speaker 1: to do that by a software engineer, Chris, Is there
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  Speaker 1: an example, I mean, I note in your story that
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  Speaker 1: you talk about the relationship between unemployment and inflation. Is
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  Speaker 1: there an example where this kind of artificial intelligence would
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  Speaker 1: be beneficial not just in setting interest rate policy. Well,
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  Speaker 1: and first of all, it will be beneficial to macroeconomists
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  Speaker 1: in making the your fundamental economic forecasts as relate to
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  Speaker 1: unemployment inflation GDP, and that's really the foundation of monetary
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  Speaker 1: policy making. And and even more basic than that, there
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  Speaker 1: are economists that work for computer scientists that work for
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  Speaker 1: investing companies UH and for other companies like Amazon, um,
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  Speaker 1: Netflix and many other web based companies that at utilize
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  Speaker 1: machine learning already to make predictions and more. I would say,
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  Speaker 1: more confined spaces. So the universe of their customers, for instance,
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  Speaker 1: is a sort of a more manageable universe of data
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  Speaker 1: to make predictions upon, and they're using that quite effectively
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  Speaker 1: now Already. Macro economics, though, introduces a lot more complexity
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  Speaker 1: to the issue. Just really quickly. What did Mike Caroli
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  Speaker 1: say from JPN about this, Well, he he spoke to
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  Speaker 1: the point of, even if we do have computers that
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  Speaker 1: can set monetary policy, there's another question about accountability, and
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  Speaker 1: he asks whether they can actually say testified before Congress.
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  Speaker 1: Thank you very much. Chris Condon, Federal Reserve reporter for
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  Speaker 1: Bloomberg News, joining us from our Bloomberg studio in Washington,
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  Speaker 1: d C. We are broadcasting live from the Bloomberg Breakaway Summit.
• 10:55
  Speaker 1: You're listening to Bloomberg Radio, in which parts of Europe's
• 11:02
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