Trump Threatens Drug Tariffs; Hassett Frontrunner For Fed Chair

0:00Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done. ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com by selecting Work Mode, available on Plus and Pro plans.

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1:44Bloomberg 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 new developments on tariffs. President Trump says he's likely to impose levies on pharmaceuticals as soon as the end of the month. While he didn't specify a rate, any tariff would likely impact the likes of Eli Lilly, Merck and Pfizer, which all produce drugs overseas. The president spoke to reporters and comments heard live on Bloomberg Radio. Pharmaceuticals will be tariffed probably at the end of the month. And we're going to start off with a low tariff and give the pharmaceutical companies a year or so to bill.

2:28And then we're going to make it a very high tariff. And the president also says his timeline for implementing tariffs on semiconductors is similar. Nathan, the president also predicted that he could strike two or three trade deals with countries before implementing his so-called reciprocal tariffs on August 1st. He also says he's reached a deal with Indonesia. Indonesia is very strong on copper, but we have full access to everything. We will pay no tariffs. So they are giving us access into Indonesia, which we never had. That's probably the biggest part of the deal. And the other part is they are going to pay 19 percent and we are going to pay nothing.

3:07On social media, the president also said Indonesia has committed to purchase 15 billion dollars in U.S. energy, four and a half billion worth of agricultural products and 50 Boeing jets. And Karen, the president is also continuing his criticism of Jay Powell. That's as Bloomberg News has learned Kevin Hassett, director of the White House National Economic Council, is the early frontrunner to replace Powell as Fed chair next year. Treasury Secretary Scott Besson says the formal process to find Powell's successor has already begun. In an interview heard right here on Bloomberg Radio, Besson suggested Powell should also not remain on the Fed's board of governors after his term as chair ends.

3:46There's been a lot of talk of a shadow Fed chair causing confusion in advance of his or her nomination. And I can tell you, I think it'd be very confusing for the market for a former Fed chair to stay on also. Surgery Secretary Scott Bessent also says he's part of the decision-making process, but the final decision will come from President Trump. Nathan, Congress is a step closer to clawing back billions of dollars in funds for public broadcasting and foreign aid. The Senate has voted to advance$9.4 billion in cuts on a 51-50 vote, with Vice President J.D. Vance breaking the tie. The measure would cancel funds for the Corporation for Public Broadcasting, which funds PBS and NPR.

4:29The networks have warned that could force local stations to close. But House Speaker Mike Johnson says public media have misused federal funds. They're biased reporting. They're not objective. They pretend to be so. They have for a long time. And the people don't need to fund that. House Speaker Mike Johnson spoke before the White House offered assurances to South Dakota Senator Mike Rounds that tribal radio stations would receive$10 million. The package now heads to a voterama of amendment votes before the Senate takes final action today. Karen, a controversy that has split President Trump's voter base is now threatening a wider divide in the Republican Party.

5:06This is over the administration's handling of documents related to disgraced financier Jeffrey Epstein. This month, the Justice Department said it had no new information to release on the case. That's after Attorney General Pam Bondi told Fox News earlier this year that she had Epstein's client list waiting on her desk. Now, Republicans like Missouri Senator Josh Hawley are calling for more transparency. I think all this stuff ought to be public. I mean, I think all of the documents should all be public. I think we'd all ought to be out in the open. Another Republican, Kentucky Congressman Thomas Massey, says he'll force a vote in the House to release documents in the case.

5:43President Trump says Republicans should put Epstein behind them. I don't understand why they would be so interested. He's dead for a long time. He was never a big factor in terms of life. The president says he thinks Attorney General Bondi has handled the case well. He has suggested without evidence that the Epstein files were made up by Democrats. Shares of NVIDIA closed at an all-time high. CEO Jensen Wang says he should get the first batch of U.S. licenses to export H-20 AI chips to China soon. But he says it's still unclear how many licenses the U.S. will approve. Speaking at a conference in Beijing, Jensen Wang praised China's achievements in artificial intelligence.

6:23Models like DeepSeek, Alibaba, Tencent, Minimax, and Baidu ErnieBot are world-class, developed here and shared openly, have spurred AI developments worldwide. Jensen Wang's NVIDIA made history last week as the first company to hit a$4 trillion market value. Shares of chipmaker ASML are down almost 8 % in Europe. Nathan, the company's CEO is walking back the company's growth forecast for next year due to trade disputes and global tensions. ASML forecasts for third-quarter net sales missed estimates. Inflation also in focus in Europe this morning. In fact, U.K. inflation rose to its highest level since January 2024.

7:10CPI ticked up to 3.6 % in June from 3.4%. And previously, economists had expected the figure to remain unchanged.

7:20Time 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. We're learning more about two women in New Jersey who were killed after their vehicle was swept up in floodwaters during a storm that moved across the Northeast Monday night. They were in their car on the road when it was swept into the Cedar Brook during the peak of the heavy rains. Governor Phil Murphy. We got crushed, not just here in Berkeley Heights, but in this part of the state in particular. Sadly, two losses of life in Plainfield in a vehicle that was swept away and sadly the deceased were extracted.

8:01It is the second deadly weather system in the Plainfield area this month. Early in July, three people died when thunderstorms caused trees to fall. The Pentagon says that Defense Secretary Pete Hegseth has ordered that 2 ,000 California National Guardsmen be withdrawn from the security mission in Los Angeles. That order will reduce by almost half the 4 ,700 Federalized Guards and Marines sent to the city in early June to protect federal property and personnel following anti-ice protests. Los Angeles Mayor Karen Bass. I have said from the beginning that what is happening in Los Angeles is we are being used as a test case.

8:42And I am hoping that this experiment with the lives of people ends here. New York City mayoral candidate Zoran Mamdani told business leaders that he would begin to discourage the use of the phrase globalize the intifada after being pressed on his views by Pfizer chief executive Albert Bourla. According to people with knowledge of the matter, the Democratic mayoral nominee met Tuesday with about 100 business leaders from the Partnership for New York City. Mdani, an activist for Palestinian causes has been criticized for refusing to denounce the phrase, a reference to the armed Palestinian uprisings against Israel.

9:20Meanwhile, Senate Minority Leader Chuck Schumer was asked about it during a news conference yesterday. Look, what the globalized intifada means is really wrong and should be condemned, and I look forward to my discussions with Mr. Mamdani. And Mamdani picked up the backing yesterday from the largest union for city workers, DC37, and from New York Democratic Congressman Adriano Espion. Global News, 24 hours a day and whenever you want it with the Bloomberg News Now. I'm Michael Barr, and this is Bloomberg, Karen. All right, Michael Barr, thank you. Some people treat ChatGPT like some kind of smart search engine, and some use it to get work done.

9:58ChatGPT Work is a new way of working in ChatGPT that can take action across your apps and files, stay with a project for hours if needed, and turn a goal into finished work. It's designed to help you move from a chaotic starting point to a reviewable first version. So all the source materials, briefs, and scattered information that you have to grind through to turn into something useful can just become something useful. Put ChachiPT to work on your most ambitious ideas and projects. Get started at ChachiPT.com by selecting Work Mode, available on Plus and Pro plans. Let's talk about healthcare for a second.

10:35It doesn't always work the way people expect it to. If you've ever waited on a prescription refill or had a hard time getting the care you needed, you know the feeling. The system should just work better for everyone. That's exactly what the people at Optum are trying to do every day. They're a health care company linking patient care and pharmacy services and using data and technology to drive the whole system so care is connected, not complicated, for patients and providers. Things like making it easier to get care that looks at the whole person, from primary care doctors to mental health support and even in-home care, and then using technology to make sure they all work together.

11:12Technology designed to help doctors spend less time on busy work and more time with their patients. And those prescriptions? Optum is working to bring costs down, save patients money, and make it easier to get refills. Little by little, Optum is helping make healthcare work as one for everyone. Head to business.optum.com to see how.

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12:08Time now for the Bloomberg Sports Update. It's brought to you by Flushing Bank, and here's John Stashauer. John, good morning. Good morning, Karen. There's never been an MLB All-Star game or at least a finish like this one. In Atlanta, looked like a National League round. A catch to a Marte, two-run single before the AL got an out. And stayed 2-0 until AP to Alonzo. Three-run opposite field homers, sixth inning, first met with an all-star homer since David Wright in 2006. Corbin Carroll homered. The NL had 6-0. Back came the AL. The A's Brent Rooker, three-run shot to get him on the board, and then two runs in the ninth.

12:42They tied the game with an infield single with two out. No extra innings. It was instead time for a swing-off. Each team picked three players to swing three times, and Kyle Schwarber hit all three of his out for home runs. The NL won. Schwarber was MVP he spoke on Fox on the field afterwards. Just trying to not hit a home run I guess just trying to stay short because if I would have tried to hit a home run I would probably hit my guys over there but just happy that it worked out for us and the National League's going home with a win. For Philly to be an all-star MVP is Johnny Callison at Shea Stadium in 1964.

13:21The day after the Jets lopped up wide out Garrett Wilson with a four-year extension they did likewise with cornerback Sauce Gardner. They drafted both players among the first 10 picks of the 2022 draft. Tomorrow begins the 153rd Open Championship, just the third ever at Royal Portrush in Northern Ireland. And this tournament, like all of them now, begins with world number one Scotty Scheffler as the betting favorite. No matter what happens, we're always on to the next week. And so that's one of the beautiful things about golf, and it's also one of the frustrating things because you can have such great accomplishments, but, you know, the show goes on.

13:53And that's just how it is. You know, it's great to win tournaments. It's a lot of fun. Sometimes the feeling only lasts about two minutes, it seems like. Sheffield tees off about 24 hours from now, just after defending champs, Andrew Schauffler. John Stash, and we're at Bloomberg Sports. Karen Nathan. Coast to coast on Bloomberg Radio, nationwide on SiriusXM, and around the world on Bloomberg.com and the Bloomberg Business app. This is Bloomberg Daybreak. Good morning. I'm Nathan Hager. President Trump's trade negotiations may be heading into the final stretch with just 16 days to go until the August 1st tariff deadline.

14:32The president says higher rates for pharmaceuticals could be coming sooner rather than later, and only a few more trade deals may still be in the works. We're working on probably five or six of the five or six. I'm not sure I really want to do them. You know, you want somebody that knows how to negotiate. but we'll probably have two or three. The president spoke to reporters at Joint Base Andrews outside Washington last night and this morning we're joined by Bloomberg News senior editor Bill Ferries. Bill, it wasn't that long ago we were hearing maybe a dozen, maybe 18 trading partners could be coming up for deals.

15:05Now it seems like that window is narrowing. Good morning. Good morning, Nathan. Yeah, it is narrowing. We've had this fourth country, I guess, get some sort of an agreement, whether you want to call it a deal or a framework, with Indonesia getting 19 percent tariffs on their products and in return agreeing to buy apparently about 19 billion dollars in goods and some Boeing jets and things like that. That would be basically the fourth deal you can count on. And you heard President Trump there. I think he went on to say that he's still hoping that India might be among the countries who get some sort of an agreement.

15:46And that would obviously be a really big one that's been hanging out there. But that leaves a whole lot of countries. You know, we're very far away from those 90 deals in 90 days that we heard about in April. But there's still, you know, the president has signaled that there's a chance that this August deadline might also be extended. Scott Besson said almost certainly that would happen for China as they continue working out the details of their agreement. But a lot of countries still feel like the last two weeks is time they can use well to maybe get through the finish line here with the Trump administration.

16:23And even if we get closer to that finish line, Bill, the president's talking more about sectoral tariffs as well, including potentially pharmaceutical tariffs. He had said maybe those would be raised by 200 percent in a year or more, but maybe that's coming sooner. Yeah, he said that August 1st or the end of this month could be when he decides to go forward at a much lower level with pharmaceutical tariffs. And he even said semiconductors with the pharmaceuticals. He has talked about 200 percent. He says that that would potentially be phased in over a year or at one point he said a year and a half.

17:01the idea being to try to get these companies, many of the big ones which are in Europe, to move more of their production into the United States. He seems to acknowledge that that would take some time, but he doesn't have unlimited patience. It's hard to know whether a year or a year and a half is really enough. 200 percent would be a huge increase. So that might be the leverage he's trying to use to get them to the table. And speaking of unlimited patience, we're not seeing much of that when it comes to Fed Chair Jay Powell and interest rates. And now we're hearing more about how the search process for a replacement is going, maybe even sooner than expected.

17:36Yeah, it sounds like Scott Besson said the formal process of starting to pick the next Fed chair has already begun. And Besson, of course, has long been on the short list for that. But President Trump's saying that he likes the job Besson is doing at Treasury, so he might not really be the leading candidate at this point. One person who we do think is probably the leading candidate right now is Kevin Hassett, the head of the National Economic Council and an advisor, economic advisor who's been close to Trump for really better part of a decade at this point. He seems to be perhaps in the poll position.

18:17And Chris Waller, former Fed governor, also on that short list. 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. 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.

18:54And 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. 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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