Iran To Unlock $12 Billion; Alan Greenspan's Legacy

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1:45Bloomberg 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 with the latest on the Middle East. The U.S. has issued a 60-day license allowing Iran to sell its own oil on the international market. This gives Tehran an economic lifeline as both sides continue talks on a permanent peace deal. We get the very latest from Bloomberg Middle East correspondent Abir Abu Omar. What we know about this waiver is that essentially the U.S. Treasury has extended it to Iran until August 21st. That is the day where the 60-day period of negotiations would have stopped.

2:28And so that would allow Iran to sell oil exports, bringing back this much needed supply to the market because of the shutdown in the Strait of Hormuz. Our teams on the energy side have tracked just how many oil barrels would come out or have come out actually over the past week. And that's about 30 million barrels. And so we're still seeing a trickle of movement. Definitely better situation than what it was at. But the waiver essentially means that Iran can sell its oil even to U.S. refineries, theoretically. But something to bear in mind, again, is that the EU, for example, has its own sanctions.

3:03And so we don't know if they're going to be buying this oil. Bloomberg's Abir Abou Omar says seven tankers indicated they were in the Strait of Hormuz this morning and checking oil prices. Now, West Texas Intermediate is down seven tenths percent, trading at$73.35 a barrel. Brent is eight tenths percent lower at$77.28. sense. We now turn to the latest developments in British politics. Nathan, the UK could be set for a quick transition to a new premiership as rivals to the frontrunner Andy Burnham stand aside. We go to London, where Bloomberg's Ewan Potts has the latest. Good morning, Ewan. Karen and Nathan, the UK is set to get its seventh prime minister in a decade.

3:41In fact, it's almost 200 years since Britain changed its leader so frequently. As the Labour Party has a majority in parliament, its leader becomes prime minister. And after the former mayor of Manchester, Andy Burnham's main rival for the leadership dropped out, he could get the job without a formal contest. If that happened, number 10 Downing Street could have a new occupant as soon as the middle of next month. In London, I'm Ewan Potts, Bloomberg Radio. All right, Ewan, thank you. Let's turn to politics here in this country because it is primary election day in New York and Maryland, as well as a runoff day in South Carolina.

4:14In New York, a number of congressional races could be a test of Mayor Zoran Mamdani's political power. The mayor has endorsed challengers to two Democratic incumbents, Dan Goldman and Adriano Espeyat. We spoke with Congressman Goldman about his race against former New York City Comptroller Brad Lander. Look, I think broadly, we generally agree on what the problems are. Life is just way too expensive for the vast majority of Americans. And we have to address the dramatic escalation in wealth inequality and the difficulty that so many people have in accessing opportunity in this country and the American dream.

4:54New York Congressman Dan Goldman appeared on Bloomberg's balance of power. Mayor Mabdani's also endorsed activist Daria Liza Avila-Chevalier against Congressman Espeyat. Well, there's also a crowded field, Nathan, to succeed retiring Congressman Jerry Nadler in his midtown Manhattan district. It includes John F. Kennedy's grandson, Jack Schlossberg, and former never-Trump-Republican-turned-Democrat George Conway. Momdani has not given an endorsement in that race, but in the interest of transparency, we should note that Michael Bloomberg has endorsed Michael Asher for Congress, and Bloomberg is founder and majority owner of Bloomberg LP, the parent company of Bloomberg Radio.

5:33And Karen, we're also keeping an eye on primary races in Maryland. Governor Wes Moore is seeking reelection to a second term. He's facing a Democratic primary challenge from physician Eric Felber. The Republican governor's race features nine candidates, including former state delegate Dan Cox, who lost to Moore in 2022. In the House, 24 candidates are vying for retiring former Democratic leader Steny Hoyer's seat. They include former U.S. Capitol Police officer Harry Dunn, who helped defend the Capitol during the January 6th attack. And in the South Carolina runoff, Lieutenant Governor Pamela Yvette is facing State Attorney General Alan Wilson again in the Republican governor's race.

6:09President Trump endorsed Yvette in the primary, but last week he said he'd be happy if either candidate wins today. Let's turn to Washington now, Nathan. President Trump is putting attention on the Lincoln Memorial reflecting pool. Algae has started to build back in after his$16 million resurfacing of the landmark. And now the president says he has evidence of vandalism at the site. We have a hundred and we have a, I think, 290, 300 foot slit right through it, probably a box cutter or a knife of some kind. We had people lifting up the basic, some of the, it's not a lot of damage, but it's, we'll probably have to let the water out and refix it.

6:49The president spoke to reporters in the Oval Office, but he provided little evidence to support his claim. The Interior Department says five people have been arrested for vandalism at the pool and five others have received citations. On Truth Social last night, President Trump said he's preparing lawsuits against ABC News over its reporting on the damage to the reflecting pool. Let's turn to markets now, Karen. We're watching a tech-led sell-off around the world. NASDAQ futures right now are down about two and a half percent. And in Asia, South Korea's KOSPI index plunged 10%. Mark Dowding is chief investment officer at RBC Blue Bay.

7:26If you stand back a little bit, I think what you would say is that some of the recent performance in stocks has been highly speculative, fueled by a passion from retail investors for short-term gains, looking at momentum. This is the way the markets have been behaving and operating. That's RBC Blue Bay's Mark Dowding. Shares of SK Hynix and Samsung Electronics each plunged more than 10 % in Asia. Here in the U.S., memory chipmaker Micron Technology reports earnings tomorrow. Nathan, SpaceX shares they continue their recent slide. They're down another 3.8 % in early trading. The stock is coming off three straight losing sessions, erasing a total of$600 billion in market value.

8:05The sell-off comes as the Elon Musk-led firm gets ready to sell investment-grade bonds for the first time. Robert Shiffman is a senior credit analyst for Bloomberg. Bloomberg. They're going to be spending a lot more over the next few years than they make, probably in the neighborhood of 30 to 40 billion dollars of negative free cash flow for the next few years. On top of that, they have a 20 billion dollar term loan due next September that are going to use the proceeds from this bond deal to pay off. So they're just getting ahead of the curve like everybody else. Like, why are the alphabets and Amazons and Metas raising so much?

8:40It's because over the next few years are going to be spending a lot more. And Bloomberg's Robert Schiffman says SpaceX is seeking to raise at least$20 billion from the debt sale. Finally, Karen, tributes continue to pour in following the passing of former Federal Reserve Chairman Alan Greenspan. Chuck Lieberman of Advisors Capital worked with Greenspan when he joined his firm as an economic advisor. He was always insightful. He did a great job of explaining points. If you ask him a question, he always had charts to demonstrate, to show the data backing up his logic. And his logic was impeccable.

9:13He was insightful, really, until the very end. Chuck Lieberman of Advisors Capital praised Greenspan's independence and communication as Fed chair, as did former Fed Governor Betsy Duke. He was so famous for that sort of doublespeak that nobody could understand. But he really pioneered Fed communications and the communications that we're used to today in hearing from the committee after the meetings. That's former Fed Governor Betsy Duke. Now, Alan Greenspan's legacy was clouded by the 2008-09 global financial crisis that followed his time as chair. Princeton professor Alan Blinder recalled how some felt Greenspan missed the buildup to the housing bubble that preceded the crisis.

9:54The markets would get some crazy ideas in their heads. And more than once I went to Greenspan and would say, it would only take one statement from you to get that crazy idea out of their heads. But he didn't until late in his term when he was starting to change. That's Princeton professor Alan Blinder. And following the news of Greenspan's death yesterday, colleagues described him as a driving force for change at the Fed and a guiding light for investors. Alan Greenspan was 100 years old. 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 in a rare act of bipartisanship the senate passed the 21st century road to housing act the measure will loosen regulations to encourage more home construction open up funding to convert abandoned buildings into new housing and it also bans wall street investors from buying single family homes so those homes can instead be sold to families.

10:54On the Senate floor, Democratic Senator Chuck Schumer of New York said for too many Americans, home ownership is simply unaffordable. The median home buyer in America is 40 years old. The down payment is excruciating to many and puts housing out of reach for them. The House is expected to vote on the measure today. There is word the acting director of national intelligence, Bill Pulte, has begun firing people at the agency. The president earlier said he had asked Pulte to execute the immediate downsizing of the office. In California, a state of emergency in the Boyle Heights neighborhood of Los Angeles, where a warehouse fire has been burning since Wednesday, prompting air quality alerts.

11:39Building owners say the fire may have started while contractors were testing solar panels on the roof. Los Angeles Fire Chief Jaime Moore. If you're sensitive to smoke or have any respiratory concerns, please stay indoors. Close your windows. Set your air conditioning units to recirculate rather than draw from outside air. Fire Chief Moore, Global News 24 hours a day. And whenever you want it with Bloomberg News Now, I'm Michael Barr and this is Bloomberg, Karen. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Thanks, Karen. A blockbuster NBA trade ahead of tonight's draft.

12:15Giannis Antetokounmpo, 13 years in Milwaukee, a two-time MVP. He led the Bucs to the NBA championship in 2021, traded to the Miami Heat for four players and three first-round draft picks. Julius Randle traded by Minnesota to Brooklyn. Also from the NBA, Dusty May, the new coach of the Dallas Mavericks. He just won the national championship at Michigan. College World Series in Omaha, Oklahoma wins the title. I'll meet you in North Carolina. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this.

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15:10This is Bloomberg Daybreak. Good morning, I'm Nathan Hager. As talks continue between the U.S. and Iran, Tehran is getting an economic lifeline, a 60-day license from the U.S. to sell its oil. Vice President J.D. Vance says the U.S. is not giving up too much. Whether good faith or bad faith, you can't trust anybody's words. You have to trust what they actually do. That was Vice President Vance speaking on his way back from the talks in Switzerland, and we're joined now by Bloomberg Jerusalem reporter Dan Williams. I think I'd heard Vice President Vance and other administration officials, Dan, say that Iran's financial benefits through this process would be performance-based.

15:45Does this 60-day waiver rise to that level? Good morning. Time will tell. Good morning, Nathan. There's already a divergence of accounts from Iran and from the United States now that they've gotten the photo-op meeting of principals at that summit in Lucerne out of the way. and left the stage for more, should we say, mundane technical talks. Either side is talking up, but often in different directions. The US, the Trump administration saying that unfrozen funds will be used for humanitarian purposes, perhaps even to buy soy products from the United States. But the spokesman for the foreign ministry in Tehran saying there would not be a limitation on how Iran uses those funds.

16:28That, of course, will stir concern in the US, in the West, and indeed in the region. That some, perhaps all of that money, could go toward rebuilding Iran's military capacity, perhaps the capacities of Iranian allies like the Hezbollah militia in Lebanon. Perhaps not coincidentally, the top U.S. diplomat Marco Rubio is also beginning a visit to the Gulf. Perhaps he's heading out there to try and reassure Gulf Arab states aligned with the United States that the Trump administration will do what it can to keep this deal on track during that critical 60-day review period. How are these talks being received in Israel right now, Dan?

17:09Of course, Israel remains a wild card with the fight against Hezbollah in Lebanon. Yes, there are actually those who argue that the fact it's a wild card, the fact that from the outset it was outside these negotiations on the MOU, it's not a signatory and apparently it wasn't even consulted much of the time when it was being drafted, there is a viewpoint now that perhaps this strengthens Israel's hand paradoxically because Israel can claim frankly naturally and legitimately that it's acting alone and unilaterally because it wasn't consulted and it certainly didn't sign on the dotted line. The Israelis were shocked when this first emerged about a week ago that this deal was in place.

17:46It appears they've now resigned themselves to letting the Americans take the lead. Trump despite a dipping of his approval ratings in Israel as a foreign leader nonetheless is one of the friendliest presidents the Israelis have ever seen in the White House. They won't be quick to turn their back on him. At the same time, they have a very immediate focus on Lebanon, something you alluded to earlier in our conversation, where they want to make sure that their freedom of operation against Hezbollah is not hindered by whatever emerges from this U.S.-Iranian deal. The Iranians want to preserve Hezbollah.

18:19They want to force Israel out of Lebanon. and the Israelis are saying, no, that's a red line for them. For now, the Americans have been pressing Israel to hold fire as much as possible, perhaps to review the rules of engagement in Lebanon to prevent needless loss of civilian life, needless damage there. But the Americans seem to be content for now with not insisting on an Israeli withdrawal from what is effectively 5 % of Lebanese territory. 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.

18:57Eastern 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.

19:34And I'm Nathan Hager. Join us again tomorrow morning for all the news you need to start your day right here on Bloomberg Daybreak.

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