alix: we focus on the trading behind the hottest commodities in the business. we want to get to the data dig we talk about the top stories of the week. herself, jay powell speaking, saying nothing new. the bond market does not like it. one way to look at it in the commodities landscape is real rates, which puts pressure on gold. the orange line is real rates that have entire. 70 basis point area. the white line is gold. gold winds up selling off. nickel losing serious shine, filing the motion for years. some more supplies coming online but it does throw in a question commodities super cycle thesis. copper getting beaten up today. we get the opec presser underway here. no production increase in april.

a huge surprise for the market. the saudi's are going to stick to withholding one million barrels a day of oil. russia gets an exemption. they can increase a portion of the 500,000 barrel a day increase. 's numbers -- by opec's numbers, this can be a 2 million barrel a day deficit. let's stay with opec and get into the ring with julian lee. why are they doing this now? julian: saudi arabia is taking a cautious approach. the mood music from their oil minister has been one of caution. he opened his comments urging his fellow ministers to take a cautious approach to keep their powder dry.

to point out in his view the demand recovery people are expecting is being driven very much by the rollout and acceptance of vaccines. that is still really a very early stage on a global basis. he is urging caution. he says for him prices don't matter. he refuses to talk about prices. he refuses question after question on prices. for him is about inventory levels. he wants to see oil stockpiles back in the 2015 to 2019 range and that is when people feel comfortable. alix: what i thought interesting was russia going on board with this. last month, they could not even meet the exemption target because of the weather. are they going to be able to take advantage of higher prices like they would want to? julian: i think they will.

february was particularly cold and parts of russia. we sell repeated instances of their pipeline monopoly saying inputs into their system were restricted because of the weather. cold weather is not going to last. as temperatures are picking up, supply bottlenecks will he's. russia clearly has spare capacity. 10 counts -- to cut something like 2 million barrels a day. and it will do. every month since the deal was done it has still pumped above its targets. february will be closer but it may still be above its target. alix: this feels like a green light for u.s. shale. they will say they like u.s. shale. do we expect producers to take advantage of these prices and produce more? julian: i think so.

you can lock in a profit of these prices but you have a new administration that is much less laissez-faire about oil operations. you have a bunch of companies whose shareholders and lenders are not so keen on this sort of frantic drilling and production growth model. the saudi's feel quite comfortable. in answers to a specific question on the subject, the oil minister said drill, baby drill is gone forever. he clearly is not worried. alix: that is a great line. really appreciate your time. julian lee joining me. as oil prices rally, so you stocks. over 3% -- exxon is over 3%. yesterday they unveiled carbon

goals. the key part of carbon capture is the volume exxon has been able to capture over the last 10 years. majors in europe are looking to wind up oil production and ramp up alternative energy. exxon will try to green its product by trapping this carbon before it hits the atmosphere. over the past 10 years, it's only been able to grow by 6.5%. it has a long way to go. i sat down with chairman and ceo darren woods and asked him what he would make final investment decisions in the market. darren: to put context around the world we are doing, there are four critical elements that will make that business and carbon capture and important part of the solution going forward. first and foremost was the available technology today for carbon capture. it is fairly high cost and requires fairly concentrated sources of co2.

one is a big challenge is making that a technology that works more broadly and can be deployed is to lower the cost of that. we have been working on the technology side for over 10 years. another key important part required is government policies that make sure there is a transparent and explicit price on carbon that incentivizes investments. regulations that support the investments. legal frameworks. we are seeing more and more focus from governments in this space which is encouraging. we see tech funds. venture funds looking for opportunities to invest in carbon reduction opportunities. this is an opportunity for low carbon solutions business. the fourth area is the demand for carbon and carbon offsets. as the economy works to decarb onize, we are finding offsets to help them achieve their objectives. you put that together, the

converging at this point in time gives us an opportunity to try to drive that. those things have to work together and come together. that will set the investment. alix: not quite there yet. you mentioned the venture capital money. it brings up what occidental has done, which is basically getting other people to find carbon capture investments. who might you think about partnering with the do something similar? darren: as i've said, this is a growing space. if you look at the growth in venture funds and climate tech, they have grown five times faster than the average venture fund growth. that growth has been concentrated in transportation mobility. there is a big opportunity and the power generation sectors and industrial sectors for additional investment. there is opportunities, which is part of what the new low carbon solutions business will be focused on. finding people who will be interested in partnering and

leveraging the capability exxon mobil can bring to the space to make the investments and reduce the amount of carbon in the atmosphere. alix: delta or united has been one of those for oxime. have you talked to corporate about this? darren: that is the market demand piece i was referring to. companies in sectors that have difficulty decarbonizing, we will look at that angle and the investment angle, bringing that together with our technology and projects capabilities and experience in the space in our facility footprint to see if we can put those together and have a successful business that grows shareholder value. alix: you have not talked to them yet? darren: we established the business on march 1. that business is up and running. it is in the early stages of engaging with these different forces coming together. alix: part of my interview with

darren woods. time for a commodity radar. we look at the week ahead. chevron will have its investor day. later on on tuesday i was speak with the ceo mike worth. the i-8 releases -- eia releases its energy outlook. key for the grain markets. that does it for commodities edge. catches thursday at 1:00 p.m. in new york. this is bloomberg. ♪

matt: welcome to "bloomberg markets." we will speak with scott minerd about what the fed might do. we did not get a lot of clues from jerome powell but we will go over that with scott. i want to show you the price action we have seen since fed chair jay powell stopped speaking. you have got the 10-year yield at 155. a big jump for the 10-year. we have seen yields in the u.s. climb across the curve. the dollar index graph is striking. it is up to almost 108 against the japanese yen.

the dollar index gaining ground today. s&p 500 going the other way. we saw the inverse correlation between the yields and stocks lately. that is worrying people looking at value risk models. you see new york crude. another big piece of this puzzle, a huge job here. brent as well, heating oil and other petroleum products after opec said it will keep production where it is. no increases there as far as we can divine from opec. i want to show you nasdaq. the nasdaq is now negative year-to-date. it has come down. 1.5%. we said this today about cathie wood's arc fund. there are others. he saw alix steel talking about

gold, which is fascinating. stocks coming down as bonds come down. could be bad news for the market in general. now let's get over to scott. jay powell was just speaking. he said there is a lot less to do before the economy is healed. what it would take to make him worry. >> i would be concerned about this sort of the conditions where a persistent tightening threatens the achievement of our goals. i would be concerned of those things were to happen. matt: let's get a will to reporter cinelli graseck -- sonali basak. scott, let me get your reaction to the powell comments. traders are positioning for the fed to raise rates before 2023. the markets want powell to prove

he's going the other way. scott: i think the fed is finding itself in a bit of a dilemma here. they need the markets to remain relatively favorable to achieve the long-term employment goal. at the same time we are starting to see inflationary pressures which i believe, and the chair says himself, should prove to be transient. market participants are putting the fed to the test and saying, ok, given the spike in inflation, if it is not transient you were going to have to act sooner. that is the real tension. the other question is what are you going to do if it continues? they want answers to these questions. sonali: when you did this

analysis on where inflation is going, transient means there is some near-term concern, right? how are you positioning your portfolio? how are you preparing for that volatility? scott: one of the best traits we had in the last couple years was a curve steepening trade. as we expected the spread between 10-year yield 10 two-year yields to increase, and that happened, that's given us some good insulation on the backup. we are slowly taking that off and reducing our exposure to that trade. slowly extending the duration of our portfolios because we notice even if 10-year notes get the 2% which seems to be the new number everybody is talking about, it will not be sustainable. history shows these sort of

spike up in deals that occur after the end of a recession typically are reversed because inflationary expectations gets ahead of what the real inflation experience is. sonali: this is bleeding into the s&p 500 and nasdaq. where you see the market ending the year? my favorite question for you. scott: it will end with that we are today. possibly less then 1% in the 10-year note. it depends on what finally breaks in the market. as the market continues to press on the fed and to try to find out what their reaction function looks like with the increase in long-term rates, we are obviously seeing the impact that's having on stocks, especially tech stocks.

eventually something will have to give here. i think that will be the moment of truth because it'll either forths people to rebalance their portfolios in a flight to safety or the federal reserve will step in and do something, which i think one of the best options they have is to do another round of operation twists. matt: when do you think they will do that? if you think that is the most viable option, they probably think it's an option as well. i'm sure they want to keep options open. do you think they will execute, and when? scott: they will eventually get there. the issue now is they missed their opportunity to start expanding the duration of their asset purchases a number of months ago. now if they do anything like

operation twists or extend the portfolio duration, it is going to look like they are behind the curve. they are going to be very reticent to act. they are going to drag your feet. that is what i think ultimately we will get to something in the market that forces their hand. we have a fed meeting coming up in 13 days. i don't think they will announce an operation twists at that time. or even any sort of yield curve control. in all likelihood they will probably talk about that they talked about it. i think this will have to play out probably over the next eight weeks or so. matt: one of our senior reporters had a great story yesterday on a lot of market

participants questioning liquidity issues in the $21 trillion treasury market. they say liquidity is there unless you need it and then it's gone. what you think about the possibility of liquidity issues there? scott: i am grinning because that's one of the lines i have used in the last 20 years. everything is liquid until you have to get to it and then it becomes a problem. obviously as the fed continues to issue so many long-term bonds we do have to find an equilibrium rate where we can attract buyers. the market right now is telling us we have not reached that equilibrium. it is really signaling they are looking for the fed to provide it. the flipside is on bloomberg

yesterday there was a story about the fact the 30-year bond -- the 10-year bond is trading on special at rates of -3% and lower. for the viewers, if you want to borrow the bond, you have got to pay a rate of interest to get it. that is telling us there is a fairly good short base underneath the treasury market. eventually that short base will have to be squeezed out and eliminated which should lead to buying. sonali: you said you will end the year lower. how much lower? we are at 3800 now. are you talking about a 15% correction? something bigger? scott: i was talking about bonds. i think equity will end of higher. i do believe to your question

that some time here, probably in the second or third quarter, we will see a correction in the stock market. i think we will find out the fed will not tolerate a stock market that is down more than 15%. just like we found out in 2018 in december of that year when the market suddenly split, the fed adjusted policy. i think that is where we are heading. we are going to get that kind of correction before the end of the year in the fed will adjust policy to address it. sonali: last march it took them to moves in two weeks to finally bring market higher. operation twists the only answer to the market here? do you see them doing something drastic down the road? scott: i think down the road the

ultimate answer is not the supply of treasuries and the fact there will come the day when the federal reserve is concerned about the size of its balance sheet and buying too many treasuries. they will shift to yield curve control. how i envision that working is to say we are going to set a maximum rate for the 10-year note. i don't know what that rate is. maybe it is 1.5 percent, maybe it is 2%. in the 1940's it was to went to 5% -- he was 2.25%. every time rates rise to that kind of level the market will step in and by the bond -- buy the bonds. the reason i feel strongly about that is that we already see -- we don't have an indication from the federal reserve they are

ever contemplating reducing asset purchases or raising short-term rates. the market is already having a tantrum. can you imagine what happens when the central bank comes out and makes a statement that says we decided we are going to start tapering our asset purchases? the market is going to have a major problem. i think the fed will have to come up with a policy adjustment which assures investors they are not going to let long-term rates get out of control. matt: scott, you are one of a handful of voices everybody in wall street listens to. i wonder if you have taken your treasury argument to wall street et. you can see the short squeeze appear. scott: there is something here

with credit spreads as tight as they are. if you're income oriented investor there are a number of options you have to get an increase in current income. it's extremely limited. the average high-yield bond yielding less than 4% with a higher and quality bonds like investment grade bonds yielding less than 2% unless you extend your maturity 30 years or something. the ability to get current income at a fixed income is declining rapidly. i do think at some point investors will look at the pullback in bonds -- i'm not talking about retail investors -- and say it is time for us to rebalance. we have a good profit in the stock portfolio. let's take some gains and put

some money into bonds. the only place you will be able to get any yield bonds is by buying longer duration assets. whether they do that for mutual funds or directly i think that will provide a catalyst to get the market going. matt: there is potentially a lot of stimulus coming down the pike. great talking to you, scott. thank you for joining us. sonali always a pleasure,. scott minerd. coming up, powell's market morning. why the central bank will not sit back and let financial

mark: this is bloomberg's first word news. the controversy over the origins of covid-19 is heating up. a group of scientists is calling

for a new independent probe to consider all possibilities and mailed them whether the virus came from an animal. in an open letter published by the wall street journal, more than 20 scientists -- pardon me -- said the investigation by the world health organization and china is not independent enough. new york city has received its first shipment of johnson & johnson's covid-19 vaccine. mayor bill de blasio says the city has been supplied with more than 16,000 doses of the one-shot vaccine. the mayor says homebound senior citizens will be among those receiving the shots. he also said when he becomes eligible to be vaccinated, he is hoping to get the j&j shot. a firm hired to monitor the power markets in texas as the grid manager overpriced electricity for almost two days during last month's energy crisis resulting in $16 billion in overcharges.

amid the deep winter freeze that knocked nearly half of power generation offline, the electric liability council of texas said the price of electricity at the $9,000 megawatt hour price during a great emergency but a watchdog said they left the price in place days longer than necessary, resulting in massive overcharges. u.s. agriculture secretary tom vilsack says he plans to move swiftly on initiatives on lower carbon emissions from farms me to act on climate change programs this year. during an interview with bloomberg television today, he also said he's hopeful that china will eventually meet its purchasing quota from the phase one trade deal. >> understand that the china relationship is always tenuous. there are many factors and many letters to that relationship. it's important for us not to put all of our eggs in that basket.

it's necessary for us to continue to look for new markets and deeper markets. mark: secretary vilsack was concerned -- was confirmed last week by the senate and previously served eight years under president obama. global news, 24 hours a day on bloomberg powered by more than 20 700 journalists and analysts in over 120 countries. i am mark crumpton, this is bloomberg. ♪ ♪ >> welcome to bloomberg markets. matt: we are joined now by our bloomberg and bnn bloomberg audiences we want to bring you the top stories from around the world on the bloomberg terminal. fed chair jay powell failed to

push back against the recent run-up and yields, only saying he is monitoring financial conditions and would be concerned by disorderly markets as a result, we sought yield spike. after those comments, the 10 year treasury rose to 155 and is now coming a little bit lower but still holding over 150. a number of other huge moves including the s&p 500 falling more than 1.6%, wiping out its gains for the year. amanda: of course, the market reaction to powell's remarks is really the story. it had been kind of quiet leading into it and we see a big turn to the negative. a one month decline for the s&p 500 and the nasdaq erasing gains for the year and now flirting with a 10% decline off its high. we see a similar story in toronto as well. one pocket of strength is thanks

to opec holding true on its output levels is the energy groups for the broad u.s. market. it is materials for canada but at the 10 year yield that will be the focus for investors, rotation out of asset classes may continue and the big question was what would jay powell have to say about the threat of inflation. will he reassure that the fed stands ready to act? he reiterated what we have heard is that they are watching but not concerned at this time and is got a bunch of reasons for that. he said they are watching closely to see whether business conditions tighten. >> i would be concerned by disorderly conditions in markets where a persistent tightening and financial commissions threatens the achievement of our goals. i would be considered if those things were too -- i would be concerned of those things were

to happen. amanda: bloomberg's michael mckee with us now i guess the most important thing to know about that is that we haven't seen financial conditions tighten so what is the needle that jay powell is threating? michael: he has been trying to convince the markets that the fed means it, they will not be raising rates or tapering there qe purchases until they get the economic outcome they want which is maximum employment. he defined that is not just a low unemployment rate but many coming back into the labor force that pushes up wages. until they get inflation to 2% and over for a little while. the market things we might at that inflation rate sooner than the fed. powell was certain it would take some time. we will see inflation go up temporarily, he says, but that will be transient and it will fall back so we are not ready to move.

the market reaction obviously is they don't believe him. he was asked about the disruptions last thursday and the treasury market and the good ongoing problems at the low and, the short end of the yield curve with overnight rates that are trading a little bit negative. he had the same answer to both and it revolves around that disorderly idea. have a listen. >> it was notable and caught my attention. but again, it's a broad range of financial conditions we are looking at and that's really the key. it's many things and we want to see and would be concerned if we didn't see disorderly conditions , orderly conditions and marketing we don't want to see a protestant dish a persistent -- a persistent tightening. is not appropriate to isolate one particular interest rate or price. michael: he went on to say that should there be a disruption that threatens the economic

recovery, the fed would take action but refused to specify what those actions would be. he was -- he doesn't want to give credence that the fed might do something at its next meeting or any time soon. matt: some people in america are paying three dollars per gallon for gasoline. of course in berlin, i'm paying two or three times that but for americans, that's a hefty amount and that's the kind of inflation they actually feel. we see oil rising today almost 5%. what a day to say there is no inflation out there. michael: he didn't say there was no inflation but he said we will see inflation and energy prices are one area in which we will because of what's happened with opec and in large measure because of the storm that hit the southwest of the united states a couple of weeks ago, shutting down gasoline refineries. that has pushed up the price of gas but jay powell says that will be temporary. with the fed is worried about

his inflation expectations over a long time, the idea that you think prices will keep going up, they are netting that americans don't like the idea of higher gas prices but realize they will not stay elevated. amanda: we have course the markets here and it feels a little trigger-happy around that 1.5% that you would see a major rotation out of equities and yet we know at some point there is that level at which the yield on risk-free becomes attractive enough and people will reach for it. is it on the fed's radar that there is a whole bunch of capital out there and the spikes we saw last week could be dislocating in other asset classes? michael: they know the liquidity that is going into the market has made some markets wonky. they are looking at it in a different way. the markets are looking at the move up in the fed is looking at where we're -- where were we

before the pandemic? where would interest rates be? we are still below, the yield curve is below where we were in december of 2019. inflation is way below where it was in december of 10 2019. we got room to run without causing problems of the economy and that's what they are looking at. matt: scott minerd was just on and said the fed at some point we'll have to resort to operation twist. is that becoming a popular view? michael: it's becoming more popular but it's not a majority view yet. the thing about operation twist that helps is that you would sell the short end, and finance holdings at the long and so you are not really adding to the fed's balance sheet. there are some questions about duration and other complications but basically, you are using status quo and changing the mix

of what you buy. that wouldn't really have a major impact that would happen on trading but do they knew -- do they need to do that? it doesn't seem like that's any time close. matt: thanks very much. wrapping up jay powell's comments for us for now. this is bloomberg markets. i am matt miller with amanda lange. ♪

♪ matt: this is bloomberg markets. i am matt miller with amanda lange. we have seen some pretty steep moves in treasury yields.

i want to pull up the 10 year to show you the line up after jay powell started talking and didn't say what the markets thought he would or maybe wanted him to. right now, we are trading at 154 but we almost hit 156 -- 155 a little while earlier. i also noticed a big jump and you can see that playing out against a number of currencies. it's especially against the japanese yen. you can buy almost ¥108 for one ingles dollar. let's go over to brian who follows the treasury market for us. i love your last column, don't fight the fed. but you kind of do see markets pitted against jay powell right now or am i not reading it right? >> obviously, jay powell has

moved the markets but it kind of raises the question -- what do you want him to say? the 10 year yield going up his tightening in a way. mortgage rates go up and obviously you see the impact on stocks so that's a self reinforcing mechanism and the fed controls the short end of the yield curve and that's where you see no moves. there is the expectation that the fed will keep rates low for a while until the economy comes back stronger and when it does, they will raise rates again. i think he's been remarkably consistent and people are trying to wrap their heads around a fed that's not willing to preemptively tighten at a sign of inflation popping up. amanda: as you note in your column and you just reiterated, the short and says we do believe the fed and they will not have to raise rates. focus on the five year because so much is priced off of that. when we saw it crack 7.5 last

week, that sent jitters through parts of the market. what does that say when we see a move in that particular part of the treasury market? >> the five-year is super interesting. it's just beyond where the fed has its dot plot and they have them out to about three years so five years gives an indication that aside from what the fed says, what do we the market think will happen with interest rates? it's indicated there will be some tightening in the near future. what that basically says is that the fed will be successful at policy makers in congress as well will be successful at getting the u.s. economy back to where it was pre-pandemic. the fed was raising rates as recently as 2018 and had to loosen a bit in 20 because of the trade war. the economy was still on pretty solid footing. jay powell said as much at the opening of his comments today.

i think there is an expectation we will get back to a solid u.s. economy, stronger labor market and decently high inflation above 2% and then the fed would tighten because they said they would. i think it boils down to that. matt: i really can't understand that expect tatian when you've got more than 10 million people out of work. we spent the last year talking about how this recovery k-wealthy people will be doing better and for them the economy will be great but we know for the disadvantaged, it's probably going to be worse and that it's not a small group. >> yeah, i wish i knew how it would play out and i wish i could say the economy definitely will be better. the bond market has started to price that in and you think about tent up savings, yes it is k-shaped in many ways and accrue the wealthy individuals but if

they are in non-services or create employment in various sectors, that could generate more jobs. it could be a broad-based recovery and that's what the fed is focused on. that's one of the keywords that jerome pyle likes to use. they are not just going to necessarily hike if they see a 4% unemployment rate. it will be about the participation rate and getting more people from all sorts of communities backed the labor force. amanda: this is a point you also make in your column is that the steepening yield curve suggests there may be even more optimism than we thought about the economic recovery. there is some uncertainty in that but that extreme optimism, is it priced in? we don't know where inflation shows up and historically,

inflation is a surprise. jay powell said slow-moving inflation will stay slow-moving. it can act as a surprise aware with the shock appear in your view? >> right now, the treasuries are still pricing in probably low-inflation. it's funny to think about in some ways because the 10 year yield is it 150 and ever was freaking out and before the pandemic, the record low was one point 32% so we are not that far off from pre-pandemic lows and treasury alleles. if inflation pops up and becomes more transitory, i think that is where the fed starts feeling pressure. jay powell set i expect we need to be patient if we see that but there is a little bit of a waiver. you don't want to let the inflation go fully because that raises a whole another set of risks. he says i will not have hyperinflation.

there is that risk out there that things could spiral quickly if they don't clamp down and i thinks that's -- and i think that's with the bond market is trying to figure out now. amanda: to your point, if the market is getting it wrong, what is your best guess of why that is? based on your assumptions, the fed is doing exactly what it wants which is getting inflation running about 2%, full employment and strong growth. >> i think the bond market right now is going through a violent repricing from levels that were extreme because of the pandemic. i think they are now grappling with seeing the light at the end of the tunnel and vaccinations are coming down the road, what is fair value? i think people are still grappling with that given how low rates have been for the past year. in a historical context, they are still low and can have a ways to go higher. it will take some time before

longer-term deals region inc. will livery him. amanda: great to have you with us and speaking of shaking out, we are seeing the stock market at session lows. we will drill into what's happening after this. this is bloomberg. ♪

amanda: this is bloomberg markets and we are watching markets hitting session lows with reaction in part to comments from fed chair jay powell today. after we had seen some groups hanging on especially energy, up as much as 3% today, it's now up barely 1% and all other subgroups are negative. the nasdaq is in correction territory. i give those internals because

this is not a narrow move to the downside, this is a big momentum move lower. >> and you are seeing it start off with tech shares. you see the yield spikes and immediately people pull out of growth stocks. what we didn't know is this kind of sentiment would reflect across sectors. now it's taking down utilities, materials and even financials which usually benefit from high heels and that's an interesting dynamic that you are seeing it across the board that people are getting spooked. that's a function of those opec comments you saw earlier. matt: i think it's really interesting that more and more, we are seeing this negative correlation between yields in stocks or may be more basically, bonds and stocks are selling off or gaining at the same time. richard cookson wrote a great

opinion piece about how this could be an early sign of the value at risk shock. are you hearing anything else about that? >> people are paying attention to those correlations. going back to the tech field, the nasdaq is weighted so heavily for that. what happens with tech reflects across the broader benchmark. the yields are inversely correlated at the moment with the stock market and that's something that's fairly rare. it seems intuitive but that's something we only saw at the end of last year and before that, dating all the way back to 2016 so it tells you this kind of dynamic where you start to see bonds and tech sell off at the same time, not only does it confirm that tech has served as a haven quality for many investors but simply that those kind of risks for the tech sector could be accelerated as we see those deals search higher.

we know consensus expects this is not the end of the yield rally. amanda: we have seen that move into those yield stocks and the value dividend part of equities. there is the underlying logic that if the yield curve is steepening so much because of this goldilocks scenario where inflation stays at day but growth is stronger than we thought, that should be good for equities and it should be good for growth stocks. what are you looking at for the market to reach some consensus? >> you want a reflation rally and it means not just one sector , you want it to be evenly spread across the board. it has to reflect that the economy as a whole has to be lifted. when you see the growth expectations, when you see inflation that supposed to be generated in a good way, that should be healthy and tech even if it's a haven is supposed to

help their bottom line because it means more votes for their companies. the yield curve will matter for the bond investors but the stock investors are literally only looking at the 10 year yield. they are not really looking into the deeper dynamics of the bond market. matt: thanks very much. we are seeing 2% drops in stocks right now as the yields and the dollar spikes. looking forward to meeting you back here same time, same place tomorrow. this is bloomberg. ♪

mark: security is high outside the u.s. capitol with national guard troops and police officers

on alert inside a massive black fence that surrounds the capitol grounds and several neighboring buildings. anti-pelosi said the guard troops protecting the guard troops protecting the capital should stay as long as they are needed amid a new threat of another mob attack. >> we should have them here as long as they are needed and the silliness of this being inauguration day and that in may, the president will be inaugurated is -- it falls into the realm of let's not waste our time on it. mark: law enforcement is on high alert intelligence uncovered what is described as a possible plot by a militia group to storm the capital again just two months after the january 6 insurrection. mexico will step up security for candidates