improvement in the economy, but the pace will probably slow down now that we've had this rebound. >> we see the possibility of further downside on wages. >> this is a secular downtrend on the dollar that could be 10%, 20% over a two-year period. >> there is a certain logic to the markets doing better than the economy here. >> this is "bloomberg surveillance," with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. ferro continues his sabbatical. a most unusual thursday as well. a hurricane much greater than what was anticipated for five days ago, harkening back to 1856 , west of new orleans, far east of houston. we've got unemployment, jobless claims coming up at 8:30. really, all is pushed aside for

around 9:10, a speech by chairman powell. much at the center of a storm in many ways. fiscal stimulus seems to be off the table as the political back-and-forth of the rnc and dnc take focus. really interested to hear what he says about inflation is real yields dropped near all-time lows yet again. tom: the real yields dropping is increasing inflation expectations. i looked this morning at great britain, at the united states, europe, and switzerland, and the rate of change of the inflation expectations, with the u.s. leading the way to a higher vector versus the other three major countries. we've got a lot to talk about. here's lisa abramowicz with the morning brief. lisa: it: 30 a.m. is the other bonanza of data ash 8:30 am is the other bonanza of data we are getting -- 8:30 am is the other

bonanza of data we are getting. we are expecting another one million new initial jobless claims filed. this brings 23 of the past would you for weeks at one million or more -- of the past 24 weeks at one million or more. at 9:10 a.m., fed chair jay powell speaks from that jackson hole cyber simple cream -- si.rson poirier -- cyber 10:30, president trump gives his nomination exception speech. -- nomination acceptance speech. tom: been labeler reaffirming -- hislaidler reaffirming guidance, but really didn't want to address 14% unemployment. lisa: here's my question.

three weeks ago, you and i were talking with economist dr. --nomist that said delayed economist after economist that said delayed fiscal stimulus would lead to a decline in stock valuations. we are at new record highs. mark meadows of president trump's administration yesterday said it is unlikely we will have any sort of deal on the second round of fiscal stimulus until the end of september. . at the earliest don't understand this. get the data check right now with christopher harvey. we welcome all of you on bloomberg radio, bloomberg television, a simulcast. we have been thrilled with your response. lisa, send all of the good news. i don't want any of the hate, any of the shade going to lisa. [laughter] lisa: i can handle what. -- i can handle it. 0.68%hat nominal yield, inflation expectations, and you end up with the real yield,

-1.05 percent. it will be interesting to see how that reacts off the news. michael mckee is leading our coverage. i was up in the adirondacks where lisa was, and the skin is peeling. lisa: oh yeah. that's why you have to portage because you're holding the canoe over your head. that's good shade. tom: but i do the portage with the aluminum thing underneath. [laughter] christopher harvey with us. the problem with christopher harvey is when you get his research note, you go damn, because there's always one or two sentence since -- one or two sentences that are absolutely brilliant. christopher harvey with wells fargo, you absolutely daniel the -- you absolutely nail the under ownership of apple computer. how is it possible that apple is under owned? christopher: that is a great question. it is something we have been monitoring for about two years

now. we have been scratching our heads why institutional pms have been underweight apple. we talk about the underweight, , and they was growth would say, we don't care. we would say, you should. growth stock. let's move on. now a lot of people are saying, how did apple get to where it is .t this point in time that is why we think it continues to grind higher. tom: what is the behavior of fund managers as they continue to quarter and? -- to quarter end? are they forced to buy these highflying techs? christopher: i'm not sure if they are forced, but you do hear a lot of the risk managers knocking on the door and saying, you told me two months ago, three months ago you were going to take this up. he told me apple was going to pull back. it hasn't. we need to do something now. you have cash on the balance

sheets or cash laying around in the portfolio. you have to start at what ties and that because what is happening is relative performance is beginning to decay. it's been a pretty good year for a lot of the managers, so they want to keep that from happening. lisa: there's been ownership more broadly of u.s. stocks. can we make that conflation? can we say that the reluctance to own more apple shows a reluctance to have a heavier overweight in u.s. stocks? christopher: there's a couple of things going on right now. one of the things that is happening is we are seeing this move to passive. people are starting to get more apple into their portfolio. they are just doing it in a different way. owners aren't waiting around for them to make that move. the other thing, to your point, we have seen this rally. we talked about a summertime melt up. we are there. people have been brought kicking and screaming to this thing.

now we are not saying it is time to leave the party just yet. with think a lot of the good news is priced in, but this is a time where people get squeezed in and funny things do happen. talking three weeks ago, four weeks ago with economist after economist after stock trader who said if we don't get a second round of fiscal support, we will see stock prices go down. they are at new record highs. why is this happening? christopher: i think that's why they are economists and not portfolio managers. the second thing we are seeing, what we have been saying is the reason for the run-up is things are getting less bad, and continue to get less bad. anecdotally, there are more people on the road, more people in restaurants. so the economy is slowly grinding higher. you still have basically 0% interest rates, credit spreads that have tightened dramatically , funding widely available, and you still have good reports from many companies, so i think that is really what is going on, and

the belief that something will get done. tom: i want to pin you down on a percent move up in spx. how do you feel? wells fargo, can you quantify single-digit, or dare i say double digit up for the market? christopher: we have been one of the more aggressive off the bottom. we had higher price targets, but we are through our price target at this point in time. we are right, the market is wrong, the market is going to fall apart. we said there's plenty of reasons for this market to continue. now we are looking less about market direction and more about the portfolio, what you want to own. our thought is you want to look for companies that have covid data, that have better comps in fourth quarter -- excuse me, first quarter and second quarter of next year. you want more economic sensitivity because we do think

the economy will continue to grind higher. tom: we welcome all of you this morning on bloomberg radio and bloomberg television, particularly across sirius xm in the path of hurricane laura. it will go up into the right, and we say good morning to all of you preparing for hurricane laura. what i find so interesting about the thursday is the event structure is so pretty couple to the president's speech tonight, and yet, we really don't know what the various outcomes of the various events of thursday will be. lisa: and you are not going to be chased by a bear in jackson hole. we do know that, which is probably somewhat of a relief for you, but very much the focus is going to be on jay powell. ism an equity perspective, there perhaps outsized risk that we could see equity response that is more than any response we could see and bonds to something that jay powell says? christopher: there's always that possibility.

one of the things when we got the minutes a couple of weeks ago, it wasn't as dovish as a lot of people thought. for a hot minute, we pulled back. i don't know if jay powell is going to talk about inflation, but we've been talking inflation for the last 10 years. we've flooded the market with liquidity in the united states, globally. it is really hard to go belly up or bankrupt. we have too much capacity. that's one of the reasons why we are talking about the lack of inflation as the creative destructive process never reaches that natural and. i hear a lot of things about inflation. i will believe it when i see it. tom: christopher harvey, thank you so much, with wells fargo this morning. --c chandler of benin bird if theockburn writing, framework of chairman powell is ho-hum, how will the market take it? huge anticipation for what chairman powell will say on this idea of where is that inflation level appropriate for the fed.

what do you think of that? debitwe are expecting a message from jay powell. how is he going to be more dovish than keeping rates near zero forever, and having a quantitative easing program that is going to respond to any dip in the economy? what is more dovish than that? tom: you mentioned a second look at the gdp numbers, and what we have heard without austin from peter hooper of deutsche bank, no stimulus, no vaccine, he q1,s for a recession q4, to this.a backdrop absolutely extraordinary. lisa: it will be interesting to see what jay powell has to say about stimulus. he's taken a pretty active role in saying to washington, you need to do your part. that is what is going to keep this economy going. we've done our part. tom: at 8:30, jobless claims. alisha levine coming up before

claims. i think she is much more cautious, i'm guessing much more cautious than what we just heard from mr. harvey. lisa stay with us. eight., negative this is bloomberg. ritika: with the first word news, i'm ritika gupta. hurricane laura is battering louisiana with high winds today. it also brought the threat of a catastrophic storm surge and flooding. the storm came on tour with maximum winds of 150 miles per hour, one of the most powerful hurricanes ever to hit the state. winds have now died down some. , there are concerns that some areas could be uninhabitable for months. mike pence excepted the republican party nomination to be president trump's running mate again on the third night of the convention. pence praise to the president and blasted joe biden m.v.p.

pence -- blasted joe biden vp pence -- blasted joe biden. joe biden has been a cheerleader for communist china. he wants to repeal all of the tariffs leveling the playing field for american workers, and he actually criticized president trump for suspending all travel to china at the outset of this pandemic. spoke fromce historic fort mchenry in baltimore. a white 17-year-old police admirer is being held after two people were shot to death during violent protests in kenosha, wisconsin. demonstrators were protesting the police shooting of a black man. the teenager was arrested in illinois about 50 miles from where the shooting l took place -- about 15 miles from where the shooting took place.

in kenosha, a curfew was put in place. the protesters ignored it. 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. ♪ i'm ritika gupta. this is bloomberg. ♪

vp pence: where we fought for free and fair trade, and this president stood up to china and ended the era of economics

orinda, joe biden -- economic surrender, joe biden has been a cheerleader for communist china. we already gained back nine .3 million jobs in the last three months alone. tom: night after night of the democratic national convention and the republican convention, a look back at the previous evening's festivities. right now on a thursday, no one cares, as we look forward to president trump's speech tonight. kevin cirilli joins us. how will the president speak to the people up in sylvania? kevin: he's got ash of pennsylvania -- the people of pennsylvania? kevin: he's got to talk about jobs, as well as the energy sector. this is really going to be what you saw in president trump convention speech four years ago in cleveland, ohio. that is a different type of temperament and much more moderate tone, with occasionally sprinkled in some classic,

quintessential trumpian remarks. the bottom line is this is an opportunity for the president to really kickstart his reelection campaign. as you and i were talking about offline, the challenge is he doesn't have an opponent who is on the campaign trail and entrance -- and in front of cameras every day. tom: next monday, we really engage the battle to labor day, and what it really heats up, what would you expect from vice president biden? kevin: i think you saw a preview in terms of how the democrats are beginning to defend how a biden administration, and how the obama administration handle be bola -- handled ebola. it is going to push back against republicans arguing that joe biden did not have a plan in place to take on the coronavirus. you have seen them come out and attack the republicans for how they have handled the pandemic. vice president mike pence

offering a preview of those political attacks, suggesting that the democrats would not have been in favor of restricting travel in january from china. that is something that is a bunker at -- that the democrats are saying is not correct. however, that is going to be a key point of contention during the debates leading up to november 3. lisa: are we going to get a surprise policy announcement from president trump tonight? kevin: i am struck by whether or not there could be. have been there several key policy announcements this week, whether it be in terms of the u.s. sanctioning firms from china that are connected to their one belt, one road initiative, or whether it be other policy prescriptions as it relates to china and additional sanctions. i think the biggest question on my mind is where does the president go in terms of additional executive action with the lack of fiscal stimulus.

yesterday i spoke to an advisor out of the white house who told me the president is still very much weighing the option as it relates to a host of different industries, including the airline sector. lisa: as we wait for the jobless claims figure in about an hour and 10 minutes, what is the latest in terms of how long president trump's executive action can be in effect to get that supplemental income to the newly unemployed? kevin: this is where the weather report down in beaumont, texas for hurricane laura is really putting pressure on people like senator john cornyn, a republican in texas up for reelection, and quite honestly in a tougher fight than he would like. he is still trending up in terms of the polls because the fiscal stimulus debate that has dragged on throughout the summer, now you've got hurricane laura , a lot ofhe gulf those lawmakers in both the house and senate, this is going to light a fire under them when

their constituents are now dealing with the pandemic and a hurricane. tom: i get any bentley at the morning and go down to work. i understand my life is a normal. well, guess what? i'm seeing a lot of pain out there. andan, it is really ugly small america. i ask you this question yesterday. the president, i believe, mentioned stimulus yesterday. where is the even modest stimulus to show the washington flag? kevin: from the political angle, should the president get a deal, he would no doubt campaign on it. from another political angle, speaker pelosi, whether or not there is incentive for her to negotiate with republicans, especially when, truthfully, they view the senate as in play for taking that on election day. one could make the case there is not that much political incentive. ofm a policy angle, when 48%

businesses in these country are small and medium-size businesses, there's incentive for both parties to come to some kind of will. so i think this is really on a collision course. the final point i would make on this is you look at the polls that suggest that those bases are dug into their respective camps, but look at how the republican party has been remade in the trump era. when you see how the working class has been increased 10% nearly since 2010 to the republican party. tom: thank you so much, particularly for the 10 year perspective as well. with that perspective, we are andntaged by david westin our republican national convention average, on radio, on television as well. i find it absolutely extraordinary. you wonder if the political debate is going to be overcome by the economic data beginning at 8:30 this morning. lisa: that is really the interesting question. president trump is winning when

you look at polls on the economy, and yet the economy is facing a lot more challenges yet, even if the worst of the pandemic is over. i think of that, the 23rd out of 24 weeks with the unemployment above one million, new unemployment claims. how does that translate to a positive message for the future? this is a huge challenge we will see an answer to, perhaps tonight. tom: it speaks to americas farther and farther apart. what have you seen in the bond market in the last 24 to 48 hours as well? i know you're looking at ash white folks -- i know you are folks, ig? wait lisa: you are seeing the biggest companies doing just fine. if you look at the bond sales so far this year, we talk about the record pace. it has come from the behemoths, not the companies that need honey.

you're seeing bond yields dropped precipitously for those big, well-capitalized companies. for everybody else, there really is a struggle for capital at affordable prices, particularly these smaller firms. again, a tale of two economies. tom: futures deteriorate. , 22vix was at 21 for a bit solid, and now 23.34. some of the tension very clearly as we have seen from a number of economists today. the barbell outcome of a powell speech, no news or substantial news on a new inflation view for the fed. in the yield market, we are back a 1.4. both lisa and i looking at the real yield took four digits, -- -1.0569%..0569%

we do that because it is a simulcast. radio loves four digit statistics. amrita sen on oil, next. it: 30 jobless claims. this is bloomberg -- 8:30 jobless claims. this is bloomberg. ♪

tom: "bloomberg surveillance." for those of you on bloomberg radio, the sun rises in the central time zone. galveston, 113 miles from lake charles, really the center city of hurricane laura. nevertheless, galveston greatly affected by the historic hurricane. not only the surge, but that effect as well is the massive rain falls that are expected. our rob carolyn talking about 40 inches of more -- 40 inches or more of rain. we have brian sullivan of bloomberg looking at the commercial aspects, and then amrita sen will join us on the oil outlook. what will this do to commercial western louisiana? brian: you are going to have 10,r rail lines, interstate

which is a major artery for that area, is going to be closed. in, wipescomes everything out, puts saltwater over everything, and now you've got 40 inches of rain on top of that. this is going to keep people from getting in to repair things. tom: brian, you are expert at this. do you anticipate a rapid , as i recall, andrew was horrific. which is this going to be? brian: i think it will be slow and steady. you've seen similar storms. rita came in there. there was damage for months afterwards. i came through a letter to the west, months afterwards. it is not just some thing they will bounce back by next week. lisa: when i see things like catastrophic storm surge and warnings to get out at all cost if you are in the path of this, even if you are concerned about

coronavirus and have health concerns, that is a secondary concern to just evacuating. i do wonder about the spill on effects we saw after katrina. are we worried about anything like that, about a storm surge causing damage days down the line? brian: storm surge is going to take a couple of days to actually relax. they were talking about it going 40 miles inland, so we may start to see things as the sun comes up. the sun is just coming up there, as tom said. people trapped, people need to be rescued, towns lost, houses lost. i think when the sun comes up, we are really going to see some catastrophic, awful scenes. lisa: you've been covering the weather, the patterns and the responses for years. , givenre enough people the coronavirus catastrophe going on, to go down and do the rescue measures that are needed? brian: we've done a couple of stories about this. looking at fema and also looking

at the national guard, the national guard certainly is probably in much more solid ground. the problem everyone talked about was what happens if your staff gets corona when you are down there. who do you call when these people are getting sick themselves? that is the main fear, that with the rising instances of the virus across the south, you could see some problems in the recovery weeks, months, line. tom: brian sullivan, thank you so much for your reporting this morning. hurricane laura heading with 100 to mile-per-hour winds -- with 150 mile-per-hour winds at 4:00 this morning. now it is in shreveport, going north towards shreveport, louisiana, and then a wide curve to the right expected. for those of you on bloomberg radio and bloomberg television,

good morning. ,he image is galveston west-southwest of lake charles, giving you the gentleness of galveston. maybe some of that called as the hurricane receives -- some of that calm as the hurricane damage as well. i want to get an oil update here from amrita sen of energy aspects. we were rudely too short with her the other day. here is so-called u.s. oil independence, where we not only export oil, but far more, we export refined products. how does that fit into the global oil system even this disaster? amrita: good morning, tom. we saw some of this three years ago with hurricane harvey because now, u.s. is such a big exporter of refined products. when harvey hit, i thing it

really surprised to the market, and latin america couldn't get the products. we had to source from other parts of the world. crude got brought up with it. some refiners are having to buy in this market to supply, so yes , it is similar. but i think you can't compare this to three years ago because, due to the virus, we have so much inventory at hand. this just helps run down some of it overnight. it doesn't move the needle to eliminate it, whereas in 2017, the market got much tighter. tom: i am certainly guilty of complete focus on upstream production of opec and all of the other chitchat. what is the state of investment worldwide midstream at that refinery level? is facinge refineries

probably one of the worst years ever because you've had the virus, so obviously demand is down, but also, refining is a very slow industry. a lot of capacity has come online, even before the virus. we can't shut down refineries in because as quickly there's always the angle about unemployment or providing security for supply houses, so we have way too much refining capacity. margins are very poor. that is why i am sure you see quite a few u.s. refiners have started to close down on the west coast, and on the gulf coast as well. that is just a trend that is starting. that is going to be one of the most important trends in the oil market over the next five years because asia continued to build up refining. lisa: this is one stunning aspect of the storm and the bleed throughout this moment,

with the inventories where they are. typically when you see a storm barreling down on an area that produces 1/5 of all u.s. oil, you would expect oil to rise. as the areas hit are the refineries, this means asked will be more expensive, and you actually may get less demand for crude. is this a perfect storm for some of the producers in the u.s., the idea that they are going to see the prophet squeeze even more and accelerating bankruptcies? amrita: i think the reason prices are coming down today is mainly to do with the fact that it seems like the storm isn't going to hit the refineries as hard as what people feared. i think there's two aspects to any kind of hurricane. on an overall basis, crude plus product, this storm, just like harvey, is actually bullish because you have shut in 91% of offshore production in the gulf mexico and a lot of refineries, and man does not going to fall

by nearly as much as total supplies. but unlike last time, the damage to refineries will be very minimal. at least, that is what it looks like right now. we don't know yet. therefore, i think a lot of the long positions such as getting out, thinking we don't need to be positioned as if things are going to get worse, that is why we are receding. ultimately, given the amount of inventory we have come of would have been transitory anyway. -- let it go, let it go. brent is frozen at $45 a barrel. is that a managed price by somebody? while re-frozen at 45. -- why are we frozen at $45 a barrel? amrita: you could have gone on holiday, and it would be exactly where it was. opec is managing this cutback in production. u.s. shale is still struggling

to come back. it is a balanced market, but demand is 7 million barrels a day lower than "normal was put "normal" than demand. it is after that demand recovery that you could get the upside, and also when you would have brought down the inventory. you're still a year away from that, so unfortunately we will have a lot more conversations about oil not doing very much. it will be much more about relative value trades rather than outright prices. lisa: amrita sen, thank you so much for being with us. tom, right now we are less than an hour away from what i think is going to be the key number of the week ahead of the jay powell speech, and that is the un-limit figures. the than one million for

23rd out of 24 weeks. tom: i remember moving the yen with david goldman at bank of america years ago. ferro, you and i have moved the needle on research with hsbc. steven major has published a sharp note on the fixation on the real yield. that you've got to look at the nominal and inflation expectations, and the residual of that, the outcome is yes, a real yield. but they are in the camp that far more attention should be paid to nominal dynamics and inflation dynamics. major and hsbc published that note today. that is the key issue, and also how we measure it. if you go to a grocery store, there is inflation. tom: you've got that right. [laughter]

store, as john tucker of bloomberg radio mentioned to me, it is not that it is one or two prices. it is everything. it seems like every single item is up fractionally. dennis gartman made note of this the other day. it is not just lumbar. number gets the headlines, but it is off more leading to some -- but it is a lot more leading to trysting inflation dynamics. are headinge we into that jackson hole speech from jay powell at 9:10, i was looking at cabin prices. those are going up, too. maybe it is people trying to get out of the cities. tom: it is for beautiful people like me. they put me 42 miles north. bears,me, three grizzly and kevin down the road. [laughter] lisa: commuting with your people, right, tom? tom: what can i say?

coming up, the interview of the day on the american labor economy. we are thrilled to bring you mark zandi of moody's. he says the unemployment rate is higher than 10%. mark zandi coming up. stay with us. this is bloomberg. ritika: with the first word news, i'm ritika gupta. it is one of the most powerful storms ever to hit louisiana. hurricane laura made landfall earlier today with winds up to 150 miles per hour. they have now slowed down some. still, the hurricane brings the threat of a 20 foot high storm surge and flash flooding. authorities are concerned it could make some areas uninhabitable for weeks. vice president mike pence says america's economy is back on the way back. at last night's republican national convention, pence praised president trump for the way he has handled the economic crisis caused by the pandemic. vp pence: because of the strong

foundation president trump poured in our first three years, we have gained back 9.3 million jobs in the last three months alone. [cheers and applause] and we are not just opening up america again. we are opening up america's schools. ritika: pence also encouraged voters to question whether biden is "nothing more than a trojan horse for the radical left." the cdc is issuing controversial new guidelines on coronavirus testing, saying that asymptomatic people may not need to be tested. the cdc says the change was not influenced by the white house, and is meant to clarify the limits of testing. 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. ♪

>> we think it will get below 10%, but not by much. we are somewhere in the 9% range. this is going to be a slow process of getting unemployment down. tom: the rate of change back to

normal. dr. hooper at deutsche bank. a wonderful conversation the other day. let me review. he says no vaccine, no stimulus, recession q4 into q1. there are transient moments across any week of "bloomberg surveillance," and a week ago, mark zandi stopped traffic with a statement on what the real unemployment rate is. we got a massive response to dr. zandi's estimation that 10% is really 11% and even out towards 14%. he joins us again on this important claims day. what will claims confirmed today, dr. zandi? dr. zandi: that the labor market is still struggling. claims, andyou i then another half-million in pandemic ui claims, folks that

are gig workers or self-employed. so 1.5 million in total, and that is just cataclysmic. before this pandemic, the all-time high was back in the early 1980's. we had a week of 700 house and -- of 700,000, i believe, so double that. , but itt where we were is still very deep in the hole, hard for us to get out. , can youher question quantify the lack of stimulus right now? is there a number you can put on that because we have this indecision in washington? dr. zandi: i think it is mounting. the damages mounting. you can see it in consumer confidence. we got a read the day before last that it is low and slumping again. you can see it in the labor market data. i think the damage caused by

congress and the administration not getting it together is starting to mount, and i think peter hooper is right. if we don't get another rescue package here, certainly by the end of september, we are probably going back into recession. lisa: what does that mean in terms of what begun employment will look like -- what unemployment will look like? dr. zandi: peak unemployment, we've seen that back in april when businesses were all shut down, and we got close to 20%. now we are sitting here officially at 10%. my sense is that if we get a wreck you -- a rescue package that is of reasonable size and reasonably well-designed, and i am still expecting that, we will probably in the year with the unemployment rate somewhere around 9%, 9.5%. if we don't get a package, we are headed north. hard to imagine we get back to 20%, but we are headed higher.

we will stay in double digit unemployment probably all the way through 22 anyone. i would ghost asked through 2021. -- through 2021. i would go so far as to say that this period will probably go down in history as a depression. lisa: i just want to let that said in because the idea of double digit unemployment rates through 2021 is stark, and a story that a lot of people are afraid of as we look at all of the shuttered storefronts. i am wondering, the nature of job losses are not all the same. you talk about the peak unemployment rate, at least in nominal terms in april, yet a lot of those were considered temporary. what proportion of the ongoing job losses that we are seeing now do you think are permanent? dr. zandi: it is a good point. early on, the thought was that these were temporary, that once businesses got up and running, they would quickly hire back

their employees, and we would get back to low and employment pretty quickly. that increasingly looks less and less likely, the more and more these jobs are -- you have people saying they are still on temporary layoff come but they are on temporary layoff for long time.s of my sense is we lost 22 million jobs at the worst of it, we got 9 million back, so we are to 13. if you tell me we are going to be down for 5 million when it is all said and done, those are the jobs that are not coming back. it is going to be very hard to get those folks working again, and those will be different jobs. that sound about right to me. now the elasticity of wages are radically different then what you and i studied, and radically different than samuelson 1948, radically

different than the classic studies of the united kingdom and their lengthy depression. what is the elasticity, the responsiveness of wages given these challenges? dr. zandi: well, when you have such high and employment, they are not responsive. there's so may folks out looking for work, very difficult to get wage growth of any consequence. we saw that in the expansion coming out of the financial crisis. it wasn't really until the very end of that expansion, before the pandemic, that the labor market was tight enough that we were starting to get more wage growth that was consistent with what we would expect. even if we get a rescue package, even if unemployment goes into the single digits, it is going to be a long time before get back to full unemployment -- to full employment and we feel more comfortable that we are in a

well performing economy. that is how long it is going to take to get back to something like that. tom: thank you so much. just a stunning analysis there of the what if's out of a lack of stimulus, or if we do see stimulus again. it will be one million, as the survey. right now we are 35 minutes away from this important claims study. lisa: the prediction mark zandi just came out with is stunning and sobering, and deeply concerning, the idea that this will be looked back upon as a great depression. if you have double digit unemployment all the way through the end of next year, what does that do to new graduates? what does that do to young people just coming out of college and trying to enter the workforce? tom: i want to emphasize that a a depression is not defined within the definition of recession. the word depression has a life

of its own, like the word reflation. it is somewhat undefinable. what i would point out is if there were a number of byressions identified the 1930's, there was a more vibrant oppression in 1929 and into 1932, but we enjoyed a whole other kind of recession -- depression, rather come out of 1937. lisa: the key issue i expect to hear a lot more about is employees. four to 5 million jobs will not come back. what will people do with their time? tom: it is an american thing. evidence that america is committed to retraining as you see in europe and as you see in germany. we will have to see. maybe the unemployment rate will change its tune. -9% on futures.

alicia levine with us, bny mellon, a more cautious view then many we have been speaking with. claims in 35 minutes. this is bloomberg. ♪

>> we are looking for continued improvement in the economy, but the pace will probably slow down at the we had this quick rebound. >> we are looking at the possibility of recession in q4 and q1, and further negatives. >> we are looking at rates near zero for a long time, maybe forever. >> there is a certain logic in the market doing better than the economy here. >> this is "bloomberg surveillance," with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. a simulcast come on bloomberg ra