Trump Orders Minneapolis Pullback; US-Iran Talks Set for Friday

0:00Donald Trump is rewriting the Washington rulebook and reshaping the global economy. If you're trying to connect the dots behind the headlines, Bloomberg's Trumponomics podcast is here to help. I'm Stephanie Flanders, head of government and economics at Bloomberg. Every week, I'll bring you a smart, focused conversation with reporters and experts from Washington, Wall Street and beyond. Listen to new episodes every Wednesday and follow Trumponomics wherever you listen. Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk bonds for a minute. Capturing value and fixed income is not easy.

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1:14All investing is subject to risk, Vanguard Marketing Corporation Distributor. 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 in Washington, where President Donald Trump has carried out an annual tradition. The president sat down for a wide-ranging interview ahead of the Super Bowl with NBC News. The discussion covered an array of topics, including the situation in Minneapolis after the deaths of two Americans by federal agents. President Trump says immigration enforcement in the city needs a softer touch.

1:54Look, I'm not happy with the two incidents. It's not, you know, It's both of them, not one or the other. He was not an angel, and she was not an angel. You look at some tapes from back, but still, I'm not happy with what happened there. Nobody could be happy, and ICE wasn't happy either. President Trump says he personally decided to pull 700 agents from Minnesota yesterday. That still leaves about 2 ,000 federal agents in the Twin Cities area. A Quinnipiac University poll shows 63 % of voters disapprove of the way ICE is enforcing immigration laws, though 77 % of Republicans approve, 61 % think the Trump administration has not given an honest account of Alex Petty's shooting.

2:35Nathan, President Trump also discussed geopolitics in the NBC News interview. The president had a message for Iran's supreme leader ahead of indirect talks with the country tomorrow. I would say he should be very worried, yeah, he should be. As you know, they're negotiating with us. And President Trump has threatened military action against Iran if it does not reach a deal on its nuclear program. The White House says both sides still plan to meet in Oman tomorrow. President Trump also touched on his hour-long call yesterday with Chinese President Xi Jinping. He said they covered a lot of topics and that it's important that both leaders have a good relationship.

3:12The Federal Reserve also came up in President Trump's interview. NBC's Tom Lamas asked if interest rate policy weighed on the president's decision to replace Chair Jay Powell with former Fed Governor Kevin Warsh. I mean, if he came in and said, I want to raise him, we said that he wouldn't have gotten a job. He would not have gotten a job. No. President Trump says he believes the Fed is an independent body in theory, but he also says he's a smart guy whose predictions on the economy should be considered. Well, sticking with politics here, Nathan, today voters in northern New Jersey will select nominees in a special Democratic congressional primary to replace Governor Mikey Sherrill in the Republican led U.S.

3:48House. Bloomberg's Lisa Mateo has more on the lineup of contenders. It's quite the crowded list, 11 candidates to be exact. In the spotlight is labor activist Annalilia Mejia, who has called for abolishing ICE and taxing the rich and corporations. She's landed endorsements from Bernie Sanders, Alexandria Ocasio-Cortez, and multiple unions, and uses the same social media firm that helped New York City Mayor Zoram Mamdani go viral on TikTok. Among the higher profile contenders are former Congressman Tom Malinowski, Essex County Commissioner Brendan Gill, endorsed by former Governor Phil Murphy, and Tahisha Way, Murphy's former Lieutenant Governor.

4:27The winner will face the only candidate in the Republican primary, Randolph Township Mayor Joe Hathaway, on April 16th. Lisa Mateo, Bloomberg Radio. All right, Lisa, thank you. Now the latest on the missing mother of NBC Today show host Savannah Guthrie. She sent a public message to her mother's kidnapper saying her family is ready to talk but wants proof that she's alive. We live in a world where voices and images are easily manipulated. We need to know without a doubt that she is alive and that you have her. Savannah Guthrie's 84-year-old mother Nancy was last seen Saturday around 9 45 p.m. when she was dropped off at her home in Arizona by family after dinner.

5:16Nathan, we turn to the markets now, and there's been a momentary pause to the global tech sell-off. NASDAQ futures are higher after the index erased its gains for the year over the past two sessions. Traders are weighing whether the flight from tech has been excessive amid concerns over disruption from artificial intelligence, lofty valuations, and vast capital outlays. This morning, shares of Alphabet are down more than 2.5%. The Google parent did top quarterly revenue estimates, but says capital spending on AI will be significantly higher than anticipated. CEO Sundar Pashai says the money will deliver a return on investment.

5:53Revenue from AI solutions built by our partners increased nearly 300 percent year over year. And commitments from our top 15 software partners grew more than 16x year over year. And Alphabet CEO Sundar Pesai says capital expenditure could come close to$185 billion this year compared with the almost 120 billion analysts had expected. Well, sticking with company news, Karen, shares of Qualcomm and Arm are both tumbling in early trading. The semiconductor company signaled a shortage of memory chips will crimp growth in the electronics industry. Now shares of Qualcomm are down 10.5%. Arm is lower by more than 7%.

6:32Nathan, the big tech earnings continue today with Amazon reporting after the bell, and we get a preview with Bloomberg's Tom Busby. Amazon.com is expected to show steady 21 % revenue growth in its Amazon Web Services cloud computing division amid heavy spending on artificial intelligence. That's for its bread and butter e-commerce unit. Analysts expect the company benefited from resilient holiday spending despite a 35-day long government shutdown and a slump in consumer confidence. Bloomberg consensus calls for revenue of$211.49 billion on earnings per share of$1.96. Tom Busby, Bloomberg Radio.

7:10All right, Tom, thank you. All is not calm in markets this morning. Outside of tech, precious metals are in focus. Once again, let's get the very latest from Bloomberg's John Tucker. John, good morning. Good morning, Nathan. Yes, silver. Let's start there. That plummeted as much as 17 % as the commodity is struggling to find a floor following this historic route. It's nicknamed the Devil's Medal for a reason, Nathan. Its price is volatile and it's led to financial ruin for more than one speculator. After a record-breaking rally that appeared to run too far too fast, the medal has retreated by more than a third from its all-time high January 29th.

7:46Gold has fallen below$4 ,900 an ounce. The precious medal soared last month in a rally underpinned by speculative momentum, geopolitical upheaval, and concerns about the Fed's independence. In New York, I'm John Tucker, Bloomberg Radio.

8:04Time 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. Business leaders, labor groups, and transit advocates are calling on the Trump administration to restore funding to a$16 billion rail tunnel that links New Jersey and Manhattan. The Gateway Development Commission has warned that it must stop work on the tunnel by tomorrow unless the U.S. Department of Transportation immediately releases federal funding tied to the project under the Hudson River. New York, New Jersey, and the Gateway Development Commission have sued the Trump administration to restore funding.

8:44The partial government shutdown is now over, but the fight over a new round of funding for the Department of Homeland Security is just getting started. Lawmakers have under two weeks to reach a bipartisan decision. Arizona Democratic Senator Ruben Gallego. I'm not optimistic, not from what I've heard so far. But from what I hear from the American public, they think ICE has gone overboard. Democrats are calling for judicial warrants before ICE would make arrests. They're also calling for a ban on ICE agents wearing face masks and make agents wear body cameras. Alabama Republican Senator Kate Britt.

9:21So we're putting the safety and security of the American people first. What Republicans will not do is change the law. What Republicans are not going to do is not enforce the law. Senator Britt says we got here because of rhetoric from the left. Officials from the self-driving vehicle industry appeared before Congress. Responding to reports of Waymo vehicles not stopping for school buses in Austin, Texas, Safety Chief Mauricio Pena says they've already updated their safety software. Safety is our top priority, especially the safety of children and pedestrians. It comes just a few weeks after a Waymo vehicle hit a child who'd suddenly entered the roadway in Santa Monica, which has prompted a federal investigation.

10:05Officials from Tesla and the Autonomous Vehicle Industry Association also testified. Global News, 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg Heron. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer. Thanks, Karen. More NBA trades ahead of today's deadline. Kristaps Porzingis goes from Atlanta to Golden State in exchange for Joseph Kaminga, who was unhappy with the Warriors, as well as Buddy Heal. This means the Warriors are no longer interested in acquiring Giannis Antetokounmpo from Milwaukee.

10:40Anthony Davis goes from Dallas to Washington, part of an eight-player trade in a hockey trade. The Rangers dealt free agent to be Artemi Panarin to the LA Kings and a baseball free agent signing Frambois Valdez with Detroit. That's your Bloomberg Sports Update. Stay with us. More from Bloomberg Daybreak coming up after this. Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky, and let's be real. Lots of firms throw a couple flashy funds your way and call it a day.

11:15But not Vanguard. At Vanguard, institutional quality isn't a tagline. It's a commitment to your clients. We're talking top-grade products across the board of over 80 bond funds, actively managed by a 200-person global squad of sector specialists, analysts, and traders. These folks live and breathe fixed income. So if you're looking to give your clients consistent results year in and year out, go see the record for yourself at Vanguard.com slash audio. That's Vanguard.com slash audio. All investing is subject to risk, Vanguard Marketing Corporation Distributor. Hello, I'm Stephen Carroll. I'm in Brussels where many of Europe's biggest decisions get made.

11:53And I'm Caroline Hepker in London. We're 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.

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12:51Coast 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. Minnesota, Iran, the Fed, all of that and more came up in President Donald Trump's wide-ranging interview with NBC News, portions of which aired last night ahead of the Super Bowl and months before a midterm election. Now, the president says when it comes to the deaths of two Americans in Minneapolis. I'm not happy with what happened there. Nobody could be happy, and ICE wasn't happy either. But I'm going to always be with our great people of law enforcement.

13:29That was President Trump in the interview with NBC's Tom Lamas. We're joined this morning by Terry Haynes, the founder of Pangea Policy. And Terry, I'd just be curious to get your thoughts on whether a Super Bowl interview returning to this tradition for a president is something that resonates with voters, particularly at this moment for the president. Good morning. Hi, good morning, Nathan. I don't think it hurts him at root. And it is a good thing that he's returning to this tradition. And it's a good thing that he gave NBC a good deal of time on this. And, you know, people deserve to hear his voice kind of cutting through the cacophony on all these subjects.

14:10So, yeah, I do think it's a good thing. And in terms of the president's comments about the situation in Minneapolis, he says he made the personal decision to pull the 700 federal agents yesterday. He says it needs a softer touch now. What is he doing in terms of overcoming this political backlash that we are seeing playing out in the polls? Well, I think it's a good thing, generally, that the president understands that the enforcement process up there was certainly overreached, to put it mildly, and that he made that decision. You know, it's just as the bad decisions ultimately come to roost to his detriment, the good decisions, you know, help him.

14:58And, you know, as I say, fundamentally, it's a, you know, I think that's a good thing that they kind of ramp up the method of enforcement. Going forward on the prospects for ICE DHS continued funding, though, I think Congress has got a, and the White House have a huge lift because you've got the temptation on both sides to overreach and include other things other than the matter at hand, how ICE does its job. And you've got a potential goals mismatch where if Republicans seem to be more united on figuring out exactly what kind of guardrails ICE should have, you've got Democrats, I think, all over the place here, some saying they're for guardrails.

15:42Others want to defund. Others want to keep away from other issues like sanctuary cities. So I think this is going to be a difficult lift. And politically, Democrats run the risk of turning something that they want to keep as an advantage into looking like their immigration enforcement opponents or Homeland Security enforcement opponents. So it's a delicate mix, and I think people would be well, on both sides, would be well advised to kind of keep to the subject of how ICE does its job. Just 30 seconds left, Terry. We also heard the president say he wouldn't have picked Kevin Warsh as Fed chair if he wanted to raise interest rates.

16:26What's the message to markets when it comes to Fed independence? The message on Fed independence, I think, doesn't come from the president, which is kind of the usual stuff. It comes from the Senate. you've got not only banking committee member Tillis saying he's not going to confirm until the Powell investigations drop, but I think there's a very big thing from Tim Scott, the banking committee chair yesterday, basically giving the Trump people a fig leaf in order to get out of this, kind of get rid of the Powell investigation. The signal there is not only is Warsh very likely to be confirmed, but Trump should back off trying to warp or destroy Fed independence because that's Congress's agency.

17:07This 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.

17:47Search 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.

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