>> the world is desperate for yield. the world is desperate for income >>. with the vaccines insight -- for income. >> with the vaccines inside, there is much hope. >> we still have a lot of bad news to get through over the next quarter or so. >> certainly support is going to be needed going forward. >> we should not be worrying about $100 billion here or there. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. everyone.morning, it is jobs day.

we welcome you on the simulcast. bloomberg radio and bloomberg television across this nation and worldwide. this due of news is just extraordinary. an important moment will be lawrence kudlow after the jobs report. but jon, i want to talk for a moment about the markets. affected.oeing come up 5%.igit 13% on the s&p 500 year-to-date, and the nasdaq 100, lisa has loaded the boat on the nasdaq, up 38%. this is a boom and great bull market. jonathan: record on the nasdaq, just off that on the s&p 500. the market has ignored all of the bad stuff over the last month and held onto all of the good stuff. does that change in 29 minutes? the payrolls report, the estimate for hunted 60,000 -- the estimate 460,000.

tom: kevin cirilli talking about the enthusiasm to get something done. we will talk about that in the moment. i love what greg peters of pgim said in the opening credits, the idea that everybody is looking for every bit of yield. to me that has been undersold story this week about how other credit has really moved with a vengeance, price up and yield down. lisa: one of the most shocking speakers in this entire day is priya misra, when she came out and said the fed is probably going to extend the direction of their bond purchases at their meeting later this month, not because they think monetary conditions need to be easier, but because markets would throw a tantrum. we would face another taper tantrum without their support. they are backstopping these valuations no matter what happens with a jobs sprint or anything else. aboute could care less next year's outlooks. word ofo reads every

every single 2021 outlook. what is the blend of those outlooks so far? jonathan: you really want me to do this right here, right now? [laughter] value overgrowth. international over the united states. underweight core government bonds in the united states and europe. we've heard it, haven't we? you will hear it again, i'm sure, at some point today. tom: a good friend of jon ferro's over in london writing it up on the real backstory of 2020. you can't get a dog. you can't get a cat. news -- oned on cap cat news. what's the return on invested cat? i love that. costs, and this

pounds,nd -- this is in a lot of money over its lifetime, including in vet bills. some people may be forced to part with their cats. [laughter] jonathan: so you have gone from dow points to 2021 outlooks to the animal you know i absolutely -- i'm not going to say it. the last time i said what i thought about cats, people called in and complained. you are not taking me there. carry-on. tom: julia coronado joins us as we look at the serious news of the moment. with macropolicy perspectives, julia coronado was dead on on economic growth coming out of the financial crisis. what is your call for the next 12 months on economic growth? julia: it is a real dichotomy between the near-term, the next six months, and the six months that follow. we have a pretty flat profile for the next six months.

we get a little bit of stimulus. we are not expecting a big package, although those hopeful noises. but we heard hopeful noises before. more importantly, the pandemic itself keeps people on the sidelines. we really can't return to normal until we see confidence in their health. we expect that in the second half of 2021, where we expect we can get a nice surge in pent-up demand for services, which is what is still lacking, both in hiring and spending. the services sector is 85% of the u.s. economy, still lagging behind. jonathan: getting a read on the economy right now i am finding quite difficult. claims has been really dicey in the previous couple of weeks. we have been told it comes with a health warning. you can't trust these numbers. the employment component was quite soft on the manufacturing side this week. how do you look at the data coming through, the

high-frequency data and put together some kind of estimate as to when november looks like? never the tea leaves have been harder to read. we know all of the data is measured with a lot of error right now, partly because data collection has been disrupted by the pandemic itself. this month is really hard because we thought some of the high-frequency hiring indicators that come from the small business sector have rolled over and are suggesting a negative print this morning. the broader indicators like the ism services, consumer investments and office reports survey claims are holding up ok. looking for a 250 k gained this morning, which is not enough when you are 10 million jobs in the hole. it will be a little bit of a worry for moderation and just confirming that the pandemic is taking a toll, and that might be

inevitable in the near term. i do agree with what you were saying earlier, that it could be key in getting the stimulus over the finish line, which has been just like watching lucy and the football, watching these negotiations. lisa: it's been fun. i will say there is a question of what the value is in this jobs data, if it is so messy. even if you get the headline right, is that the value, or is the value elsewhere? what are you looking for beyond just the headline? julia: we are concerned about labor force participation. one of the reasons the has gone up sote quickly as we have lost who have toen up looking for work watch over their children, so we are definitely looking for participation, but i don't look for a rebound right now because of the pandemic. but that is something to keep an eye on.

also, just the composition of job gains, whether we are seeing that resiliency and the goods producing sector. the ism manufacturing hiring rolled over. resiliency and resistance we have seen is in the goods sector. tom: what is so important here is the goods sector resiliency, as you mentioned, and also the distinction of the service sector. are we going to see a reversion to 3% inflation in the service sector, or are we going to sustain this disinflation? which is it? we have to be careful when we talk about inflation and sting wish it. of confusion in how we talk about inflation.

we don't think we are in deflation just because airfares are low. shift down, one-off and then it will rebound. hasation, ongoing inflation to come from the labor market. it has to come from increases in purchasing power. otherwise, why would you would nor commodity prices when we are looking for the tea leaves of trend inflation? it is just a demand destroyer or a purchasing power enhancer, depending on which way the prices are going. it is not inflation or deflation, so there's a lot of excitement about the potential for inflation in the next half of next -- the second half of next year. if all that is is reversion to normalcy, that is no inflation. what happens in 2022 depends on the labor market is.

i do think we should see some reversion if we get demand and recovery of services in the second half of next year. that doesn't lead me to my belief for inflation in 2022 and beyond. 2020, not over, already talking about 2022. julia, we always appreciate your time. thank you for joining us. always smart, always sharp. the payrolls report in about 20 minutes. tom keene, the fed is just going to sit this out no matter how good things get through 2021, no matter help things improve. they have already told us they are going to sit this out. tom: i'm glad you bring that up because i am behind on this. i've used your vacation days and was away. you can do this on the bloomberg professional service. i can look to the january 27 fed meeting.

can they even wait that long? they are going to get a jobs report first week of january. the other sport, seven days before the inauguration, do they act before january 27 with or without stimulus? conditionsinancial are still really loose. i think what they will have at the end of january is some clarity on what percent it looks like, and then get their hands around what fiscal policy is going to look like. mike shoemaker of wells fargo made that point. why would you believe the fed in two weeks time is going to do something big and material when they don't know what congress will look like for the next couple of years? tom: it is a conversation of two weeks ago that is different than now. just because of the stimulus talk of the last 48 hours. there's been an ab rep shift, and we have to see where that goes in these remaining days. jonathan: and where i think there could be an air pocket is

in treasuries. priya misra of td securities touched on this. if enough people expect the fed to do something in a couple of weeks on extending the average maturity asset purchase program, that could get a little bit messy. it depends how much they are willing to look through that. tom: david in brooklyn says he's got cats for sale. [laughter] lisa: keep trying, tom. jonathan: do you know what tom keene does for the month of december? he buys a tree. he doesn't decorate it. he leaves it there for three weeks, and then literally before he goes away for the week of christmas, he decorates the tree. it sits in the living room with nothing on it. i've seen it, and i have photos. that's my come back. this is bloomberg. with the first word news, i'm ritika gupta. the justice department is in talks about resolving charges against the cfo of huawei technologies. it is a long-running dispute in

a clash between the u.s. and china. she has been confined to this city of vancouver. there's talk of a deferred third prosecution agreement on violating sanctions that would allow them to return to china. on aes are higher now stimulus package by the end of the year. meansrtisan plan negotiating is now getting more interest from the republicans. the proposal calls for spending $908 billion. they say it is a starting point. doordash has boosted the price range for its ipo, now looking to raise $3.1 billion, the biggest u.s. food delivery company marking shares at $99 apiece. it is a group of web-based

companies that help ipo's line-up airbnb is another. 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. ♪

>> this is the moment to use fiscal resources. i would go bigger now rather than smaller. when the crisis is over, talk in

a reasonable way about how to get back to a sustainable path. i just want to be clear, the crisis being over is when most of us are getting back to work and the unemployment rate is starting to look the way it did before covid. jonathan: and we hope we get there quickly. that was the former u.s. treasury secretary jacob lew. alongside tom keene and lisa abramowicz, i'm jonathan ferro. live from new york and london on bloomberg tv and radio, your payrolls report 12 minutes away. the median estimate, 406 2000. equity futures up 11. looking for a new all-time high. the euro-dollar just off the $1.2157.2020, the break again in 10 year treasury yields, up another two, 0.9228%. tom: at j.p. morgan chase, james

glassman has been a distinguished career speaking to jp morgan clients, business is small, medium and large about the state of the economy, and best of all, dr. glassman has listened to them. they be now more than ever, it is good to speak to jim glassman. what are you hearing from jp morgan clients? dr. glassman: what i am hearing is very mixed. this is a charles dickens year. some people are doing really quite well. others are struggling. the guys that are struggling, you know. the bars come of the restaurants, the air travel system. the guys not struggling are in real estate, consumer, capital spending projects. i think everybody is a little baffled because from their particular perspective, they see a lot of noise. depending on where you look, it

could be great or awful. i think people look to folks like you or me for guidance come up because we are sosebee looking at the broad picture. i try to translate what i thing is going on in the equity market for them, and i think most people by the idea that the fundamental issue is if you get a medical enter, you are thinking very differently about things in a few months. maybe by next summer, as tony fauci says. enter has been the key issue here. we have already seen some pretty tremendous progress in the job market with all the help we got from the initial rounds of fiscal stimulus. people are seeing that, and they are feeling it. they are becoming -- the folks i listen to, they stayed much more confident that we are going to get out of here, and they may think i am too optimistic. i tell them by this time next year, we will be back started where we were. it is all about the medical

ther which we now know -- medical answer, which we know has a good chance of getting out there. lisa: is there some sense that investors are looking at the now and seeing profits that are pretty good for the big companies, and they are buying because they got cash? dr. glassman: that is a good point because until last week, i kept telling myself it must be an imagination driving this. we think this is making us more efficient. we saw all of this fiscal stimulus. we know there's a medical enter in the pipeline. but when i saw the news last week on the profitability of companies in the third quarter, after-tax profits of nonfinancial companies rebounded to an all-time record high. that has put us right back into this zone we have been in the last 10 years. so you might be right.

equity investors here all of this stuff, they are trained to look at performance of companies , at a lot of these companies are doing really well. i think the shock of covid which is forcing us all to go online, working from home, it is making business is much more efficient. maybe that is what is showing up, and maybe that is what is driving the equity market. because if i didn't know, if i didn't have a view about the future and i am am just looking at the reality, the reality you just point out is pretty impressive. jonathan: if i didn't know, i would think the fed is buying equities. i think that is the story many people are going to find actual markets in. me, the most to unusual thing in my career is to see the value of the u.s. stock market running up to almost twice the size of the u.s. economy. i've never seen that before. i think it tells you that the equity market is looking beyond

this crisis and telling you something big is going on in the world. it shows up in the change in attitude about inflation from the fed. it is the innovation giving us ways to transition to this crisis. jonathan: it has been a powerful transformation. in a few minutes, we will have payroll numbers. i want to talk about the labor market with you, if we can. the employment component was a little bit soft. a quote from the ism talking about absenteeism, the struggle with hiring, getting workers to return. are you hearing the same kinds of things? dr. glassman: i was hearing the same kinds of things back in june. people were getting compensated pretty well on unemployment. some of that is expired, so it shouldn't be all that difficult. i think the best thing you should know is the weekly uninsured employment trends. they are no longer distorted.

it is only a distortion if i am having to file multiple back weeks of claims. this is not so anymore, and counting the guys running out of benefits has been improving. a little less dynamic in the last month that it was before, but still showing you a gradual imprint -- a gradual trend in unemployment, which is a positive. i thing it is a reminder that we still have a lot of momentum out there from the earlier actions this year, and no we are just waiting for that vaccine distributor. jonathan: still a lot to do. we've got to leave it there. jim glassman, thank you sir. six minutes away from the payrolls report. your median estimate in our 468,000. that is the headline number we will be looking for in about five or six minutes. tom: let's say the data is not going to move.

we need to focus at a 10 year -- atat 0.92%, dif 0.7%. distant from lisa: a lot of people are not going to potentially sell treasuries because they believe the fed will come in and be that put if yields go to high. the key to me is what is the breaking point to get in and take action? are they going to do it preemptively to avoid a taper tantrum? jonathan: is bad news good news? is good news bad news? i always find this absolutely amazing. if you accidentally tune into a business network for payrolls friday, try to explain it in about five minutes time. the payrolls report is just around the corner for the month of november. your estimate, 460,000. number, 638,000.

alongside tom keene and lisa abramowicz, i'm jonathan ferro. for our audience worldwide come on bloomberg tv and radio, payrolls next. this is bloomberg. ♪ it's down to the wire,

the team's been working around the clock. we've had to rethink our whole approach. we're going to give togetherness. logistically, it's been a nightmare. i'm not sure it's going to work. it'll work. i didn't know you were listening.

jonathan: for our audience worldwide, live on bloomberg tv and radio, the payrolls report just seconds away. the estimate 460,000. the previous read 638,000. here is michael mckee. 245,000, a significant decline from what we saw last month of 638,000 on revised. the forecast was for 460,000. the unemployment rate does drop as forecast to 6.7% from 6.9%. there is a good data point in that. we need to see what the overall labor force participation rate is, and i will get to that as we go along. let me quickly see what we have got. to participation rate falls 61.5 from 61.7.

that may explain some of the reasons we are seeing a lower unemployment rate. .verage hourly earnings up .3% the factependent on there are fewer people who make less money in the payroll numbers. looking at some of the details. 8% unemployment rate down from its high in april but still 3.2% higher than it was in february. the number of persons on temporary layoff, this is something everybody has been watching, has decreased 441,000 to 2.8 million, down from 18.1 million in april. 2 million higher than february. the number of permanent job losers at 3.7 million is little change from the month before. still higher that it in february. the number of long-term unemployed is up 385,000. these are people that have

exhausted their regular unemployment benefits. the number of people who are 21.2% tong, up from 21.8%. more people staying home to work from home. -- the payroll numbers for september revised up 39,000. better news. 711,000 in september. october revised down by 28,000. 11,000 additional employees over the three month period. tom: i will give you a chance to breathe. i want to emphasize the way it is distributed, i do not like it, nobody likes it. it was better when michael mckee was hermetically sealed before. what i have seen off the bloomberg is a set of headlines showing the two americas. the number of u.s. unemployed for 27 weeks rising, almost 4

million, a stunning headline if i can find it. michael mckee, the jobless rate higher if workers were classified correctly. do you trust this data? michael: you trust the data as much as you can. with thisme up alternative unemployment rate number. it is basically the data we have. we know statistically it is about as good as we will get given how much data they collect and the difficulties in this pandemic. it is comparable to prior months. that gives us something to work with. quickly looking at some of the numbers in terms of hiring. --ernment employers employment and local government down 21,000. we saw 86,000 fewer people working at the federal level because the census is ending.

some distortion upward. tom: what you see in the markets? quick drop&p 500, a after a huge downside surprised, and then a quick pop. now we are higher than where we were before. equity shrugging this off. this number for this market will be seen as stale. it is important to policymakers, and maybe this is the thing that drives them over the line washington. 10 yield -- 10 year treasury yields up to .93%. euro-dollar breaking up a little bit. these are subtle moves and i do not want to drop too big a conclusion, but for many people coming to this print it was less about the meaning for markets and more about what it meant for policymakers in washington. tom: i love your idea of subtle moves. this is important. did we get an advance here on

the december report due the first week of january? the disappointing nonfarm payrolls, did that have a december feel to it? michael: it does. member the survey is taken in the week that includes the 12th of the month. this is the first half of november and we have seen a lot of lockdown activity since then. you can expect disappointing numbers in december. one of the weird things about this number. this is a holiday hiring season. retail hiring went down 35,000. tom: some of the details throughout the morning. michael mckee will parse that data. for these market moves, important to bring in our next guest. jonathan: jeffrey rosenberg joins us from blackrock. jeffrey: i think you hit the nail on the head with the market reaction. it is a weaker report than expected. certainly you're seeing the impact of the pandemic surge,

particularly stronger in leisure and hospitality. the market reaction has been to the through this policy response. this week we have a lot of acceleration in terms of movement on that and this is the kind of news the market is interpreting as pushing them over the finish line. that is why you see bond yields higher, easy steepening in the curve. these are small moves, but not the kind of response you would expect from a disappointing payroll report, yields rally, per flattening. you are seeing the anticipation that this is reminding us this is about the pandemic and about fiscal policy. this implies a better expectation for fiscal policy that eases the pressure on the monetary policy to have to do more to restrain yields. that is why we are seeing curve steepening. lisa: you think markets are right? you think this is bad enough

news to prop policymakers to be good news for the economy and passing some sort of fiscal support bill? jeffrey: it is not so much that this is bad news. it is disappointing relative to expectations, but remember how wide the expectations are. what it is a reminder of is we are seeing a slowdown, we are seeing a weakening, we are seeing sectors negatively impacted. it is a reminder of how important the fiscal policy response needs to be given the surge we are seeing across the nation. tom: let's get out front of your monthly note. what is the fed's flexibility to economy, the labor new politics of the nation, and their ability to buy assets? does any of that change into the new year? jeffrey: we saw some of that change with ending the cares act flexibility.

the most important policy supports were extended into the new year. certainly some of the most , policymarket reaction reaction responses are starting to fade. that does not mean we cannot reup them in the new bill we are contemplating this year or next year. the fed retains tremendous amounts of flexibility to respond, but their response, as they have been saying, is limited in what monetary policy can do. what monetary policy can do is to support fiscal policy. it is the policy support through the employment support, through the extension program, that is the direct support. the fed will mitigate any market reaction to future expansion of .ebt, impact on debt service they will maintain the ability of governments. this is not just the fed.

the ecb is highlighting the same kinds of policy to enable fiscal policy to provide as much support as needed without the cost of increases in interest and debt services. jonathan: that could mean extending the average maturity of the purchase program over the fed. your yield on a 10 year, 93 basis points. how far would you push that move on the 10 year before you think the fed gets uncomfortable? jeffrey: i do not think the fed gets uncomfortable with small basis points move, five to 10 basis points moves, i think 93 basis points, 100 basis points, 125 basis points, it is really about the pace of increase the fed will concern itself with. if you're talking about the next six months a gradual increase of interest rates, i do not think the fed needs to react to that. what the fed would be reacting to would be a sharp rise in interest rates.

certainly we saw that during the taper tantrum. they react to big moves because that is disruptive to financial market conditions, financial market functioning. small moves in slow moves the market can absorb the fed can absorb. they will want to keep the lid on interest rates because of the benefits we are seeing to the housing sector. the most interest rate sensitive sector is benefiting greatly. those benefits extend across the economy. they want to ensure they retain the benefits as we want to go forward. lisa: do agree with priya misra that if the fed does not extend the duration of their bond purchases in the next two weeks there will be a taper tantrum? jeffrey: i am not sure there'll be a taper tantrum of the sort we saw during the original taper tantrum. there is a lot of expectations built into will they or won't they extend. i do not think the extension will result in such a large disappointment you see a taper

tantrum. i think you could see rise in interest rates, steepening of the curve, but it is a lot more uncertain whether at this point in the economic cycle they need to spend that bullet. because of that, i think the market is more balanced with regards to the potential reaction. certainly the reaction might be bear steepener, but not so much to call it a taper tantrum. jonathan: thank you so much -- tom: thank you so much. let me do a data check before we go back to michael mckee. futures up 13. down we go abruptly and write back up in yields, .93%. 1.68%, may be dollar weakness as well. michael mckee come in honor of bernard balin i want to talk about not the deep people -- the ling of america but the d employment of america.

the stationng where is versus the peak in 2000 versus even the average. how unemployed is america? michael: still significantly unemployed. i will give you a figure. the labor market put something out in terms of the total number of people unemployed -- let me see if i can find it while i tell you. 10.7 million people below where we were in february when we started this. still a lot of people unemployed because of this. inare also seeing trends labor force participation decline because the baby boomers are retiring. tom: really? michael: everyone is wondering why you are still around? tom: keep it up. lisa: you will throw me under the bus again? michael: the other issue is schools being closed. a lot of people happy to stay home to take care of children.

there a lot of people who are not in the labor force and a lot of people unemployed. there is a long way to go. lisa: given the fact there is this permanent unemployment bleeding into the figures, what is the real unemployment rate? we are looking get a headline number of 6.7%. u6 number.% is the there are people who have calculated higher. it is still significant number of people looking for work or discouraged workers or those who can only find part-time jobs. thelook at 12% to 15% is rough estimate of where we are with that kind of unemployment. jonathan: i want to turn to the bond market and get to what 10-year treasury yield's are doing off the back of this number. yields are up three basis points. .94% on the 10 year. we talked about this initial read. it is a mild move on the back of the downside surprise. it is clear the conclusion for a

lot of people is this pushes the fiscal talks over the line. that is why you have a lift in yields, you've equities breaking out a little more, i have no idea if that is where we will be at the end of the day. that seems to be the conclusion many people are drawing after the data drops. say is soi would important is the idea of two americas. cameedwards of louisiana up with this phrase, and all i can tell you is i have never seen two americas like i see it this december morning. jonathan: i cannot agree with you and this speaks to why me and so many other people who been uncomfortable with what is happening with markets and what is happening with society. the huge challenge of 2020 has been to divorce how you feel about what is happening around you, the disparity so many people experience and we are aware of, from your outlook for

markets, which are trading on the aggregate number. the question i would be asking is when does the disparity start to matter to financial markets? markets will trade on the aggregate number, and i would argue the disparity starts to matter to markets when it starts to matter at the policy level, and it will matter at the policy level if you get a democratic sweep. it could be the difference between two very different regimes -- january 5. tom: tell us about lawrence kudlow. how hard will you grill him. jonathan: it will probably be one of the last times we catch up. the outgoing national economic director. i'm trying to gauge what the package will look like in d.c., whether it has the president signoff. whether it includes $160 billion of state and local eight. that has been the redline back to july. tom: interesting on those red lines. it is a key conversation.

michael mckee, 10 seconds with you before we get to our policy expert in washington. what date it will you look for as you stagger through december to the january report? michael: retail sales and spending to see if americans are still going out. a services-based economy, do we still spend money, or are people concerned because of the numbers they are seeing and starting to save more? tom: thank you so much on the jobs report. futures up 12. right now on policy, henrietta treyz joins us. is the ink drying on a stimulus bill? are you that certain it can get done. henrietta: i feel pretty great about it. i know that is crazy talk, but i do not think there is a question of whether or not we would get a bill, it is a question of the size and scope. i am optimistic. , 70% odds we get a bill done.

lisa: the 10 year yield believes your message. points asto 95 basis people price in the greater likelihood of fiscal support package passed in washington on the heels of this labor market report. do you believe that this was a bad enough report to push any of the laggards on capitol hill into passing something? henrietta: i really do. i had an interesting conversation with the client who was still looking at stimulus as unnecessary and saying the market does not need stimulus. i think that is an outdated way of thinking about how d.c. considers economic policy. this is an anomaly under the trump administration that anyone cared about the stock market. it is about the fundamental data. it is about the employment numbers come it is about gdp data. it is exactly the kind of print say makes members in d.c.

-- massive increase in covid, we are going into the holidays, we will not be here for another month and a half, we have to do something now. i feel be something in the $600 billion range, that includes $300 billion in money that has already been allocated in previous iterations of stimulus, the cares act or the ppp program . there will be somewhere in the range of $300 billion of new funding that goes out to extend the pandemic on employment assistance. point as key sticking we've been talking about for a couple of months is the funding to state and local governments. what is the tipping point for mitch mcconnell to get on board with the bipartisan agreement, or something that still include some aid to state and local governments? henrietta: state and local is absolutely a sticking point because you still have the divide mentality among whist

with -- among midwestern senators. if you can stop discussing state and local broadly but getting to school aid, specifically buses, rail, transit, subways. these programs will lay off 10,000 workers. they are slashing their provisions by 40% in d.c., in new york, in chicago. they are making a lot of noise at the transit level. if you can start talking about transit funding -- tom: i take issue with this after talking to patrick floyd -- to patrick foye. washington hates transportation because they are democrats in big cities. will that change? henrietta: there is enough of a push to get you a small batch of funding. there is a long way to go, but i think fundamental underperformance is something that has shifted the last couple

of months. jonathan: a bit of disruption on your line but we will stick with it because this conversation is important. how important are the things we are discussing right now to the january 5 runoff in georgia? henrietta: i think that is a critical question. it is important because you need and a funding to keep democrats at home and not enough to alienate the republican base. that package i just walked through, roughly $600 billion in spending does just that. nois no bailout, there is $300 a week unemployment insurance booster at the federal level, no direct payment to individuals, none of that democratic-socialist minded stuff that will get the republican senator's in trouble, but it is also enough to provide aid to the democrats and members of the georgia community that needed the most, mostly in the unemployment insurance eight to get them to stay home. this will be the largest turnout

runoff in the state of georgia. the margins are exceedingly tight. the latest data shows all soft is up 50 to produce 48, whereas warnock is up 52 to loftin or -- 's 45.ffner georgia polls were pretty accurate in november. there needs to be a concerted to be -- there needs enough to keep the democrats home, which creates concern as to whether or not president trump should go to georgia or whether they should or shall not pass a minimal stimulus bill this cycle. i think they will. think that is threading the needle. .hat is what they will get jonathan: history is barely part of the conversation. the alex for 2021 hardly includes january -- the outlooks for 2021 hardly includes january 5.

there is the assumption we have a divided government. do you think that is a mistake? henrietta: if you think -- if we do see the democrats pick up two seeds, there will be the definition of divided -- we will need to watch the two at risk for flipping sides, lisa murkowski or joe mansion. he will look at a 60 vote threshold -- you will look at a 60 vote threshold for any legislation. that is what vice print -- that is what president-elect biden is signaling he will make his state of the union address about, his inaugural speech, and concentrate exclusively on the coronavirus, the need for stimulus, and that will occupy the first quarter of 2021 until they get it. if there is a 50 seat democrat "majority" they will try to pursue things like reconciliation and get more funding, but you will not see anymore legislation passed. i encourage our clients to focus on things that can change at the

regulatory level and trade policy, u.s. china relations, u.s. eu, u.s. japan. that is the focus on the future. jonathan: we always enjoyed catching up with you. treyz.ta here's the story of last 22 minutes. downside surprise on payrolls. lower.vious read revised the market read pretty clear. soft read on the headline number. seen as a stimulant to provide the stimulus in washington, d.c. equities higher, bond yields up to almost 95 basis points. tom: i have never said this but we are on the 1% watch. only five basis points away. you may get a one print today. jonathan: you think so? tom: if you get mr. kudlow to say the right things, yes. the burden is on your shoulders. i believe i speak for queen

abramowitz that the burden is on your shoulders. you must get larry kudlow to sate yields at 1%. jonathan: i think to get him to say something that would lead yields to 1% would mean there is agreement on capitol hill, and imminent agreement with the state eight for the above and a deal looks -- that looks close to $1 trillion, which is a bipartisan proposal, and something away from the $500 billion on offer from mitch mcconnell. lisa: this confirms the charade of the whole thing. it is not a surprise the market is weakening as we have an increase in the pandemic, record numbers of hospitalizations. it is going to get worse. people are going to stay home. restaurants are closing. the fact that this pushes over the edge some talks about stimulus efforts is notable as far as the p.r. aspect and the idea of trying to garner popular support, especially at the time of the georgia election. jonathan: talks that have been

going on since before july on this particular package. we have been talking about this for a long time. a.m..ou slide in at 6:50 i am starting the morning early. the most important thing i heard was from miss treyz. georgia is a mess. that is the reason they would get the stimulus through. jonathan: for the conservatives come is that the equation different? i thought she was more nuanced than that. tom: may be. i do not know. i think mitch mcconnell will collapse on stimulus because he is scared stiff of the outcome in georgia. jonathan: i do not think it will be about the data. it will be about the economic restrictions across the united states of america. i think california has said this is a threshold, and many people think we will preach at. lisa: people are expecting -- we will breach it. lisa: people are expecting a new round of stimulus.

jonathan: this was fun. i enjoyed stiffing with you. tom: your entourage is a lockdown. lisa: we will keep talking. jonathan: coming up, larry kudlow, reaction from the white house in the next hour on bloomberg. ♪ wanna lose weight and be healthier?

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jonathan: good morning. the countdown to the open begins right now. pretty futures holding on and bond yields breaking out. we begin with the big issue. covid and the recovery. the u.s. payrolls report coming in much weaker than expected as the surgeon virus cases hits the labor market, giving economists much to worry about in december and beyond. the pandemic accelerating across united states. another day of record-setting infections come another day of state officials urging caution. >> the bottom line is if we do not act now, our hospital system will be overwhelmed. if we do not act now we will see a death rate climbed, more lives lost. that is why today we are pursuant to the blueprint we put out 14 weeks ago of pulling that emergency brake. governors finding increasing support on capitol hill with president-elect joe