US-Iran Stalemate; Trump Weighs In On UK Terror Plot

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1:52Good morning. I'm Karen Moskow. And I'm Alexis Christophorus. Here are the stories we're following today. All right, Alexis, and we are seeing that on a lack of progress in U.S.-Iran talks, Iranian officials have privately expressed pessimism about reaching a deal to end and reopen the Strait of Hormuz before U.S. midterm elections in November. We get more from Bloomberg Middle East correspondent Abir Abu Omar in Dubai. You're looking at where diplomacy stands right now, and it's pretty much the same position that it was at over the past few months. Really, with no end in sight, really, for this war, we have some signs to suggest that both of them are willing to come back to the negotiating table.

2:34But really, at this point, it's a question of who blinks first and who kind of succumbs, for lack of a better word, to the others' asks. And Bloomberg Zabir Abu Omar reports that a U.S. official is saying there will be no or will not be a pact with Iran unless issues regarding the country's nuclear program are addressed. And President Trump is criticizing the U.K.'s decision to release five men held on bail over an alleged terror plot against a Royal Air Force base. Let's get the latest now from Bloomberg's Ewan Potts in Europe. Ewan, good morning. Alexis and Karen, the release of the suspects erected over the weekend has sowed confusion about an incident that authorities had described as a serious attempted attack disrupted at a late stage.

3:17The Royal Air Force Base in the west of England is a key launching pad for US airstrikes on Iran. But according to a British official, no viable explosives were found at the scene of the men's arrest. The chief of counter-terrorism policing says that the men remain under investigation and multiple lines of inquiry are still ongoing. In Brussels, I'm Ewan Potts, Bloomberg Radio. All right, Ewan, thanks. Now to the latest on the trade war between the U.S. and Canada. A U.S. import ban on a select number of Canadian products is officially in effect. The Trump administration's latest trade restrictions block imports of motorcycles, alcoholic beverages, and whey products from Canada in response to retaliatory tariffs imposed by Prime Minister Mark Carney's government on some U.S.

4:03goods. The trade affected by the new import ban is relatively small, about$1 billion. The U.S. and Canada exchanged almost$900 billion of goods and services in 2025. Well, Karen, back here in the U.S., President Trump is set to host a lunch meeting with tech and AI leaders today to launch a new government website, america.gov. Bloomberg's Amy Morris reports from Washington. Anthropic CEO Dario Amadei is reportedly among the AI executives expected to attend the lunch meeting with President Trump. Semaphore reports Google CEO Sundar Pichai and Meta's Mark Zuckerberg will also attend. A White House official says the new America.gov website is designed to help Americans access federal information and resources.

4:48The event will include panel discussions on AI, energy dominance, health, space, and agriculture. In Washington, Amy Morris, Bloomberg Radio. All right, Amy, thank you. White House National Economic Council Director Kevin Hassett is weighing in on artificial intelligence. He says AI will have a beneficial impact on future job growth. The growth benefit of it is way bigger than you might think. The concerns, of course, are that it's going to change people's jobs, maybe cause some jobs to be replaced. Firms that start using AI see their sales go up a lot, their employment go up a lot, and wages go up a lot because the people are more productive, the firms that don't employ AI start to fail.

5:29And White House National Economic Council Director Kevin Hassett made the comments in an interview with Bloomberg's David Weston at the New York Economic Club. Catch the conversation on the Bloomberg Video Hub at Bloomberg.com and the Bloomberg Business App. And the artificial intelligence debate is catching the attention of Pope Leo. Axios is reporting the pontiff told reporters that warnings from AI researchers should be, quote, taken seriously and are not fake news. OpenAI is holding back a version of its Astra artificial intelligence model, Alexis, after it failed to perform as well on safety evaluations.

6:06OpenAI has reported a series of security incidents in which its AI agents have reached outside systems, adding to broader concerns about AI slipping out of human control. The company said last week that it was pausing training on its most capable models after another AI model accessed the Internet when it was supposed to be unable to do so. And Karen, Chipmaker Advanced Micro Devices is acquiring the AI startup World Labs. The price tag,$8.2 billion. World Labs was founded by AI industry pioneer and researcher Fei-Fei Li. Bloomberg's Ed Ludlow spoke about the deal with AMD CEO Lisa Su. For the size and scope of our ambition at AMD, having a world-class research team and Feifei's team will be the nucleus of our AI models team, I think is absolutely critical.

6:54When we think about all of the innovation that is to be done over the next decade, I think we want to do it really with innovation across the entire stack. And so I view this as, you know, both, you know, a big vote of confidence for, you know, just the work that's already been done, but even more importantly, what we will do together. AMD CEO Lisa Su speaking there with Bloomberg's Ed Ludlow. And you can catch the entire interview and all of our high profile conversations on our video hub on the Bloomberg Business app. Well, Alexis, we turn to the markets now where global stocks are trading at one week lows.

7:28The S &P 500 wiped out this month's advance, while the tech-heavy Nasdaq 100 lost 1.1%. Michael Purvis, the CEO at Tall Backend Capital Advisors, is still bullish. The rally this year, the 13 % or so rally, has been driven by exceptional earnings growth. Again, to get to 8 ,500, a little bit of, not a lot, but a tiny bit of PE expansion with more earnings growth, which has been running a little bit more than 2 % every month this year. If we see a continuation of that, you can easily get to 8 ,400, 8 ,500. Tallback and Capital Advisors Michael Purvis' forecast would be about a 10 % gain from current levels.

8:10And Karen, much of investors' focus, of course, has been on the Treasury market, where the benchmark U.S. 10-year yield rose to the highest since 2007. Bloomberg's John Tucker joins us now with the latest. John, good morning. Good morning, Alexis. In uneasy calm, I'll call it, settling over the bond market right now, That could change in a heartbeat, though. We have a busy stretch of labor market data that kicks off today with the release of the August job openings report, the Joltz survey. With bond yields at multi-decade highs, Bob Michael at J.P. Morgan Investment Management actually sees opportunity for investors.

8:44Can the Fed actually do a total of six rate highs, go from three and five-eighths to five and an eighth? because if they can't, then bond yields of over 5 % are pretty much a gift to you. And toss this into the mix. This is historically a bad time of year for bond prices. Over the past decade, Treasuries have posted a median loss of almost 1 % for the month of September. As one strategist puts it, it's been a train wreck in rates over September. A Bloomberg columnist, John Authors, comes up with the new word, bondpocalypse, in New York. I'm John Tucker, Bloomberg Radio. All right, John, thank you.

9:20In company news, Goldman Sachs has reportedly discussed a plan for John Waldron to succeed David Solomon as CEO as soon as next year. The Wall Street Journal says Waldron, who is currently chief operating officer, could take over toward the end of 2027 or in 2028 with Solomon moving to an executive chairman role. And last year, Goldman's board gave Waldron a restricted stock package now worth nearly$120 million to stay five more years.

9:49509 on Wall Street. Time for a look at some of the other stories making news in New York and around the world. For that, we're joined by Bloomberg's Michael Barr. Michael, good morning. Good morning, Alexis. It's cleanup time for residents in the Northeast. In Seabright, New Jersey, the nor 'easter sent roughly three feet of water into parts of the low-lying coastal community. This man in Monmouth County was out Monday trying to restore his property. When you live down here, we're kind of ready for it. It kind of happens all the time. If you can get the lightest little rain, you're going to have flooding.

10:19But this Northeast was a little bit more than just flooding, so we had probably around three feet of water over here. The Federal Emergency Management Agency said response coordination centers in impacted regions were operating. The Senate passed a bill to limit college athletes to one school transfer during their careers and regulate collegiate sports. The bipartisan Protect College Sports Act was approved on a 77-22 vote and addresses issues including media rights and fee caps for agents. The bill must still be voted on by the House, which is out of Washington until after the November 3rd elections.

10:56Authorities are saying the director of engineering for New York Times Games was allegedly shot and killed by his 77-year-old in-laws in Dublin, California. The case reportedly involves a pending divorce, child custody battle, child abuse and domestic violence. The victim identified as 40 year old Jonathan McKenzie, legal expert Stephen Clark. This has all the aspects of a deeply personal revenge type killing. So it's going to be important for law enforcement to dig deep into the relationship between these parties and the victim's wife. and what email and text information was exchanged regarding the potential issue of domestic violence.

11:40Last year, McKenzie pleaded not guilty to two counts of child abuse and was released on condition of parenting classes. Wind is whipping Mexico's northern Pacific coast and water has started to flood some streets as Hurricane Polo bears down on Baja, California, sir. The hurricane is threatening flash floods and mudslides. Polo is a Category 3 storm with top sustained winds of 115 miles per hour. Global news 24 hours a day and whenever you want it with Bloomberg News Now. I'm Michael Barr and this is Bloomberg. Thanks, Michael. Time now for our Bloomberg Sports Update. And for that, we bring in John Stashauer.

12:18Thanks, Karen. Monday Night Football in Chicago. The Bears having to use their third-string quarterback, 38-year-old Case Keenum. Hadn't started an NFL game in almost three years. He was terrific. led the Bears to a 27-7 victory over the Eagles. The Vikings drafted QB J.J. McCarthy with the 10th overall pick just a couple years ago. He was injured his rookie season, then didn't play well last year. The Vikings have traded McCarthy to the Giants. The baseball postseason begins today. Four series get underway in New York, Houston, Atlanta, and San Diego. That's the Bloomberg Sports Update. Stay with us.

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13:38The e-rickshaws, like the pedal variants before them, are mostly built in sheds, garages, and makeshift workshops rather than in big factories, driving a micro-economy of small tradespeople across Indian cities who sell wheels, rims, headlights, horns, speedometers, and seats. The government regards e-rickshaws as a way to reduce air pollution and cut reliance on imported oil, and will stop registering new gas-powered auto rickshaws from January. That's the Bloomberg Tech Minute brought to you by ChatGPT. Put ChatGPT to work on your most ambitious ideas and projects. Get started at ChatGPT.com today by selecting work mode available on plus and pro plans dog grooming genius here most people see a busy dog salon but i see operational excellence thanks to genius from global payments scheduling personalized checkouts instant absolutely genius from game day crowds to every groomer in this shop Genius keeps everything flowing seamlessly.

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16:34And good morning, I'm Karen Moscow alongside Alexis Christophorus. And sources tell Bloomberg Iranian officials have privately expressed pessimism about reaching a deal to end the war with the U.S. and reopen the Strait of Hormuz before the midterm elections. This says President Trump continues to insist issues regarding the country's nuclear program must be addressed. Iran will never have a nuclear one. That's a very big thing. because if you want to see turmoil and a travesty, let them take out a city with a nuclear weapon. Well, our next guest says a chance was missed last week to put the standoff toward a settlement rather than escalation.

17:11We get more on that with Bloomberg Opinion columnist Mark Champion. Mark, good morning. Hey, let's get straight to your piece. You say one side just overplayed its hand in Iran. Explain. Well, you know, we're at a point, you know, coming towards the midterms now where both sides have basically said if we don't get some kind of deal before then, then we're going to see escalation. We're going to see a return to bombing. And just today, for example, the chief Iranian negotiator, Mohammed Baal Khalibaf, who's an important guy in part, you know, he's a veteran of the IRGC. the regime's Praetorian guard, if you like.

17:58And he said, you know, if we can't sell oil and no one's going to sell oil in the Middle East and no infrastructure in the Middle East will be safe. So really what has happened is that, you know, the U.S. has been very successful both in blockading the Iranian ability to get its oil exports out and in breaking the Iranian attempt at a blockade. And that success has now emboldened President Trump. He's sounding very confident, says we will win. And he wants to impose his deal, a deal that he's willing to accept. And so the talks kind of broke down. There's still mediation going on. But, you know, both sides are talking about what happens after the midterms with the U.S.

18:52You know, Trump saying, you know, he's considering to return to bombing and the Iranians saying that they are ready to escalate. And by escalate, does that mean broaden the war then and getting more countries involved? Yes. So we know they can escalate in the Gulf. They've done it already. They can hit the east-west pipeline, which Saudi Arabia is using to move oil out of its exports without having to go through Hormuz. They've done that before. They can have hit and will again hit energy infrastructure. So oil refineries, Qatar's gas, natural gas installations, these are huge pieces of the global economy.

19:40And so the Iranians have shown that they can do it and they're basically threatening that they will escalate. And it's really the success of the U.S. that has, you know, reopening Hormuz for international oil, getting, you know, half or more of what was flowing out of Hormuz before the war. That success has now left, you know, Iran in a quandary. So, you know, they either have to, you know, back down and accept terms from the U.S., which this particular regime is highly unlikely to do. or they have to escalate. What about diplomacy, though? Is there still hope for diplomacy? I think so. You know, ultimately, I think that the Iranians do want a way out of this.

20:32You know, they're ready to escalate, but they know that it will be pretty devastating for them. And, you know, President Trump ultimately, a number of times before, he's wanted to do certain things, you know, like to occupy Harg Island, where, you know, most Iranian oil is exported from, and then was persuaded by, you know, his advisors, military advisors, well, you know, we can do it, but what then? We just, you know, become targets, say there's not much we can do after that. And so, you know, it's, there's stuff that he wants to do, and, you know, has wanted to to before, but it's always a question of, okay, so what will that achieve?

21:17How will that end the conflict on the terms that you want? So that remains unclear. And as they get towards restarting the fighting for real, then I think those, you know, diplomacy then has a chance. 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.

22:04Plus, 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. And I'm Alexis Christophorus. Join us again tomorrow morning for all the news you need to start your day, right here on Bloomberg Daybreak.

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