>> everything is in place for inflation to rise, and i think it is going to rise significantly enough to make the fed uncomfortable. >> quite frankly, no one seems to believe inflation will be anything but transitory. >> the fed's objective right now is managing expectations, and they are doing a great job of that. >> as long as interest rates are close to zero, you are destroying everything in capital markets. >> you step back and look at the fed's goal of reacting, they want to wait it out, but market prices don't wait things out. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: melting up into the long

weekend, marking the halfway mark. good morning. this is "bloomberg surveillance ," on bloomberg radio and bloomberg television. jonathan ferro with the day off. romaine bostick is gracing us. it is interesting here, $1 trillion here, $1 trillion there. we may be talking about real money. tom: it is a judge mary shaw -- it is a generational reset. it is stunning. there's any number of ways to spin this, including the back-and-forth politics, but wow is it a throwback to reagan, a throwback to another time and place. lisa: but what it's going to actually get done, and perhaps more importantly, what is getting priced in? what has markets actually reflected? romaine: when you look at the bids we signed two materials, a

lot of the industrial stocks, i think a lot of people are pricing in the upside from that investment, and what really hasn't been priced in yet is the potential downside from how you pay for that investment, and i think that is going to be the tug-of-war we see deeper into the year. lisa: which raises the question about inflation in 90 minutes about a half-hour's time. i do wonder what we are going to see and whether it will matter. at what point does inflation data even matter when people say they are waiting for later in the year to even begin to think about transitory? tom: year over year, 3.5% is the statistic. on the core inflator we go to do .9%. mike mckee, i can't do anything with my shirt today. [laughter] on radio, it looks appalling. now we are back to normal. i look at the pce deflator, and i think it speaks volumes about

the set of inflation series that everybody looks at. mike mckee looks at one, i look at another, etc.. what i am really looking at is called atlanta sticky from the federal reserve bank of atlanta. i want to know what sticky prices are doing as they micro move, and paints in inflation seen. lisa: still, you've got janet yellen coming out yesterday, transitory. it is a restart. i am looking at this and got to say, you are starting to see these labor market shortages and a question mark around that. romaine: at the end of the day, it is not just about what you see in the aggregate data area it is really about inflation expectations, and the market is just not buying it. you look at five-year five year breakevens here, and we are priced just slightly above that 2% level, so this is a market at least right now that is not all that worried. tom: and the market call of 30 years a disinflation and a deflationary tendency to get

when i look at steve major, david rosenberg, and others saying wait, don't be an inflationista, the heart of the matter is technology and what has done to this american economy. lisa: and also the fact that, you killed me for this yesterday comes that people are getting older and people are in more debt area that leads to slower growth, full stop. tom: unbelievable, the effect of this technology in all we have seen, and that is a good to catch -- that is a good time to catch up with christopher grisanti, moving from growth to value at mai capital. in your research note, use amazon, by it. chris: and that is weird for a value guy. but what we have to realize is that amazon has underperformed the s&p for a year now, so the

pendulum has clearly swung to value and energy, financials. i think this is maybe the first time in three or four years investors have the time to buy -- have a chance to buy amazon at a relative value to where they usually trade. the reason i really like this is because the earnings in the first quarter weren't just good. they were absolutely terrific. it they are not underperforming because they are anemic. they are underperforming because they are not the flavor of the want. lisa: our tech stock -- are tech stocks independent of rates? can you bet on them regardless of what benchmarks even do? reporter: -- chris: i do suspect interest rates will be higher, and i expect that the lie of this period is that the discount

rate is lower. if earnings come through and they keep coming through because the economy is strong, these are going to be terrific long-term investments, and i don't care if 10 years or three. romaine: it is also about the revenue growth, and i guess more importantly, some of the pricing power these companies have. when you look at amazon, look a lot of these big tech companies, is part of the appeal in a rising rate environment the power that they are going to have over the consumer and over the market to set rates where they want them to be? chris: you are absolutely right. if we are in more of an inflationary environment, google for example, there advertising, and they will push the price of advertising. these guys will rise. i am more scared of wage inflation. these guys, with the exception of amazon, are employee lite,

so they are pretty well set up for a world with higher inflation. but i wouldn't believe that higher rates are going to be necessarily bad for these companies long-term romaine: we are almost coming out of the covid crisis, knock on wood here , heading into what is the unofficial start of summer. a lot of people are getting back out, starting to spend. a lot of investors looking to that reopening trade, trying to invest in companies that could potentially benefit with all of us getting back to normal here. has that already been priced into the values of some of the stocks? chris: i sure think so, romaine. we have been talking about a reopening trade for nine months now. i walked into walgreens a few weeks ago and there was row after row of hand sanitizer on sale. the world is dynamic, and i think the market has discounted the value reopening trade. these energy stocks had their day in the sun like they haven't for 10 years. i think it is just too late in the game to go there right now.

tom: what is your study of pricing power? we are talking not day after day, but twice, three times a week. somebody emphasizes pricing power as being important. is it? chris: i think it is right now, and i think it will be more important. i think we are entering a period that we haven't been in and at least 10 years, maybe 25, of moderate to higher than normal inflation coming. i think commodities are the headline, but the steak's wages. i think we will start to see that early next year. if you can't price to overcome the headwinds of inflation, you have a problem. i think that will become more obvious next year and especially in 2023. lisa: there's this idea that big tech is defensive, that that is the defensive play. i want to give you a chance to clarify. it's your call on some of the big tech names a defensive characterization, or is that

simply where money is, and highly sensitive equity -- and not in highly sensitive areas of the equity market? chris: the mass just looks really compelling for these tech names, and it doesn't look so compelling now that they have gone up so high in price for the energy and financial names. the earnings growth and the revenue growth is much higher. so i think the real value right now is in tech, and i would phase the reopening value trade. tom: thank you so much. greatly appreciated. i am going to look 10 years back at this great bull market. lisa, we have an s&p 500, i've got to do this again here, i'm using the great tra function on

the bloomberg, a great secret of "bloomberg surveillance." i was right. s&p 500, 21.9% per year the last 10 years. all those certitudes of single-digit, actuarial assumption, the great miss call of this market. romaine: when you break that downromaine:, you talk about the 20% growth rate we have seen, we talk about an underperformance of something like 34% over the last 10 years with regards to those value stocks, and the flipside is that momentum, this growth names, a lot of those names over the past 10 years, now people are touting as the new value stocks, whether it is app is on, -- whether it is amazon, apple, what you will. lisa: a question is how much we are bringing forward those returns. the one push back to that is that you are seeing the dividends increase at a lot of companies, and at what point are stocks the new bonds? tom: going back to our interview

with william freese, this is a huge mystery into the end of the year, the share buyback dividend dynamic we will see from companies. i don't agree have a clue what that is going to be. romaine: no, but -- lisa: no, but you have been seeing increases in dividends that are pretty steady. . the whole idea of value and that people are bidding up income at a time when you can't get it in the fixed income complex. romaine: i think that has been what people will keep an eye on. the traditional area of income and safety to a certain extent is just not there, and people are finding that income and safety inequities. tom: what's terrible here, sonali handed me a nutella l atte, it smells great. lisa: so where's the terrible? is it transitory? tom: for me, it's transitory. i will go back to the tang.

dow futures up 136. we welcome you on this friday, a memorial day. bharat ramamurti of the white house, next. this is bloomberg. ♪ ritika: the russian hackers behind the solarwinds campaign have escalated their attacks on u.s. federal agencies, think tanks, and nongovernment organizations, according to a blog post from microsoft. in april, president biden orders sanctions against 32 russian individuals and six companies that provide support to the kremlin's hacking operations. prime minister boris johnson meeting with hungary's viktor orban.

johnson has held relatively few face-to-face meetings since the coronavirus pandemic began. germany's president said today he will take a second term. he made his pitch for another five years as germany's head of state four months before the country elects a new parliament. investors swapped to safety in the past week, and the biggest addition since april 2020. bank of america said gold friends -- gold funds and other havens soared. market players are looking for alternatives over concerned about equities.

a potential victory --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. ♪

♪ >> my judgment right now is that the recent inflation we have seen will be temporary.

it is not something that is endemic. i expected to last for several more months and to see high annual rates of inflation through the end of this year. tom: secretary yellen there. she has a huge task ahead of her on the budget as the proposal is made and the disposal will be done. right now on the budget, bharat ramamurti joins us, the white house national economic council deputy director. he's from one of the esteemed families in america. what have you heard from southern india and the last couple of weeks with their pandemic challenge?

bharat: it is tragic what is going on in india. a lot of my family is still there, so we are on pins and needles hoping they make it through ok. i know the united states has taken steps to assist india in dealing with the pandemic, and of course, taking the steps it did on the vaccine patents. i know the administration is looking at all we can do to help our brothers and sisters abroad, including those in india. tom: i will be pleased to talk to you about this further, but just because of the new slow today, we cannot. let's go to the economy. republicans will say this will break america. it is not doable. respond. bharat: i think the budget demonstrates that there is a fiscally responsible way of ensuring long-term, sustainable growth in the united states. what the budget calls for is a series of investments in

infrastructure, in our families, and in our families, and and four additional years of school, all about improving and increasing productive capacity over our economy and the long-term. 30 million americans don't have access to high-speed internet right now. what do you think it does for the economy to connect those folks in rural areas on tribal lands and elsewhere? right now there are 400,000 schools and childcare centers that get access to water through lead pipes even though we know that comes with a danger to long-term health and safety of our children. the president's plan would call for ripping out and replacing all of those pipes, which not only creates good jobs in the short term, long-term success in the economy, and the budget lays out a fiscally responsible way of paying for all of these investments, such that from your 15 onwards, the debt and deficit starts to reduce over the long-term. i am not going to take a lecture from the same republicans who voted for a $2 trillion tax cut a few years ago that had no

discernible impact on business investment and that exploded the deficit by between $1 trillion in $2 trillion. lisa: there is a question, if you are counting on this plan to pay for itself, what role he federal -- in what role the fed will play. how much do you rely on the fed to bni player in keeping rates down -- to be an active player in keeping rates down? bharat: the other part of this is that there are new tax revenue coming from large corporations and wealthy individuals. in 2018, the effective tax rate paid by multinational corporations, compared to the tax rate your average middle-class family pays, there's clearly capacity for these companies to pay more in taxes, to help finance the investment that are going to be good for those companies in the long run.

this is a win-win scenario. lisa: a lot of people say higher taxes leads to slower growth. how would you respond? bharat: i don't think there's a strong empirical case that what the president has put on the table are going to have a negative effect on growth. in fact, quite the opposite. independent analyses have shown they have reduced more economic growth in the short-term and the medium term. they create more jobs and they create high-quality jobs, which is central to the president's message here. if you listen to his speech yesterday, the main point was that we should be looking at the economy, measure the success of the economy on how families are doing. are they able to work at a job with dignity? do they have choices when they enter the labor market? that's the kind of economy the president wants to build, and the economy we are starting to see emerge out of this pandemic

due to the president's actions. romaine: do you miss some of the more normal metrics that others would look at with regards to debt to gdp ratios and debt financing? bharat: it is relevant to look at the interest payments the united states is going to make as a proportion of gdp. if you look at that metric, it is clear by historical standards that we are well-positioned, in part because interest rates are low, have you -- as low -- are low, as you have noted. we have a unique opportunity as we are emerging from the pandemic to rebuild certain parts of macon ami -- certain points of the economy. international competitors aren't holding back. the eu announced significant investment. japan, there's a race to win the 21st century.

romaine: the messaging we have gotten from you end folks at the white house has certainly been compelling. you guys have a clear ally on capitol hill to actually shepherd this through, a powerful ally? bharat: i think this broad bipartisan support for many of the elements of the plan we are talking about. first and most importantly, among the public, where the president's plans are polling consistently at 60% or 70%, and much of the effort the president has put into his plans emerged from existing bipartisan legislation. for example, the president has proposed expansion for affordable housing. there is rod bipartisan support for expansion of tax credit. if folks are going to be consistent with previous dozens, is going to be a lot of bipartisan support for this. tom: bharat ramamurti from

the white house on the spin that begins. we saw a lockdown of melbourne in australia, and now malaysia announces a full nationwide lockdown. what stuns me here is for 14 days. i didn't expect that. lisa: it really shows the lower tolerance for covid cases in a lot of places. we saw that in japan, saw that in singapore. the question is, how do you get vaccine to these other parts in the world in order to end the pandemic. how much will they start shipping these supplies out to others? tom: we are going to come back. we've got a lot of economic data. michael mckee will join us, stephen stanley will join us, and i want to dive back in with rome -- with romaine bostick on this massive short squeeze,

and the ramifications for all of us in the market. futures up 11, dow up 131. the vix, 16.80. michael mckee on disinflation or inflation, next. ♪

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tom: a plethora of economic data , and even more important, important economic data. there are very few empire data statistics. michael mckee begins the data swamp that attends us this friday. it comes out slowly. we begin with what we've got. which one matters? michael: the interesting news, the advanced goods trade balance was expected to set a record. it does not. last month 90.6 billion, this month 85.2 billion. that will add to growth this quarter. it is something of a surprise. now let's look at the numbers that matter today cup -- that

matter today. income and spending. income drops on the month of april but was up the month before. what has happened is the stimulus checks went out in march and everyone cashed them. personal spending is up .5%. that is what was forecast. that down from 4.2%. the stimulus checks faded. the pce inflation numbers, the month over month pce in at .6%. that matches estimates. the revision shows a month before it was up .6%. the pce deflator, this is the headline number, up 3.6% on the year. that is more than the fed consensus. this is the number that figures into the fed spending. they look at core because it tells that mark but the number they are working towards --

because it tells them more. jonathan: -- tom: you are doing this in real time. i'm seeing one statistic, pce revision to 2.4%. we are looking back 60 days of greater inflation, right? michael: right. we have had a little bit more inflation. the poor comes in hotter than expected. -- the core comes in hotter than expected. .7% for april and the year-over-year number hits 3.4%. let me do a quick calculation. romaine: the data is basically stasis in the equity market. that is pre-much where we were a couple of minutes ago. we are seeing a little bit of selling pressure in the treasury market. the 10-year gilts picking up slightly -- the 10 year yield picking up slightly.

a little but of activity in the two year. the bloomberg dollar index up about .3%. you have a market that has their eye heavily on the pce number, trying to parse what .1% pickup or a .6 pickup for a revision of .5%, what does that mean for prices going forward. tom: lisa, it gets us out to later this morning. the expectation of inflation from ann arbor. lisa: how much our consumers looking at this? you have the university of michigan consumer survey at 10:00. how much are they looking at this expecting higher inflation and adjusting expectation for wages as well as how much they spent on different items in their day-to-day lives. thank you so much, michael mckee, for parsing through the data. there is a question of does this data matter or do we have to wait until september, october,

november to determine whether this is transitory or not. stephen stanley has been parsing through all of this. does it matter that the pce deflator, the key indication of inflation, came in higher than expectations at the highest levels in a year-over-year basis since the 1990's? stephen: good morning. i think it does matter. the fed will try to wait it out. there is no question that most of the uptick is inflation is temporary factors. that can get embedded in the fabric. he rightly highlighted those university of michigan inflation expectation numbers because it was shocking a couple of weeks ago when the long-term inflation expectation number ratcheted up. the fed is confident inflation expectations are not going to move but we have not seen these inflation rates in a long time. the reaction of people in the

economy could be unpredictable. lisa: could you talk about why inflation expectations are so important in determining the true path of inflation? stephen: if people expect inflation, than they are more willing to accept it and more willing to demand higher wages to make up for it. back in the 1970's, we had what economists call the wage price spiral, where every time preiser's went up workers demanded higher wages and forced inflation higher and it fed on itself. we've not seen anything like this for several decades in the fed is confidence we will not see anything like that. we have not had an economy like this where supply is being outstripped so severely by demand in a long time. romaine: talk a little bit more about us being in virgin territory. when you talked about the past economic pressures, it does not come as much from the supply side as it had this time around.

i wonder if that does start to rear its head with regard to wages and the upward pressure that may cause concern for investors. stephen: one thing that is going on right now, for a combination of factors, and extra unemployment benefits have been cited by a lot of folks, people at the lower end of the wage scale are hesitant to go back to work and firms are raising wages pretty significantly for those types of jobs. it is hard to take that back. certainly many people would look at that and say that is a great thing. people are getting paid more and that is well and good. how does that get adopted in terms of how companies tend to price? fast food restaurants have to play -- have to pay three dollars or four dollars extra for workers, does that mean you're dollar value meal becomes a two dollar value meal? that is what the fed will be watching. how much pricing power to firms

have and doesn't look like consumers are more willing to accept those price increases versus where we have been over last 20 years where consumers have been resistant to price increases. lisa: i have to say, tom, when you take a look at what we are seeing you have to wonder at what point people look at this and say we have to look past the noise. tom: what is so important, as michael mckee points out, the job my task to look this wall of data and sift through it -- the job mike has to look at this wall of data and sift through it. stephen stanley, you are a claim. nailing the market economy. i assume you've never seen savings rates like this. guys like you are riveted at -- stephen: it is important to remember the savings rate is a flow in the rate went up a lot

in march because there was massive influx of rebate checks. the savings rate goes down april because income is not as high and you not have the artificial boost of stimulus checks. it is still above 10%. in normal times savings rates in the mid single digits. what is happening is every month people are putting away more money than they normally would. it made sense for that to happen in the pandemic because people cannot spend on everything. now that the economy is reopening, households have a tremendous stockpile of dry powder they can deploy. the question is does it get spent all at once or does it get meted out over time? i think it is likely to be the latter. lisa: this is important. michael mckee highlighting this. we saw the personal savings rate down from 14.9% from 27%. it seems like people are spending in force.

at what point do you adjust your expectations for gdp, for inflation, based on the savings rate coming down so rapidly? stephen: we will see what it does once the impact of the stimulus checks abates. may is the first clean month we have had a while in that front. all through last year savings were running much higher than normal. at some point i would expect the savings rate to go down to a below normal rate because people are flush. they do not need to save. they're probably going to want to be spending. we have all of this pent up demand for travel and all of the fun stuff we've not been able to do. i would expect as we get later in the year the savings rate will go down dramatically. tom: interesting economic data and more this morning. when you look at the savings rate, the wall of money that is out there, i do not by for a

minute there is an assumption in the market. what you read? romaine: a lot of the strategists we have talked to say that money might not come back. a lot of that has to do with why people save. a lot of that is about the perception of uncertainty going forward. i'm not sure there's any more clarity today about the economic trajectory than what people had a year ago. tom: it'll be interesting to see. futures back a little bit. on we go through the morning. through the 9:00 hour, good conversations with the import michigan numbers. what you have? lisa: i am wondering why the market is so sanguine. this idea inflationary data has been coming in stronger-than-expected and people are buying what the fed is selling. what are they seeing that gives them that conviction? what will we see that could potentially upend that?

we will see that in the next hour on "the open" with megan greene. this is the question. where does the conviction come from? romaine: the conviction comes from the market has been spoonfed by the fed for a better part of the decade and if the fed tells them this is transitory, a lot of people are willing to buy into it. lisa: people have been conditioned that we have never got the inflation people said we would get, but everyone saying this time is different. tom: i anecdotally would say the inflation is tangible. you look at the numbers on the screen, we are looking at the market and quoting all of this data. i go back to pce deflator. you are looking at three handles. romaine: it is certainly tangible, but there's a question some of the inflation is in pockets and not as brazed as some people will think. a question of whether it is persistent. lisa: lots of pockets and the

brown boxes that show up at the keene household. romaine: chewy? amazon? lisa: everything. romaine: there is a -- tom: there is a chewy delivery today now that i think about it. stay with us. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. president biden will kick off spending negotiations today when he sends lawmakers his 2022 budget plan. lawmakers will debate about the size of the deficit, how much funding for the military, and whether to end the ban on federal funding for abortion. budget negotiators may need a stopgap -- the u.k. has cleared a vaccine from johnson & johnson . it is the first single dose shot to be vaccinated in britain.

moves gives britain a fourth shot, though they use may be limited to half of the population that has already received at least one vaccine dose. the japanese prime minister is extending a state of emergency for tokyo and other cities in eight last-ditch effort to rein in covid ahead of the summer olympics in less than two months. many worry the sports spectacle could turn into a super slower event -- a super-spreader event. apple getting ready to revamp its line of air pots. the company plans to unveil a new version of its air pod this year. apples home and accessory segment has -- exceeding 10% of total sales. americans will be paying a bit more for their memorial day holiday weekend barbecues.

statistics from the bureau of labor statistics tracking prices for six staples, including ground beef, cheese, and potato chips has been on the rise. 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. ♪

>> you want to be sensitive to the idea inflation could take

off. people talk about inflation. i do not see too many of them saying i'm confident i know where inflation is going. a lot of opinions floating around. that is the point. you cannot forecast these things. even if you could, you do not know what the effect will be on the stock and bond market. tom: david booth talking about the challenges of investment in a most unusual time. that drives for the conversation. wall street week tonight at 6:00 in new york. romaine bostick and tom keene. lisa abramowicz prepared to drive the ferro show this morning. if you look at the cfa institute , it is equity theory turned on its head with where we are right now. romaine: we talk a lot about the rotation we have seen, also about the push into some of the

stocks that are not quite as valued. tom: this is a joy for romaine bostick and myself. you read the cfa financial analyst journey will. what you do is you turn to a robert arnott article. he has been definitive in driving forward academics in what we do at the cfa institute and what we do inequity investment. robert arnott of uc santa barbara. to the theories i read from you in the cfa institute ages ago still hold, or is a new paradigm where the risk-free rate is? robert: it is no new paradigm. we have always had bubbles in markets acting in occasionally irrational ways in pockets of

the market. the risk-free rate is manipulated by central bankers all over the world. it is artificially held negative. if you think of interest rates as a speedbump to discourage reckless investing, we do not have speed bumps, so we have misallocation of resources, we have zombie companies. it is not pretty. the risk is it does not end nicely. tom: if you take a balanced approach with the high art of the market the results are your results will be mediocre versus the glory of the faang stocks. you know the story is amazon -- is amazon a value or growth stock to research affiliates? robert: amazon would definitely

be a growth stock. growth stocks are better companies. that is why they demand higher multiples. the quality of the company and the quality of its future growth prospects are not unknown to the market and are fully reflected in share prices. one of the things we have worked on. you mentioned financial analyst in the first quarter. we had a paper examining the value effect. we found in our research that the value effect is alive and well. value stocks win relative to growth stocks. not when they are becoming cheaper and relative valuations, which is what has been happening in the last decade. tom: romaine bostick read that article. every coefficient. romaine: we will see if i can remember half that stuff. we will find out in 16 weeks. we talk about the definition

mission -- the definition of value and a lot of people have taken the fed environment to redefine what themselves what value can mean. if we ever do get some sort of normalization of monetary policy, a normalization at the same time as fiscal policy, do we revert back to what we would normally consider to be value in growth? to those spread back out? robert: there are so many catalysts that could revert things back towards normal. a normalization of fiscal policy , a normalization of monetary policy could be the catalyst. it could just be, as is the case of the tech bubble in the year 2000, just gravity can bring the high flyers back down to earth. when we were working last summer on the paper examining the value effect, one of the things that is interesting is over the last dozen years, if you use

price-to-book value which is the conventional way to measure value, the value stocks underperformed the growth stocks over the course of a dozen years by 58%. that is huge. that is the biggest drawdown ever. they got cheaper relative to the growth stock by 68%. if you have a stock that has gone down 58% and the p/e ratio has gone down 68%, what does that tell you? that tells you earnings are up. that tells you the stock is healthy at the markets opinion of the stock is the source of the drawdown. when you look at things from that perspective, do you take a stock like that and say cannot stand the pain, get me out of here, would you look at a stock like that and say i cannot believe how cheap that is. romaine: you go back 20 years

when we had the conversation about the tech bubble in the late 1990's and we had a lot of people trying to make decisions about what was value and what was growth. we know some of those companies went on to become the amazon and microsoft we now hold dear. how do you parse that in today's environment where you look at this need -- this new breed of tech stocks and decide which are the ones that do have that long-term growth potential? robert: we wrote a paper just recently entitled the market delusion in which we pointed out that what happened in the tech bubble in 2000, what happened in the ev market, electric vehicles market last year was a situation where the pricing of these assets went up and up and up, and they went up in a context of a perception they were all going to be winners, that they could be with one another.

they are market disruptors and disruptors get disrupted. of the 10 largest market cap tech stocks in the aftermath of the tech bubble in the year 2000 , how many of them beat the s&p 500 over the next 10 years? zero. one beat it the next 20 years, that is microsoft. it underperformed for 10 years that it outperformed for the next 10 years. that on a 20 year basis would make the market a little over 1% a year. the average for tech stocks was a percent a year under. tom: we are out of time. a weekend read for me has to be robert arnott in the great peter bernstein, 2002. a classic paper. you are done with queens gambit and all of the other streaming, read bernstein and arnott, you will be happy. futures up 10, dow futures up.

romaine bostick. romaine: i am sticking around. tom: stay around this morning. great to have you with us. stay with us, this friday, memorial day. this is bloomberg. ♪

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lisa: good morning from new york city. equity futures melting up to end the week ahead of a long weekend.

i am lisa abramowicz in for jonathan ferro. the countdown to the open starts right now. >> everything you need to get set for the start of u.s. trading. this is "bloomberg: the open" with jonathan ferro. ♪ lisa: we begin with the big issue. markets closing out the month. >> market sentiment is changing. >> people recognizing the back half of the year will be robust. >> the expected explosion in u.s. data. >> the potential for infrastructure spending. >> we are at a $1 trillion floor and we are talking about going higher. >> republicans cannot stop it. >> biden wants to spend much more. >> are a new lift to sentiment. >> you seehe