and be healthy. get off the floor and get on the aerotrainer. go to aerotrainer.com, that's a-e-r-o-trainer.com. headquarters -- romaine: let's get you caught up on what going on. the s&p dow and nasdaq closing at record highs. caroline: an extraordinary week, record highs on the stock markets and also on the death count, the push-pull of is seeing assets being pushed and pulled around also. stocks, commodities, risk assets

have been on fire and what exactly are the pricing in? hopes of a vaccine, hopes of stimulus? how can that fed wire without some sort of his -- fiscal lifeline? the day was so bad it looked good because as many events started to set in that we see congress actually pushed through some sort of deal, so many angles to digest today, but what is clear is this rotation trade is on the front and center. joe: absolutely, everything is flying but was -- what has really been flying are these deep cyclical commodity linked equities that have been dormant for most of the year and they continue to have really strong weeks. stocks, youenergy look at the end of november basically right ever since we got the vaccine news they have been shooting straight up and have had another strong week. if you look over all still down 31% on the year. thatne: a lot of those

have been left for dead a few months ago are rallying hard on this day. diamondback finished a day up about 13%, apache, you get the picture. there is a general sense that as you get the recovery, as you see more demand for raw materials whether in the middle space or in the energy space, that could have the energy -- benefit for the market. joe: joining us with more is michael purves. in -- incredible stretch this cyclical commodities have put together. basically a month of real outperformance tends to be sustained or maybe the better question is, what would it take for this outperformance to be sustained? they arerger chart still massively underperforming.

>> one name i have been focused on is u.s. steel which was frankly a stock that was not trading well before covid and nora were steel prices which you determine -- nor were still pricing. the way i look at this name is that the stock was left for dead. every analyst hated it. steel prices were quietly skyrocketing. --late august there were they were 450 a ton, now they are $8.20 a ton. lastook back over the 10-15 years that is good, but the stock has started climbing here. , you ask what is needed for u.s. steel, it has doubled in the past few weeks, what does it need to go higher?

you can make the case that steel prices need -- don't need to go up much more, they just need to not collapse. analyst, i canro feel comfortable if steel prices are probably not going to collapse. not in the near-midterm anyway. continuing to show optimism surrounding the economy, where are some clever places to be in the moment that have not been swept up we have seen thus far? >> i think you have to look at each name differently, you may have seen platinum which is breaking out. that isa precious metal a bit different than gold and silver, i think you have to look case-by-case.

i got comfortable with owning u.s. steel and i am recommending it to my clients. i think it can easily double some keyd on assumptions holding together which i think they will, i think when you get in the energy names it is a little bit different. you have to be careful about what is a big tactical bounce a safe longer-term investment here, so i think it is your time horizon here. i think right now you can make a more obvious case to buy a mispriced materials name like -- than buying an airline or something more dependent on vaccine recovery. a lot of these can be -- by fiscal stimulus coming together, by the fact that inventories

were laid down and so forth. if you are trading in the shale names or in the majors in oil, you are obviously taking on oil data. discussionifferent and a complex one, i'm not an oil analyst but i don't feel wonderful about thinking that oil prices are going to keep rising here into the next year. i think you have to be careful and it is very much a single stock by single stock. 1.i would make from a macro point of view is that what this rotation is making is that stockpicking and sector picking is extraordinary important. the tide is lifting a lot of boats, but the alphas are made on a single stock basis right now. romaine: when you are looking at the macro picture, are you focusing more on the consumer spending side of this recovery or the business spending side?

are there certain areas you think give a little more clarity as to the pace of the recovery? an overall economic picture, obviously the consumer is really important. the consumer has been surviving this pandemic better than certainly a lot of expectations. point, thesome consumer seeing a more commitment to capitalist spending shares is going to be key -- expenditures is going to be key. i think you can flash back to 2018 is what we are seeing right now, we are seeing may be some fiscal stimulus to help us out of this very severe economic contraction. 2018 you had to this notion we were going to return back towards a growth after the tax deal was passed. that lasted six months and then you had all the usual structural forces coming back.

on the macro side, i think there is an echo of 2018 and i think you have to be careful and watch the corporate spending and the theitment to fixed goods, commitment to capital expenditures, how is that growing and how much is that going to be changed by covid? joe: real quickly, you just have a minute left, but going back to the materials, one way some of these prices of commodities can run is if there was significant underinvestment and diminished capacity in the past causing this kind of price squeezed. do you feel even pre-covid we knew a lot of these industries like steel and other commodities really suffering by diminished investment, does that in your view make this run more sustainable because there is not a supply capacity like in the past? 10,sure, you go back to 20

oil was going to go higher because of the china nation and when china backed off that and we started getting that transformation in the chinese economy, we went into a commodities market which ultimately supported -- resulted in supply contraction from copper to steel and so forth. ultimately those supply contractions will change, u.s. steel is opening a plant right now. i think you have to look at all of these materials names in the context of a very powerful balance as opposed to necessarily a whole new world order where you have to have a five-year overweight to commodities. i will look at this how you navigate alpha in the intermediate term and not necessarily something you stick in your 401(k) and forget about.

romaine: have a wonderful year on coming up next the show we have the big november jobs report. we are going to break down the numbers coming up next. this is bloomberg. ♪

romaine: this morning we found out the u.s. labor market added 245,000 jobs in the month of november well below what most people were looking for and raising a lot of concerns here about the vigor of this economic recovery. joe: missed expectations, but this is not what you would normally see after a miss and that was the immediate knee-jerk reaction to the report.

we saw 10 year yields tick higher, so it is one thing to say it sometimes stocks move higher because you expect easing, but now we see they are right at 830. the 10 year yields ending at .97 just below 1%. caroline: the question is can we break above 1% and also what is the fed going to think about that? joe: to be clear one theory is perhaps the report will kick them into action in congress and get that stimulus. let's bring in the senior u.s. economist for bloomberg economics. how bad was this report? headline that jobs missed, labor participation slip back, it was below expectations, how concerning are the numbers here? >> i think it was a pretty bad report all across. we saw the jury ration in the growth in payrolls, -- we saw

deterioration in growth in payrolls, from the private sector getting hurt and the worst news is that it is just the beginning. we are forecasting headline payroll for the december readings in the area of 150 negative. simply because the lockdowns that started in the beginning of november and they cause of this in the growth, they worsened in the second half of november and growing into december. we will see a worse rating this month and we will probably see a pickup in the on employment rate. romaine: interesting here this data point we are getting hit today -- here today. the market reaction seems to be this is going to get congress to act potentially and maybe even the fed to act, is there a longer-term projector he -- trajectory here that you would

actually think would make the fed change or somehow adjust its policy in some way? >> bad news-good news for the market, the idea is that people are expecting that that will push congress to act faster. in fact, i remain quite step skeptical, that is screaming the leading -- the leading data is just grinning that they need to put -- act inckly to avoid drops economic output. alreadyxpecting that simply because nothing has been done yet. about howtalk to us the data is screaming at you, what has been interesting is how some of the dire predictions

particularly when you see the fiscal close -- cliffs coming in, we expected it to fall and it just didn't, what do you think is going to be different this time? >> this time we do see the acceleration in covid cases. that was a huge driver in the beginning of this year. it seems like it is happening right now, so it is really a -- forceddown lockdown that are closing parts of the economy and having huge impact on economic growth. obviously the help from the fed, the cares act in the beginning of this year, that has helped a lot. really the reopening of the economy has the most profound impact on economic growth.

the economy reopened into the third quarter and we saw this huge rebound in economic growth. i think that is what we are going to see in the near term. we will see a deterioration in economic growth into the year probably comewill in the first quarter regardless of policy help and things like that. once the vaccine is available, we will see a rebound and there is nothing much you can do about , policy has to try and soften this blue -- blow. stuff, we will continue to watch that, our thanks to you, the senior u.s. economist for bloomberg economics. coming up, bitcoin hit an all-time high this week then pulled back just a bit, so we discussed the rally with the asset chief managing officer next, this is bloomberg.

caroline: today we are focused on the extraordinary week in markets and crypto is in it, but coming hovering near the 19th -- bitcoin hovering near the $19,000 mark. thatve got breaking news riot blockchain is putting up 1000 more shares. joe: absolutely, pretty extraordinary week and readjust side -- we are just shy of those record highs that where we were weeks ago, joining us now is the chief operating officer at bit live asset management. it comes to this question of who is the buyer that is driving this? his institutions, retail, high net worth? in your view, where is the marginal dollars coming in? >> thank you guys for having me back, great to be with you on a

jobs report day. what we are seeing that is different this time around compared to previous rallies is that it has become a difficult for professional investors do not have an opinion. at some point it is going to be the case that if you are managing other people's money and you are investing, you are not doing her job if you don't have an opinion. often times once you sit down and study the asset class and you develop an opinion, you become a buyer and i think that is what we have started to see since the late summer. i'm not going to say that everyone is going to arrive at the conclusion that they should be wrong, but i think that is where this marginal buyer has been coming from. romaine: everyone has an opinion, i am curious about some of the reports that we heard about paypal and some of these

payment companies embracing bitcoin in a way that folks did not necessarily think whatever happened. , how much ofappen an impact to that have? >> there is no question it has had a significant impact and i think you have the same dynamic there with these other companies getting involved. i think people underestimate the reach that paypal has. i think what happens is if you sit down around the investment community and believe me, all of these companies are, it is hard to get to different conclusions. many of the public companies that have announced they are going to be involved in bitcoin or cryptocurrency, many of the public companies that have announced they have purchased cryptocurrency have been rewarded by the public markets. this is against a backdrop of a -- assete at so class class, there is limits to other

cryptocurrencies out there so that as the space becomes more crowded, the supply is fixed and there is not that many seats at the table. what we have is an increase in price. caroline: is there a risk that given the limited supply people start going down the food chain and start looking at more alternatives? absolutely, there are risks i want to be clear about their -- that, there are regulatory risks and people should absolutely consider them. it has also been a classic feature of previous bull markets in crypto that people get a taste for bitcoin, they start investing their and then they look over into other assets in the space. that wengest these is are investing in the asset class, we think probably ether ium will be the story of 2021 as we move forward and we think the

risk is that folks and investors do not appropriately screen these additional assets or analyze these additional assets. most of us with day jobs don't have the time to consider those risks that you are talking about. it is important as investors move over into the other assets besides is going -- bitcoin which we think is the natural think that ise the dynamic that will occur. you talk about everyone needing to have an opinion on bitcoin and it is kind of like that, everyone does feel like they have an opinion, but with other asset there are clear ideas how to value them. tod is historically tied real interest rates and volatility, do people have any idea of why bitcoin at 19,000 as opposed to 1900,

do have an idea of where it should be at? >> i think valuation is an important question. the traditional metrics certainly do not apply, so we started to see reports coming ,ut from professional analysts the bloomberg commodity analyst was out this week with a bullish report as well, there is just not a lot of slack in the string. joe: i like that phrase, thank you. caroline: great speaking with you, stay well and we wish your team as well of course. romaine: great conversation there and a reminder to all of our viewers, you can also become our listeners, subscribe to our weekly podcast called " what'd you miss this week?" it is available wherever you get your podcast. joe: we should do a second podcast, the worst of the week. romaine: that might actually be

pretty popular. caroline: how would we indicate that? joe: bloomberg technology is up next, have a great weekend. . . . it's moving day. and while her friends

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