US Strikes Iran Again, Bond Yields at 19-Year High, More

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What is the main topic discussed in this episode?

Francine Lacqua 0:01
Next week on Leaders, with me, Francine Lacqua. I speak with investor and entrepreneur Amanda Stavely on the boldest deal of her career.
Nathan Hager 0:10
That was bold. That was brave.
Francine Lacqua 0:12
Walking away from Newcastle.
Nathan Hager 0:13
It was the toughest decision I've made.
Francine Lacqua 0:15
And what she's looking for in her next football club.
Nathan Hager 0:19
I just want a challenge, and that's what excites me.
Francine Lacqua 0:22
Listen and watch Leaders with me, Francine Lacqua, on Bloomberg Television or wherever you get your podcasts.
Nathan Hager 0:31
News when you want it with Bloomberg News Now. I'm Nathan Hager. And I'm Karen Moscow. Karen, we begin with retaliation in the Middle East. The U.S. has hit dozens of Iranian targets in a two-hour operation following Iran's surprise ballistic missile attack on a U.S. base in Jordan this week. President Trump had warned the U.S. would be hitting Iran, quote, very hard. Israeli Prime Minister Benjamin Netanyahu says he stands behind the president.
Benjamin Netanyahu 0:58
We're partners. We're allies. He's the senior partner. It's the United States of America, let's not forget. And I'm a junior partner, but I'm the prime minister of Israel. And when I have to stand up for the interests of my country and the security of my country, I do so.
Nathan Hager 1:15
Israeli Prime Minister Benjamin Netanyahu spoke in an interview with ABC News. We get the very latest from Bloomberg Middle East correspondent Abir Abu Omar in Dubai.
Abir Abu Omar 1:24
The U.S. military did strike military targets. It stopped short of targeting bridges, civilian infrastructure infrastructure. So for the time being, we're still seeing measured attacks on both fronts by Iran and by the United States, but definitely not a positive sign because we're seeing an escalation. That ceasefire that was signed or that temporary ceasefire that was signed in Switzerland seems to be a thing of the past now.
Nathan Hager 1:48
Bloomberg's Zabir Abu Omar reports two liquefied natural gas tankers were hit with drones off Egypt's Mediterranean coast around the same time as the U.S. attacks. There has been no claim of responsibility. Well, Nathan, as the war takes a toll on the U.S. weapons stockpile, the Defense Department announced two massive contracts worth about $135 billion to major U.S.

What happened in the latest U.S. strike against Iran and which targets were hit?

Nathan Hager 2:09
defense companies. The Army reported a $59 billion agreement with Lockheed Martin to bolster production of Patriot interceptors. At the same time, the Pentagon unveiled contracts worth as much as $76 billion for General Dynamics and Huntington Ingalls Industries to expand construction of the U.S. 's top nuclear submarines. Let's turn to the economy now, Karen. Bond investors are sending a message following the Federal Reserve's decision to keep interest rates unchanged and the news conference from Fed Chair Kevin Warsh. We get the latest from Bloomberg's John Tucker. John.
John Tucker 2:43
And Nate, it's not a good message. The market's questioning Warsh's credibility. Investors sent the long bond yield to a 19-year high. Stocks tumbled, the Dow falling over 1,000 points. It's because the Warsh Fed didn't move, even as Warsh acknowledged an inflation problem.
Nathan Hager 3:01
Inflation remains elevated relative to the committee's 2% goal. The committee remains resolute.
Barry Ritholtz 3:08
You've heard this before, but we will deliver price stability.
John Tucker 3:12
If there is an inflation problem, Torsten Slocke at Apollo Management is like a lot of investors asking this question.
Torsten Sløk 3:18
well, what are we waiting for? We didn't get a clear answer for what exactly are we waiting for, which was, of course, was a subtle way to try to get some forward guidance.
John Tucker 3:26
It doesn't help Warsh's credibility that three members of the Fed's Open Market Committee dissented. If Warsh can take away any solace, maybe it's from the fact that he hasn't been skewered yet by President Trump.

How did Israeli leaders respond to the U.S. strikes and what did Netanyahu say?

John Tucker 3:37
Inflation, by the way, has been running above the Fed's target for five straight years. In New York, I'm John Tucker, Bloomberg Radio.
Nathan Hager 3:44
All right, John, thank you. Well, monetary policy is also in focus overseas this morning. The Bank of England is getting set to make an interest rate decision. Let's go to London and get the latest of Bloomberg's Ewan Potts. Ewan, good morning. Karen and Nathan, the UK may have a new Prime Minister, but the economic backdrop for the Bank of England remains much the same.

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