♪ >> i think the reopening has a long way to go. >> we still think we are in a bull market. obviously we had a correction. >> the bottom line as we are getting a big spike in inflation. >> the inflationary pressures we are seeing will abate, but i think we are in a pretty unique period of monetary policy. >> it is hard for the fed to maintain the degree of accommodation when the output gap is closing fairly rapidly. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: the great inflation debate

of 2021 heating up. good morning. jon ferro off today. romaine bostick tolerating us for another hour. we really have to focus on the markets, what is going on with 10 year yields in particular. the idea that we have been talking all year about inflation picking up, about whether perhaps the fed is staying on hold for too long, and here you have the 10 year yield down to 1.54%, a material shift lower. tom: that is absolutely extraordinary. what percentage of the zeitgeist is that pushing against? lisa: it is massive. tom: i think that is the right word. lisa: when you look at the camps, they are deepening. you have the likes of bill dudley on one side, and a whole host of professionals including no -- including nobel laureates saying the fed has it exactly right in the markets right now, saying the fed does seem to have it right for the time being. tom: the other thing i would look at besides bitcoin a bit off is within the data blur, the

quiet of the fx market to me is really important. i loved when one of our guests said mom is the fx market and dad is the debt market. i thought that was pretty good. [laughter] lisa: setting up a real battle between the two that feels somehow familiar. romaine: what is bitcoin, the crazy uncle? lisa: romaine, the nasdaq is at session highs, up 0.5 percent. this stems from the low yields, but also potentially the boost from the cyber issues we saw. what are you seeing in that area? romaine: we saw this correlation before a couple of months ago, when we saw those yields drop and we saw a little bit of a pop in those big cap tech names. people tend to gravitate towards this is a form of safety here. it may not be some of those cyclical names people have been filing into, but when people look for steady growth, reliable

revenue and reliable margins, it always comes back to those companies, the amazons, microsofts, and apples of the world. lisa: i have to wonder, is it correlation or causation between the yield and big tech? tom: i don't know, but three points is a big move. a major digital outage this morning, fastly, link -- linkedin to a ws -- linked into a ws -- linked into aws. romaine: you see the bid into some of those cybersecurity's now. tom: red and green on the screen, with the nasdaq 100 up 0.5%. the yield at 1.539 8%. the real yield doesn't give you much, 0.86, -0.86%. currencies on board. this is a really important

conversation. let's be honest, folks. this is the conversation of the day. cyber malik has tangible real-world experience and write her notes over conservative money. we are thrilled she could join us this morning. there's a huge body of intelligent, balanced, managed money. they have done all the right things. they bring balance, and they all feel behind. what do those people do who are in conservative balanced money that haven't performed? guest: the issue has been that a lot of people try the markets, and that is a loser's game. we saw people pulling their money out of the markets, cash on the sideline, and trying to wait for a buying opportunity. that is a tough sell when you look at equity markets that have been up double digits. going forward, we think that

markets tread water for a little bit as we continue to be concerned about inflation and taper talks, but we do see a catalyst coming up, and that is second-quarter earnings. they should grow at over 60%, and really the next leg of this cycle could come during q2 earnings, when companies talk about outlooks. what we are looking for is capex spending. we think that could really extend the cycle. we see low inventory levels, increasing production growth, and as that picks up, -- that capex picks up, that is good for the economy, good for the cycle. lisa: your view. really feeds -- your view really feeds into this contrast we see in earnings growth paired with a 1.53% treasury yield. saira: the bond market is saying that they see an increase in interest rates, but it is going to be orderly, well communicated, and when we look at yields, we think markets are

seeing yields settle at this point. we think going forward, a mild increase in yield may be up to the 1.75%, 2% level by the end of the year, the market should be able to handle that as long as growth remains strong. romaine: how does this work with general expectations of inflation? i keep hearing this could be persistent. saira: our view on inflation is that it is going to keep causing volatility because we didn't expect the data to spike at a much higher level than we would've hoped for at the beginning of this year. so a higher spike in inflation in the near term, but eventually we do expect that shift from spending on goods to spending on services, so there's going to be pockets of inflation rather than broad inflation. what would were yes again is around tech support earnings. we need to hear what companies are saying about wage inflation. we are seeing supply issues in this weaker than expected

payroll data. if wage inflation really picks up, that is a key component of overall inflation. and we do need to start worrying that it is more than transitory and the fed may have to pull the ripcord and react a little earlier than we all want. lisa: so how do you diversify? saira: within equities, you need to start looking outside the u.s. the u.s. has had strong returns for a decade now. outside the u.s., the emerging markets, we like areas such as china. severely lacking countries are coming soon hopefully out of the covid issues, like india and brazil look attractive to us. you can look at other asset classes. within fixed income there's still areas like emerging markets. you need to be more selective, focus on quality areas, and then move into some real assets that are more heavily hedged for inflation, which could be a positive for your portfolio. tom: percolating with the underperformance of sony people is the theory of rebalancing.

simon constable in "the wall street journal" wrote a brilliant article which i know you agree with, the whole rebalancing thing is carried away, and there is over- rebalancing. how does saira malik rebalance? saira: i don't think rebalancing always needs to be something you automatically do. i think you need to look in areas where there's valuation description -- valuation discrepancies and catalysts. if you consistently develop into europe, that would have been a real gain. that would not have been something we would've done. you could have rebalanced out of expensive tech into cheap energy , and that would not have been a way to win your portfolio. coming into this year, there was more of a catalyst for energy companies coming higher up on the esg spec. the reopening trait is positive for energy. a little bit stronger in terms

of tighter supply. but you need to wait for those things before you automatically rebalance your portfolio is because that can lead you to a loser's game where you're just buying losers that remain losers overtime. romaine: when we talk about the more structural changes coming out of this pandemic, whether you're looking at energy, looking at tech, there's a general sense that you either go for the pure plays, go for a pure play energy company in that space, or maybe a company that is a little bit broader in nature, that maybe has a little but of a buffer if the one big hot thing everybody is chasing doesn't work out. what is the general strategy you are advocating offer clients? saira: -- you are advocating for clients? saira: for us, it is which of the companies can really have leverage to the reopening leverage growth. earnings that will be the cost of capital over a cycle. particular sectors that we like our the consumer sector. we think with the reopening trait still in front of us,

consumer stocks should be quite strong. we like industrials because we do see now signs of a longer-term pickup in capital spending, and we like financials . i heard one of your guests be less positive about financials. a higher interest rate environment, higher positives for financials, and we still ask -- we still like small caps. tom: sarah malic of nuveen -- sarah malic -- sabre malic -- s -- saira malik of nuveen, thank you so much. what i love about the white sox, romaine, they still do the fireworks behind the scoreboard. i remove her that as a kid. romaine: i do, too. staying loyal to my white sox.

tom: you know, they ruined it. let's save ourselves with a data check right now. futures up seven. dow futures go the other way. what do we make of the nasdaq? lisa: i think this is fascinating because it really does correlate with lower yields. saira was talking about inflation protection and the concern about higher inflation. what happens if yields go materially lower? i don't think we have analyzed that enough. i think that is the risk, that if something looks like perhaps the outlook sours a bit and yields go materially lower, then what happens? romaine: -- tom: at 1.5364%, let's be blunt, 1.49% is unimaginable. romaine: we actually had this conversation on "the close" last week. we have a lot of great conversations there, tom. to stay up a bit later. we talked about 1.50% being the

bottom right now in terms of what is priced into this market. i think it changes the dynamic for a lot of pricing we are seeing in equity markets. tom: we will continue. much more to talk about. on radio and television, an important conversation later with david malpass. this is bloomberg. good morning. ♪ ritika: with the first word news, i'm ritika gupta. a senate investigation of the january 6 assault on the capitol details mistakes made by the government, the military, and law enforcement. a report says there was a lack of training and per ration for capitol police, who were overwhelmed by the writers. police told senators they were left with no direction when command systems broke down. president biden has come out with a plan to secure critical supply chains ranging from medicines to -- could

result in tariffs on certain imports. a problem that cause multiple websites around the world to go down has been fixed, according to the server hosting service fastly which has not said yet what caused the outage. amazon is offering six month subscriptions starting at six dollars and medication for common ailments. it is a effort to get more people to buy drugs online rather than at the drugstore or supermarket, and it has a way to make in the market. tesla handed over more than 33,000 locally made vehicles in may. analysts are watching to see if it will run out of -- if it will

run in china or have lower sales. 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. ♪

>> down the road, there might be

additional, but it will be many years before we see the scientific proof. you have three compounds with similar activity, and we are the first one in the market. in a few years, there will be others, and we invite them because the market is so large. tom: good morning, everyone. the gentleman from biogen this morning on this uproar over biogen and alzheimer's disease. we welcome you on "bloomberg surveillance." what we thought we would do is actually talk to a medical expert. we are so fortunate at bloomberg intelligence to have dr. fazeli with us. sam fazeli is our senior pharmaceutical analyst. you know right where i stand on this. i am absolutely outraged. the fda really pushed back. she was not happy. she was legit pro out of mcgill university in ottawa, in canada,

and she said baloney. there are residual uncertainties. what is she talking about? sam: well, i think she's probably referring to a couple of very choice phrases that the ceo of biogen used. "additional hypotheses," i think he used that phrase. i am not going to try to over interpret what he's says, but we are dealing with a hypothesis. the idea is you reduce any lloyd in the brain, which is what this drug does, and i gives you a benefit. that is where the question mark is. lisa: there's really a question, given the dissent you saw on the fda panel come on which way the fda will go. has their process changed post-pandemic or in the past couple of years in terms of erri ng on the side of, if that can help somebody, why not? sam: i guess that could be something that has gone on here, but i have to say that i don't

think necessarily the process has changed. we have seen examples of this kind of outcome before. the one before this was the situation with -- with the drug for muscular dystrophy. the same kind of eyebrows were raised after that. so i don't want to necessarily call this a paradigm shift in the way the fda does its job. lisa: how much does it shift the burden to insurance companies on whether to approve this kind of medicine given the expense, $56,000 for the medication? is this unusual, for insurance companies have such an incredible say in whether it is appropriate or not? sam: absolutely. in europe we get regulatory bodies who do have that mandate. here in the u.s., the fda approval, the label for the drug is so broad relative to what the

data actually was looking at, that it is literally your issue to go and figure out whether you want to reimburse this for your members, and if you do, who? i'm assuming they are not going to be able to go against what the fda says, but i suppose they will be asking. i think there's a lot of questions here. my mind is going around in circles on. -- circles on it. romaine: not only does it give a little more wiggle room for the insurers, but puts a lot of onus on the doctors as well. i am curious as to why the fda in this particular situation is going to allow such broad discretion to doctors, particularly when it is not entirely clear yet whether this drug is actually going to solve the root cause of alzheimer's. sam: it may be comes down to the

exact issue we were talking about earlier, that the data is open to interpretation. maybe their view is not only the clinical data, but also the massive divide within the scientific community, of the importance of this. romaine: isn't that usually resolved during the clinical trial process? sam: absolutely. that's what this trial should have done, but unfortunately it did not get us that far. tom: let me cut to the chase. i was weaned on this with microbiology and virology at the manchester institute of technology. you and i have tattooed to our brain the fda with smithkline french ages ago having the courage to say no to the limit of my -- no to thalidomide. have we breached the trust earned in the 1950's? sam: there is a risk of that. those are big claims, but there is a risk of that here. i have to tell you one thing,

and the member of an expert panel, which i am not, what is the value of me joining and spending hours and days viewing data, giving my opinion, only for the fda to basically say, great, thank you, we are going to do something else. tom: exactly. i am not going to mince words here, folks. does the number $56,000 per year have anything to do with this decision tree? sam: well, perhaps. but the other appoint -- but the other point, let me ask the question this way. it was $50,000 per year, you still have to go through test, you still have the risk of rain inflation that you get from this drug. let's be clear, i unlike everybody else are likely to be touched throughout my life with this disease. you will want a drug -- we all want a drug. we just wish it was a little

more straightforward than it turned out to be. tom: thank you so much to join us today, with "bloomberg surveillance" and our senior pharmaceutical analyst. lisa, your thoughts on that conversation. lisa: it is a massive issue, the question of when you approve a drug. if there's a chance for it helping 50% to 20% of will who are affected, do you allow it to be circulated? do you make it more mainstream. if there isn't necessarily scientific backing, do you think we just wait and see? the reason i ask is because we saw the rapid approval of the covid vaccines, and it was preliminary approval,, so at what point -- preliminary approval, so at what point you weigh in on this? romaine: there's other avenues they could have taken to get this out to a smaller group of people to see if had the ecstasy. -- to see if it had the

efficacy. tom: you nailed that. they do the phase four testing before they raise the hopes of millions of people touched by this horrific illness. romaine: and sam pointed out, this is something that affects all of us. so many people have been afflicted by this. we have people in our families. so we are all rooting for something to get done. but there's a way to get it done and not get people's hopes up too high. lisa: just going back to this question sam fazeli raised, they are really leaving it in the insurance companies' hands whether to approve this or not. they have ever reason not to approve a $56,000 drug unless they think it is going to be helpful, but talk about the level of power the different entities have in this country. tom: we see the cost of this moving up as well. the tape is much better early this more -- much better than early this morning, even with

the digital outage. lisa is styling and her i survive the outage shirt. [laughter] dow futures up 15, nasdaq up 0.6%, the vix, 16.36. stay with us on radio and television worldwide. good morning. ♪ ♪

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tom: an eventful day in june. thank you for joining us from coast-to-coast. thank you for joining us worldwide. nice comments worldwide ahead, particular on the digital outage seems to be in america. matt miller in berlin making clear he was not enjoying an outage. romaine bostick in lisa abramowicz with me. jon ferro is off. futures up nicely. the recalibration of where we are in this great game forward. john ryding with us now. a few years ago he wrote an acclaimed piece on the putting green, the fairway of this federal reserve system.

he and i will revisit this piece right now. i did not know where the putting green is. i guess it is somewhere. where is it for chairman powell? john: for those of you less familiar than tom with a note i wrote 17 years ago, we are talking about monetary neutrality. the fed is still easing despite $120 billion of security each month. interest rates are being held at 0% at the short end. inflation measures continue to rise. if you want to look at the progress the fed has made, if you can call it progress on five-year inflation rates they have moved up from 1.6% and introduced average inflation targeting of august of last year to 1.9%, up to 2% at the end of the month. we are at the fed's inflation

target but the fed has admitted to a process. it will not start raising rates until it has met its inflation target, overshot its inflation target. i'm not talking about golf anymore in answer to your question about where the putting green is. this spells problem for inflation. tom: the monetary game of golf we are in is a game of fear. the greatest fear is does the fed react measured, or do they react in a state of panic? how does the fed get to a responsible strategy that gives us grady a without the tamp -- gradation without the tantrums of the market? john: you have to take a monetary hippocratic oath. do no harm. why is the fit continuing to ease?

what is the rationale? what about employment? here's a key thing. the fed talks about a jobs gap of 7.5 million from where we were february last year. increasingly the signs are it is not the lack of availability of jobs that is preventing people from working. we will get into reading on jobs today. will probably have another record high number of unfilled jobs. first, stop easing. the fed of 1994 and 1995 when interest rates rose as much a 75 basis points, those days are gone. the first thing is let's have a serious discussion about what the purpose of quantitative easing is at the next fed meeting. give us some guidance.

lisa: this is exactly the argument kevin warsh, the former fed government -- the former fed governor made yesterday in the wall street journal, that the fed is committing to a policy error, it will wait longer and have to hike rates faster. what will the fed accomplish if they slow the pace of the bond purchase, the $120 million of bond buying every month? john: as i said, do no harm. let's stop continuing to ease with inflation at target and rising. we corresponded a couple of weeks ago. we are very much on the same page as far as the monetary policy is concerned. monetary policy works in mysterious ways. inflation is a monetary phenomenon. if you look at the nfib report

out today, you have the smallest number of small businesses raising prices since 1984. the third-highest readings of all time in the percent of small businesses intending to raise prices. just stop easing to begin with, and then assess. go ahead. lisa: what you say and what kevin warsh is saying, the implication is significant. i want to draw a line on this. are you saying the fed will cause another financial crisis by allowing risk to build in markets, for risk to build up with their easing and then have to hike rates much faster than people are expecting? john: the fed will not hike rates for a financial crisis. if we go that far the fed will be finding new ways to ease. what i am saying is the fed is feeding an inflation problem. right now it is not a problem,

but it was stark and the wall street journal about commodity prices and inflation. reminds me of my former colleague from bear stearns who was very influential in talking about monitoring commodity prices. the monetary message is clear. a lot of ceos same these are not transitory. the fed sigma inflation problem will be transitory so they do not need to respond to this. business inflation expectations are rising, market inflation expectations have risen. i think that is a market move we will see higher inflation breakevens. romaine: some of the distortion we have seen with regards to expectations has to do with people trying to make a distinction between inflation and cost of living. this idea the two are not necessarily in sync the way they

would've been in the past and you can make concessions to one while at the same time still being loyal to the other. john: that is a great question. house prices are going up about 20% for the year right now. that is a very rapid asset price inflation. how does that materialize in the cpi? it puts down the pressure on rents and leads to a cpi that is rising more slowly than what otherwise would have been the case. the desire to move into own accommodation of pushing up price assets is being manifested in a slower inflation. despite that, we have the last cpi reading year-over-year was 4.2%. we get another one later on this week. that will show even more upward pressure.

romaine: when we talk about this idea of personal savings, that skyrocketed during the pandemic. it has obviously gone down. it is still elevated compared to what we saw in 2019. the idea of the savings rate has not come down as quickly as some economist had were cast, does that blunt the potential impact of a persistent inflation? john: i don't think so. it is a great point you made about savings because firstly, accumulated savings, savings which would have not been made had there been no pandemic, they stand at $2.5 trillion. that is more than 10% of gdp in terms of spendable funds, it is readily available. then you have additional people still saving. the economy is not fully reopened. new cases of covid over the last

seven days are down 81% from where they were on april 13. the economy is reopening. a lot of those funds can be deployed. we do not know when they will be deployed. the fed does not know when they will be deployed. what will be the impact on prices when they are deployed? we are seeing used car prices putting a lot of pressure. a big part of the cpi in april -- you will see air france coming up, you will see a lot of areas and services adding to the pressure we are seeing from the goods economy, the commodity upon me. tom: we have to leave it there. john ryding. will parachute in. here on what we observe today from internet outage.

ivan, you are expert at the review of the companies like cisco that make the stuff we take for granted. does aws, does google, microsoft, and does fastly take for granted the solidity of their systems? ivan: i do not believe the manufacturers take it for granted. i believe consumers always believe the internet will work well and be fast. however, we are in an environment where there are all kinds of cyberattacks to be disruptive and cyberattacks to hold companies for ransom to disrupt businesses to create an anti-competitive environment. there is a lot of vulnerability. this highlights the importance of redundancy in the networks, security in the networks, and more and more come in the beginning, the speed of the

network, the network works through the sophistication of the hardware. more and more a lot of these networks are software defined networks, which are relying on the sophistication of the software and relying on the software to provide increased security. we need this constant rerouting. what a company does like fastly to maintain speed, just like when you're driving on the highway, internet traffic to have traffic jams if everybody is trying to get with certain website at once for a special deal. it is important we maintain it. lisa: there is also a question about the visibility of some of the breaches in security or other cyber issues. how good is our visibility into when a company gets hacked, especially if it does not necessarily make it into a disruption we can see?

ivan: it is only as visible as the situation is rectified or it becomes a problem. it is only a problem until it is a problem. if it is a ransomware denial of service attack and a company may have to call in another company and make arrangements for some kind of payment to remove the ransomware, then it may hit the headlines. it may be a significant issue for the company. if they have other servers they can reroute to come it depends on the strength of the infrastructure, which is also part of the importance of this infrastructure bill, that we continue to build out the robustness of our communication infrastructure and our power grid. tom: thank you so much. lisa, we talked about a 1.4910 year, we are halfway there. lisa: the move lower in 10-year gilts has been striking over that -- in 10 year yields has

been striking. back down to 1.56%. a sharp move. i'm trying to figure out why. there's not a lot of data coming out showing this, which proves there is some sort of technical push with so many people position for higher inflation, that if we start to get lower yields perhaps momentum goes more quickly. romaine: it is interesting to see, coming in with five basis points on a day you are not seeing a lot of movement in the dollar, it does wonder where the cash is coming from and why does moving to treasuries at this point. you started test the 1.5 level, equity strategists say keep an eye on the ndx and some of the bigger cap flows. romaine: a guest earlier today messaging in and saying u.s. treasury futures have been sold in asia and a bid comes in for the u.s. hours. that seems to be what is happening right now. the bid is coming in with a tear. tom: coming in with a tear, the

velocity of lower yields front and center. lisa abramowicz going forward in the 9:00 hour. coming up, a conversation with david malpass of the world bank. his view of the global economy. stay with us. this is bloomberg. ♪

>> what the fed is saying is we may not raise rates that allow

inflation to be higher for a period. she is saying higher rates might be a good thing. this is a bit confusing for the markets at the moment and it would be quite good if we had one consistent message from the u.s.. tom: sir howard commenting on the markets and the messaging of our economics at the moment. howard davies with us yesterday across bloomberg. futures up nine, dow futures up last, nasdaq futures up more. maybe an optimistic day in the markets with the vix, 16.39. 14 things to talk to barry ritholtz about. romaine bostick and tom keene. lisa abramowicz prepared to drive the network or it at 9:00. the journal getting it started a few days ago. we heard from the gentlelady from nuveen who was talking about it as well. let's go to the authority on this. i say this with great respect. barry runs real money.

barry has to rebalance or not rebalance and has some experience. to me it is about the sharpe ratio of william sharp of stanford and we are completely return based in this industry and less volatility based. discuss. barry: these rebalancing articles come along every couple of years. i always feel they should start with the disclaimer this week's column is brought to you by hindsight bias. hindsight bias, telling you what you did not know two years ago. that is the problem. if technology is going to keep going, stocks will keep going up. if bonds will not necessarily do well, and if emerging markets in europe will lag, of course you do not want to rebalance if your goal is to maximize your performance. that is not the point of rebalancing. the point of rebalancing is to

maintain a portfolio that is consistent with someone's risk tolerances and financial plan. again when you're making the do i rebalance or not decision, you have no idea what will happen over the next 12 to 18 months, so you are aiming for a median approach. tom: what is so important within the sharpe ratio, there is no beta in the sharpe ratio, no fancy mathematics. what there is is variance, the up-and-down of the daily game. the media and the pros look at return, return, they did not look at the risk taken. how do our viewers and listeners focus on risk and less on return? barry: the idea of rebalancing, being a little bit of a free lunch over long periods of time is rather than gas, do i rebalance your or not, you

basically say here are my parameters when these asset classes are more than x percent away from our original core percentage waiting. we world balance because it means you are selling what has gone up and might be pricey from and you are buying what has gone down it is little bit cheap. doing that around the margins over long periods of time theoretically adds -- pick a number -- different study showed different things. 25, 40 5, 60 basis points hobart long poop -- over long periods of time -- 45, 60 basis points over a long periods of time. tom: barry ritholtz is using the phrase a little bit. romaine: this debate comes up every time you get to what is perceived as a market top.

you do not want to miss out on whatever the next great rotation may or may not be. i am curious about the idea of safety and hedging for the potential that maybe we have reached the top, maybe we have reached some sort of investment year. is the idea in the context of rebalancing less about let me jump on the next big train of moving out of the station and more protecting whatever i've made so far in terms of profits? barry: remember, when you're doing a rebalance, hypothetically you are a 60/40 portfolio and each of those are broken into five or 10 different asset groups. u.s. large gaps, small-cap value come emerging-market. whatever it is, some of the holdings may be 10%, 15% higher than where they were when you did rebalancing a year ago or six months ago. the idea is you are not trying to pick a top, you are saying this group of asset classes, by

our preestablished rules, you're not doing on the fly are reacting emotionally, these are our rules for rebalancing. these have exceeded our parameters and we will trim back a touch. when the market is up 75% over 12 months, which is a little misleading since it was up 17% over 13 months, backup thrash and recovery, yes, you are rebalancing. the flipside of that is you can set up a variety of parameters that anytime the market drops, fill in the blanks 20%, 25%. in that circumstance your rebalancing into equities. i roots of the about our direct indexing software we used. that rebalance took place about 30% down.

it was the only giant moneymaker . i china to emphasize these -- i try not to emphasize these outliers as this is what you should do when your rebalancing. you want something consistent over decades, not reacting to whatever's happening in that moment. tom: have to leave it there. thanks for the clinic. barry ritholtz with bloomberg opinion. we have been remiss, and have to spend our final nine seconds -- amc. romaine: amc again. tom: up fractionally. technically up to the 70 level, down to the 50 level. midpoint 55-ish. it is almost technically legit. romaine: almost technically legit. under $50, only if it gets back down into the 30's, that will

make it more legit. you talk about the inflation bounds a great. so many people have put part of the 40 into crypto or alternative assets. i wonder what portfolio balancing you do when you start to see the drops. tom: it is a raging debate and my job is to stay out of the debate. i am not a fan of rebalancing, but barry ritholtz goes to the heart of it, which is you do not sell apple to buy jp morgan. pick one idea. at the markets in move by -- there is a graduate audi -- there is a graduality to avoid the bad mistakes. romaine: i like the conversations of the show. tom: we got william sharp into it.

forget traynor and jensen and focus on sharpe according to philosopher romaine bostick. tom: red and green on the screen. stay with us. david malpass in the next hour. this is bloomberg. ♪

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lisa: stocks climbing

potentially to new highs as bond yields plunge. i am lisa abramowicz info jonathan ferro. the countdown to the open starts 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. debate heating up over what would be the biggest policy error. >> we are in a pretty unique period of monetary policy. >> the fed is doing the right thing by waiting and seeing what the world looks like. >> the fed has the plan and they can be patient. >> the federal reserve can go this slowly. >> when the fed starts to pull the punch bowl away. >> taking away the punch bowl too soon. >> the fed is putting so much liquidity into the system. >> it is