what do we have to reassess. jenny was talking about how she was wrong with respect to what the rate was and people are as -- reassessing what it means. jonathan: let us talk about what happened to the house. the tiktok built breezes through

the house and then senators line up to say slow down and we take our time in the senate. this could drag on and on. >> it can. and you look at the hawks like lindsey graham, he was on fox and said it was a good question about how he was gonna vote and he said eileen yes that his concern and he is coming in line where the former president is and that is potentially why he feels that way he is concerned if tiktok is not there where did those individuals go and it is the facebook player, the potential google, x, twitter. and the bottom line is and i am astonished to see yesterday the bipartisan support for passing but also the no's. marjorie taylor greene lighting up with alexandria ocasio-cortez, it is not every day. >>lisa: i'm curious about this push because of the political affiliation of the buyer.

the fact you want a conservative buyer to come in. the hearings justify someone's credibility on one side of the aisle or the other before they can take over this because you want to prevent it from the liberal social media companies of meta. jonathan: where is this going? jonathan:i found the whole -- lisa: where is this going? jonathan: i found the whole episode entertaining. when someone sees a good thing, another person has to try to take it for themselves. this is entirely the logic of a bandit. counterfeit and pirated goods from china accounted for 75% of the value of counterfeit goods seized by u.s. customs and border protection. to hear china talk about bandits and stealing other people's

things when the stats sort of say something else about what happens in the mainland lisa: is rather entertaining. lisa:it's -- jonathan: is rather entertaining. lisa: to that point, let's think about this for a second. that's all i can say. >> what social media company is actually being able to be successful in china? none of them. it's a little funny. the tiktok version in china, very different on how they allow children to engage on that platform than it is in the united states. jonathan: more on that story in a moment. a busy day ahead with tons of economic data, economic features on the s&p 500, ahead by one third of 1%. the yields are a little lower, down a basis point. we have gone from the 400 40's to the 400 60's on the two year yield in a short space of time. lisa: slowly pushing back expectations for a june rate cut.

how much do we see this continue? at a certain point, don't we have to have a capitulation to the idea that rate cuts may not be as great as we thought. jonathan: the greek central bank governor was talking up two cuts before the summer break. summer break starts in august for the ecb. 100 basis points maybe this year. when you think about what's the difference between the ecb and the federal reserve for a year ahead? lisa: what do they mean it? because that's what it might come down to. when is summer and when do we have to talk about this? it's fascinating to see the divide, given the fact that the peripheral regions don't need it as much as germany and germany is still be hawk versus some of the others. it's kind of twisted. jonathan: coming up, russ of

blackrock. tobin marcus and julia coronado ahead of ppi and retail sales at 8:30 eastern time. china awaits ppi and retail sales data later this morning. the feds first cut will come in june and we continue to like growth including software, health care and consumer. russ joins us now for more. can i get into the month of june? it feels a little stale. i keep hearing june, june, june. what informs your view? >> i would start by saying something else, which is necessarily the most important thing that's going to happen to the market this year. i think june is a reasonable baseline.

the fed selected the cut three times this year. the market started the year differently. at the end of the day, as you mentioned a few moments ago, the market has been remarkably resilient as we have repriced from seven cuts down to three and begun from march to june. i would say that whether the fed goes 4, 3 or two, is maybe not as important as the fact that long-term yields have been relatively contained. the economy is still solid. we are likely to get two to two point 5% real growth and 4.5% nominal growth. this is why think the market continues to move forward even as investors repriced these fed cuts. lisa: -- you've got equal weight outperforming as this rally does broaden out the equity market. it all began because the fed was going to start cutting rates.

now, they may not cut rates as quickly and it keeps on going. is it really justified? >> i think it's a fair question. stocks have had a big run rate it would not shock anybody if we had a 6% pullback in the not too distant future. i think there is an important difference between two or three cuts and no cuts. this is what investors have to be aware of for the market. which is that you can live with slightly less easing by the fed if it is happening in the context of a strong economy and strong earnings. if we get to a point where inflation is so sticky that the fed goes the entire year and does not cut, i agree that that is qualitatively different and something that probably leads us to a different conclusion. if you get 2, 3 or four, it's probably not a big -- as big of a driver is what's supporting the stocks. including a lot of cash on the sidelines.

lisa: you said one of the reasons people have gotten this enthusiasm is because of the stability and long-term rates. we saw that with the 30 year notes. pretty successful and strong. we keep talking about how the leverage has been shifted to the u.s. government and at some point this is going to be a problem and it will be reflected in structurally higher yields. why doesn't that give you concern? >> i think it is concerned but it depends on the timeframe you look at. speaking with clients yesterday, if you're talking about the deficit, i think this is a real issue. it is structural, as everyone knows. it's not obvious that this will derail the market in 2024. does it come up in 2025, 20 26, 2027? hard to predict. in the short-term, they will focus on what is the volatility of rates come what's happening with fed cuts to a degree and what's happening in the economy. as you were talking about, the labor market remains remarkably strong and jobless claims remain

low. we have an environment where earnings are coming into be strong. that's more likely to drive the market over the next two-three quarters than the federal deficit. jonathan: if it's not on supply, what's it on? >> it's mostly on supply. this is where you have concern about the deficit short or long-term. it doesn't necessarily mean you're going back to 5% but you have two to 2.5 trillion dollars that you have to sell of gross environment. many of the buyers are less engaged. the fed is shrinking their balance sheet and the term treatment, the -- the return treatment, the incremental return is relatively small. when you look across the different asset classes, in our opinion, there are better places to be read we remain modestly underweight with most of that on the long end of the u.s. curve. jonathan: you're killing me in the space of 60 seconds.

it doesn't matter, it kind of matters. a little bit of japan in the mix. i want to talk about that little bit of japan. a big move on the nikkei. starting to see a call back after the yen started to strengthen. what's the relationship between the two? >> the yen makes a difference but it affects what part of the market you are thinking of. we still think there is upside. i think people are aware of normalization of monetary policy. what i would add to that is as we spoke about in the "the market globally is run. japan is where we still see the best value. i think we are going in a cycle in japan where use shift -- you shipped exposure of it. banks have had a great run, are they going to leave the market going forward? maybe not. we still think this market has

upside. you may be start to think about where are you in this market, relative to where you might've been six months ago. jonathan: how crowded is that trade in your mind from your perspective at the moment, given how excited people seem to be about it in the last few months? >> when i look across all of the world, i don't think it's the most crowded. it's been a huge run but let's put it in perspective. you just got a high that was established in 1989. this was a market that i can tell you from talking to individual investors that no one owned for a very long time and forgot about it. yes, people come back into japan over the last year but it was very owned for a very long time. jonathan: it's underweight at the long end on the u.s. treasury curve. supply matters just a little bit on the equity market. let's talk about japan pre-have you seen shares of toyota over the last 12 months? compare that to tesla.

we will talk about the auto makes a little later. that is about toyota committing to hybrids and not making the move to go into be pure ev play like we have seen from other manufacturers and they have benefited massively from doing so. lisa: i think if someone breaks down how much of it is because -- i think someone should break down how much of it is because it is a japanese company and how much of it is because they are going hybrid. it sort of exemplifies why people are going in beyond just a currency trade that may or may not continue to be a positive. jonathan: it's still a question. you drop from 150 to 140 or 130 or 120. where does that leave of the stocks? lisa: we will find out because japan officials are saying probably april is the time. jonathan: 147.82 for the

dollar-yen. >> janet yellen says it is unlikely market interest rates will return to pre-pandemic levels. the u.s. 10 year yield averaged two point 93% through 2018. -- 2.93 percent through 2018. it now sits just below 4.2%. saudi arabia is pushing ahead with one of the largest stock offerings in recent years. the kingdom is said to be in talks to add wall street banks for a secondary share of sales with aramco. they plan to hire j.p. morgan as one of the main underwriters to be offering. morgan stanley is also a contender for the deal. rent in manhattan, rising during a busy february for leasing. the media rent for new leases came in at just over $4200.

up 3.3% from a year ago. the number of new manhattan leases signed in february were up nearly 8% from last year. rent typically drops during the winter months but apartment prices have not let up. that's your bloomberg brief. jonathan: a big month in manhattan. we will talk about that -- don't want to talk about that a little later. lisa: you don't want to think about it. >> we have invested to keep your data safe on all platforms and will continue to do what we can. including exercising our legal rights to protect this amazing platform. jonathan: that conversation coming up next. live from new york city this morning, good morning.

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jonathan: stocks on the s&p 500, positive by one third of 1%. unchanged on the 10 year, 4.1938. for surveillance this morning, tiktok's fate resting in the hands of the senate. >> just wanted to share some thoughts on the disappointing vote in the house of representatives. we have invested to keep your data safe on all platforms. we have committed that we will continue to do so. we will continue to do all we can, including exercising our legal rights to protect this amazing platform that we have built with you. jonathan: a fight over tiktok heads to the senate after the house overwhelmingly passed a bill to ban the app or force the sale from its chinese parent company. chair maria cantwell says she is concerned about americans data, stopping short of committing to taking up the house bill.

he does not think anything happens before november. you have five reasons to why it won't happen. what are they? >> thanks. the senate has a long history of killing house bills. two, i think we are already seeing key senators show a distinct lack of enthusiasm of picking this up. you mentioned cantwell, she has a competing approach. she and other senators are going to chafe at the idea. they need to follow the houses lead, that's not how the senate operates. the congressional calendar is a complete mess. this needs a vehicle to ride along and it's unlikely it gets a standalone senate vote. there are a not -- not a lot of those vehicles going around and the closer to november we get, the more they will get into campaign mode. number four, trumps flip-flop. heading into a campaign, there

will be reluctance from democrats to do this in a way that lets trump say i stood against this and did not want to take away the service that people like. there is an implicit bargain that the blame on this needs to be spread around and trump has thrown that out the window the past week. -- in the past week. there are also first amend meant concerns. there is uncertainty about how litigation would go based on what we are seeing in the proceedings around the montana state ban. that will be a concern for senators also. between now and november, it's hard to see how and when this moves forward. lisa: given that reluctance, is that why chuck schumer put out one of the most vanilla, lukewarm statements i've ever seen come out of the senate, saying the senate will review the legislation when it comes over from the house. this past overwhelmingly with bipartisan support and schumer is like maybe we will get to it. >> when the house says jump, the senate does not say how high.

they say may be some time. they have their own bills. you see some of the senate leaders on this issue get in line trademark warner came out and said that's move ahead with this particular bill. but in general, there is a lot of turbulence between the house and senate. no love lost between the chambers, even when they are looking at their co-partisans on the other of the capital. it's not surprising at all that schumer is responding in this essentially empty way that leaves all of his options open based on how conversations go. annmarie: it's still under review. if congress does not act, what happens to that review? >> that's a great question. we are on year three or four of that? i think the general understanding has been that the administration is apprehensive about moving forward. with their fairly open preference to compel or influence a divestiture, based on concerns of how it would go in court if they were to order

that. the paper trail going back to the trump administration and whether or not it amount to a plausible security case that is free of politics is of concern. everybody i talked to inside and outside the ministration has a lack of confidence in their ability to prevail in court if they were to move forward. it seems to me like that probably stays in limbo too. they don't want to sign off on the litigation plan that the tiktok folks have moved forward but they understandably are not eager to take their chances in court. lisa: it becomes more calm look at it when you have the argument over who is an acceptable person to buy said tiktok. how realistic is it that there would be any kind of agreement and which company would be viable? which company has the funding and what the government's role is in facilitating that? >> beijing has said openly that they are not interested in

proving a divestiture and that has been the message. they are going to exhaust their legal options and fight this until the end of the day before going along with this. the logistics around figuring out who has the financial capacity to absorb this would make sense as a buyer. how you manage the antitrust concerns is very real also. i think the biggest obstacle is probably from the chinese communist party in terms of willingness to prevent. jonathan: i want to finish on the former president trade we talked about this over the last few days, a complete 180 from where he was 3-4 years ago. we are trying to figure out what that could mean for u.s.-china relationships under trump volume two. what does that look like, tobin? tobin: absolutely. i think that there is an expectation that the u.s. uniformly gets worse under trump. he has his proposal for a 60%

tariff on all u.s. imports from china which would be a drastic escalation of the trade war. we saw in the first trump administration and we are seeing now that there is a great deal of contextualism. if you are willing to fire him from the u.s. side and the xi jinping side, there is a selective easing on various different points. in the early days of covid, he was complimentary of xi jinping's covid containment strategy based on the fact that they were trying to close the phase one of the trade deal at the time. the chinese are using this as a propaganda tool. in taiwan, there is an open effort to tell the taiwanese that if you're relying on independence from the mainland is on the u.s., trump is not the guy for you. jonathan: appreciate it.

tobin marcus of wolf research. we are going through a list of u.s. companies that have the money. it's a long list. and u.s. companies that might get the green light from washington, a much shorter list. we have to consider they want it to be sold. lisa: witchy things is a more likely potential vehicle and what this could do in terms of the tit for tat. jonathan: much more on tiktok throughout this morning. coming up, troubles facing tesla and the ev market. tesla is down 1.4%.

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jonathan: live from new york equities positive across the board here up one third of 1% on the s&p 500. on the nasdaq we are positive. the small caps doing ok .2%. i want to talk about the front-end of the yield curve looking at a two-year yield right now. yields on monday up six basis points on tuesday. on wednesday a little bit longer this morning but yields are certain to grind high through the week. we started at 448. we are now in the four 60's. >> people are flirting with fewer rate cuts. they dismiss that as being a bit

of histrionics but they say the market if it had a voice we are not so sure about how many rate cuts can come this year given the hot cpi print we've got even it continues to chug along. the key question is when this becomes harmful. when higher rates suggest slower growth going forward pretty slower growth is something this economy can happen just fine. jonathan: looking at the headline numbers on aggregate. let's push this through fx. this is a question that's been asked a lot. ultimately they pointed out just yesterday and their note where the fx strategists were where they expect euro-dollar to decline. the fact of the matter is it all makes a lot of sense but in reality it's not how things are playing out. the euro-dollar we have not seen that pronounced weakness, the move towards parity, were talking about recently on this program. lisa: you said it was because of

positioning. i don't know the answer to this. is it because they think the fed isn't going to necessarily remain as high as they are, they will cut more aggressively to they think the region is already priced for recession and is doing better than that? i'm not sure what this is suggesting because if you look at the narratives it would make sense for the dollar to be stronger. >> have we seen peak u.s. exceptionalism. i think a decent example might be what's happening with sterling. moving back to 130. plus another 1/10 of 1% is the growth inflation takes in proving in places like the u.k. where it's been pretty terrible over the last year or so. >> it's a great question and has it peaked or people getting sick of it i'm concerned it's overly crowded looking for other places to dip their toes and say what looks cheap. later on in this cycle it would be great to go into small caps and international stocks and you

might as well get ahead of that even if it's not happening just yet. how much of that is what we are seeing versus natural peak of what people are calling for for a while. >> she was talking about equities. they were dying to get that shift away from large capex towards the russell. that's where the options market was leaning into and it has been for a while. lisa: looking for that shocked upward move. if you look since the middle of february the russell 2000 is still underperformed even as equal weight outperforms even as you see small caps rather large caps not necessarily outperforming russell still hasn't gotten off the ground. jonathan: under surveillance today u.s. retail sales, traders waiting to see if the inflation report will confirm or deny this hotter than anticipated cpi data. bloomberg economics expected month over month from 0.3% prior

prayed investors will look for a possible rebound in retail sales after weather and seasonal adjustments on the figures from january. retail sales ppi jobless claims take your pick. lisa: it is the last inflationary before the fed's meeting. it does go into the pce core reading of the fed. put that aside for a second. curious to see if you do get hotter than expected ppi report does the market finally react to the way we think they ought to give and what a lot of people are saying. annmarie: how they reacted matt -- after interested in retail sales talking about what walmart had to say in january the walgreen ceo, retail customers are under stressed and making deliberate choices to seek value. does this resilience continue. is it good to be seasonal or is it actually going to be softer. >> let's get to janet yellen. the treasury secretary morning

we may be in a new normal for interest-rate speaking to saying i think it reflects the current market realities and the forecast were seeing in the private sector. it seems unlikely yields will go back to being as low as they were before the pandemic. telling biden's economic policies including the inflation reduction act. >> treasury secretary janet yellen hardly with a controversial take on the bond market at the moment. annmarie: she shifted her language. january of 23 she said they were more likely to come down in line from where we were before the pandemic. january of 24 she says the jury still out and now she says it is unlikely. she did explain for most people when they think of transitory they think days and months, maybe not years. she has said she regretted it before.

from my reporting it was janet yellen who is behind the scenes saying we should be careful on inflation it might not be as quick as you are expecting great she also said the trend in inflation is favorable but might not be smooth. that's what the fed is dealing with. >> deals done in washington at the moment. resid and biden expected to voice concerns over the deal to buy u.s. steel. shares of the company falling by the most in nearly four years. they offered to buy it for $55 a share in cash. the company says the deal would strengthen u.s. jobs and national security. biden hits the campaign trail in rust belt states later on today. if you think it's difficult of the moment between the likes of bytedance and congress in washington, japan is an ally. and we think there's national security concerns around this. >> you're doing this right before the representative from japan is going to come and join

the white house. it's kind of an embarrassment to some people are saying to basically double down on this and it raises this question do you put your campaign in to become the most union friendly president out there ahead of an international relationship that's key to potential national security braided -- security. annmarie: this statement will come before the prime minister heads to washington. this is an election issue. trump said he would ban it outright. in february the union said they received personal assurances that biden has our backs. look at pennsylvania. trump winning pennsylvania 2016, biden winning in 2020. i don't think this is a national security issue. >> let's move on to tesla. hit by downgrade from wells fargo. calling it a growth company with no growth. losing nearly one third of its market cap to start the year. more struggles for ev's. the startup plunging after

report from the wall street journal what the company prepares for possible bankruptcy. we got yesterday a downgrade to tesla from wells fargo. catching up with them a little bit later. a bit of an upgrade on traditional automakers in the u.s. from morgan stanley. where is this market going and where is it right now. >> we ubs out with lowering their price target on tesla to 165 i think they were to 25 beforehand. but we are seeing is a very clear indication of the part of their ir team canvassing the analyst to say you need to take your numbers down and really setting expectations much lower for the first quarter of the year when we look at what's happening in the u.s. and in china with a real slowdown and momentum for ev's. and with tesla saying to start the year we are going to have a

notably lower growth rate. this is a case of we haven't necessarily seen consensus, down to sort of respond to that. we are seeing delivery expectations dialed back to a significant degree, price targets and recommendations are being adjusted as a result of that. morgan stanley coming out and really sort of questioning whether or not it made sense to spend as much on ev's which i think is a little bit late to be honest. i think we've already seen the likes of gm and ford and others really dial back their investment in eeev's and even in volkswagen case in germany altogether the plan braden -- the plan. jonathan: it's no growth. i was going through the estimates from wells fargo. no growth this year, negative volume growth next year. i have no idea what kind of

multiple you should put on a name with no growth. i look at other day -- names like toyota. pure ev's aren't doing well at all, it's the hybrids. you and i talked about gm entertaining the idea. is that with the market is now. in the next 18 to 24 months. >> it absolutely is where the u.s. consumer is in we are seeing acknowledgments even in detroit of this idea of maybe we need to rethink hybrids. i think keeping -- i think in businessweek they had a great in-depth story about the fact ford which just a year-and-a-half ago was really sort of beating their chest about bringing out the f-150 lightning, of the amount of investment they were putting into eeev's, jim farley really talking about this being the way forward and setting its sights on tesla. farley is a former toyota

executive, they've really sort of rethought their plans and you are seeing a hybrid f-150 offering. you are seeing toyota not being able to keep up with demand for models like the prius and hybrid rav4. i think we are absolute going to see some challenges with some pushback on the part of the consumer in the u.s.. even over here in europe, toyota sneakily under the radar has really built a heck of a business building and selling hybrids when 10 or 15 years ago the germans wanted us all to go in the direction of diesel and we all know how that ended up. toyota has not gotten the credit it probably deserves questioning just how ready the consumer was to go fully electric and this is a palatable solution to bring

emissions down from where they would otherwise be while not necessarily regulators would like the industry to get to. lisa: i wonder if we can write the chapter on electric vehicle subsidies. the discounts people got for buying ev's in the united states prayed was that a failure? >> i think it has been a really complicated issue in the u.s.. in order to give them a new lease on life, joe manchin insisted he needed an american supply chain for batteries and for ev's to be made in america. that's all well and good. of course very much in keeping with the biden administration's agenda. the huge complicating factor is we don't have some -- battery supply chain in the u.s., we don't have minds and processing to bring cheap ev's to market the way china does. if we are going to push the

industry to do that it is going to take some time and you are really good to go through some growing pains because it will be more expensive in china for quite a while before we even start to close that gap. if we are not willing to sort of put up with the challenge that that's going to be, that it is going to alternately end up in failure. >> to breathe some new life into the ev market, the u.s. would have to say not all of those goods need to be produced in america and it actually welcomes some of the supply chain components from china. >> i think there's absolutely some pushing on the part of some members of the industry to say we need some relaxation on these rules, on the other hand you have parts of the supply chain that say we need the support of the industry and to sort of move forward with this plan to sort

of lean ourselves off of china. our projects that were trying to get going in response to the ira are just not going to survive. they are not to be viable. there's a real sort of tension within the industry and some of the players that aren't necessarily typically working with automakers and their suppliers of exactly how quick do we need to move in order to make this all work. i think a real sort of you can also tell some hesitancy on the part of folks in washington were essentially any time the treasury department has had to make a decision about how they move with these and when are they going to formally implement some of these requirements. we've seen so much campaigning and i think that something we are going to continue to see. >> big reality check just pushing back the timeline. great to catch up. my favorite graphic right now is

the one year move that we see in toyota versus tesla. this is hybrids versus ev's right here. toyota is up by more than 90%. tesla down over the next -- and a quote from adam jonas of morgan stanley jumps out. ev's may be the future, they are struggling to be the present. hybrid sales growing faster than ev's in the united states. that's where the market is. lisa: that's where the hopes and dreams have been shattered. it had so much from its peak, we've seen peaks hope -- peak hopes and dreams. no we are building with the present is. jonathan: that conversation continuing later. we will speak with wells fargo on tesla. after calling the ev maker a growth company with no growth. that story coming up later.

here's your bloomberg brief. >> a bill aims at forcing a sale of tiktok is moving forward. the house passed the bill by a vote of 352-65. it heads to the senate where its prospects are less clear. chuck schumer said he will review the bill. investors await the highly anticipated reddit ipo. the social media company giving guidance on its expectations. reddit is telling potential investors it expects revenue in 20 to grow by more than 20% versus the previous year. according to its filing with the sec in 2023, the company's our revenue just over $800 million. donald trump is starting to think about what his cabinet would look like if he is reelected in november. bloomberg's reporting the former

president is set to be considering billionaire john paulson as his trickery secretary. other potential names in the mix have a poke -- robert lighthizer and billionaire jeff yes. >> you know how this is going ago. like casting for hollywood movie. it's good to go for months. he's got a do some speeches and throughout random names. this is good to go on forever. >> he spoke after the new hampshire primary saying he makes money everywhere he goes. he can make money anywhere. maybe he will be my treasury secretary. >> up next to the fed's elusive inflation target. >> the market got way ahead in six to seven rate cuts. they want to ensure they are actually successful getting inflation down. the not so good inflation prints we saw a recently reinforced that. >> big morning for economic data

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>> stocks rallying by one third of 1%. a little bit of it lift. 10-year just short of 420. euro sliding. against the u.s. dollar prayed under surveillance this morning the fed's elusive inflation target. >> the market got way ahead of the fed orders when the market was pricing six or seven rate cuts. getting inflation down to 2%. the not so good inflation prints we saw a recently just reinforce that. i think the world isn't going away the fed reserve were expecting. i think there's plenty of time to see how this develops.

>> here's the latest this morning. next week after two cpi prints this year. we expect the fed to hold rates steady in a unanimous decision. our base case is the fed will indicate they are in a holding pattern for now with minimum changes to the policy statement and the baseline outlook including the expectation three rate cuts may be appropriate. julia i want to talk about a difference of the moment of what we see in cpi and what we expect to see in pce. >> that is the question. certainly when after the january what we were hearing from fed officials was it was sort of an anticipated bump on the road so is bill dudley was just saying the market has gotten ahead of the fed. the fed had built-in bumps on the road and there baseline

outlook. that's why they had a more patient path for rate cutting than the market earlier this year. the question is whether february has rattled that confidence. february was only a little bit better than january. another bump on the road perhaps. we will be launching the fed raises forecast for year-end. and whether it reduces the number of cuts in its baseline from three to two. it doesn't sound like they need to do that right now. and three rate cuts they can start in june, july. they have more data by then. they are not in a rush and that is the holding pattern idea. they haven't gained more confidence, they have not necessarily lost confidence. this is sort of an expected bomb. but they will have more ahead and they will take their time and get out of that data. lisa: is there anything about the recent data that surprised

you, that's made you re-think a couple of baseline assumptions? julia: that's a great question. i would say the january data that we had worries some jump in housing inflation, that reversed in february so that was a bit reassuring. we were on alert after the january reading but there is still the open question as to when that housing inflation takes another step down. it stepped down last year. all the leading indicator say it should go further. it really hasn't yet and it's been kind of flatlining for six months or so. that's one thing we think we are going in the right direction there but we really need the data to confirm that and the timing and magnitude are highly uncertain. that is the question about when exactly we are going to see that break down to a new range in housing inflation. >> have you rethought the longer-term rate of expectations

as janet yellen brings up the fact we are probably not going back down to pre-pandemic levels. do you feel at the recent data has confirmed because it's a new dynamic in the economy that we will leave rates higher and inflation higher for a longer amount of time. >> certainly i think rates are probably going to land at a higher level this cycle. i think that that doesn't necessarily have to come with higher inflation. i think the fed can get down to its 2% target but i think the economy has a better productivity trend this cycle. we are not deleveraging like after the gfci. there's a lot of indications, business formations, the investment strength that we have seen from businesses that we could be on a better productivity trend and that would mean a higher neutral rate for the u.s. economy. that isn't necessarily where we are right now.

5.5% is the new neutral. it could be 3% to 3.5%. that seems perfectly reasonable. >> when we get ppi later this morning what are the pieces you are more focused on than others? >> there's a few key pieces. the overall and the core ppi don't necessarily mean anything for us. what we are looking for is airfares, some complaints of financial services. some components of medical care. those are directly taken from the ppi and go into the pce. we will get a much better handle on whether pc e will be better or worse than cpi. what we saw in the december press conference when chair powell acknowledged they updated the forecasts after the ppi on fed day, the fed is watching this data as closely as we are.

it will be important to see those details. >> good to see you as always. just got a headline from the president talking about u.s. steel. u.s. steel should remain domestically owned and operated. your take on this one. >> this is about shoring up union votes and we cannot stress how critical pennsylvania is for both of these men. trump winning in 2016. biden in 2020. this says to me election issues of the unions and jobs is coming before a key ally. this is not china. this is not iran, this is japan. >> coming up next, brian oui's are, and rolf, the conversation coming up shortly. the second hour bloomberg surveillance up next. ♪

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>> we have continued to see equity markets continue moving up when companies are doing well, earnings are positive we are out of the earnings recession of last year. fundamentals are good. >> that's good to be what's propelling stocks higher. is the fundamentals. >> businesses are in good shape. from a balance sheet perspective. >> we are approaching the equilibrium. >> this is bloomberg

surveillance with jonathan ferro , lisa abramowicz and annmarie hordern. >> the second hour of bloomberg surveillance begins right now. good morning. for our worldwide this is bloomberg surveillance. your equity markets positive on the s&p 500. you had very little data in the past when he four hours. driven by the price action. in about 90 minutes time. >> does it matter, is a good and narrative at all. it was supposed to be the most important risk on a risk off event of the week and did have some interesting nuggets. it was treated as a done in the market. when will this market take a signal from the data being dismissed. jonathan: would you prefer to talk but a single name instead. u.s. steel is down by more than 5% in the premarket. this stock got hammered in the session. this from the president of the united states, u.s. steel should

remain domestically owned and operated. annmarie: we thought it was good, according to the first reporting that. the white house must've felt the tremendous amount of pressure after this leak. this has been under review for national security concerns but biden had pledged according to the unions he had their backs. he is really choosing the election, the politics of this. over if there's any potential national security. the bigger issue is this is an ally. how awkward is it going to be when the prime minister of japan comes for a state dinner and they decide it looks like they're going to block this deal or clearly putting their thumb on the scale here. >> it's important we remain powered by american steelworkers. i told our steelworkers i have their backs and i meant it. it's been iconic steel company for more than a century and fighting to remain an american steel company that is domestic

lyon and operated. it is election year and it is not business as usual in america in any way shape or form. >> national security is doing a lot of heavy lifting. we are talking about potential national security issues for national security -- for vehicle manufacturers and import export. will this be a sort of catch all phrase when someone doesn't like something and wants to have an opinion on it. national security certain concern and the true national concert he -- security concerns with the political usage of that phrase. >> tiktok yesterday, chinese ev's a few weeks ago. where are we going to find out the final call on what's good happen with ev's from china? annmarie: that's something the commerce secretary is looking into and also treasury i imagine. the president said we could see more of a tariff on the cvs but

that is north of 25%. for china ev's coming in so no one's really good to be buying a chinese ev with that tariff. what happens is a potential backdoor. byd looking into mexico. can these and up making their way to the united states. jonathan: yesterday absolutely hammered u.s. steel was down and was 13%. the broader market is doing ok away from this. stocks are higher bouncing back from yesterday's losses. the bond market yields going nowhere on a 10 year. going somewhere monday, tuesday and wednesday and that somewhere was higher at the front-end of the curve. annmarie: -- lisa: tick by tick people are pushing out their expectations for rate cuts. the auctions have not been terrible. you've seen this rush of money

into bonds despite some of the longer-term concerns which raises the question what narrative should be followed next. at this point nothing is being consistent -- has been consistently working. i think there is a sense, i asked one person how has it been. they said it's really boring. i said what are you doing and they said we have to resist trading because we are bored. there's this feeling when do we actually get something definitive. >> i'm guessing that person wasn't bullish. it's boring when it's not going well but it's pretty chill when things are going well. lisa: it's just that it is a boring trade to continue with. it's been the same one and there's not a lot of nuance to it. all the ideas of how things will percolate out are not working. jonathan: they are not entertained by ai. coming up on the program more on ai and glp-1's.

why tech is ripe to cool off, brian oui's are on what tiktok means for social media companies and rolf on the volatile and challenging outlook for shipping companies. big tech pulling the s&p 500 away from all-time highs ahead of more u.s. inflation data. saying it's time to look elsewhere writing while we continue to favor many of the mega tech and tech related companies longer-term they are overbought and right to cool off. industrial materials are encouraging and present newer opportunities. let's get to those newer opportunities. what is it you like about energy right now. >> i think part of it is getting caught up in this cyclical trade that's migrated out of these tech names and helped to prop up some of the cyclical areas you talked about in dutch that i

forwarded in my notes. energy is among them. we know opec-plus has been stringent with their supply. we have not seen the minutia and demand we've otherwise expected coming into this year. but also china and india and others, we are likely to see 1.5 to 2% and again with the constraints even though we are seeing some oil being pumped out of nigeria was expected otherwise. and with the dollar having weakened here by about 2.5% to 3% over the last month or so that's also helping to be supportive of oil prices. sowden met with a decent economy domestically and some improvement emerging globally to

me that is the ingredient for why oil prices are being propped up and continue to grind higher. a profitable scenario for an energy patch that's been a laggard over the last 12 months or so. >> basically saying the market faces a deficit all year not just the next few months but all year 2024. why hasn't crude rallied more. reclaiming that very recently. brent close to 85. for this to work for you do you need crude prices here or to get them to keep rallying. >> it doesn't need to go up significantly higher. it's somewhat surprising over the past four or five months obviously on the path for the middle east with concerns around iran's proxy contribution to that exercise taking place that

could have ramifications, obviously higher prices to avoid those areas with regard to turmoil taking place. it's interesting that investors have continued to move that's fairly localized at this juncture and is likely a pause in the spite. $80 for west texas are more still exceedingly profitable for these industry companies with regards to their capital allocations and made technological advances that have lowered the breakeven rate such that they don't have to see significantly higher oil prices for them to be exceedingly profitable. even though they've had some tough costs throughout 2023,

earnings are expected to improve markedly over the next 12 months. >> there's a pretty big implication in the trades you like. it's energy, it's materials, industrials that really underperformed in the past year or so as we came to the services after the goods focused pandemic buying sprees. does this imply the goods inflation, a re-inflation we are seeing could continue. all of that demand is getting back into goods that we will see, through the other readings going forward. >> i think it's a great question and i believe there's an element of that. if you look at some of the numbers. lisa was mentioning it it's amazing investors look through the cpi number and even last week's number, the core services act housing are super core inflation on the month over month basis.

for the cpi course services. that the fed would like to see because a big component of that is wages. with regard to their wage tracker. showing wages on a year-over-year basis. similar to that of january. course money to inflation rate of 2% which jay powell says he earmarks closer to 3%. the reflationary narrative is bleeding into some of these sectors. there's also a tsunami of fiscal moneys being leaked out of the chips act in the ira act that is helping to propel companies profitability in the materials like infrastructure build here domestically and defense spending is benefiting from the breakout in the global tensions

which is not just a u.s. phenomenon but a european one as well. that's helping to provide feedstock to those companies that provide industrials and materials but also we spoke of energy. you can also see it in some of the base metals percolating. look at copper prices moving above four dollars a share. gold has broken out to new all-time highs. look at silver above $25. even lithium looks like it started to form a bottom. some of this is supply related. or maybe you have to reflationary starting to emerge but also globally which isn't to say the renewed hyperinflation but perhaps it may remain high and perhaps much stickier at levels above that which otherwise would be sort of treated as an expectation and its dissent. linearly on the stock. jonathan: we've got to leave it

there, lots to think about. talking about exactly the same thing. she's focused. lisa: how long can that fiscal spending a long can you get that transferred to all of these industries. where has the leverage shifted. this is a reason i care about this. >> i've got an interview you might like as well. reading your mind. here's the quote from him. washington has a very relaxed attitude towards debt. it's not just the free lunch but congress perhaps have gotten used to. he does not know the upper limit of all of this and nobody does but ultimately the base case is at some point they will test it. annmarie: so far from interest cost.

there was more than 40% the prior year. paying off our debt in the next decade will be the top line of the u.s. budget. that's insane when you think about it. lisa: to me the issue will be the true weakness prayed where's the impulse to support the economy. if you're borrowing into weakness could you see a much more difficult climb in a benchmark rate sprayed that is really where the rubber meets the road. jonathan: look out for wall street week a little bit later this weekend. here's your bloomberg brief. yahaira: the bill proposing a tiktok ban on u.s. app stores heading to the senate. unreasonably suppressing the app. u.s. ambassador to china nicholas burns. >> we heard a number of complaints. about the american ban on

tiktok. i find it supremely ironic. government officials are using the platform x to criticize the united states. they don't give their citizens the right to use instagram, facebook and it is ironic indeed. when they shut down access one for just one point 4 billion chinese to all these platforms. yahaira: investors await the highly anticipated reddit ipo. this social media companies giving guidance on expectations. it expects revenue to grow versus the previous year. including its filing. the company saw revenue over $800 million. rents in manhattan rose during a busy february for leasing. medium rent in february came in

over $4200. that's 3.3% up from a year ago. the new leases signed in february in manhattan were up nearly 8% from last year. rents typically dropped. that's your bloomberg brief. jonathan: just got a tweet. you seem stressed. just how lisa gets. first-time viewer. lisa: it's pretty much an evergreen statement. the tiktok bill heading to the senate. >> i want to divest the chinese communist party from our data. if you shut down tiktok and there's no competition for meta and facebook and google, they become the most dominant force in america. jonathan: that conversation around the corner. live from new york city, good morning. ♪

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jonathan: we are not doing that. equities on the s&p positive by one third of 1%. yields look like this. foreign exchange the euro 1.0 940. under surveillance this morning the tiktok bill heading to the senate. >> i want to divest the chinese communist party from our data that's going to require americans. i'm leaning yes but here's a problem if you shut down tiktok and there's no competition for meta and facebook and google, they become the most dominant force in america so i would like to have somebody in the conservative world by tiktok. jonathan: we can get into that in a moment.

the tiktok bill moving to the senate after passing in the house by a wide majority. they're facing the u.s. ban unless its parent company divest the platform. estimating a band would leave as much as a billion dollars in ad revenue looking for a new home. even if digital advertising continues its gradual deceleration toward industry level growth rates next year could come out to be a good one for most digital sellers if it took effect. we've got to dance with a lot of what-ifs. so forgive me because they have no idea if it gets to the senate or passes the senate what happens next, can we just start here. potential buyers if they did divest it do we know who they would be? >> i can't imagine anyone realistically buying it. the only one biggie -- buying it would potentially be microsoft and even they have a big advertising business to start with. the most realistic scenario is if this passes we get a

situation where china says yeah, we are knocking to let that happen. or they literally split off independently and those of the only two plausible scenarios. pulling out of the u.s. is not realistic. jonathan: i want to pick up on that language you used. you say china won't allow it but bytedance says they are not controlled by china. brian: the electoral property forever thing i've read is controlled by chinese governmental supporting entities. lisa: it's the reason a lot of people are seeing it as basically a proxy war between the u.s. and china and questions around media dominance. i find it interesting about what lindsey graham said about a conservative buyer. why don't you regulate social media platforms like news outlets if were basically saying the algorithm will determine whether it has a conservative or liberal bent. brian: the logic when it came to

broadcast weighty -- broadcast radio waves. foreign owners, they could always own print, they could own -- i think the bigger issue is is there a national security, a reasonable basis for this. that's why this isn't just a first amendment issue. annmarie: rupert murdoch became a u.s. citizen so he could take over u.s. cable network and beyond that also just not just cable but wall street journal and etc.. can you see someone outside the united states buying this. brian: there's no one big enough so it makes way more sense to think of tiktok as a stand-alone entity and may be a way to think about the licensing or possibly just completely sever it. from any beijing-based operations. it's hard to imagine that because it's so integral to what

they do. the whole special sauce of the algorithm is developed by engineers in beijing so how do you separate that? it's a separate and the ferrari engine from the ferrari car. annmarie: this is what we heard from the fcc commissioner it's not the content it's the conduct. if that's the case why would a first amendment holed up in court? brian: i don't think it does hold up in court prayed jonathan: who benefits from this? brian: it depends on who takes advantage of the situation. if there is a billion in the u.s. alone that would suddenly have to find a new home. the creators that make a lot of content, they will look for new homes firstly so what really matters is does a snap, and instagram, does even a reddit start creating new creator deals to offer and make it attractive for other creators to spend more time with those platforms. jonathan: what's special about the deals on tiktok? brian: it's just who do you

produce content for first. if you're a creator he may content on tiktok you're doing it to the exclusion sometimes of instagram or for someone else. in the case of youtube sometimes they have exclusive deals. that will drive who is. so snape could double their size if they said here's a billion dollar creator fund. >> are advertisers talking with their feet in anticipation of some sort of transaction? brian: this is all happened too soon for the advertising industry to react. there's no reason why they would pull their money out. >> and no reason of concerns over national security and other things. why two soon? i wrote about this last year and people been writing about it since 2022, 2021. how is this too soon for advertisers. >> obviously blind siding tiktok

but you have to think about advertisers allocating their budgets over longer time horizons. but the reality is there's national security concerns. advertisers say that's my bottom line. that's not how they act. >> many of the social media platforms in the united states not operating in china but china is still a source of revenue for them. is that breaking down is that under threat at all? brian: not yet. this is around 10% or more of their revenue coming from china. this is still not fully appreciated. this is way broader than this. it's been growing bigger and bigger distorting the growth rate. jonathan: even though they are not there. brian: amazon is probably seeing a similar amount spending on advertising and markets. it's a big business. lisa: they want to advertise

around the world and they want to advertise where the eyeballs are. ultimately does money win out? brian: that trade is a big part of this. how does a chinese government react and again let's not even get into what happens of trump 60% tariffs. >> next time we can spend 10 minutes on it. good to see you. can't sell byd you're knocking to do the commercials on meta anymore. our coaches money win out there is much as it does in the u.s.. >> live from new york city, this is bloomberg. ♪

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jonathan: stocks are high, rallying on the nasdaq. yesterday's session positive by .4%. starting the week with yields up every day this week with the exception of this morning. down about a basis point this morning. going into economic data through the week. lisa: people are slowly pushing back rate cuts. nobody is saying anything

particularly dramatic. it is just, incrementally, things are good. jonathan: it has not been at the expense of the equity market. lisa: and it has not come at the expense of the credit markets despite rates leading to some default leave. jonathan: supertight, even with tons of supply coming into the market. possibly record numbers. under an hour away from a slew of data. ppi is particularly important. a range of views. jp morgan's david kelly is

expected. it is the revealing after his cpi this week. lisa: we are just sitting around waiting. to me, i am thinking around what will be enough to spur some sort of discomfort the market. what will make people rethink? jonathan: it will happen incrementally. we have closed the spread. the fed will reconvene and come up with a new median. it will look like what we got in december. it would not take a lot. lisa: people thought that they

were trying to be hawkish by only saying three cuts. now i wonder if them saying, no, we were serious is enough of the market to say, we have to rethink this. it is endlessly fascinating. jonathan: donald trump is holding meetings with potential cabinet picks. if he wins a second term the white house, there are other names. according to bloomberg reporting, trump possibly loading the idea of paulson serving. drip feed through the next several months of this front. lisa: maybe he will put him in treasury.

it comes at a time -- annmarie: jeff is a huge donor. he has billions of dollars invested in tiktok. the timing is -- is interesting. jonathan: you are done with this. lisa: i am done with the theater. letting it up like bachelor, not interested. annmarie: there was a new yorker cartoon the other day. one was really grilled to the tv for the election and then the other one was, should i take the blanket off when it is overreactive -- over? jonathan: china calling of the

u.s. to stop suppressing be at. u.s. ambassador to china not backing down. >> we see it this way. technology is at the heart of the competition between the u.s. and china, whether commercial technology, tiktok or techno dot plots technology that can be transformed into military technology that can be used against us. we have been very clear that we will not allow the export of u.s. technology to china. jonathan: national securities come up repeated the. lisa has been talking about it. we all have. in the future, it may well be chinese dvds. annmarie: you could be deciding between national security and climate.

when it comes to national security concerns, a lot of lawmakers are saying that this was not lagged to the public. the fbi director, the latest global deployment -- global report all name tiktok. the executive even admitted that some of their employees actually tracked the ip addresses of users, including journalists who were critical of tiktok. jonathan: let's turn to the credit. even with markets pushing expectations, one of the beneficiaries of the credit. the ceo joins us now. good morning.

let's talk about what is happening the world of credit. started this year by thinking about commercial real estate. after these portfolio companies, any distress whatsoever right now? >> the portfolio is strong and it looks quite positive. back i year, i think we would all be talking about what type of a recession we would be in right now and we are not. across those companies, last quarter, our companies grew 15%. these are very selected to make loans to release sean is this is that have a lot of potential and growth, where there is a lot of cushion in our loans.

we are not in a recession, nor are we on the engine one. lisa: do you find that your portfolios these can handle paying 14% interest rates and survive and thrive? are the higher yields not restrictive based on the growth that they are projecting? >> they are doing find that context. there was a speculative question about levels in working lives but in any case, at the end of the day, what we know is a full year of those rate. by definition there will be an incremental company that will struggle more, but it has been absorbed by the system

successfully. we are not seeing waves of changes or even precursors to that. meaningful changes. can i pick my interest instead of paying in cash? it is not even but we would suggest. he would almost have to predate an issue. lisa: we talk about, is it restrictive? you are talking about how companies are handling higher been treated now. how has it affected the demand, given that companies have seen reluctant to borrow because of rate? >> tier point, this environment has been very good for us and our series. it has raised a quick basis.

so, companies have absorbed that pretty successfully. people are borrowing capital. supply and demand, these people are going to use perhaps less of it, but the world of private equity particular, i started in private equity myself. at the end of the day, that cost to capital is a little bit of a calculation. it is how much you can pay for that company. but it is not prohibitive to conducting activity. what you need is environment are people have a common set of expectations. jonathan: was it easy in the 1890's compared to now? >> it was a lot different and there was a lot less competition.

there were two large equity affirms at the time. we are talking thousands of dollars in capital. jonathan: i think there is a worry that people are chasing deals. is that how you see things? >> trillion's of dollars of private equity. what we saw was the opportunity that need. this is a young industry, veritably. among the people focus on the large area, we focus on the largest companies. there are just a few of us. it is a young industry by that measure. lisa: a lot of people would argue that we know what is going on public markets because you

have seen the best and brightest . there is a question of is their behavior that could lead to higher default rate for a lack of transparency? d.c. colleagues operated with lower standards than yourself? >> i believe that the private market has mentally added and influence. some will do better than others. we are intensely focused on credit. we have done about $90 billion in loans. there is a durability but for the markets at large, there are ups and down. we were providing capital.

it is one where there is a large market. that is a better economic platform. annmarie: do you see more interest from some of these seven wealth fund in the middle east? >> we do. it was adopted earlier by u.s. institutions. part of that is the maturation from 10 years ago, this flavor of direct lending as opposed to the lender of last resort. this is sort of a 10 year industry that was our. now we are seeing an increase in interest. part of it is appreciating the durability. it is a safe haven. when he went to be when times are uncertain?

i think that the non-us investors appreciate that being a poor holding. you could generate terms. the absolute level of return starts to bethany for those in non-us markets as well. jonathan: is there evidence that the fed is restrictive? >> here is what we see in our world. patient is a sticky animal. 350 companies looking bottom-up? we continue to see it as sticky. we have a company that was paying $20,000. but wages are sticky.

we are not through the teeth of this challenge. we are through the worst of it, but we are not done with it. jonathan: good to see you. lisa: if we are looking at companies that can hire -- where is the restrictiveness? jonathan: let's get an update on stories elsewhere this morning. >> the largest assembler of iphone reported a jump in profit. but it was not iphone powering that growth. the taiwanese company also giving a bullish forecast. elon musk canceled a partnership for a new show on x. he was informed of the decision

just hours before he interviewed elon musk. limited says it will continue on other platforms. x unveiled the show earlier this year as a slew of other programming. and the window for the third major tests like for a major rocket begins at 8:00 eastern. it is the most powerful rocket ever developed and has the goal of taking humans to mars. this lunch hoping to approach orbit. jonathan: the program, attacks continuing to lay on shippers. >> there is no regard for the well-being of it is billion. now they have unfortunately been

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jonathan: data drops about 42 minutes from now. you know the drill this morning. under surveillance this morning, attacks continuing to weigh on global shippers. >> they have continued to launch these attacks. now, they have unfortunately and tragically killed innocent civilians. the u.s. will continue to hold them accountable for their attacks. jonathan: shares are lower in

germany after the shipping giant reported a decrease in learning. a volatile and challenging economic and political environment. especially in view of the current situation around the red sea. the ceo joins us now. when they started picking up this year, there was a sense from some people that it was may be temporary. d.c. that as the new normal? >> is a combination of buddy tried to book things quickly. services are stabilizing and the market is getting calmer. i think we will see spot rates coming down. jonathan: are you considering more land routes?

>> we have opened up a number of land route. and we holiday, we need more boxes to transport the same amount of cargo. lisa: how easy is it to transfer this to the customers? >> we see that the cost is being passed on and i think that is reasonable. the rates exploded but today we have a different situation. it has certainly helped us to keep global supply chains going and to keep the increase in cost within reason. lisa: why are some of the

possibilities moving on? >> right now you are looking at results for companies in the fourth quarter. that is why many companies posted losses. the question is what is going to happen but the situation normalizes? annmarie: the u.s. seems to be in a cycle of defense and deterrence. i you see any sides of deterrence? >> we welcome all the efforts undertaken by the u.s. and their allies to stabilize the situation. it is very difficult because it is a fairly large area that you need to defend. we have seen that the attacks have continued and that means

that we will decide that we have no other choice but to keep our people safe, even if it means that supply chains are 10 days longer. annmarie: do you have a timeline for when you think you will be able to use that route again? annmarie: -- >> we hope that we can go back through and the next couple of months. jonathan: thank you for the update. we appreciate it. looking at this day and age, we thought we could do it quickly. this included an important trade channel but it has not happened. we thought it might be temporary. annmarie: they will have to put more money into those vessels and they take a lot longer going

around the horn of africa. the cost that is going to those businesses is now trickling down to the consumer. lisa: it gives me this will question of how much does it affect prices? is that why there is not more aggressive action? why would it not be a good time? jonathan: the real world around this table is different than what we have talked -- what we have talked about. they basically said that rates are not hurting them and inflation is sticky. of course it is idiosyncratic.

sticky inflation right there as well. lisa: it is not difficult to pass it along to the companies. annmarie: besides the security concerns, if inflation is the what is hurting this inflation, you would think that they would take a more aggressive posture. jonathan: i just want to set the stage with you for the rest of this morning. positive by one third of 1%. this morning, a little bit lower . a big hour ahead. ppi retail sales. take your pick really. there are pieces that could

shake the reserve. lisa: it all comes down to airplane ticket. they are all pointing in the same direction. the idea that they are going up because boeing is not shipping as many of their planes. jonathan: coming up, anastasia will be talking about some of the estate. michael shepard and a conversation that you do not want to miss. making some headlines. downgrading tesla, a growth company with no growth. a difficult day yesterday for the stock. lisa: a difficult year for the stock. how long can that continue? jonathan: the third hour of bloomberg surveillance, up next.

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>> look at the broader picture. the broader trends are moving down.