♪ caroline: from bloomberg world headquarters in new york and here in london, i'm caroline hyde. joe: i'm joe weisenthal. romaine: i'm romaine bostickyie. joe: the question is, "what'd you miss?" caroline: markets and fed chair jay powell seem to be out of tune today.

powell overwhelmed investors with his comments today, the dollar jumping, the market but powell would perhaps push back more on the rout in bonds. but he didn't go there. but gamestop survived the carnage, getting 7%. and while markets are parallel out of tune, they are agreeing on a deal today. we are going to talk more about the future of music investment and my love for jay-z. but let's talk about the markets right now. joe: i don't get this whole thing about how the markets and powell are in disagreement. if gamestop is up, everything is fine. no one is worried at the fed is that long -- as long as they see that. it is 4:30 so it is time for our daily arts check, down over 5% again today, 10-year yield

inching up. people thought maybe powell would say something more explicit about being anxious about the rate rise, but he really stuck to his script about no rate hikes until the economy is in a good place. beyond that, he didn't have anything new to say, s&p 500 down about 1.25%. romaine: it is mesmerizing. joe: meantime, joining us now -- romaine: you didn't bring the chart? what have you been doing all day? joe: joining us is bloomberg's kriti gupta. did people really think problems going to say something like -- powell was going to say something like, rates are going up. kriti: some on the street

thought he was going to put his whole playbook out there, talk about potential change for the rate hike, that is a tall order for someone to make at a "wall street journal" summit. i think those high expectations manifested themselves. romaine: what about "the bloomberg summit?' caroline: do financial conditions become less important? kriti: that seems like a theory we are working on but it is interesting, the way the market is interpreting it, they are trying to find any spot where there isn't a selloff right now. this idea that dividend yields in the stock market at the yield on the u.s.-10 year -- the u.s. 10-year, that is hitting parity

right now. when the yields were surging, the only stock sectors in the green at that point where energy and utilities and caroline, you and i have been talking a while about the fcw factor, that is what is driving the market, the search for dividend yield. and it is interesting to put it in context with the bond yields today. romaine: a lot of people prior to the last couple weeks were saying the market needed to pull back, we needed more healthy price action. you saw the volume there. you saw what appeared to be a shakeout, but this seemed to be what lot of long-term bull -- what a lot of long-term buls said -- what they lack of long-term bulls said, that we needed a pullback. kriti: a now tech is going to

come back and bonds are going to rise higher. look at the nasdaq 100, testing its 100-day moving average. this type of thing and play, people are saying bonds are rough, therefore we are selling. i think there are factors to watch here in terms of how many corrections we have had the past few months, september, october. we were due for a pullback. in theory, this might also be a reason to sell, and that is a fair argument. joe: when is crazy is, we are not even talking about the jobs report tomorrow. was anybody talking about that today? kriti: we will tomorrow, that is for sure. after the adp payroll survey we saw tuesday, we were already expecting weakness in the payrolls by friday. i think that is confirmation. another reason to sell, perhaps, there absolutely is this idea that the job market is not making the progress we need. you have seen german pal talk about it, you have see the street talk about it on the

question is, how does it translate to the stock market? the s&p 500 on the dollar track the labor market recovery and that is traditional for a post-recessionary period, so we could see a mass reaction, positive or negative, to tomorrow's payroll port -- payroll report. romaine: they are expecting 400,000 gains. joe: it should be a fun morning. romaine: all over the map. kriti: it speaks to so many expectations built into the market. just look at the range of jobless claims alone. i'm going into powell's conference, a range of expectations on what he is going to talk about. romaine: when it doubt, blame bond investors. caroline: kriti gupta, great to happy with us as always. coming up, more on fed chair jay powell. the rising yields and what it

means for the market going forward, should there be pushback? this is bloomberg. ♪

♪ romaine: when we came into this thursday, stocks were in a holding pattern, investors waiting to see what jay powell say, particularly about the jump in bond yields. they didn't like what they heard, bond yields spiked and the stock market tournament lower. it is not clear what they wanted out of him. he has been consistent. joe: extremely consistent. let's listen to powell. >> we want labor market conditions consistent with our assessment of maximum employment. we want inflation sustainably at 2%. these are desirable outcomes that would represent an economy that is very far along the road to recovery. as a release of the bond market,

we want to see had would be concerned if we didn't see orderly conditions in markets and we don't want to see tightening. we think we are likely to see inflation moving up during the course of the year. businesses will be potentially hit by a lot of demand is the economy recovers, but you could see bottlenecks and prices moving up. we are inclined to see those as transient. as far as the rate lift off guidance, it is pretty specific. as i said, it will take time to get there. joe: for more on the day, let's ring in bloomberg's opinion -- bloomberg opinion's brian. brian: i see a lot of comments that there are warnings the u.s. economy is going to be so strong, as if that is a bad

thing. it is not, it is a really good and. and it is what the fed obviously wants. it is what we all want. and to bond yields are taking off a little bit as a result. but the idea that the fed's credibility is thrown into jeopardy and people aren't believing its policy framework doesn't hold water when you look at the short end of the yield curve because yields they are still very low and it is the long end taking off on expectations that may 2 or three years down the road, the economy will be so strong. caroline: the wringing of hands and people saying, the fed took control of the bond market, whether it was ever meant to have complete control of the 10-year at the moment, he spoke so often about financial conditions. at what point does any of it become a risk to that? brian: there is an equilibrium point, this is about 1.5

percent, 0.7 percent of the five years, 1.7 percent of the 10-year. nobody knows for sure, but we are going to find out let the 10 year rise if it wants to or fall if it wants to, and it stocks and up continuing to decline like we saw today, potentially financial conditions will tighten and the fed will feel compelled to act. but until that happens, i think they are taking off the gradual rise in yields on the 10-year. romaine: you wrote a great column on this today. 90% of your columns are great. [laughter] you talk about financial conditions that you mentioned the two-year yield is under 15 basis points, and are we focusing too much on what is going on with a 10-year the 30-euro? even the five-euro, the idea rates at the short and are anchored near zero, that seems to be a buying signal.

brian told the 10-year does have knock off implications. you talk about the 3% level for the first time since july today, so there are implications it may slow down the economy of yields rise to fast i keep thinking about the pre-pandemic -- the pre-pandemic record low in the 10-year yield, we are basically 10 basis points higher of the record low of all time on the 10-year yield. it feels very high when you contrast it with where we were last number when the 10-year yield was 50 basis points. joe: it is very low, historically low rates. the expected pace of tightening is extremely slow, maybe one hike in 2024. nonetheless, the speed of the selloff is notable, or at least it was last week. it was kind of dramatic.

does this have negative ramifications that would maybe make the fed feel anxious, just how fast these moves are happening? brian: kind of. you see the decline of ark and tesla and things like that happen at the same time, everybody a few weeks ago was saying these are way too frothy. i don't think they are going to take that too seriously. and you look at credit spreads, still very tight. i wrote yesterday about how junk bonds are actually going to be just fine probably, even though yields are all in at a very low level, just because this potential economic boost is going to keep default at a minimum, and overall help credit quantity. i don't think they are really stressing out about the move, even though it has been much swifter than most anybody expected. caroline: jobs data tomorrow,

any expectations on if the market will react heavily? brian: given the magnitude of the move today, it is really hard to say whether a beat will do much of anything for it. 190 5000 jobs added is the projection -- 195,000 jobs added, if there is a beat, you have to ask, is the fed going to tighten more quickly? probably not. it is hard to get a readout because there is so much room to go, as fed chair powell was consistently saying today as far as the labeler -- labor market not just to a 4% unemployment rate, but rod-based labor market conditions. caroline: bloomberg opinion's brian chappetta, great to have you. let's talk music next, guys. we are want to be talking about

neil young, going old-school on what people are doing with their heads at the moment. they're making some money out of them. we will speak with music man alaister moughan all about money and tightening royalties. this is bloomberg. ♪

♪ ♪ caroline: amid all the volatility in the market today, we might have forgotten we have a major deal in payments. square agreeing to buy a major stake in the title streaming service led by jay-z. there has been a lot of money directed at music in the past few months, everyone trying to figure out how square and title fit together with the new economy and music coming together as one. but there's money to be made out of royalties. joe: absolutely. a new era of music, all kinds of different business models. romaine joking, all kinds of

data in play, square paying almost 300 million dollars, jay-z going to join the board of directors. caroline: you read my heart, gel. [laughter] joe: falcons of interesting stuff. romaine: -- joe: all kinds of interesting stuff. romaine: i am interested in the acquisition two, and what is driving it. joe: joining us now is moghan music director alaister moughan. you have helped negotiate these royalties deals, bob dylan, chara, neil young, what is it about the role of streaming specifically in turning back catalogs into this easily sellable asset? alaister: the big thing

and streaming is the big increase in the industry in general and also the nature of consumption, especially the catalogs. before we would hear that you are selling a greatest hits cd once, and now you have streams that give you much longer-term consumption. it also gives you a lot of better quality data. that is what is driving the catalogs thing right now, longer-term consumption. joe: when we look at some of these deals, bob dylan, $300 million estimated. neil young, half of his catalog for $150 million. talk about how you see you can value these and why they become assets? why are so many musicians selling them? alaister: right now, there is a lot of demand. and in particular, before the digital era, selling your catalog was a last-ditch

scenario. a lot of markets are after these assets. a lot of these artists have reached the stage in their career where they are thinking about estate planning and they need someone to manage their legacy. and all those components combined to create a very recent market for unique assets and has made this a more palatable time to sell than 10 years ago. caroline: let's bake it to him guys let's take it to my love of money markets and jay-z -- let's take it my money markets -- let's take it to my love of money markets and jay-z had him cashing out on his champagne label. alaister: to assess value, you look at the royalty statements. you usually see the annual

growth, but what titles are bringing income, what type of streaming, is it radio, and you would be surprised by the data and you can get a really good sense of jay-z's estate, how sustainable it is and where it is going. and also, understanding the copyright rights you own. a lot of music funds are also looking for upsides. so if a new jay-z biopic is in the cards in the few years, those add to the upside of these acquisitions as well. romaine: when we talk about the way some artists are able to monetize their past work, the big question is, what about new artists and their ability to monetize themselves within the music industry, not just going out and acting and other ancillary products.

is there a financial business model that works in the age of streaming where you are basically just making a few cents per play? alaister: i guess the one thing in the artists' favor is, traditionally, a record label would be taking the lion's share, 80% to 90% of the income. now come artists have a lot more leverage to negotiate those rate. -- those rights. because you can put your own music on spotify yourself, so what is a record label going to do for you? that is the good thing the streaming environment has brought, but to have meaningful income, you need a large volume and there is a downside there are maybe smaller artists to back in the day could sell 50,000 cds and make a living. now, you have to sell 50 million. joe: we saw this year is that they lot of artist lost a ton of

money due to the disappearance for a year of the concert business. how much did that help artists get encouraged, i will cash in right now, get a payday from selling the back catalog, and as touring and concerts reopen, could that reverse? alaister: i think it could reverse a little, especially for artists that are still active touring. u.s. topo to have a lot of legacy players. for example, bob dylan -- you still have a a lot of legacy players. for example, bob dylan. another great example is the killers selling their back catalog. you might think they have been sick -- have been having significant touring revenue, but that being taken away really changes the game. caroline: do the artists care in

particular who they sell to? how are these buyers distinguishing themselves? alaister: some care, some don't care. but a lot of these are pushing the angle of legacy management. we are not only buying a catalog, we are now the custodian. songwriters and producers of modern pop songs, they can have 12 songwriters and they might not be is attached to the work as they might be if it was a single songwriter. so some people might be willing to cash out. some people can get a partial interest and try to catch some of the upside, so it really does depend. joe: great stuff, our thanks to moghan music director alaister moughan talking about the business of streaming and back catalogs.

here more of the conversation out monday on the podcast i host with tracy alloway, and you can even find it on some streaming services, like on spotify. romaine: you just tried to sell your catalog. 2 joe: you are a musician to -- caroline: you are a musician too. joe: i should put my songs up there. caroline: you were performing in the real world. joe: i had a music career. i played two concerts in new york. i would have been a huge star, had it not been for the virus. caroline: you could have been a contender. joe: i am a huge country music singer. caroline: you are far more of the guy who is going to put it on some sort of crypto meme. joe: we will do a segment next weekend that will be the topic. romaine: your career?

joe: now. [laughter] romaine: i am on board. caroline: that does it for "what'd you miss?" joe: "bloomberg technology is next. romaine: and in australia, daybreak australia. this is bloomberg. ♪

♪ emily: i am emily chang in san francisco and this is "bloomberg technology." bitcoin flips amid a wider market selloff, but mike novogratz if you are staying, you could help close the wealth gap. coming up.