House To Vote on Shutdown Deal; Gold Plunge Deepens as Traders Unwind Bets

0:00Hello, I'm Stephen Carroll. I'm in Brussels where many of Europe's biggest decisions get made. And I'm Caroline Hepker in London with the hosts of the Bloomberg Daybreak Europe podcast. We're up early every weekday keeping an eye on what's happening across Europe and around the world. We do it early so the news is fresh, not recycled and so you know what actually matters as the day gets going. From Brussels, I'm following the politics, policy and the people shaping the European Union right now. And from London, I'm looking at what all that means for markets, money and the wider economy. We've got reporters across Europe and around the globe feeding in as stories break So whether it's geopolitics, energy, tech or markets, you're hearing it while it happens It's smart, calm and to the point And it fits into your morning You can find new episodes of the Bloomberg Daybreak Europe podcast by 7am in Dublin or 8am in Brussels, Berlin and Paris On Apple, Spotify, YouTube or wherever you get your podcasts

1:02Bloomberg 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 in Washington, where the federal government is under a partial shutdown after the uproar over the killings of two U.S. citizens under immigration enforcement in Minnesota. Democrats are demanding new restrictions on federal agents, including warrant requirements, body cameras and removal of masks. House Speaker Mike Johnson says the impasse over government funding won't last long. Well, let's say I'm confident that we'll do it at least by Tuesday.

1:38We have a logistical challenge of getting everyone in town. And because of the conversation I had with Hakeem Jeffries, I know that we've got to pass a rule and probably do this mostly on our own. I think that's very unfortunate. House Speaker Mike Johnson appeared on NBC's Meet the Press. Minority Leader Hakeem Jeffries says the Department of Homeland Security needs dramatic reform. We need to actually build these strict requirements in terms of behavior into the law so that the courts can hold them accountable and the American people through their representatives at the state and local level can hold these individuals accountable.

2:13House Minority Leader Hakeem Jeffries was a guest on ABC's This Week, and you can hear This Week and Meet the Press every Sunday on Bloomberg Radio. The Senate passed a bill last week that funds DHS for two weeks to allow more time to negotiate. The rest of the government would be funded through the end of September. Nathan, the Democratic candidate for a Texas state Senate seat in a conservative district near Dallas won a runoff election on Saturday, overcoming a late intervention from President Trump. Taylor Romet defeated Republican Lee Wamsgans in the race for the seat in Tarrant County, which includes Fort Worth, getting 57 percent of the vote.

2:48President Trump carried the district by 17 percentage points in 2024. Turning back to Washington now, Karen, the Justice Department's latest release of its Jeffrey Epstein files continues to reverberate. On Friday, Deputy Attorney General Todd Blanche said the agency had finished its review of six million pages of material on the late sex offender and ultimately released about three and a half million of them. Blanche says congressional leaders can still see the material that's being kept under wraps. He also appeared on ABC's this week. We have nothing to hide. We have nothing to hide. We never did.

3:19And our doors are open if they want to come and review any of the materials that we produced. It's Deputy Attorney General Todd Blanche, but Democratic Congressman Jamie Raskin says all the files need to come out. They've done no real investigation. Their entire determination has been to shut it down to protect Donald Trump. Congressman Jamie Raskin of Maryland appeared on CNN's State of the Union. The latest batch of documents includes a list of unverified tips about President Trump that the Justice Department has called untrue and sensationalist. The Wall Street Journal reports the release also exposed the names of dozens of Epstein's victims, including many who have not shared their identities publicly or were minors when they were abused.

3:59DOJ is required to redact all victims' names under the law ordering the file's release. Let's turn to the markets now, Nathan, where risk-off is being felt across the board. Stock futures are falling and precious metals tumbling once again. After dropping more than 11 % on Friday, spot gold is down another 3.7 % this morning. Spot silver is down 3.6 % after plunging 26 % on Friday. The rapid declines come after a record-breaking rally, and Martin Ritchie covers the metals for Bloomberg. I think throughout last week, all that kind of frenzied trading, all the bulls piling in, And I think there was a lot of warnings that this price was going ahead of reality.

4:39But now we're in the situation, I think, across gold, silver, and perhaps even copper and metals. We're looking to see where people start to buy the dip. And Bloomberg's Martin Ritchie notes that gold is now down about 20 percent from its all-time high. Megan, oil is falling today as well, Karen. West Texas Intermediate is down nearly 5 percent, trading just above$62 a barrel. The drop comes after President Trump downplayed Iran's Supreme Leader Ayatollah Ali Khamenei's threats of a regional war over the weekend. President Trump says he is hopeful the two sides will come to an agreement. Hopefully we'll make a deal.

5:14If we don't make a deal, then we'll find out whether or not he was right. And this morning, a spokesman for Iran's foreign ministry says the country hopes diplomatic efforts to avert a war with the U.S. will bear fruit within days. And there are some new developments this morning on the artificial intelligence front, Karen. NVIDIA CEO Jensen Wong says the company's proposed$100 billion investment in OpenAI was, quote, never a commitment and that the company would consider any funding rounds one at a time. Wong's comments come after The Wall Street Journal reported Friday that NVIDIA's investment plan had stalled after some inside the company expressed doubts about the deal.

5:48Wong spoke to reporters in Taipei over the weekend about OpenAI and its CEO, Sam Altman. I believe in OpenAI. The work that they do is incredible. They're one of the most consequential companies of our time. And I really love working with Sam. NVIDIA CEO Jensen Wong also said, quote, I believe in open AI. They're one of the most consequential companies of our time. Nathan, let's stay with AI. And shares of Oracle, they are down almost 3.5 % this morning. The company plans to raise$45 billion to$50 billion this year to build additional cloud infrastructure capacity to meet demand. Its largest cloud customers include advanced microdevices, meta platforms, NVIDIA, and OpenAI.

6:30The announcement coincides with persistent fears about whether massive artificial intelligence-linked investments by tech companies such as Oracle will pay off. Okay, Karen, let's turn to the weather now. A large part of the nation's coming off another frigid weekend. So let's bring in Bloomberg meteorologist Craig Allen to find out whether any letup is in sight. Craig, is any letup in sight? Well, there's no doubt this. There's no doubt right now, Nathan, that the coldest weather is over the eastern quarter of the nation. It's not quite as harsh in the central plains or, as a matter of fact, it's even warmer in the Rockies right now than it is in parts of Florida.

7:08So you've got that. There's going to be a very brief reprieve in the bitter, bitter cold, but it'll come right back before this week is through. And, you know, we're taking such a hit on the grid and our wallets, too. You think about all the cleanup, all the power outages that are going on across the Carolinas because there was just a wicked blizzard condition across most of the Carolinas. And, of course, now you've also got freeze warnings for the entire state of Florida for this morning. So that will probably show up agriculturally, you know, in the supermarkets a little bit down the road as well.

7:47So, yes, there is going to be a little bit of a reprieve. But unfortunately, Nathan, Karen, it looks like bitter cold weather will come back towards the end of this upcoming week. All right. Bloomberg meteorologist Craig Allen. Craig, we're going to be checking back with you throughout the morning.

8:06And it's 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. President Donald Trump said he plans to close the John F. Kennedy Center for the Performing Arts for about two years to carry out renovations. President Trump's decision comes after a significant backlash, including prominent artists canceling performances and declining ticket sales following his takeover and renaming of the center to the Trump Kennedy Center. For years, the center was home to the opera and the National Symphony Orchestra.

8:41Democrat Taylor Romet has won a special election for the Texas State Senate and flipped a reliably Republican district that President Trump won by 17 points in 2024. The labor union leader and veteran easily defeated Republican conservative activist Lee Wamsgens in the Fort Worth area district 57 % to 43%. President Trump distanced himself from the loss Sunday after urging votes for Womguns a day earlier. I don't know anything about it. I didn't know. I mean, I know there's a race going there. And it's too bad. What can I say? I have nothing to do with it. Romet is to face Womguns again in the November general election to decide the seat for a full four-year term.

9:28The 68th Annual Grammy Awards took place Sunday in Los Angeles. Bad Bunny has won Album of the Year, the first time a Spanish-language album has taken the Grammy's top honor. The Puerto Rican native opened his remarks by saying, Ice out. We're not savage, we're not animals, we're not aliens, we are humans, and we are Americans. Many other artists also used their time on stage to spread a pro-immigration and anti-ice message. Billie Eilish, Jelly Roll, and Lady Gaga were among the night's other winners. Olivia Dean won Best New Artist. Kendrick Lamar won for Best Rap Album and Record of the Year.

10:09The Grammys were aired on CBS. Today is Groundhog Day. According to folklore, we'll see if we'll get six more weeks of winter. Global News, 24 hours a day and whenever you want it with the Bloomberg News Now. I'm Michael Barr and Karen, I'm rooting for that rodent. This is Bloomberg. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Thanks, Karen. All NFL teams now have a new head coach for the Arizona Cardinals. It's Mike LaFleur. He had been the LA Rams offensive coordinator for the Las Vegas Raiders. It apparently is going to be Clint Kubiak, the Seattle offensive coordinator.

10:47Well, that can't become official until after the Super Bowl. Farmers Insurance Golf in San Diego. Justin Roselet all the way finished with a 23 under par score, which was the best score in tournament history. Outdoor hockey in Tampa, the Lightning beat the Bruins. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. As markets move and headlines break, what matters most is context. A Bloomberg subscription gives you unmatched reporting, sharp analysis, and powerful tools that help you connect the dots. Visit Bloomberg.com slash podcast offer to learn more.

11:29coast 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 and for the second time in just a few months the federal government is under a partial shutdown this time amid the national outcry over clashes between immigration enforcement and protesters in minnesota but unlike the last time around the record shutdown house speaker mike johnson says this one shouldn't last long, but he has a bottom line. We have to allow ICE to do its job. We have to allow Border Patrol to do its job, and we're going to make sure they have the funding to do that.

12:04That was House Speaker Mike Johnson on Fox News Sunday, a show you can hear every weekend on Bloomberg Radio. This morning, we're joined by Bloomberg D.C. breaking news editor Alexander Pierce. And Alex, of course, the Senate passed the bill last week that would fund the Homeland Security Department for two weeks to allow for negotiations. Is that going to be enough time, given where things stand between Republicans and Democrats right now? Good morning. Good morning, Nathan. It's unclear at the moment, given that the Democrats are making a series of demands, some of which the administration has indicated they would not accept.

12:38So the Democrats would like to see body cameras on immigration enforcement officials. They would also like to see identification, that agents don't wear masks, and also that agents seek a judicial warrant before searching homes or pulling people out of vehicles. Tom Holman, who's the board of Tsar, who's been sent to Minnesota, has indicated that some of those demands will not be accepted, such as regarding identification. But there are indications the administration may be open to some of the demands, maybe wearing body cameras or ending what are known as roving operations in cities. But at this point, it's still very much stuck in the negotiation phase, and whether two weeks will be long enough is questionable.

13:20All right. So while we wait for further developments on that front, possibly getting the government open this week, there is a lot more fallout this morning over what sounds like it may be the final release of Epstein files from the Justice Department. Is that our understanding? Yeah, that's certainly how it's being portrayed by the Department of Justice. They released millions of documents last week, including photos and video footage. But what we do know is that this represents about 50 % of the files that the department holds. That's proving very controversial, particularly among Democrats, given that the law that was passed last year called on the Department of Justice to release all of the files, and actually by December 19th.

14:03So this is already quite a significant delay. The department says for their part that they are withholding documents that contain sensitive information about victims and or that are related to ongoing federal investigations. And they've given no indication that they are anytime soon going to releasing some of these files. In our last minute, there's a report in The Wall Street Journal this morning that some of that sensitive information may have gotten out anyway. Yes, that's true. So of the millions of documents that were released last week, according to the Wall Street Journal, they did an analysis.

14:39And it shows that actually many documents actually contain a lot of sensitive information, including full names and in some cases addresses of some of Jeffrey Epstein's victims. The department has said that when that has been identified, when it's been notified of these lack of redactions, it will take them off its website and redact the information. But it's already another sort of indication that the handling of this case has not gone as smoothly as it should have, given that the law did say last year that it should redact all information, all sensitive information regarding victims. This is Bloomberg Daybreak, your morning podcast on the stories making news from Wall Street to Washington and beyond.

15:20Look 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.

15:58I'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.