>> we just can't catch up after going through a depression every bust with this health crisis to suddenly having a runaway bull market. >> the economic data is great. this is all reopening, fiscal stimulus. but how much does behavior change? >> beyond this summer, after we get this reopening driven boost, how long is it going to sustain? >> all eyes are on what constitutes substantial progress right now. >> what does this economy look like six months down the road? i think that is where you are going to see real inflation. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: earnings season revving up. for our audience worldwide, good morning. this is "bloomberg surveillance ," live on tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. equity futures positive a little

more than 0.1%. better revenue growth through the year ahead. that is the obvious story. it means higher costs. tom: the famed bloomberg headline service has just a wall of earnings coming on at 7:00 wall street time. just hundreds and hundreds of headlines. to me, the margins are there. earnings are there. but it is a real story corporation to sector on revenue growth. what is it now, and what will it be? jonathan: and what will the high costs due to the margins on some of these companies' balance sheets? the number of mentions of inflations during earnings calls have risen sharply, more than tripling year on year, the biggest jump in our history since 2004. that is the theme so far of q1. tom: archer daniels midland,

they expect significant revenue growth. but then you look at the revenue mix forward, and with verrone coming up, this huge mystery of q3 and q4. jonathan: the mystery of that deceleration, that is what we need to start getting our heads around. lisa: the mystery of how much some of these consumer staples can pass off these higher input costs. it is interesting that coca-cola, chipotle, png, kimberly-clark, they are all saying they can pass along these costs. does that mean that individuals possibly aren't earning as much in terms of higher wages, and that speaks to the deceleration we are talking about? jonathan: good morning to you all. on the s&p 500, equities up about five points, a little more than 0.1% to 4185. in the bond market, yields up a single basis point.

let's call it 1.58%. in the fx market, euro-dollar, $1.2018. we are in about 0.1%. lisa: no drama, but there seems to be a growing consensus about how possibly more surprises could come out of europe than the u.s. i'm watching washington, d.c., project get vaccinated. president biden will be getting updated bidens from the cdc on what you can do if you have been vaccinated. maybe you can take off a mask in public. will they be something more to entice some of the hesitant to get jabbed? at 2:30, a senate finance subcommittee hearing. there are some that believe taxes should be higher for wealthier individuals, versus those in high tax states saying

that's not really good enough for us. after the bell, microsoft and alphabet both reporting earnings. you were talking about how there have been incredible beats. there was a ubs report showing that companies have beat earnings by about 25% versus the average of 11%. just the idea here that the beats have been tremendous. we have not seen the follow-through with price action. what are markets following? if it is not faith, if it is not the actual reality, what is driving the price action? jonathan: listen to what the markets are telling you. that's what we are always told. jetblue expected to reach breakeven in the third quarter. that's the look ahead from jetblue and airlines here in america. tom: the struggle here, it is very granular, but really, they are accountable. they are counting bodies and they are counting the revenue and the margins coming in. they're giving a third-quarter vision. you wonder, did you get a third-quarter vision from microsoft? jonathan: opening the

transatlantic corridor soon, jetblue, getting into the mix. tom: there's the mint thing. jonathan: have you tried it? it's pretty good. tom: i sort of like airplanes. i actually fit -- sort of like there planes. i actually fit in them. jonathan: real talk. [laughter] i will say the business class offering for jetblue is pretty decent. i will vouch for that. chris verrone, strategas head of macro strategy, joins us. chris: i just want to be aware of where we are in the cycle. i feel like we are at that point where there is a collision between expectation and reality playing out in real time. just think about how a market cycle matures. the first 12 months off of the

low, it is remarkably easy to beat low expectations. as that matures, i think we review some of the sentiment data. some of the responses to your earnings might not have been robust as one would expect given the strength, and ultimately, what we have to figure out is are we heading into a period of peak data? peak data historically has been met with corrections. i'm thinking about 1984. you are 13, 14 months off of the low. you had some of the best out of the cycle, and you went nowhere. i'm thinking about 2004. you had pmi's in the 60's. i'm thinking about 2010. the market stalled with the best data of that cycle. so i just want to be a little bit respective of where we are. there's not much yet to support this view. what we're doing here is looking at history and saying, what do we need to be mindful of? tom: that's right where i wanted to go. what is in the charts?

when you look at individual charts, when you look at sectors, when you look away from equities, what do you charts -- what do your charts guesstimate about the trend right now? chris: i think the sector right now telling the most interesting story is consumer staples. i think staples are answering three questions. yesterday, staples made fresh relative lows versus the s&p. they are at their lowest relative point versus the s&p at any point over the last several years. number one, it says we are probably not late cycle. secondly, i think they argue that some of the price and inflation pressures are stickier than the fed tells us they are. staples are very sensitive to input costs. we have seen what a lot of food stocks have done over the last number of weeks here. and then third, if bond yields were going lower, wouldn't staples be stronger?

i think the revolutions -- the relative weakness in staples and utilities suggests bond yields don't go a ton lower from here. so the staples are telling a lot of different, interesting stories. lisa: the idea that bond yields might not go much lower from here, that that mean bond yields will go higher from here because of inflationary pressures that perhaps, as you say, might be trending anymore stickier and significant way than the fed is considering? chris: i think we are pausing yields basically on sentiment and flows. three to five weeks ago, you get to a point where just everyone was a bond bear. i think there needs to be a sentiment response from that. but i would turn your attention to some other areas of the world. german bond yields really have not gone down. you were talking about the areas of the world where there were surprise. i think the ability to surprise

and europe is probably easier than it is to surprise here. jonathan: if you've got -- have you got a conviction long in europe right now? chris: i think european autos, which spent the last five or six years in purgatory, they are leadership groups within europe. i think the industrials within europe. but look at the materials. all of these big global material stocks are breaking out of their bases. you had this tepid rally in dollar over the first three months of the year. other has rolled back over as the big global, bellwether material stocks have broken out. jonathan: chris, always good to see you. chris verrone, autos in europe up almost 20% used to date -- 20% year to date. what a run. tom: i looked at a lot of log charts today. you're absolutely right, the leg

up here, we are just addicted to it. there was a real measured view in january. it was wrong. it has been, as you say, what a run. we heard from mr. verrone that no pauses are in order. jonathan: q1 was america's quarter. if you look at the price action, a lot of that has synced up. european banks severely underperforming u.s. banks off the back of better growth in america versus worth growth in europe -- versus worth growth in europe. we have been pushing that through the fx channel. on the equity side, i think it is a little more complex. more difficult. lisa: our people perhaps looking past some of those risks to differentiation and looking in search of a discount in a very highly price world? i do want to say something that was really interesting that i read from stephen linder this

morning all -- steve englander this morning on the euro call. he says the u.s. trade deficit has widened dramatically in march, and the idea is that all of that money the u.s. government put in the hands of individuals went to buying stuff that helped the rest of the world, that cause the imports to way outweigh the exports from the united states. tom: mr. englander, who's been at 42 firms in the last 44 years, holds court at standard chartered. but that's ok. jonathan: it's ok. lisa: it's transitory employment. [laughter] tom: i can't keep track of where anybody is. jonathan: i agree. it is particularly tough in foreign exchange, tom. tom: where jordan rochester this week? jonathan: nomura still, i believe. [laughter] jordan rochester is probably listening to this right now, thinking, i hope so. tom: three firms in the last six months. where are they?

jonathan: james bevan is still at ccla, still the chief investment officer, and he will join us in the next hour. euro-dollar, $1.2081. your bond market yield higher. from new york city this morning, good morning. tom is with bloomberg still, i can confirm. [laughter] this is also bloomberg. ritika: with the first word news, i'm ritika gupta. president biden's proposal to boost the capital gains tax would hit individuals earning $1 million, and married couples jointly earning the same amount. the president is set to unveil his plan tomorrow. it would almost double the capital gains rate for some taxpayers. meanwhile, president biden is expected to sign an executive order today that would raise the minimum wage for federal contractors to $15 an hour. it is currently $10.95. the new $15 wage would start next january.

the latest u.s. census figures are good news for republicans. they will gain two seats in the house of representatives under the new census. california will lose a seat for the first time ever. general electric burned more cash than expected in the first quarter. that crimped ceo larry culp's turnaround after signs of improvement. they called it a difficult environment for the crown of ge's industrial business, aviation. u.s. businesses saw arising bills for all kinds of materials. in earnings calls, executives from businesses ranging from chipotle to appliance maker whirlpool have outlined data that shows inflationary pressures building in the economy. global news 24 hours a day, on air and on bloomberg quicktake,

powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

>> we have been reminded that the status quo is not nearly good enough, and that innovation

is indeed the path forward. for our part, the united states will work to end the pandemic with our partners and allies. we will invest in our health security at home and globally. jonathan: that was vice president kamala harris addressing members of the u.n. alongside tom keene and lisa abramowicz, i'm jonathan ferro. tuesday morning shaping up as follows on the s&p 500. equity futures up a little more than 0.1%, five points on the s&p. we have $18 trillion worth of earnings this week on the s&p 500. apple coming out tomorrow, amazon on thursday. into the bard month -- into the bond market, where yields higher which 1.5792%. racing through the earnings for you, this one is just for you, tom.

tom: when you and i had lunch the other day, you had on those classic crocs. jonathan: i had no idea people actually wore these seriously, but apparently they do. tom: i bring this up because this is anecdotal. company to company, we are all focused on amazon and all that, but each company has a story about how they are doing in this horrific natural disaster. jonathan: they are doing pretty well, i raise -- pretty well, apparently. lisa: the story is that everyone is at home, and they prize comfort over all else. jonathan: this trend continues? people have just given up? [laughter] lisa: they've given into a new life. tom: -- joins us from washington this morning.

jack, the president will speak, and it will be a most interesting speech to the middle of both parties. how do those middle parties shift with the census announcements yesterday? they wake up with a new america for the next 10 years. what does it mean for moderate democrats? what does it mean for moderate republicans? jack: in the near future, some members are going to be worried about getting redistricted out of their seats. the ones in the states losing state -- in the states losing seats, they are potentially in trouble. more broadly, as we look to 2024, a lot of this is a shrinking rust belt, and as you saw, growth in texas and more of the sunbelt other than california, so it really does

throw things out of whack, i think especially for democrats, who got gains in 2020 in those key states like pennsylvania and michigan, which are now losing a seat each. tom: how does president biden adapt not only in the speech, but forward to the new reality that he's got to do better in texas? jack: one, he is leaning into policies that are popular that may be tough to get bipartisan support for in congress, but that play well in the polls. so i think in his speech wednesday, he may actually be playing a little more to the left of the party, talking about childcare, free community college, pre-k, social programs that aren't exactly centrist, but that poll very well. other than that, there is an aspect of racial diversity. the white working-class conversations we had after 2016

apply a little bit less to presidential politics, and the lessons that democrats learned in georgia -- for example, georgia isn't gaining a seat, so that is the kind of state increasing its clout in the long-term. lisa: how do capital gains taxes appeal to republican voters, in particular those that voted for president trump? jack: the capital gains tax may not appeal to republican voters, but that is one of these issues, along with the increase of the corporate tax rate, that biden is pushing where he is very aligned with the bernie sanders side of things, and it is a sort of populist approach. it is interesting that he has played it both ways. he's pitched that as a tax policy on its own, but also as a pay for for this next round of legislation, so he's tying that rhetorically to free community college, childcare, that kind of thing. jonathan: can you lift the lid

for us on what is happening down in washington with the lobbying effort from big tech companies, the people affected by this discussion that we are having right now? what does that look like at the moment? jack: a lot of this is happening in the open because there is so much republican opposition to what democrats want to do on taxes. so even lifting the lid, it is very clear republicans are outright opposed to not only the capital gains issue, but a lot of the corporate tax proposals by biden that he wanted to do sooner in this next bill, the infrastructure bill. there may be some middle ground, but clearly it hasn't even taken a lot of lobbying to get very significant opposition to these proposals, and anything that is going to become law at this point, unless they ram it through in a partisan way, is going to have to be very watered down. jonathan: jack fitzpatrick there

, bloomberg government reporter. and to turn to some earnings this morning as well. ups up by almost 7% in early trading. it was a big beat. tom: we are making jokes about it, but this is a real litmus test for the entire nation . if i am at microsoft, particularly if i am at amazon, the ups story is great news. jonathan: amazon on thursday, apple coming up on wednesday. lisa: sales of ups climbed 27%. not exactly surprising. i guess the key question is the wage dynamics, given the fact that they have to hire enough people. they are dealing with labor shortages, along with a lot of other companies. jonathan: dreaming of reopening is easier than actually doing it, the words of mike wilson over at morgan stanley. this is going to affect different companies differently, just to state the obvious. it is going to be important to

see who can meet that bigger demand. tom: it is about hiring the marginal unit worker. right now, where i sit, that is the theme for the next 200 days. where do you find the next worker? jonathan: and labor costs are going up. lisa: really, they are being spurred up by the $15 minimum wage proposal by president biden this morning, an executive order for contractors with the federal government. you do wonder how much staying power this has. does it count as, should i say it, transitory? where's tom? is he drinking? jonathan: do you think the news conference is interesting tomorrow? lisa: i think it will be fascinating. jonathan: i don't think policy changes in any way, shape or form. i just think the conversation changes, and they have to respond to that. coming up, bank lumbar oda --

banque lombard odier's head of fx strategy. [indiscernible] [laughter] jonathan: from new york, this is bloomberg. ♪

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♪ jonathan: live on tv and radio, for our audience worldwide, here's the price action on the s&p 500, the nasdaq, the russell. we advanced four points on the nasdaq and the russell, up just a little bit. switch up the board. yields higher by a couple of basis points on the long end. curves just a little bit steeper. about 1.58% on tens. let's finish on this, copper, now the highest since march 2011 and pushing towards $10,000 here on the london metal exchange. we are up by about 1.5% intraday. miners in europe up almost 20%

on the s&p 500. do you want to talk about the lme 500, tom? the heritage of the london metal exchange? tom: i'm looking at london lme palladium. jonathan: what do you see? tom: moonshot, hyperbolic. jonathan: thank you. copper, $9,892. the earnings today, tomorrow, thursday all piling up. here's romaine bostick. romaine: let's start with travel, housing, and e-commerce. jetblue did report here. demand is picking up, and the company seems bullish about that demand persisting through the summer. the problem is those costs are rising. labor costs rising, as well as fuel costs, and company saying

that is going to put a crimp in profitability going forward. there's also a bit of concern about revenue on a year-over-year basis. the forecast is still for a drop on revenue from the previous year, though still an improvement from the pandemic levels. pultegroup reporting. sales for homes continues to go higher. investors may be a little concerned about the persistence of some of this. you can find 19% revenue growth in the first quarter. they are still looking for 20% plus growth for the next three quarters. some investors are now starting to wonder whether that is going to be met. ups also having a great quarter as well. interesting number was what they made on international revenue. this actually rose about 12%, and this is a huge metric because that actually dropped in the previous year-over-year comparison, primarily because of the pandemic. so a little bit of a return to normalcy here. after the bell, another deluge of earnings. keep an eye on microsoft.

gross margin expectations for this company, 68%. that's what the street is looking for on this company. right now they have just shy of $2 trillion valuation. alphabet also reporting. we've gotten a peak at some of the digital ad spending. it appears google is probably going to continue that strength we have seen for some time. expectations higher for both of those companies. expectations not all that high for starbucks here. they've been really hit by coffee prices. tom: does their ballet shift this afternoon on "the close?" does microsoft have to talk about funding a look that? romaine: the difference between apple and microsoft is microsoft to a large extent is to a growth company. apple can't really claim that anymore. it has been much more they value play, and you have to give investors a little something

more than just that 5% to 6% juice they are getting every quarter. tom: is that it? romaine: there's tons of other earnings. crocs earnings. they are doing well. justin bieber is on board. i know you've got a few pairs in your closet, tom. jonathan: justin bieber where's cro -- justin bieber wears cro cs, does he? romaine: celebrity endorsements, jon. tom: they look great. romaine, thank you so much. jonathan: people embarrassed of their wealth, they wear crocs? if that's what it -- is that what it is? thanks, romaine. tom: "the close," must watch, must listen this evening. very informative with the earnings coming out. right now some of vasileios gkionakis with us, banque lombard odier. i've got to go right to the

dollar and the catalyst for the win of dollar weakness. what will drive dollar, dxy, finally below 90? vasileios: i think it is going to be when we get some confirmation that the vaccination rollout in the european union is going at pace. i think we are in a really good global scenario where you have a big global gross into trade upswing. you have commodity prices rising because pent-up demand is rising. there are some question marks, one about the pace of potential future yield increases, and secondly about how the vaccination rollout in the eu is going to pan out, which is likely to affect the growth outlook, especially in h2. i think the view is that the pace of yield increases is going

to be normalized, so it is going to be consistent with the fact that global growth is picking up , but it is not going to be abrupt, as i abrupt as it has been in late february and march. over the past two or three weeks, we have seen it peak with the rate of vaccination, but nonetheless, i think a lot of that has already been in the price, so i think from a fundamental medium-term view, dollar goes lower from here. there's a very strong element of may seasonality that sees the dollar higher. tom: is there going to be a lot of jawboning about stronger euro? do you anticipate we will see the nation saying enough of this dollar week strategy, or is that an -- this dollar weak strategy, or is that an ancient idea? vasileios: let's not forget that

what is really relevant for eurozone inflation is trade with europe. this is what really matters in terms of the pass-through or not of prices into domestic inflation. in that respect, euro china has the biggest weight. to the extent that you are talking about a gross based, generalized dollar weakness, euro-dollar upside is not going to translate into euro china upside. more likely, potentially euro china downside because the renminbi has plenty of appreciation to go through. in that respect, i think this will keep the trade-weighted euro in check, and i very much doubt that we are going to get a collective, synchronized i all governing council members of the ecb noises about the level in europe. jonathan: there was a clear

slow down of the rollover of the maturity in china. what will drive that additional renminbi trend? vasileios: first of all, i think it is quite clear that the pboc is in a slow type of mode. indeed, we expect some 30 basis points toward the end of the year or the beginning of the next. secondly, the other important element is that you keep on seeing portfolio flows go into china. these are largely because of the gradual process of account liberalization, but also because chinese bonds are being included into bond indices. this has not been exhausted. a lot of the flows coming to china on the corporate and the retail sector have not actually been converted into renminbi already. over the past eight months, a large chunk of domestic names

have been hoarding a lot of dollars. they have about $180 billion, which is quite unusual. we expect that these things are going to start unwinding, meaning that domestic players are going to start converting these dollars into the renminbi, reminiscent of what happened for or five years ago, back into 2016, and this is going to put another leg lower into dollar china, and potentially other renminbi courses. lisa: when does the pboc get involved to suppress the renminbi's rise? we saw it peak out at 7.2 per the dollar. when does the pboc get involved? vasileios: i think the pboc is one of these central banks where

they learn by doing. they try to avoid mistakes from the past. i refer to what happened back in 2015, of the devaluation in everything. basically, my main point is that i think right now, they have shifted into a regime in which you have controlled appreciation, and i think they are very happy with it and pretty comfortable with the renminbi going higher in a normalized fashion. if you look at the renminbi basket, typically you tend to think of the pboc having a range between 92 and 98. however, if that rebound in global growth trade continues, the fact that china has not lost share in export competitiveness, i don't think the pboc is going to have any problem seeing the trade-weighted renminbi version

of this etf basket breaking above 98. jonathan: we've got to leave it there. vasileios gkionakis there, banque lombard odier head of fx strategy. i wonder, and a different kind of question, whether they will tolerate the high yields that will lead to a stronger currency. will they see it as consistent with a brighter outlook in the same way the federal reserve did more recently? i think many people have their doubts about that. tom: they will jawbone. the question is when. what do you think, up three figures here? jonathan: maybe. we have seen it before. i think the thing going against the ecb right now as they don't seem to be on the same page about anything at the moment. that could get dicey in the months to come. tom: the microcosm of earnings to come, i want to go away from amazon, alphabet is well. hubble, shelton, connecticut,

they make 130,000 electrical parts. it got revenue growth, high single digits. they are minting money and they are raising their dividend. they are up 90% of the bottom. jonathan: raising their full-year earnings forecast, too. that's the story in america right now, a better outlook. that's been the story of the last six months. equities up 3, 4 on the s&p. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. president biden is stepping up pandemic assistance to the rest of the world. the u.s. will share its entire supply of astrazeneca's coronavirus vaccine with other countries. plus, it is putting together an aid package for india. all of this represents a shift for president biden. he's been focusing on making sure americans are vaccinated first. president biden is staking a claim on economic issues ahead of the 2022 midterm elections. according to his advisors, the president's infrastructure and family support plan are an

appeal to the disenfranchised white voters who put president trump in office. he will also be targeting independent suburban women. polls show there is some republican support for the biden proposal. -- is ramping up lobbying efforts in the u.s., trying to cultivate its relationship with president biden after it faced saudi led boycotts in the persian gulf. since january, qatar has hired seven prominent firms to do consulting work in washington. eli lilly has cut its forecast for anymore earnings after the government canceled an order for the company's coronavirus antibody. the agreement now focuses on lilly's combination treatments. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

♪ >> if you decompose the decline in rates, they are all being led

by real rates, so i think the market finally heard the fed, that the fed is going to be extremely patient, that they are going to see actual data, not forecasted data. so with the fed controlling the front end, i think that limits how much rates can rise. jonathan: it is almost tedious, isn't it, how much people agree with the federal reserve? good morning. alongside tom keene and lisa abramowicz, i'm jonathan ferro. equity futures up three on the s&p 500. we advance not even 0.1%. yields up a couple of basis points on the 10 year to 1.5827%. euro-dollar totally unchanged, $1.2085. let's get straight up his rick, switzerland -- straight out to zurich, switzerland. ubs taking another hit, more than $10 billion from that one investment firm. unreal. tom: it is a whale, but a

different whale then we saw over 10 years ago. jonathan tyce joins us from bloomberg intelligence for beleaguered european banks. what is the difference right now between ubs and credit suisse? jonathan t: well, obviously ubs has a slightly smaller wound to lick from the archegos fallout, and with a new ceo at the helm, he has a fresh set of eyes perspective, and i think for example, prime brokerage, ubs will probably likely retrench far less than credit suisse. but clearly, both of them somewhat blindsided by what happened with archegos. jonathan f: clearly, investors, too, because no one was told how big it was. can you help us understand that a little bit more? when a bank from now on says it

is not material, but it actually means? jonathan t: bear in mind, i think they were probably looking at the low hundreds of millions of dollars. in the grand scheme of things over a year's earnings, not huge. i guess because all of the attention was focused on credit suisse at the time, maybe they thought it wouldn't have to worry and perhaps they could settle at different levels. it is not like we haven't seen this in the past. things have been revised upwards , but we got a very accurate number for q2 with some very strong wealth management and probing central flows. it just roof looks a little bit of disappointment, but nothing more because we should be able to draw a line under this. lisa: are there potential risk management issues that come up, especially due to the fact that they didn't think it was material to mention this, and the likes of deutsche bank set

to report later this week evidently missed out on this risk? jonathan t: if you look at the story, deutsche did actually manage the position far more efficiently. i suspect everybody had a bit of this. it was a question of who was most aware. so risk management and ubs, we have a new guy at the helm. no doubt, he will be thinking, i was entitled immediately. but he was quite clear on the interview earlier that he wasn't going to retrench from prime brokerage. lisa: there were some positive wins here, particularly when it came to wealth management. however, still a lot of cost pressures. our european banks only playing a game of cost cutting at this point? jonathan t: i think european banks are still somewhat behind the curve for cost cutting. bear in mind, everything was put

on hold last year as dependent hit, and if you look a lo -- if you look at a lot of european banks' retail, these are some of the most over bent -- overbanked countries in the world. so i think there's a lot more to come. tom: you are expert at the revenue compare and contrast. i am always shocked at how small the swiss banks are on a revenue basis relative to the u.s. big banks. what is there transactions and combinations future? what does ubs do? what does credit suisse do? jonathan t: they have both done reasonably aggressively on the private bank wealth management route. if you think about ubs and its retrenchment out of things didn't come, which is very similar to what we saw with

deutsche and equities, they have become far more selective in the businesses they are in, so when you think friday sort of -- when you think for a sort of non-investment banking for ubs, they certainly punch above their weight, and i think globally, you forget quite how big the u.s. banks continue to become as europe spends a decade in turmoil. jonathan f: how's this for a stat? it comes from a report here at bloomberg news, coming from the fed data. total loans and leases out to a record low as a share of deposits. we talked about that subdued loan demand in the first quarter. does that continue into q2, q3? jonathan t: well, we know that the behavior of the corporate and retail last year has ramped up deposits, and credit carnes

end loan facilities have been paid down, so that will continue to be a function of how quickly things rebound. but in the u.k., they've actually had some good numbers. so it will take a while, but i would expect normalization to happen over the next two to three quarters. jonathan f: jonathan tycw= ofe -- donovan -- jonathan tyce of bloomberg intelligence, thank you. tom: to me, it just comes up to how do you compete away from this easy krach we see right now, which is everyone going into wealth management. who is not going into wealth management? jonathan f: the issue we've brought up repeatedly, what i hear from you is that using this is an attitude problem. tom: absolutely, 100%.

sorry, it is cultural, it is attitude. they are comfortable doing what they are doing, and you get into trouble. when does that change, and why hasn't that changed? david haro at credit suisse has been waiting for that to change for a long time. tom: we had the conversations at davos, people looking for a change, whether it is cross-border or within nations, and it doesn't happen. there's not enough fortises going on. lisa: there's a tension here. how do you make money? how much risk do you take in order to do so without necessarily suffering the consequences? this tension keeps getting borne out and will do so if they just want to make more money. jonathan: i remember a line from president draghi many years ago when he said rates have to be low now so they can be higher in the future. i think rates are lower now than they were then, and they are not going up for a long time. james bevan of ccla will be joining us in just a

moment. [indiscernible] [laughter] i am trying to record that. i might start recording that when we get to the summer months. tom: maybe i should try crocs. jonathan: i would love that too, tom. this is bloomberg. ♪

>> we just can't catch up after going through a depression-era bust with this health crisis to suddenly having a runaway bull market. >> this is all reopening, fiscal stimulus. how much does behavior change? we are all becoming behavioral scientists. >> are we heading into a period of peak data? peak data historically has been met with corrections. >> all eyes are on what constitutes substantial progress for now. >> it has a long record of controlling