>> euro seeing a lot of virgins -- you are seeing a lot of divergence within the market. >> the base will probably slow down now that we see this quick rebound. >> we've got demand being stimulated, and that imbalance should lead to higher prices. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. onsay good morning to you simulcast. bloomberg television, bloomberg radio worldwide. it helps to have in august with a lot to talk about. today is so different. what i observe as the bond market finally confirms the higher equity prices. risk on, equity up, and finally

we get prices down and yields up across bond. i don't know how long it can last, given the fact that we still are getting signs that there are going to be layoffs, and thinking in particular of delta coming out overnight and saying they may have to lay off nearly 2000 pilots after the september period. i've got to say, still a lot of headwinds out there. tom: i agree. the partition of america is extraordinary. we just spoke to the congressman from the court could -- from the fourth congressional district of arkansas. he made clear the economy is really good and sets up the inequalities and differences you see between democrats and republicans. of course, our convention coverage. one quick point before we get to the complete data check, futures up 15. you looked at the brief for the morning.

lisa: consumer confidence for there hasof august, been greater resilience than in coronavirus cases. after that, we get a tale of two markets. roadforce. has given a into the consumer confidence. as you mentioned, day to of the republican national convention. melania trump expected to try to humanize president trump, perhaps taking a bit of a different tone than what we .eard last night tom: we will see. a number of other voices on day two of the republican convention. on the dow futures, we will get

to that any moment. all in all.r i don't want to make too much of that. i would mention turkish lira, 7.39, backup nicely. mr. erdogan speaking of his disappointment in economic matters in the way people are pushing around this turkish economy. gold not part of the story. right now we want to get started with stuart kaiser of ubs. he is head of equity derivatives . stuart kaiser, i want to look at the. , in that is brilliant the vix that we quote is 22.37, but the future view is very

fearful, and is a much higher number of about a 28 level. is that unusual? art: it is unusual. there's a couple of things that go into that. to beonomic risk is going part of it. if you look ahead of previous elections, that gap between spot vix and the october futures normally is somewhere around 1.5 to two points, and now it is more like 3.5. that gives you perspective in how much uncertainty is priced into the election right now. tom: should the vix be lower right now? should the vix be at 19 or 18 even? debate thecould

exact number, but it probably should be a bit lower. u.s. volatility is at a particularly large premium to but the market has been realizing, so how much the market has been moving, we could assign that to a lot of reasons. picture, u.s. implied volatility is higher relative to baseline market moves than the rest of the world, so you could argue you could be a few points lower from here. i think you're just going to have trouble finding people willing to sell at that level. tom: some breaking news, best buy in with better comp sales. what i love about this, operating in eight nm environment is the quote as they look at -- lisa: that is optimistic. tom: it is. it is really remarkable what we are doing, however behaviors change in pandemic america. lisa: it turns out having a big box with stuff and it is actually helpful, which brings

us to how people are positioned right now in the markets. one thing people have been focused on is the short positioning inequities and how that has come down dramatically with yet another bear in the market, throwing in the towel. what do you see in terms of positioning and the amount of bearishness currently priced into markets? stuart: generally speaking, the trade for the last two years was to be in a relatively safe portfolio. i think the starting point was not an overly aggressive type of equity exposure, so to me it is not too surprising to see people not hedging as much as you might expect just because they don't own what you would consider a risky asset. if you look at how downside is priced into derivatives markets, it is not particularly out of line right now, and not to extended.

that should be a good corollary to short interest. it is maybe not what you might expect even the level of uncertainty that most investors fear. i think that links back to the fact that the type of stocks they own are not the riskiest stocks. they own these high dividend yield stocks that don't require demand for hedging that way it would if they were all in on the cyclical trade. really important point, especially as you talk about the uncertainty. they are not providing guidance at best buy, falling in line with a lot of companies saying we can't predict the future right now. without that visibility, just betting on a dividend payment, what exactly are stock investors buying right now? are they simply buying the hope that the federal reserve will keep rates low indefinitely for the foreseeable future? stuart: there's a lot of optimism priced in. to the fed, to the election, to

vaccine outcomes. i don't want to say it is consensus, but a lot of investors are expecting relatively good outcomes on all three of those fronts. in that sense, you are buying hope to some degree, but if you were to look at the standard deviation of earnings estimates, those are still very wide, and that is just because of what you cited, that we are not getting guidance from companies, so analysts don't have a really good idea of where these earnings are going to be. the range of outcomes is wider than it has been, which leads to more uncertainty. all of those things are linked together, but if you ask mia, i think there's a pretty high bar for the fed and for vaccine news because i think people are pricing pretty good outcomes on all three big drivers. tom: stuart kaiser of ubs with us. what is the short squeeze story? you get that supercharged feeling. is there the shorts out there to

squeeze this, to drive us higher in equities? stuart: the short data doesn't show that there is a huge squeeze out there. i think the squeeze might be more kept on the sideline, getting squeezed into the market. people that have been hesitant or cautious to dip their towing to -- to dipthere their toe in. --maybe it is more than a more of a cash squeeze than a short squeeze. you may have people capitulating on their caution. that is equally as important. it is still cash flowing into the market and still a new buyer to put prices higher potential he. lisa: we have some bears that are capitulating. ome bowls also -- some bulls also

capitulating. do you see that as a potential for a near-term shock? stuart: we definitely see higher rates as a risk to the market. even though you've had a move in rates recently, inflation excitations have also risen, and typically equities respond very favorable, so the inflation is kinda balanced out to move higher in yields. we think inflation expectations, 10 year breakevens are pretty fully priced at this point, so additional upside from here in rates would be a little more of a tightening and would probably be a risk to equities, so particularly real yields around the 10 year space, that would be an event that equities would have to deal with. we dealt with a little bout of it in august fairly well. if we got another piece of it, it could be a bit of a risk. some people are looking at good vaccine news as potential driver of that. if you had a credible u.s. vaccine announced and it looked like it was going to be widely distributed, that could put

upward pressure on growth expectations and rates, and at the index level, that could be a little bit of a sell the fact event. that is your kind of rotation scenario. tom: we will steal from anybody, but we always give credit when we steal, effective immediately. it is the acclaimed kaiser cash squeeze. i like that. [laughter] stuart: please no. the nexte that is tuition check. stuart kaiser of ubs, thank you so much for joining us today. lisa, you ok? lisa: i'm fine, but how many guests have to leave this show saying, "please no, tom." [laughter] tom: great to have these folks on derivatives. to get real challenge

them to speak basic english as well. joins us, regina mayor from kpmg. we will look at some thing that doesn't get looked at that much, oil. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. president trump and speakers at the republican national convention that a positive spin on his handling of the coronavirus pandemic. the president thanked frontline responders and said the virus is going to be fading. others warned what would happen if joe biden is elected. >> there's more work to do, but there is a light at the end of the tunnel. job gains are outpacing what the so-called experts expected, but biden's radical left-wing policies would stop our economic recovery cold. he's already talking about shutting the country down again. it's madness. speakers procession of

democrats'combat the portrayal of the president as incompetent. areasis one of the rare of cooperation between the world's largest economies. still, china is far behind its promises to increase purchases of american farm, energy, and manufactured goods. in germany, chancellor angela merkel is demanding full transparency from vladimir atin's government over russian opposition politician, likely poisoned last week. the kremlin hasn't responded. filednaire jack ma has for what could be a record-breaking ipo in hong kong and shanghai. the 2.1 trillion

dollars raised by saudi aramco. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. gupta.ika this is bloomberg. ♪

only live in a world that wants you to believe in the bad news racially, economically, and

culturally pulled revenues. >> in much of the democratic party, it is now fashionable to say that america is racist. that is a lie. america is not a racist country. tom: some of the comments last night at the republican national convention. the first night a very different look and feel than what we saw from the democrats in terms of the technology and usage of it. the senator from south carolina and former u.s. ambassador to the united nations nikki haley speaking. right now, kevin cirilli, our chief washington correspondent. do you detect that night after night, the republican convention will be the same? is there a consistency here? or was that a one-off theme last night and we will move on to other themes over the last three days? kevin: i think this evening's theme is going to be much more focused on foreign policy, with secretary of state mike pompeo's speech coming this evening. another notable speech, first lady melania trump. i think last night, what you saw

were first and foremost, a shot at the 2024 republican presidential primary. what you saw last night was senator tim scott really talk about diversity through the lens of conservative ideology and nikki haley, former u.s. ambassador, speaking in a much more calming tone that quite honestly would lay particularly suburbssome of those that the reelection campaign has fought so hard to make up round on. a shrinkings to be republican party. is there any angst out there over the popular vote portion that they command now, or is it strictly about establishing ll rowboat -- establishing an electoral vote victory? kevin: i think that is a good point. the electoral college is how you win an election in the united

states. result of that, president trump lost the popular vote to hillary clinton by several million votes in 2016. thatuld like to see happen. lisa: from a pulling perspective, how are both conventions playing with actual voters at this point? kevin: if you look at the nbc -- "walleet journal l where thenal" pol president is trailing, it would suggest that biden got a bump his runningming mate. on the issue of the handling of the pandemic, voters disapproved of president trump. but on the issue of who is best

suited to handle the economy, president trump leads by 10%, so it is that dueling narrative that the republicans want to see addressed in the days ahead. lisa: one of the main narratives i heard last night was democratic cities being overrun with crime and defunding the police, that narrative really being hit hard. how well does that play for the republican party in general? kevin: according to my reporting, you look at what they pollsying at the internal , that the issue of law and order is going to play particularly well. , youhe second point here heard this from senator tim scott, talking about school choice. when i talked to sources on the president's reelection campaign, they say families are staring down the reality of whether or not their kids can go back to

school school choice is something they -- back to school. school choice is something they feel will help to make inroads. tom: a delicate question, and this comes from the credibility and earned credibility of kevin cirilli, with miles and miles on the campaign trail across this nation. there was last night one of the speakers who alluded to the ofsident as the bodyguard western civilization. can you translate that? kevin: it is globalism versus nationalism, and it speaks to a certain portion of the president's base, but they are speaking in very broad terms. this is someone who a certain faction of the republican party say is a nationalist versus globalism. tom: it harkens back to what steve bannon was talking about months ago. how would you presume the

democrats will respond to those tones, those illusions that were heard last night? toin: i put that question congresswoman sheila jackson lee , the chairwoman of the subcommittee on cyber intelligence and the deputy whip of the democratic caucus. what she said is it is an issue of western alliances, restoring western alliances versus the go it alone. she consistently says that a biden administration would favor multilateral conversations not just on the economy and foreign policy versus a unilateral approach from president trump. tom: i've heard this from a great number of people, multilateralism or bilateral is him that we have seen from president trump erie it will

secretary pompeo underscore that today in his speech? kevin: i think what he is going to make the case on is on israel, the president's support for israel and taking a tougher stance against the communist party in china, but i also think they have pushed back on the notion that they haven't been able to get allies on board in areas of agreement. if you look for example on the building of a 5g network that moves away from china, they would be able to have success on that front. comekevin cirilli with us our chief washington correspondent. of theck on night two republican national convention. i find it absolutely fascinating how far we have come from any of last convention and all of the emotion. the kennedys while retiring. it is amazing where we have come years.ars, 12 years, 16

lisa: this is a unique moment on many levels, not only because of the coronavirus, but definitely a shift in the american spirit in certain ways. i will say the backdrop to me is very interesting. mike pompeo going to be speaking later, at the same time we are getting news that the u.s. and china seem to be more on the same page with a trade agreement than previously expected. you seem skeptical. at the same time, it seems to be a dampening of some of the tensions. tom: as we said at the opening of the hour, we have certainly seen it in the markets, a huge distinction today folks, the bond market with the stock market. yields are higher, 30 year bond out four basis points, 10 year build out -- 10 year yield out three basis points as well. tonight, the rnc convention.

coming up, mark mccormick will join us toronto dominion bank on foreign exchange. part of that is a weaker turkish lira today. part of that is the mystery of the dollar, decidedly not idiosyncratic. idiosyncratic.

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tom: "bloomberg surveillance." good morning, everyone. here andt yields looking at the nominal yield inflation expectations down to the real yield, it is substantialat -0.01 negative yield, how do you expect chairman powell will address that in his speech? lisa: i think the key aspect will be how he looks at inflation, how the fed is going to measure inflation, but their inflation goes are going to be looking ahead. to your point, the idea that we are seeing yields get a lift, yet remaining near record lows well below negative one present tells you something, tells you about how much the fed is picking yields lower, and

frankly how much real prices right now are not reflecting inflation expectations. with the best buy earnings winnerssaw earlier, the and losers within the american economy, i've never seen at this starkly. has: the idea that best i no visibility into the future is some thing we are hearing more and more, which raises questions about the amount of debt some of these companies are raising because of said policies, because of keeping rates so low. the idea of we don't know. we are going to have so much more debt that our growth is going to be that much slower. i expect the fed to address that at some level on thursday. tom: we do a great job of getting into conversations that really have to do with the season. the one great season is back to school. and toma abramowicz keene, mark mccormick of td

bank, their global head of fx strategy. the entire conversation before aft and how minecr our children's brains are rotting. the collapse of our children and as they know it, sitting in front of their pandemic computers, is mindnumbing. is the foreign exchange market as mindnumbing as our children are? [laughter] what are we going to see with the dollar? the range bounded this -- the range boundedness of japanese yen is extreme every. -- is extraordinary. mark: a bigger driver is really the real yields are moving lower. the growth story is changing around the world. fiscal policy is changing the

landscape, and the dollar is extremely overvalued, so you haven't been able to sell on valuation for the past two years. when you put those ingredients together come potentially with the potential we are seeing in the euro zone, this is a trend in the dollar that could be 10%, 15% over a two-year. . so short-term, the dollar looks a little bit overdone. it would be a modest consolidation in a deeper, broader downtrend, again with the main question being the election. updateve us a safe haven . what do you learn from studying the safe havens of foreign-exchange? the safe nature of haven is changing. euro has bobbed and weaved

as a procyclical currency and a safe haven. swissie has acted like a safe haven. even sterling in this quasi-safe is acting haven because we are not seeing the same demand for the u.s. dollar. what's interesting is em is lagging, but the high-powered g10 alternative reserve currencies plus gold is driving what you would call it differentiation along the lines of what is being considered a safe currency in this environment. the dollar is going to continue to unwind, but even if we were to see risk stumble a bit, i think the euro is going to be a little bit more distinguished than what we have seen the past couple of years. the euro can still rally, and the end will act as traditional safe havens.

if a driver of the yen is how foreign equities move. lisa: some people come on and say sterling is an emerging market currency, and some people what mark come on and say it is a haven currency. this is a confusing world that we live in today, and the dynamics behind it also confusing at a time when there $15 trillion than of negative yielding debt. at what point will that drive more foreign flows back into the ?.s. mark: i think what is critical is it was a big concept, an important as a driver for markets, but it didn't make any money. scenes anddifferent different economic realities of trade that reflect different deficitegimes, trade was a massive loser because the current account in the budget deficit was off cut -- was

offset by repatriated capital flows. i think as we move forward, the fixed income market is less of a dominant driver for currencies because central banks are all moving in the same direction area even emerging markets are converging to where g10 is. if you go back to the yen, the tenure spread on the g9 average versus jgb is basically minimal now. there is really high-yielding g10 currency anymore. so if you think about it, what is really going to matter's perceptions of growth, capital flows, business inequity, and those kinds of drivers of where people want to invest over the long run. even in sterling, it is interesting because it is a broader dollar downtrend. even if they have current account deficits and they seem to have negative yielding debt, they will still be seen as potential attractive investment destinations when it comes to the equity side of it. i think that is going to be the big driver of the next couple of quarters. lisa: which brings me to china, the one major economy expected

, the u.s.is year expected to shrink by as much as a. is this mean that the yuan has a chance to outperform meaningfully this year? mark: if you think about one of the best performing assets beside gold, it is chinese equities. chinese equities have rallied this by the uncertainty around the trade deal, despite the rising rhetoric that's come from president trump on the trade deal. we got some confirmation overnight that things are moving in the right direction, and that has amplified the move. even despite all of the lack of , chinese equities have .een a powerful force if we go back to u.s. real yield, that is the plumbing for the entire system. macros will tell us where real yield should be, 20 to 25 basis points higher. as real rates are suppressed, we are seeing this demand for other

real assets. asnese equities are trading an opposite view of u.s. real rates, as is gold, as is commodities, as is those alternative currencies we talked about. tom: i've got to rip up the script here on this insight. if the dow jones industrial average, the nasdaq 100 trading as a proxy against depressed real yields? mark: i would say if the analysis we've done -- it is a cluster of assets. on one side, you have real rates. on the other side of that cluster, you have everything on the other side, which is g10 currencies, high-yield credit, emerging-market equities, especially chinese equities. the other side is your hedge, which is basically investment-grade credit and the dollar. you are either in the one camp, which is all high beta, or

you are basically buying investment grade credit. tom: interesting dynamics with erdogan in turkey as well. we will test a line in the sand for mr. erdogan and his bankers in a beleaguered turkey. what is the significance if turkish lira weakens against the dollar? mark: it is more policy credibility. there's not a lot of independence in the central bank. people feel the government is driving policy decisions in turkey right now. it is a flight of capital flow. it doesn't have the power and the ability to drive growth the way that the u.k. or the u.s. or the euro zone. they don't have the fiscal legitimacy to put in growth enhancing policies. if you look at which currencies are lacking, there a covid story and a fiscal story. turkey falls into the fiscal credibility story, so when you

have a large current account deficit in the world doesn't trust in the decisions being made or how they are being made, it is going to be a very core backdrop for that currency even though risk is rally, which is why you see south african rand and a couple of other emerging markets still lagging here. tom: mark mccormick, thank you so much of td securities. just absolutely fascinating to me, the dollar mystery here. you hear about big figure moves to dollar weakness and wonder how the other nations will react to that. the emergingly in nations, what you have been focusing on, and rightly so, this is front and focus. your focus on turkey is important. people might say you get the turkey report every day, and you do, it is because it highlights political risk, particularly in the developing world. this to me is a huge issue when it comes to either where you end

up putting your money, but also in terms of debt blowups. this is something the imf is concerned about, as well as many major investors. tom: what is important here is the political nature of this. mr. erdogan, and extended term there. all the uproar within turkey. now his expansion across the eastern mediterranean as far as libya, we've had some very good conversations on this, particularly the new tensions between turkey and greece as well. i want to do a data check here as well. today, what clicks in is higher yield. the 10 year yield, 0.69%. on the 30 year bond, one .3967%. , you want toing say it is on a range, but nevertheless, it is back as we've seen. as we talked to mr. mccormick and his expertise on oil, we will go to one of the top energy experts. regina mayor has earned this at

kpmg on oil. we will speak to her in a moment. it is a simulcast on bloomberg radio and bloomberg television. it is "surveillance." good morning. ritika: with the first word news, i'm ritika gupta. president trump's defenders took the stage at the republican national convention last night. they defended his record and warned what would happen if joe biden is elected president. >> joe biden is good for iran and isis, great for communist china, and he is a godsend to everyone who wants america to apologize, abstain, and abandon our values. donald trump takes a different approach. he's tough on china, and he took on isis and won, and he tells the world what it needs to hear. ritika: the president tried to

paint a positive picture of his response to the pandemic. he met with front-line workers in the crisis. it is a rare reversal for the food and drug administration. the commissioner has backed off his claim that an experiment therapy has provided a dramatic fit to coronavirus patients. at a press conference with president trump, hahn said blood plasma from survivors of the virus could save lives. a second night of violence between police and protesters after a black man was shot by police in an incident, on video. police fired tear gas to try to disperse crowds. is set totorm laura become a powerful hurricane before making landfall wednesday along the northwestern u.s. gulf coast. the storm poses a threat to the region's oil and natural gas infrastructure.

global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

>> it is all about the shift underlying the economy. you can't relook at the whole picture. you have to look stuck by stock,

bond by bond. that is the name of the game because it is a big market shift we see. tom: really interesting conversation yesterday with michael collins of pgim. talked about the dynamics of the fixed income market and some of the oddities of this august. right now we want to bring in a guest, and we get lucky on news of the dow jones transformation, with regina mayor of kpmg, their global head of energy. there are many people in the industry who work on the seminar , the conference racket, and all of that. regina mayor has absolutely nailed ownership of the study of hydrocarbons. she does this for kpmg out of cornell and harvard, working out of houston. there's so few people that work the circuit constructively like regina mayor. areowns the world i can

that's the world economic forum at davos. she absolutely owns the high ground on this. but there is something more important to talk to right, and that is they are miserable in irving, texas this morning. lisa: they are watching the storm bear down on them, which is threatening a whole host of oil reserves. let's start there, the idea that you've got these windstorms headed toward the gulf coast. how much could this disrupt oil production in the u.s.? regina: it's less of a risk on the supply side with oil production because only about 10% of u.s. reduction comes out of the gulf of mexico, and we are sitting quite pretty with regard to crude supply. the thing to keep an eye on is product supply destruction because 50% of the u.s. refined capacity comes from the texas and louisiana gulf coast, so based on the current projections with tropical storm laura projected to become a category

three hurricane, you could say roughly 35% of production is in the path. i don't think it will take that capacity off-line, but there is that risk. lisa: over in irving, there's another storm, and that is the storm against hydrocarbons with energy moving away from that area. exxon being removed from the dow , the longest serving member of the index, after its market billion offrom $450 market capitalization back in 2014 to less than $200 billion now. are we just seeing the beginning of the destruction of the hydrocarbon complex, or is this the end of the destruction? regina: it does mark a shift in the era of where capital wanted to go and what investors are going to look at. the stoxx are clearly on a boom -- the stocks are clearly on a

boom. the behemoths of our time are probably not where capital wants to go, and it does mean that these very large international oil companies have to pivot their portfolios to embrace what is known as the energy transition if they are going to stay relevant. you see different players taking different strategies, and i do think they will pivot and survive, but this does indicate a big shift in investor sentiment. tom: what is the heart of the matter here is combination. occidental has done. do you see in industry roll up to get back to the size of revenues where they have scale to profit? regina: i think it is a scale game, and you are absolutely right there. but the bid-ask spreads are still so far apart, and where i thought we would have seen more of a wave of mergers and acquisitions, balance sheets are under such pressure that it is

difficult to get the capital to make a play, and difficult to see consolidation that we need to see. however, there have been some chevron's there was acquisition of noble that looks very smart in this environment. tom: i don't want to talk individual securities. they got pushed out of anadarko and all that. does the big money come in? does private equity come in and start acquiring value priced hydrocarbons? do you see someone like blackstone or blackrock playing? regina: i think the pe firms have done their bit in the last decade, especially in the 2010s. most of them are actually trying to pull out now. what i think we will end up seeing is assets change hands because the assets still have underlying value, but the companies structured around the with the debt and equity portfolios they have list less attractive. i think we are going to have to see more restructuring, more

debt consolidation, and then you will see less of the company logo shifting. lisa: have we already seen peak oil demand? regina: i don't think so. there have been some who will say 2019 might be peak demand. we still see projections that will take us up to 110 million barrels per day, which is still 10 million barrels per day more than we consume in 2019, and you will still see that into the 2030 timeframe. energyt have a base of that will sustain all of our needs that does not include some element of hydrocarbons, at least in the foreseeable future. lisa: do you think the pandemic has accelerated the shift away from hydrocarbons or slowed it because of the subduing of the price of oil? regina: i think it has accelerated the shift. we have demonstrated what we can do for the environment and how we can reduce carbon simply by

restricting our movements, not flying as much, not commuting as much, not going to different shopping centers. that doesn't directly translate into a reduction of gasoline demand, but we have seen the positive impact it can have on carbon. most of the other countries, when you look at their stimulus packages, they include green stimulus. notably absent, the u.s. isn't focusing much on green stimulus, but globally, i believe the pandemic has accelerated the move towards the energy transition. tom: thank you so much. regina mayor with us of kpmg on this historic day, exxon out from the dow jones industrial average. i find it absolutely extraordinary, no other way to put it, this move. it is something that 20 years ago was truly unthinkable. lisa: take a look at exxon shares, down more than 36% year to date. if you take a look at

salesforce.com, a software provider brought into the dow, it has gained more than 28% year to date. a tale of two markets very much accelerating the future bringing it into today. biotech,n is a giant but honeywell is really the unspoken story here. honeywell was in the dow, out it went, and they have put together such a superior industrial track record. they really have delivered over the last 10 years. enus,ke salesforce growth ,ut honeywell -- growthiness but honeywell not getting the headlines they should. lisa: it is really a lagging indicator because apple did a stock split. tom: jon ferro, he and i argue about this all the time, and i'm sorry, the dow jones is the fabric of what we look at. there's a romance to it. lisa: jon, you are being trolled.

up 198. futures 28,439.at this is bloomberg. dow jones industrial average. stay with us. ♪ ♪ experience the ultimate sports hub.

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for a natural, effortless look. call in the next five minutes and when you buy 500 strands, you get 500 strands free. call right now. (upbeat music) >> you are seeing a lot of divergence within the market. >> there's a disconnect between what is happening in public equity markets and what is happening on the ground. >> the stock market doesn't reflect the real economy. main street is dragging. >> the pace will probably slow down now that we had this quick rebound. >> we've got less supply and we got demand being stimulated, and that imbalance should lead to higher prices. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. jonathan ferro, lisa abramowicz, and tom keene. it is a