>> we need rates to keep rising, but in a slower, more orderly fashion. >> the market is pushing the fed as to whether or not it will be able to hold the line. >> consumer confidence will come back and there will be spending. >> the reopening is not even in the market yet. this value trade is still relatively new. >> we do have inflation. that is good for the reflation trade. that is good. . for the cyclical trade. . that is where we want to be -- that is good for the cyclical trade. that is where we want to be. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone.

it is a simulcast on bloomberg radio and television. thrilled you are with us on a monday. there was a four day weekend, and then you get to friday, the foundation for the lift up we see this morning. forget about bonds. forget about currencies. forget about commodities. stocks lift. jonathan: small caps lift. the s&p 500, we have a lift by 1%. jonathan golub was terrific, talking about how we have seen a boom in the cyclical part of this market, and put them together with lori calvasina of rbc, and we get the idea that we still have not seen the broad-based participation with the year so far. tom: i spoke with anthony dwyer of canaccord genuity, whose thought is that if there is not a genuine recession, the fact is we are looking at 6% or 7% real

gdp. it is difficult to go down given that. jonathan: look at the primary market and the credit market, and things are still ok. it is a very different environment. tom: your reading the tantrum we saw. what is the outcome of your reading? lisa: the outcome is there still is a borrowing cost at very low rates, but you did see companies start to race to get into the market, thinking perhaps yields are going to rise. i am trying to pair the message you are talking about from jonathan golub, from lori calvasina, with the message we heard from matt horn bok -- with matt hornbach. i am trying to figure out the consistency here, the urgency may be felt by fed officials paired with this incredible optimism still seen in equities. tom: i would suggest the market is doing the combing down for the fed.

jonathan: totally agree because the fed hasn't said anything about coming down yet. they've got plenty of opportunity to later this week. i asked this question a little earlier. are they more concerned about tens and elsewhere, or about market pricing and rate hikes prematurely? lisa: hold on a second. and i didn't have an answer for you last time because i didn't have that much time. i have a couple more seconds. jonathan: you've got an hour. lisa: ok, and our on short-term fed policy -- ok, an hour on short-term fed policy. on the long end, on 10 year, on 30 year treasury yield, that affects the borrowing costs of the united states and the willingness of fiscal policy makers to borrow more money and invest in the economy. both are of concern to the fed. the question is how did they achieve rates at a level they see as sustainable. tom: where are those short-term rate hikes?

lisa: they are already starting to be modeled in in 2023. tom: they are worried about march 17 and the fed meeting afterwards. i can do this on the bloomberg professional service, on radio, on tv. arch 17th, april 28, and june 16. that used to be long-term fed gazing. now we are out to 2024. jonathan: the whole point of the new framework, the communication of the last nine or 10 months, has been to say we are not going anywhere. we are not going anywhere. the market is getting ahead of it. we are not going anywhere even if the market is getting better, and we are still getting ahead of it. tom: dow futures up 326. i am trying to get to three big figures on the vix. there's so much carnage in the markets. where are you looking in the data? jonathan: i would say take a look at the fx market as well. tom: i agree.

jonathan: the japanese yen we getting against a stronger dollar. norwegian krone, polonium in the mix as well. whether we start to see a stronger dollar that bites off the back of this conversation about u.s. expect pinnell is -- u.s. exceptionalism, we will hear that soon. tom: for me, that is a huge deal. i will take it out to vaccines and the glorious numbers of under 2000 deaths in america today. let's bring in all we have covered to get you into that final month of this quarter. david riley, bluebay asset management, with us. what part of the market are you most focused on into march? david: the biggest focus echoes the discussion you have just been having, which is i think more around the shortened of the u.s. rates market, the fed has so far signaled it is not too

concerned about long end rates going higher growth expectations, to pick up inflation expectations. it might be a little uncomfortable, but they are not worried about higher yields at the low end. as lisa was alluding to come of the sword and was starting to move forward as well and actually -- alluding to, the short -- the short end was starting to move forward as well. i don't think that is going to be consistent with the forward guidance given around tapering in the forward guidance around allowing inflation to run above target for a substantial period of time. i think just right now, kind of keeping an eye on the front end of the u.s. curve and rate expectations, and then how the

fed potentially reacts to that. jonathan: it is totally inconsistent with guidance we've had so far. i think a lot of people are anticipating better economic forecasts for keeping the monetary policy outlook basically the same. chairman powell speaks thursday. deep expect them to change the script? david: i expect him to push back a little bit in terms of the first time, in terms of what we have seen in the rates market. i think what we have tried to do is to sort of reiterate that qe is going to be here through this year and tapering -- [indiscernible] -- and i think that will help calm down some of the trend. but it has been interesting because if we look at what the reserve bank of australia has tested and set up its bond

purchases, thern about higher rates. the fed really hasn't pushed back in any real shape or form against those higher rates, and may require a more serious wobble in rates to do so. it is clearly looking at what risk markets and financial conditions as a whole are doing. credit markets have proved very resilient to high-yield. jonathan: david riley, the bond market did not lead this move. back in october, we saw the cyclic parts of the credit market rift. credit markets didn't really do much until the last month, when real yields just exploded. what is it about the way this market is set up now, that real

yields almost lagged a lot of this data. why? david: we had a conversation that we were talking about sort of reflation theme going into this year, and how that was being played out, a rotation from growth to value. but the bond market hadn't really responded to that. i think you are right, the bond market has been catching up. what has really been the big change is the georgia senate election results, that the democrats have a wafer thin majority across the senate, as well as the house and white house. we have seen a pretty meaningful increase in growth expectations since the start of the year, and i think the bond market is now

responding to that. you get this kind of paradox that the fed wants to signal to say it is very dovish, keep rates unchanged even until 2024, and allow the economy to run hot. the danger there is that the bond markets will say, hold on a minute. i a bond investor. that implies inflation is really going to pick up potentially, and we've got to be compensated for that. that leads to a wobble in risk assets. , so how the fed treads that line, that means rates ultimately end up being higher than they otherwise would be. lisa: just 20 seconds here. investment-grade credit has sold off. we can see a 3% per klein year to date. is this a buying opportunity? david: i think that is really

about duration. i think duration interest-rate risk is going to continue to be a headwind for high-grade credit. i prefer to be in high-yielding credit, where shorter duration and you've still got a bit of spread cushion, and collateralized loans -- jonathan: great to catch up, sir. from new york city this morning, good morning. alongside tom keene and lisa abramowicz, i'm jonathan ferro. a busy week ahead. chairman powell concluding on thursday, and then on friday, the payrolls report. let's get to the price action of this morning. we settled down. we stabilize. we bounce on the s&p 500. so much about the bond market, really just quite violent in thursday's session. yields popping up to 1.41%. on the 30 year yield, we break out just a little bit in 30's. yields up to 2.216%.

that was a long weekend. tom: i am looking for an entry point. jonathan: what did you do on friday? tom: we went to potty train -- we went to puppy training. jonathan: very good. tom: the dog is training. jonathan: just comparing and contrasting -- [indiscernible] [laughter] jonathan: from new york, greg valliere coming up shortly. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. senate democrats will not try to raise the minimum wage as part of the $1.9 trillion relief package. they had considered including tax penalties on big companies that pay low wages, along with incentives for smaller companies to pay a higher minimum, but the claim clear over the weekend that getting all 50 democratic senators on board would be difficult. the house passed the stimulus

bill saturday. donald trump told a group of conservatives he is landing to lay the groundwork for -- is planning to lay the groundwork for a 2024 campaign. his 90 minute speech in florida made it clear he thinks he is the best choice for the republican nomination. iran says it is not the right time for direct talks with the u.s. and european powers on the nuclear deal. donald trump pulled the u.s. out of the 2015 agreement. president biden has offered to take art in talks to revive it, but iran wants the u.s. to lift economic sanctions first. american freight railroads are launching a lobbying campaign to fix their interests he dashed a lobbying campaign to depict their industry as a necessity. some of those plans could hurt truckers, their rivals for carrying goods. warren buffett made no splashy deals in 2020, but behind the scenes, the 90-year-old billionaire was hardly inactive.

berkshire hathaway was busy buying up its own stock and trading others. the conglomerate bought up a record of bircher shares, and also doubled the volume of buying and selling compared to 2019. global news 24 hours a day, on air and on bloomberg quicktake, (announcer) do you want to reduce stress? shed pounds? do you want to flatten your stomach? do all that and more in just 10 minutes a day with aerotrainer, the total body fitness solution that uses its revolutionary ergonomic design to help you to maintain comfortable, correct form. that means better results in less time. you can do an uncomfortable, old-fashioned crunch or an aerotrainer super crunch. turn regular planks into turbo planks without getting down on the floor. and there are over 20 exercises to choose from. incredible for improving flexibility and perfect for enhancing yoga and pilates. and safe for all fitness levels.

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mr. trump: i am not starting a new party. that was fake news, fake news.

no. wouldn't that be brilliant? let's start a new party, let's divide our vote so that we can never win. jonathan: former president donald trump speaking to cpac over the weekend. from new york city, good morning. alongside tom keene and lisa abramowicz, i'm jonathan ferro. this monday morning, your equity market with a lift on the s&p 500. bounce back from last week's losses, up a little more than 1%. yields up four basis points on the tenure to almost 1.45% now -- on the 10 year to almost 1.45% now. euro-dollar back down to $1.2048. crude rallying, $62 a barrel on wti, up 0.9%. tom: what we've got is better equities, and yields are coming up at the same time. jonathan: yields are up seven basis points. i am with you. we've got this lifting yields, this rally in equities. i just inc. it was the volatility of thursday that

really whips -- i just think it was the volatility of thursday that whipsawed everyone. tom: right now to washington, we go to greg valliere of agf, really looking at the moment that is out there. i want to go back to p research -- go back to peer research, where they came up with the liberal combination of 47% of the democratic party. i believe that means the majority of democrats are not liberals. how does president biden deal with that with a new animosity? greg: it is a really big story, tom. we saw over the weekend the fight on minimum wage. it is not going to be in this $1.9 trillion stimulus bill. i think a lot of moderate democrats don't like it. this is the first of many big fights that will pit the center against the left. tom: what is the six district difference in the house, and the

push by progressive, by liberals to bring mr. bite into the left? -- mr. biden to the left? greg: there's not a lot of wiggle room, absolutely. talk of a big new tax hike, i guess elizabeth warren is out with something this morning, is not going to fly. the democrats in the house worry that they could lose the house in 2022 if they go too far to the left. lisa: let's talk about that bill that senator warren introduced this morning. she was proposing a 2% tax on the net worth of households and trusts between $50 million and $1 billion. what is the chance of this actually getting past policy -- getting passed policy? greg: close to zero. it is a good argument. she can say we are progressive, we favor the people who make that much money, but you don't have the votes for some thing that radical. lisa: but are there the votes to raise taxes in some other capacity later in the year? greg: that is a good question.

later in the year as we look at an infrastructure bill, there may be some increase in corporate taxes, up from 21% to maybe 25% on the very wealthy, but some huge wealth tax i think has very little chance. jonathan: do you think we can actually get an infrastructure bill passed anytime soon? greg: i do. when people say it is to trillion dollars more, it is over 10 years, so it is not like it is all in one year. i think it is going to be tough, but they have another shot at this budget reconciliation. they get to do it twice this year. once is in the next two weeks on the covid bill. i think they will have one more chance later in the year. i do think we will get infrastructure. jonathan: what would be tough about it, considering that everyone on either side of the aisle says they want it? greg: they do. i think there is a strong need for bridges, highways, dams, telecom, all of that stuff. they are willing to spend the money.

i personally think they are spending too much money. i think $1.9 trillion is too much. i think we are going to overheat the economy, but it is going to overhead -- but it is going to happen. tom: you and i remember the phrase blue dog. what is the linkage of moderate democrats to the moderate senator from west virginia, and then over to moderate republicans? is there a new get together we don't know about? greg: it is a pretty lonely club. there are some people that would agree you can't spend this kind of money. obviously, joe manchin is the leader of this group from west virginia. but there are a lot of democrats in private who think that $1.9 trillion is too much, and many republicans. maybe it goes down to $1.7 trillion when we get the final bill in two weeks, but this is going to be a lot of money. lisa: i remember people talking about how the more radical wings of both parties had more clout, and we have certainly seen that

in the recent past. do you think it went forward, it will be the same? do you think we will see the democratic party skew more heavily to the left and the republican party skew more heavily towards trump and his more populist tone? greg: rhetorically, they will. and over the weekend, we saw a real anger on the part of progressives because biden would not go along with a student loan exemption. let me make this point quickly. i think biden himself will be the key player. he is not a radical. i call him progressive lite. he is an institutionalist, and i think you will come down on the side of moderate rather than radical. jonathan: before we let you go, i asked this question to our chief correspondent in d.c. about whether the divisions within the president's party are getting bigger, or whether we are just highlighting the more. what is your take?

greg: i think most in private say he would -- isaac most in the republican party say they him.d be happy to get he did lose the house and the white house, and they do not forget that. jonathan: the hope that we can get an infrastructure plan passed sometime soon in this country. tom: everyone i talk to over time, whatever the politics of the moment, it is all about who is going to pay for it. i go back to the rebuild of laguardia, which is a joint venture of public and private sources. why can't we do that? i don't know about the highways in the united kingdom. i never leave the hotel across the street from the studios. but why can't we have that infrastructure? i don't get it. jonathan: every year, when you and i fly out to switzerland, we get the train and they come on the platform, it leaves by the second on time every single time. answer the question who is going

to pay for it. you know who is going to pay for it? the growth and productivity it generates. tom: then why can't we do that, lisa? lisa: part of the problem is we can't agree on what infrastructure is the most important to invest in. it seems obvious when you talk about bridges and tunnels. you also have to think about green energy. you have to talk about cellular conductivity. you just start talking about different interests, and it is not as clear-cut, even though it ought to be. jonathan: coming up later on bloomberg television and radio, jp morgan chairman and ceo jamie dimon at 1:30 eastern. looking forward to this conversation. tom: maybe chime in -- maybe jamie dimon will make a point. jonathan:jonathan: i'm sure he will make several points, well-made. [laughter] lisa: i am missing something. tom: i am going to use that tonight at the dinner table. "that was a point well-made." [laughter] jonathan: coming up jamie dimon

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jonathan: from new york city for our audience worldwide, here is the price action. live on tv and radio. up 1% on the s&p 500, up a little more than 1% on the nasdaq. a rally in the small caps. emerging-market equities up 15% to 16%. on the month, it is a reset for em. does the dollar start to bite? does the start to break down? it did last week in a brutal fashion. the consensus traits, can they break down? the banks of 15% or 60% like em equities and morgan stanley saying we still have not fully

allocated the bank story. two, 10, 30, the curve up to 2.221 30's, on the 10 year up to 1.45. the pushback this week if we get from the fed, what is happening on the long end or the short end come this idea we start to price in rate hikes prematurely. tom: of five standard deviation move on the two year yield last thursday. we come right back down to inflation. this is the greatest start. we have the labor economy report on friday. thomas for celie is with rbc capital markets and does absolutely wonderful work on wage inflation. that is a huge part of the inflation story. are we going to see wage inflation? thomas: i think we can.

something i always found interesting is as we were rolling into october before we had the big resurgence in winter , you had companies talking about -- i think you can get back to some wage pressure over the course of the year. i would not to make too much of that but the reality is you do not need ramp it wage inflation to see brought inflation pickup. tom: back 15 years there was 4% wages and benefits inflation. we cratered down to the financial crisis and we were starting to come back. should jerome powell be afraid of 3% wages and benefits inflation? tom: i love this question because this goes to the center of the conversation.

at what point does the market start to worry about 3%? i'm not talking about wage inflation. hard to get to the 3% point anytime soon. i do not think you can get a 3% inflation. that is a conversation that needs to happen. what you are seeing in the market over the last couple of days, it is this belief that you are going to see more growth, more inflation. when we put out our forecast for the year in december, we thought this would be a strong year it is shaping up to play out message we thought -- much as we thought. the did -- the one thing we did not building was a massive increase in yields. we do not think people would believe it. we thought it would take a long time for people to get on board with the idea of your good to see strong growth and strong inflation.

the market has brought in faster than we thought. we basically had to scrub in all of our you'll forecasts. that is an important idea. lisa: there is a lot to unpack. i want to go back to this idea we could see 3% inflation but not 3% wage inflation, which raises the specter -- of stagflation. the idea the consumer will not be able to spend as much, the lower income workers will have less firepower in real terms. how did that factor into the growth outlook for the nation? tom: i do not think you see the big wage pressure right away. i think it will take time for us to get there. i do not discount it as a notion, but i'm talking in the near term. i think you're going to see the firmer rate of inflation and then the wage part will lag. this is a unique set up we have in the united states.

i do not know how may people acknowledge this, but we did helicopter money. we are still doing helicopter money. that is a reality. when you take the consumer in the aggregate this liquid, in a pent-up demand scenario, you will see a lot of growth. that is a reality. lisa: you are talking also that you had not priced in the higher yields to this extent so soon in the year. how much does that fall into financial conditions? how much does that affect your forecast for tightening, companies not being able to borrow as easily, or fiscal policy makers being that much more conservative about additional rounds of helicopter money as rates are higher and borrowing costs are more expensive? tom: i do not know there'll will be any sort of stoppage on the desire to do more fiscal stimulus. we will know soon enough. the reality for the backdrop is

yields -- 10 year yields, hard-pressed to make the case they go much higher. if the natural buyer has stepped to the side for the moment, which we think they have, i think that on tethers tends. 10 year yields could drift higher from here. we could say the natural buyer is down the sidelines. short of that notion, i think tends are going to be challenged to rise dramatically more. where you will see much more increase in yield is in the front end. think the front end of the market is ripe for a continued rise in yields. i stressed, if it is true that people are strong to bind to the notion you are going to see more growth, you're going to see more inflation, the natural extension is the fed will have to respond sooner than what we think. the front end of the margin is

ripe for increase -- jonathan: isn't that a test of the credibility of the federal reserve? tom: you are spot on. there's only so much the fed -- i think the fed was hoping there would be a point where people continue to believe things are not that great or there's a prospect for to get slightly better or a little bit better. this is the narrative that jay powell has been pushing. at some point he will have to change his tone. at some point he is going to have to acknowledge things look good, because otherwise that is where the credibility part of the conversation comes into play. you cannot whistle past strong growth. let me be clear. the fed is not incentivized to make a forecast, things will look awesome at the end of the year. there is no sense for them to do that. i would rather they be late to the party.

when things are ripping, from a growth or inflation perspective -- jonathan: you said at some point he has to address this. is some point march 4? tom: i think it is early. on some level, we have doing knowledge he keeps saying in the medium-term, down the road things will look better. i think that is probably the same idea he continues to push. when we get toward the middle of the year, i think will be more entrenched from a stronger growth, stronger inflation backdrop perspective and maybe at that point he starts her knowledge that. we've been saying -- he starts to acknowledge that. we think they will start the tapering process later this year. in the context of that there's only so much time he can continue to hang onto this notion of things do not look that great. we need as much help from others as we can give you. tom: what is your q3 and q4 gdp

guesstimate? i understand it is opaque. tom p.: i love you, i do not find that question that interesting. lisa: [laughter] tom p.: let me answer in a different way. tom: tom porcelli went to the abramowitz school of charm. lisa: i love it. carry on. tom p.: here is what i would say. a great way of thinking about the answer is this. in my baseline estimate i have for your growth of 6.5%. i am not building in any makeup or loss of 2020 spending, and i am not building in any drop-down of their gargantuan amount of stimulus we have in place. if you get some makeup of loss 2020 spending and you see a 20% drawdown of savings, which those are not outrageous gases, -- outrageous guesses, my 6.5%

comes 11%. without a lot of heavy lifting you can get outrageous growth rates. jonathan: you are welcome back anytime. tom porcelli rbc capital markets. he will be with us in the next hour. tomorrow, tom porcelli of rbc capital markets. wednesday, tom porcelli of capital markets. lisa: "i love you, but i do not find that interesting." tom: then he made it interesting. my question was -- what did lisa say? lisa: stagflation. jonathan: it was stimulating. you got to the point. it was a point well made. these yields, up seven on the 30 year. 2.22. tom: i take off one day and this is the love i get. jonathan: a long weekend.

did you get some rest? tom: no i did not. it was the day i took off two years ago. jonathan: you are off the rails on thursday, it was not until after the day ended that i realized why, you had friday off. lisa: i appreciate your humor. jonathan: you think he needs love right now? lisa: it was a point well made. tom: i do not want celery. jonathan: coming up, blackrock head of global financial fixed income marilyn watson. yields up seven. on the tenure, 1.44. i don't think he said i love you, john. tom: but even worse he answer the dam question. jonathan: he did. can i go? lisa: look at those markets. jonathan: from europe city, good

morning. -- from new york city, good morning. tom: will do this again tomorrow, right? jonathan: we will be here on tv and radio. looking forward to it all. up 1%. i being authentic. heard on bloomberg radio, seen on bloomberg tv, this is "bloomberg surveillance." ritika: it looks like the proposal for a higher minimum wage will not be in the coronavirus relief bill. senate democrats are shoving a plan to use tax hikes on big as this is to get them to raise wages. -- on big businesses to get them to raise wages. the concern is it would not be possible to get all 50 senate democrats on board. immigration will be the main topic when joe biden holds a virtual meeting with the mexican president today. the mexican leader plans to propose a labor program that

could bring up to 800,000 immigrants a year to work legally in the u.s.. a senior administration official would not say whether president biden supports that proposal. president biden is urging amazon workers to vote in an alabama unionization drive. he says employees should be able to make their own choice about whether to join a union free from company pressure. mail-in voting for the 6000 warehouse workers began in mid february. in paris, former french president nicolas sarkozy has been found guilty of corruption. sarkozy was accused of offering to help pull strings to help a magistrate land a job in return for a favor. he was given a one-year prison sentence but is unlike deserve it. jay frazier takes over today as ceo of citigroup. she faces a couple of challenges at the third-largest bank. she needs to overhaul control to satisfy regulators, recheck operations, and guide the firm

out of the pandemic that has forced many employees to work at home. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am ritika gupta. this is bloomberg. ♪

president biden: we will launch

a massive campaign to educate people about the vaccines, but that they are safe and effective and they can go get those shots. tom: good morning. lisa abramowicz and tom keene. a nice lift to the markets. futures up 1%. small-cap russell 2000 up 1%. lisa: last week seems to be an anomaly. that the message this morning ahead of the market opening. the question is will we see more volatility like we saw thursday. tom: on the vaccination, we go to science and it is good to go to someone with her original -- someone with original research. dr. lloyd minor did research on the inner ear and out johns hopkins and stanford where he is dean of medicine. how do we sell the part of

america that is afraid of science, that are reticent to take the vaccine? what is your best practice for the politicians in washington? >> is good to be with you. i think the science does carry a lot of weight. it needs to be explained in ways that is meaningful and understandable to people and also how we behave as health care professionals in terms of our getting in line to get the vaccine when appropriate and communicating that these vaccines are safe and effective. among the most effective vaccines and safest vaccines we have seen for any disease or any condition. tom: what we need to do to get in front of the people? i get that we will get back percent of people -- we will get x percent of people vaccinated. it is the next 10% or 20% i am worried about. is it a public affairs thing? is it a media campaign?

dr. minor: i think it is all of those. a lot of convincing people of the safety of the vaccine is seeing others who are vaccinated, seeing the results, which are already beginning to see for a variety of reasons a decline in the number of cases in the united states, but we have to remain vigilant. lisa: there was an article in the wall street journal that i found fascinating talking about a new era for vaccination, the idea some of the technology used for the pfizer and biontech as well as the johnson & johnson vaccine, this idea it would push us into possibly curating or preventing other disease. what other diseases do you see as likely candidates to be prevented, to be tackled with the new vaccination technology? dr. minor: there is several. one is there is a prospect we can develop more effective flu vaccines. we know in an average flu season the flu vaccine for that year may be 30% to 60% effective.

these vaccines we are seeing for sars have a much higher efficacy rate, certainly a preventing severe disease, even preventing mild-to-moderate disease. and the fact they have been developed so rapidly, the first vaccinations were given fda emergency use authorization 11 months after the publishing of the sequence of the virus. that is a record and something we can be hopeful for in terms of future vaccine to element in the future. tom: there is also -- lisa: there is also question of viruses that have been tamped down by social distancing. have we seen any interesting trends because people of worn masks and practice all the things the pandemic has wrought? dr. minor: in north america we have had a much lighter than normal flu season. very little influence in the

united states today. we are starting to see come as children go back to school, a lot of rhinovirus, the so-called common cold virus. social distancing, wearing a mask is certainly making a difference. we need to continue to observe those precautions for the foreseeable future as a higher proportion of the population gets vaccinated and as we deal with emerging variance as well. tom: if we have a grind, date to date one million vaccine grind, where is your visibility where you start to say we get back to normal? is it april? or is it april of 2022? dr. minor: the current evidence from our colleagues in epidemiology is perhaps as high as 80% of the population needs to have a degree of immunity to the virus in order for us to relax our guard come in order for us to back off some of the

social distancing and masking guidelines we have today. we are not close to that yet in the united states. it is conceivable we could be by the middle to the end of the summer, if the vaccine rollout goes as we hope, then it is into the later part of the summer, we ought to be able to relax some of those restrictions. tom: thank you so much for joining us in the school of medicine in stanford university. thrilled he could join us. we have to get back to these numbers. yields up, equities up. i like what jon said about confirming the stronger dollar. lisa: there is also the idea of can you get higher yields and higher stocks? this seems to be the consensus that if the higher yields come for the right reason then you can get both. more often than not you do get that. the question is the pace of the

increase in yields. what we saw last week by no stretch of the imagination could be positive for capital markets. that is a conundrum fed officials will be facing. tom: that was the pace last week but we are there now and we are getting used to a 1.43%. we had guests today talking up to 1.70%. lisa: if it is a gradual increase, that is one thing. if it is a rapid spike to 1.61% with people questioning the markets and what is behind it, that will not be positive. tom: what tom porcelli said when he was beating me to death, he and others are at 6% at he laid out the what if to get you to enormous economic growth. i do not think that is in the market. lisa: the question is if you do get enormous growth, what does that do to the long-term inflation expectations? does it force the fed hand to move faster, does it lead to a slowdown in investments that might lead to faster growth?

i keep going back to uncertainty. that is why i talking about jonathan golub and the idea he would keep revisiting his estimates for the s&p. how do you get visibility in an economy like that? tom: what is high-yield done? lisa: high-yield has done a lot better than investment grade. you have seen all in yields rise. it has held up much better than investment grade. tom: because credit worries are not that difficult in a 6% economy, right? lisa: and because the cushion is that much bigger. it is not much have as much duration rest. tom: listen. duration rest. lisa: is not as hinged to the treasury yield. tom, i love you. tom: -- just wrong. i just killed it. lisa: that was a great question. [laughter] tom: futures up 44, dow futures

up 355 points. optimistic, 24.73. today the vice president of join bloomberg on citylab, and james dimon will be around in the early afternoon hours. stay with us on radio and television. this is bloomberg. ♪

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jonathan: your equity market bouncing back. from new york city for our audience worldwide, good morning. the countdown to the open starts right now with 30 minutes until the opening bell. equity futures up 44. we advance a little more than 1%. markets during up for a big week of fed speak. >> as the fed speakers get rolled out -- >> market is unclear as to what the fed reaction function will be. >> last week was a roller coaster. >> sharply rising interest rates. >> steepening the yield curve. >> the market is testing the fed. >> the fed appears to be losing control. >> the fed needs to step in. >> the fed has to act of the circuit breaker. >> doesn't justify a raise in real yields? >> the best thing to do is to do nothing. >>he