Zelensky, Antony Blinken, Lloyd Austin discussed on Balance of Power

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News update Ukrainian president zelensky will meet with Secretary of State Antony Blinken and defense secretary Lloyd Austin in Kyiv tomorrow That's according to zelensky who made the announcement at a news conference today The White House declined to comment on the report President Biden says the climate change crisis can't be ignored speaking in Seattle during earth day Biden called it an opportunity to transition to a clean energy economy Here's Julie Ryan The president said that includes mass production of electric vehicles and charging stations across the U.S. Biden signed an executive order Friday on the changing climates effects on U.S. forests We're going to work with state and local and tribal governments to map catalog and then conserve old growth forests in our public lands Police in Washington D.C. say the gunman in an apparent sniper attack is dead after wounding four people yesterday investigators say 23 year old Raymond Spencer recorded the shooting on Friday and posted the video on social media He was found dead from an apparent self inflicted gunshot wound That's the latest I'm Dina kodiak Your listening to balance and power with David Westin on Bloomberg radio My conversation with Bank of America's CEO Brian moynihan continues for his view on how the U.S. consumer is holding up despite rising inflation and interest rate hikes We're not seeing people buy less things yet because frankly because of some of the shortest is any price is fine So they're willing to pay the price So the transaction volume of our customers activity is going up 7 8% the dollar volume is going up higher in that That means you know some of that's just price increases So corporate world is making good profits They're passing through when they can and you're seeing that some of the corporate earnings will be a very interesting earnings season But the reality they're handling the shortages and their payload the inflation It can't go on forever that way and that's why the fed has a job to bring the inflation back in line because that kind of spiral is not healthy but it takes a rapid movement to get more efficient and rapid movement to move price and with more wages people can pay the prices and do the things So when you're talking about your corporate clients particularly you're seeing much wage pressure and therefore margin compression Are they concerned about that They're all concerned about getting workers more than they are about the price because they've all raised wages dramatically Over the last 24 months So to get the workers off the sidelines and you start to see that come true you start seeing just in the last step our economist and Mark was telling me that basically the number of people who quote early retired a large had come back in the system So you're starting to see the people come back to the wage force participation rate has to go back up But it's really kind of get workers It's not the price because people feel the shortage of workers is a shorter project A shortage of products is shorter than sales And you know they're out trying to get them And those people are services business It's even more acute Brian you mentioned earlier that anticipation that the fed is going to be raising rates They pretty much said they're going to do that We heard from the Chicago fed president Charles Evans and the economic club of New York And one of the things he talked about was how far he thinks they're going to have to go This is part of what he had to say Probably we are going beyond neutral I mean that's my expectation when I see that taking out special factors I'm still left with three to three and a half percent inflation That's not what we want If the two and a half percent inflation rate I think we have more things to ponder there So Brian he's saying that he expects at least that the fed will go above the neutral rate Does that make sense to you And by the way do we know where the neutral rate is Well I think our economists likewise going back almost two months ago now put a pretty aggressive I think at the time they said 7 rate increases 7 quarter point rate increases this year and people were like that can't happen And all of a sudden the market moved with him So our people are pretty thinking they got to move pretty hard quickly and they have the license to do it because they're talking about three 50 basis point hikes at the next three meetings and things like that So Ethan Harrison team better to give you the exact estimates But the reality is if you even listen to the chair pal and others and just like the president there the ideas are going to have to move past because the inflation is much higher than what they were dealing with in 19 where there's barely getting the target level Now it's clearly through it And so the move But they'll bring it back down I mean people forget they'll come up and come down if they have to It's not like they just sit there and wait it out So yes they're going to have to move higher than what people may feel short term rate is what the economists believe And I think the data shows it With the move from the fed obviously we're seeing actually the negative real yield actually flirt with positive believe it or not Backup deposit real yield Assuming that happens which seems to be where the fed is heading what does that do for your business The question is if it's done the right way and it's going up for the right reasons you don't have a deep recession The other side banking is making more money because the flip of that real yield is we have been effectively subsidizing our customers because of what we call the zero floor So what is air floors Yeah we real rates go below zero We can't give a consumer less than zero on their accounts We stop at zero That squeezes our margins As the rates go back up we have it Frankly remember I've been CEO of since 2010 And most of my career isn't a zero rate environment It's just a short period of time where it moved and went right back down with the pandemic but the rallies will make more money and we told people what those estimates were for NII at 600 plus $1 million next quarter And then grows from there And we have a 2 trillion deposits and they're very stable and it'll be very good for our bank Given that it's done in a way that doesn't create a deep recession on your side $2 trillion in deposits is really important The last time I checked I think back of America is the largest dollar deposit taker in the world Do you have to pay more for those deposits in a world where you're going to positive real yields in the rates are going up And it's been a long time since we actually bought CDs and we thought we didn't make some money off of them Well that's what happened So the more rate sensitive product goes up But the rowdy is 40% of those 2 trillion are not interest bearing So zero is zero in any environment And the only question is will people pull money out of the accounts that didn't happen last time they actually grew during the repricing cycle we grew all through and even during the 5th balance sheet being leveled off and came down a little bit Now this is different There's just a lot more liquidity in the system and we'll see it in money will go into markets if the returns are better and it's short term medium term treasury rates go up and money market funds have become more attractive but we have those products too So we place our customers where they get the best deal But what drives our deposit base is the huge non-interest bearing checking accounts We have 5 million more digital customers.

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