♪ >> we i think are seeing the shape of inflation in the post-pandemic world. >> i think the fed is going to need to recognize this risk. >> the federal reserve take inflation very seriously. they think about the data. >> we need to see whether the -- are going to be consistent. >> low inflation, low rates, positive economic growth and strong earnings. that is a pretty good backdrop for risk-taking. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: a new paradigm of ever

lower rates. good morning. this is "bloomberg surveillance" on bloomberg radio, on bloomberg television. jon off or get romaine bostick very much in -- jon off. romaine bostick very much in. a new paradigm of international relations. i know i am just killing you with all of these references to the paradigm shift. tom: a paradigm act shift, you are killing me. [laughter] lisa: the g7 meeting very much front and center, the paradigm of international negotiations. tom: the paramedics friday -- the paradigm attic friday. jennifer jacobs, please come on air and tell us about this weekend. with is a friday in the

summer, but seriously, it is the shock and awe of where yields are. do we have a y beside short covering -- a why beside short covering? lisa: the idea is that transitory is the way to go. you can go ahead and drink. you can see at and stocks as well. people starting to shift their view of inflation to something more in line with what the fed is thinking. romaine: we should point out too, the bond market has been nudging in this direction for quite some time. i thing it was the equity market that was a little bit less convinced. they have had their little moment here where they are starting to realize that maybe the bond market was right all along, at least for the past six or seven weeks or so. that's why you are starting to see rotation, and why you're seeing a little bit of rotation out of some of those cyclical names. tom: i want to go back to the g7. we've got lots of different ways to go in this hour. but lisa, we are doing the photo op thing. what we have seen in the last couple of hours is the

conventional g7 meeting. the normality of it is extraordinary when you look at the first lady, the duchess of cambridge doing the obligatory school visit. we just had on the break the first lady and the duchess of cambridge -- lisa: hang on, you are burying the lede. it was a beatrice potter moment. they were sitting in front of a little garden check with a bunny and carriage. tom: that's not just a bunny, that is poldark the bunny. what this underscores here is to do lovey photo shoots and then move on to putin june 16. lisa: there's a question as to who it is geared towards, but it comes amid a backdrop of the world that is recovering, and he melt up his persistent. tom: what is so important here is the idea of chummy chummy,

which we talked about the last couple of days. that is really the goal of mr. biden. romaine: i think it is important. we can make fun of some of the images, but the relationship that had deteriorated between the u.s. and u.k. was palpable, and there is a sort of reparations going on right now with regards to repairing that relationship, and a lot of it is symbolic. a lot of it is the visualization. hopefully that translates to policies to benefit the u.s. and the u.k. tom: the vix comes in, 15.81. lisa floored by a 1.4451% 10 year yield. did we expect that 10 days ago? lisa: no, we did not expect that. the real yield going further negative to the lowest now since february. the question is why. where is this conviction coming? is it just a short squeeze? tom: what we are going to do is take the prodigious mathematics of alisa levine at bny mellon -- of alisa levine -- of alicia

levine at bny mellon. alicia, is the mass of the market working right now? because i've got too many people saying this is original, it is different. is it really? alicia: good morning, and thank you for your kind words. look, it is very perplexing. from what we understand, there is a positioning issue, and there is a short squeeze in the bond market that started friday with the jobs report last week. having said that, there are things that are very clear. what's clear? we are getting inflation. it may be transitory, but on the other side of this, we are probably inching up higher than we did during the post financial crisis. so we are getting inflation. some of those components will not be transitory, as we see particularly in the rent and housing space, and probably in

the wage space as well. so that is something. but the big bump is probably over and the shock is over in terms of the numbers we are going to see. but there is inflation, that's true. tom: is this a bull market where it is a grind higher, or can you give me some drama here? alicia: here's the other thing, you've got real yields almost -1% again, so your breakevens or higher. your real yields are lower. that is a great recipe for risk assets, and what this means is that the fed has sold its story and convinced everybody that they are going to roll with it, that they are not going to react to it, and they are simply not moving for a couple of years on the rates side. that's what this all means. putting this back in the framework of what do i do now, you buy stocks. that's what you do now. because a mild inflationary environment is actually great for equities, great for

businesses, great for wages, and you don't have a fed that is going to come kill it all. so you've got cyclicals going and you will have tech going here. lisa: it sounds perfect, and there's a question of a federal reserve under increasing pressure from former fed officials, among others, saying you guys are, by definition, going to be late, and it will be catastrophic because of all the various building up in this goldilocks era. what is the potential risk of fed officials taking some of those criticisms seriously, talking about tapering, and throwing a wrench in this rally? alicia: now we are positioned for the other side. we are positioned for the fed has waited so long, forward guidance has been way too dovish, and they are going to have to overcorrect. i happen to think that is the biggest risk in the market right now, which is that the fed has successfully lulled everybody to

sleep with the kool-aid that they are never going to focus on inflation and are only focused on labor issues, and the labor market is not moving as fast as the inflation expectations are, so they have lulled us all into thinking they are just going to sit there, and the risk is that they don't. the risk is that they have to overcorrect, as selena meyer said famously, on the other end of this. so that is your risk here in the market. we are priced to a bullish economy, a growth economy, mild inflation, and the reintroduction of the business cycle. remember when we use to more than 2%, with a little bit of inflation? that's not so bad. not so bad. romaine: i have forgotten those days. go back to the risk because i'm actually surprised at the reaction in the market to the drop in yields.

there was a general expectation that we were preparing ourselves for the roadmap of what a soft landing would potentially be like here with the fed. i feel like there's either a lack of control or an unwillingness to control what is going on in the bond market right now, and i just can't wrap my head around how this ends well. alicia: i'm scratching my head. we said to our traders yesterday, none of this makes sense. there is risk here that the inflation mandate is simply thought of is not mattering anymore, and in a sense, the market is telling you that because we have the hottest inflation in 13 years and the bond market rallies and is continuing to rally. it means that the fed has successfully said that the dual mandate and the mandate on unemployment is unimportant for -- is more important right now.

because we have stickiness in the labor market, they are going to sit for longer, and i think it doesn't end well. i think you wind up with an overcorrection and very fast hikes, and a very fast tightening on the other end of this because i thing it a little but of hubris to think they can control it. in the end, expectations are what the market has, and if they let it go too long by focusing on the labor market, they run that risk that expectations become on more -- become unmoored. i am not raising cash right now because i think the party is still on, but that is a huge risk out there, and i think you have to have a diversified portfolio. i am worried about the negative correlation being over forever. that i am worried about because it was easy for acid allocators. you had your risk with bonds and you have a negative correlation in off markets. that has not been the case in the last four months. he bond market and the equity

market have been correlated, and that makes it a lot trickier for acid allocators. -- for asset allocators. tom: alicia levine, thanks so much, particularly on correlations at the president. what an odd week. let's show the romance of a photo op right now. this is mrs. biden and he gets his of cambridge, and they have moved to this. here's the reality. on radio, it is a sterile room with a bunch of people talking about education no doubt. this is the grind of diplomats, isn't it? lisa: my heart is bleeding for them, going from a remote perfectly groomed children who have been instructed how to fold their hands to an antiseptic room with lots of people in front of microphones. honestly, again, who is the photo op for? that's one of the big questions. tom: i think they are playing to a set of constituencies looking to get through this.

we have a program note. romaine, lisa and i are all on the same page. stop sending in the photos of your well scrubbed offspring. lisa: i love it. i admire it. tom: sending photos looking like the children in cornwall, stop it. stay with us. this is bloomberg. good morning. ♪ ritika: with the first word news, i'm ritika gupta. british prime minister boris johnson will give leaders a beachside welcome today, formally kicking off the g7 summit. the leaders will focus on economic recovery as the summit gets underway in cornwall as the world's most developed nations discuss ways out of the pandemic. while three distributional and taxation -- wealth redistribution and taxation are likely to be on the agenda. china has approved three vaccines for emergency use in children age three to 17.

the country's accelerated vaccine drive comes as the u.s. pushes for a new inquiry to determine how covid emerged, including whether it leak from a lab in the city of wuhan. g7 leaders will call for a new study into the arjun's. 's -- into the origins. some pharmaceutical executives have been mixing two different covid vaccines to get what they claim is better protection. studies in spain and germany showed promising results. in the u.s., the national institutes of health is evaluating the method. one drawback, while researchers say the approach appears to cause more side effects. global oil demand will recover to prepend him at levels next year. that forecast from the international energy agency come with -- eight energy agency -- energy agency. they predict that world oil consumption will surpass 100

million barrels a day in the second half of 2022 as developed economies bring the virus under control. 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. ♪

♪ >> was already export -- we've

already exported doses to the rest of the world, and we've committed to deliver 100 million doses by the end of this year. the most important thing is the cooperation amongst the g7 countries. we need to donate vaccines and make sure that the vaccines are accessible. tom: charles michel of the european council with a bombshell announcement from this g7 meeting on aiding so many other countries struggling. i want to do a massive shout out to sam fazeli, who has given us perspective on the great and united states pharmacology that has allowed for this success. -- the great britain and united states pharmacology that has allowed for this success. futures up four, dow futures up 62. let's just get right to it right now. the market check is there. equities up, yield comes in at

1.45% on the 10 year yield. guy johnson holding court in cornwall. we've been showing images of mrs. biden and the duchess of cambridge. guy, we dash to bilaterals. what is a bilateral? guy: a one-on-one, tom. the first one is going to take place a little later on between boris johnson and mario draghi. that will come after we've had what they are describing as an eu coordination meeting. all of the european leaders have been rising over the last few hours. mario draghi, angela merkel, ursula von der leyen, charles michel. they are in a room right now, trying to come up with a policy framework, trying to come up with a message that will basically match the weight of

power that is delivered by the president of the united states. this is basically a coming-out party in terms of the foreign policy of joe biden. this is the first time we have seen him on the foreign stage, and he is definitely dominating. the europeans don't want that to happen. tom: to the literature of international nations, is it a united states of europe or is it a united europe of separate states? which is it? guy: i think it is still the latter, and still firmly the latter, but the europeans feel they have three heavyweights here which they need to take advantage of the authority that they bring. mario draghi, huge authority, huge economic authority. former president of the ecb. he comes from italy. angela merkel has been on the stage many years. this is her last g7, but she's been to so many. emmanuel macron, a driving force in europe. the three of them coming together, is that enough to match joe biden?

i think those are the sort of scales we are singing about at the moment. then we go from that meeting into this bilateral, breast johnson and mario draghi. what kind of message is mario draghi going to deliver? brexit is going to be half of that narrative. there's also the vaccine rollout program. the europeans are very proud of what they have done, but they feel they haven't been fully recognized for what they've delivered. how do you build back better? mario draghi is the economic specialist. how does that actually happen? hopefully that bilateral will deliver some of that. lisa: a coming-out party for joe biden. it is also a question of nexus of power. is he coming as the leader of this group, or coming as a guest trying to regain some sort of leadership role? guy: it is a really interesting question, lisa. theoretically, the leader of this at the moment is boris johnson. he's the host here. but this definitely feels like it is very much centered around joe biden.

he's the new force. . he's not donald trump. everybody is happy with that. everybody is much more comfortable. all of these leaders will get on anyway they haven't been able to over the last few years. but there is a change. there has been a change as a result of what donald trump did and the destruction he delivered in terms of the eu-u.s. relationship, and the europeans i feel don't want to go back to where they were before. they want to have a much more balanced sort of merger of equals, i guess, in financial terms, and terms of the relationship here at the g7. think that is what they are trying to deliver. romaine: we've been playing images of jill biden, the first lady of the u.s., and the duchess in england. i am curious about the optics of this. anyone looking at this, particularly folks who maybe don't follow politics and don't know the ins and outs of the relationship, you would have to come away with a sense that this

is a relationship that is if not repaired, is certainly on its way to being repaired. i wonder how much that translates into actual policy and actual movement forward. guy: at the moment, not very much, but i think there is the hope that it will become so. i think there is a belief, certainly in washington, that the u.k. has a significant to play in this new policy framework, this new foreign policy framework that the u.s. is putting forward in terms of generating this group of nations that are going to push back against authoritarian regimes, and the u.k. has taken a much stronger stance than many other european countries in terms of pushing back against china over the last few years, a strong push back against russia as well, certainly post-salisbury. i think there is a sense that in many ways, the u.k. and the u.s.

are reasonably well aligned in terms of the direction of travel for foreign policy, so i think there is a hope that the relationship can be rebuilt and rebuilt in a way that is mutually beneficial for both sides. tom: guy johnson, thank you so much. continuing coverage from cornwall today with a very busy friday schedule and into the weekend, and then the president continuing his trip in europe as well. it is important in the 6:00 hour in new york that we always speak to matthew miller with obligatory car talk. it is part of his agreement to appear on "surveillance." with romaine bostick, it is always the tradition to continue with friday soccer talk. just released moments ago on twitter, the harry kane emote and outfit as well. we are deep into soccer talk with ferro gone. let's listen to romaine on british soccer. [laughter] romaine: here's the sound of

everything i know on british soccer. lisa: let's take a moment to recognize it. [laughter] tom: that was particularly good on radio. there we are. harry kane exiting the tots is a rumor, thrilled to see he's picked up a modest endorsement from "fortnite" as well. what is next for the bond market? seriously, we don't know, do we? lisa: i don't have a sense of how much the short position has already been squeezed out, how much more has come on. i was looking for examples of the short interest on the tlt, the $14 billion long-term treasury bond. tom: slow down, what is tlt? lisa: it is 20 plus year treasuries. tom: i thought it was taco bell, tomato and lettuce taco. continue. lisa: it is not lunchtime yet, but during lunch you can watch soccer and eat a taco. but there's a question about what the positioning is like and

whether people will start to get worried about inflation again. tom: there is. we had to get that end, it was per of gloom with lisa abramowicz. lisa: more than a whisper. tom: futures up six. the vix, 15.7 zero. stay with us. this is bloomberg. good morning. ♪

(announcer) back pain hurts, and it's frustrating. you can spend thousands on drugs, doctors, devices, and mattresses, and still not get relief. now there's aerotrainer by golo, the ergonomically correct exercise breakthrough

that cradles your body so you can stretch and strengthen your core, relieve back pain, and tone your entire body. since i've been using the aerotrainer, my back pain is gone. when you're stretching your lower back on there, there is no better feeling. (announcer) do pelvic tilts for perfect abs and to strengthen your back. do planks for maximum core and total body conditioning. (woman) aerotrainer makes me want to work out. look at me, it works 100%. (announcer) think it'll break on you? think again! even a jeep can't burst it. give the aerotrainer a shot. pain and stress is the only thing you have to lose. get it and get it now. your body will thank you. (announcer) find out more at aerotrainer.com. that's aerotrainer.com.

tom: good morning. bloomberg surveillance from cornwall. guy johnson with josh wingrove and jennifer jacobs. the g7 meeting. we are observing interesting equity markets and the shock of lower yield. the real yield negative .94. a -.83 with a plunge yesterday. in the currency markets, resilient dollar. lisa: which is interesting given the fact people think the fed will remain so easy. is it because of resilient dollar or deteriorating expectations around the world has the virus continues to spread. tom: romaine bostick insisted we continue moving forward as we did with the duchess of cambridge and the first lady in short of wealth go children.

we bring you tom per sally. -- tom per sally -- tom porc l lli. your wheelhouse is wage lifting and wage inflation. give us the inflation-adjusted wage study. tom p.: wage pressure has been building for last few months. as i have been fond of saying, if base affects are getting in the way, there plenty other ways of calculating how we are doing, whether it is from a wage perspective or otherwise. on a three-month average basis, just look at the wage gains.

impressive is not an impressive enough word. in some cases looking at something like average weekly earnings, the three-month change is the best we have seen in 40 or 50 years. ditto for average hourly earnings. there's a lot of wage pressure, but one of the things i said to you many times over the course of the last year or so is we need to keep in mind that if we think about how this recession ended relative to any other recession, wages performed incredibly well. it was a perverse thing for a lot of commenters to see or understand. we came out of this in much better shape. as you rightly point out, now we have to worry about low wage pressure. tom: this is critical in the equity world that you live, that the wage worry folds right into margin worry. romaine: we have seen a lot of

companies already talk about labor shortages or the idea they have to pay people a lot more than what they would've paid them two years ago. i am curious when we talk about what the fed reaction function is going to be, particular in the backdrop of yields dropping. at a time when more companies are saying they are having trouble hiring people and the people they are hiring their having to offer higher wages, higher benefits, i do not understand how the fit can stand still in this environment should that persist. tom p.: i think it is the right question to ask. we wrote this yesterday. to me there seems to be quite a bit of complacency building in. we are seeing it in all corners. i think you can make a claim there is a bit of complacency by the fed.

there is complacency by the market. it seems like everyone, particularly the market, is pricing in this perfect transitory soft landing. i've said many times, the moving parts involved in trying to nail the inflation call is considerable. if anyone laid claim with any definitive stance on its transitory, there is a bit of complacency being built in, particular in the market. it is upon us. we are moving through this rapidly. as we have written many times, our stance is inflation will surprise people to the upside. that view remains is true for us today as it did what we are first making that call late last year and early this year. i agree with that. i think there is a bit of complacency. tom: -- romaine: talk more about

the attempt at a soft landing. we note -- we knew it was going to be difficult and i don't think anyone thought it would be -- it would not be a rocky landing here or there. i'm wondering how much what yellen is doing -- how much that complicates things if the fed does try to return to some sort of normalization over the next year or so. tom p.: great question. what potentially complicates it -- there are complications on both sides. there are complications of the fed trying to keep things too easy for too long. complications of that relates to markets that are more or less untethered in a very easy backdrop that does not demand easy policy. we are looking at least an 8% growth year in the united

states. i think you're looking at something close to 5% next year. there is a lot of growth. that will lend itself to inflation easily remaining north of the fed's target over that window. as i said, there'll be times when it is materially north of there. what is the cost of allowing that to happen in an easy policy setting? it is not necessarily unique. there always offsets the fed needs to consider. this backdrop today, as i have said many times, on the show others -- tom: you are on other shows? [laughter] lisa: carry-on. tom p.: never. there are a lot of things that are unique about this backdrop. if you turn an economy off and turn it back on like a light switch and make sure everything

is liquid, you will have a different set of challenges to face that are not in the history books. that is one of these underappreciated ideas from a policy perspective. lisa: how much is financial stability risk building as the fed remains on hold, given the idea companies are selling debt at a record pace, given the fact that rates are at record lows. tom p.: great question. i think everyone has the financial condition. bloomberg has one. every bank has a financial conditions index. the problem is a lot of them do not necessarily tell you if conditions are too easy, or the deep -- for the degree to which they are too easy. there are couple of ways of capturing the essence of that you cannot see in an index. one of the things i always like

to do is look at what a lower rated credit, what their rate is, what they are bringing to market relative to risk rewrite, and what that spread is relative to what higher-rated credits are bringing to market in terms of new issues. those breads are incredibly tight and are very narrow. even lower rated credit are not paying a lot relative to higher-rated credits. to me that is a useful sign of just how easy conditions are. you can make the argument maybe they are too easy. lisa: this is where i was going. how much is the fed being held hostage by the potential disruption to markets that have expanded dramatically should they start to taper, should they start to raise rates? there is concern that in some ways the market is holding the fed hostage based on the support the fed has given it and based on its ability to go into a tiz

zy and disrupt the economic recovery. tom p.: i think you are spot on in that regard. the feds hands are being held by the market. it is not supposed to be that way. hopefully everyone appreciates that. the market is supposed to be taking its cue from the fed, not the other way around. we all appreciate in recent years it is not work that way. it has worked in the opposite way. here's what i think people need to ask themselves. if you start the process now and go at it in a slow way, how much disruption do you give to the markets? probably not a lot. you go about that in a slow fashion, taking back accommodation, let's be clear. the tightening policy is

removing accommodation. they are different ideas. do that in a slow fashion i think the market will be able to absorb that in a much more easy way. if you wait and all of the sudden the ripping backdrop continues, which is a relatively high position call for us, then you have to rush and remove combinations much more rapidly. that can become much more destabilizing. the fed should be -- i'm not telling them how to do their job -- i think that is the conversation they should be having. what is the risk/reward of going at it in a slow fashion now versus a really fast fashion later. tom: tom porcelli, thank you so much. neil dutta has been dead on. he makes it clear he has a linkage of oil and brent crude the inflation decline. says oil shows every indication

of ebbing back and that will help out on the inflation front. lisa: fascinating since oil prices are the highest level we have seen since 2018. what will cause them to ebb? this is potentially thanks to iranian oil coming back online if this deal goes through. tom: romaine bostick -- there is talk about the energy move, david wilson talked about it earlier. how unique is the energy move? wasn't that a move off the bottom? romaine: it was off the bottom and you had a lot of economies back up and running. he saw that reflected in a lot of the industrial metals and in the soft commodities. your announcing the forecast start to pull back -- you are now seeing the forecast start to pull back and into this year next year it will moderate. lisa: we can ask, coming up in the open. we will be talking to jim bianco

, beyond co-research president. i will talk about -- bianco research president. i will talk about oil just for you. tom: there in cornwall having the beverage of their choice on the deck. the european leaders await meetings with president biden. good morning. ritika: with the first word news, i'm ritika gupta. british prime minister boris johnson will give leaders a beachside welcome, formally taking off the g7 summit. leaders will focus on economic recovery as the summit gets underway in cornwall. as the world's most developed nations discuss ways out of the pandemic, plus redistribution and taxation will likely be on the agenda. as boris johnson plays host at the summit, his government is keeping a close eye on rising covid-19 infections.

british health officials say they are now more than 42,000 cases of the delta variant in the u.k. come up nearly 30,000 in a week. johnson has to decide by monday whether to proceed with the final stages of reopening the economy later this month. delays from congestion at southern chinese ports triggered by new covid-19 outbreaks are rippling through global supply chains. the disruption is causing further pain for global shippers already struggling with interruptions to the supply chains from the pandemic. ships grounding in the suez canal earlier this year. the debate over how to pay for the nation's roads, bridges, and transit continues on capitol hill. disagreements about whether motorists or corporations should fit the bill are threatening to have negotiations between president biden and senate republicans for a infrastructure plans. biden pulled out of one-on-one

talks with west virginia senator shelley f. -- west virginia senator shelley capito. 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. ♪

>> it is still a pretty good time for real estate, and i said for couple of reasons.

one is the warning time for real estate are two fold, too much leverage, too much capital. the other, too much building. we are below historic levels in terms of supply. tom: one of my favorite people in philanthropy and finance, jonathan gray is one of those rare people who puts money where her mouth is. he is with blackstone group -- where mouth is. he is with blackstone group. he has been generous. he has done it right. he is a model for philanthropy. david rubenstein, and now bloomberg wealth with david rubenstein, looking for that up in july. the jonathan gray interview is really good. that is where we stole the phrase buggy whip from in recent hours. this is the interview of the day. jonathan miller with us with

miller samuel. microanalysis of housing and rental trends. you are always the most important interview of the day. help us get out to the interview of christmas. what are you going to be talking about in housing and rentals in our major cities? jonathan: we will be talking about much tighter rental markets. what we are seeing right now is a big uptick in leasing activity , leasing activity for the last several months has been extremely elevated as lower price points are drawing tremendous inbound traffic. the drop in rents causes musical chairs, people moving around to get the better deal. now we are seeing a tremendous amount of inbound, which has been missing from the migration story. it has often about outbound. now we have the inbound starting to take shape and it correlates

with the vaccine. i would describe it as a v-shaped recovery. v for vaccine. corporate america has not called people back yet. that will be a tremendous boost to demand. romaine: you're already starting to see the streets of new york start to fill backup. i wonder when the apartment buildings will start to fill backup. we saw a lot of discounts being offered by landlords over the past year to alert people into their buildings. -- to lure people into their buildings. when do we see that lord starting to have enough power to roll back some of those offers? jonathan: i still think we are looking at another year or two for concessions to melt away. i think the market is still highly dependent on it, but nowhere near what it was. we've been seeing concession use

decline since january, when it was at its peak. one thing that has been the most incredible turnaround in terms of a sentiment indicator for renting is we have been seeing the length of lease tenants are committing to expand sharply over the last couple of months, which suggests there is a perception that rents are going to continue their precipitous decline, and we are seeing stability in rents. the tenants are showing that in their actions. romaine: with what we are seeing in regards to availability and pricing, is there a difference between what we are seeing in the more normal part of the market, what people like me can afford, and the higher end of the market that had been a big driver for real estate prior to the pandemic? jonathan: essentially, prior to covid come in the rental market itself, the high end was weak.

post-covid lockdown we are seeing an inversion of that. the upper end of the market is actually much stronger in the top 10% of the market like manhattan is the only second that saw actual rent price growth. every other sector the lower you went in price, the larger the decline, largely marrying what is happened with unemployment. unemployment has been -- tom: one final question, the money question. we saw everybody -- to the suburbs. to they turn around and go back to the cities? jonathan: i don't think so. they be to a certain degree. we have seen that in the past, like after 9/11 there was a three year return. that is certainly possible. the ability to remote work is something that has not been seen before at this scale.

i think that is still in the mix of how quickly people move back. tom: jonathan miller, thank you so much for the update. we see it in a new bubble in new york city. i want to frame up equities in this grateful market. we underplay a record high in the sbx yesterday. what is your observation of equity strategy, are they more bullish or cautious? romaine: i think the consciousness is still there. we are seeing people embrace the longer duration equities. it makes sense when you start to see yields drift below 1.5. the idea even with the fed that wants to move, it is probably safer quite some time. romaine: -- tom: we see the ballet of extrapolation? if we are at 4200 spx, do you see people extrapolating out to 4600 or 4800? romaine: not yet. at 4200 we are already above the

price target for a lot of strategist and a lot of them are not ready to move. there needs to be another catalyst for folks to start revising upwards rather than saying we can at least hold the current levels. tom: you look at the yield continuum, alicia levine was good on that with bny mellon. the equity markets -- been laid large wrote this this morning -- ben laidler wrote this this morning. people have to look at bonds now. romaine: equity markets have been taking the pews from the bond market. they have not always bought into it but there has been more synchronicity between the two and you are seeing that in the correlation. tom: i will get to premarket on clover health. it is churning. what do i do? is there an entry point on beams. -- on the memes? romaine: you do not strike me as a meme type investor.

you have to have some fortitude for that. tom: to review this, nine to 22 to 14. romaine: that is called a roller coaster. that is not a cash position. not the old days. tom: do you know in the morning what memes will do during the day? is there indication? romaine: if i knew that i would be a lot richer. tom: you would not be here. romaine: i would be watching you at home on the couch. tom: romaine bostick, thank you so much. greatly appreciate it. we need to say thank you to tori cochran and all for setting up and moving forward our conversation in cornwall. guy johnson will be there today and tomorrow as well with josh wingrove and jennifer jacobs. the president moving forward through his historic european trip. the fix a bit different from where -- the vix a bit different

from where it was one week ago. 15.68. 10-year yield 1.46%. david westin at 12:00 noon with the senator. this is bloomberg. good morning. ♪

(announcer) do you want to reduce stress? shed pounds? do you want to flatten your stomach? do all that and more in just 10 minutes a day with aerotrainer, the total body fitness solution that uses its revolutionary ergonomic design to help you to maintain comfortable, correct form. that means better results in less time. you can do an uncomfortable, old-fashioned crunch or an aerotrainer super crunch. turn regular planks into turbo planks

without getting down on the floor. and there are over 20 exercises to choose from. incredible for improving flexibility and perfect for enhancing yoga and pilates. and safe for all fitness levels. get gym results at home in just 10 minutes a day. no expensive machines, no expensive memberships. get off the floor with aerotrainer. go to aerotrainer.com to get yours now.

lisa: futures higher to start the end of the week.

from york city for our viewers worldwide, 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. another upside surprise adding fuel to the inflation based. >> between transitory and persistent. >> that is where the debate is in the market. >> it is not a question of whether inflation will go higher. >> everyone was expecting transitory prices. >> double digit increases in airfares. >> be airfares, the used car prices. >>