♪ >> from bloomberg world headquarters in new york, i am caroline hyde. joe: i am joe weisenthal. caroline: more hawkish tones in the fed, that means that stocks drop and the yield that pushes higher? joe: the question is "what'd you miss?" caroline: we are doing a lot of talking about, talking about, talking about. 13 of 18 fed officials see a

rate hike in 2023, and beginning discussions of getting back into the bond buying. it was a hawkish surprise, you see the market reaction and we did into that spike in yields and we are going to dig into why and we will also be focusing on why jay powell is more quick to say the pace of improvement in the job market has been uneven, and out how to build a more inclusive labor force. joe: fed keeping interest rates at zero, and talking about talking about tapering, but take a listen to some of the highlights. fed chair powell: maintaining asset purchases. the housing sector is strong and business investment is increasing at a solid pace. it can be large and rapid, and bottlenecks, hiring difficulties and other constraints

can raise the possibility that inflation can be turn out to be higher and more persistent than we expect. we are going to be looking at a very strong labor market. it is not time to try to read chart conclusions about the labor market, and we need to see more data, and we need to be a little more patient. caroline: talk about a strong housing market and we are getting results coming in better than expected, second-quarter new orders of 32%, but always on the upper project -- up or trajectory. joe: still a nice time to be a seller of homes in the u.s. and for more, we turn to jp morgan head of innovative derivative strategy, josh younger. thank you for joining us. what is your take away, what is your main headline? josh: it is what it looks like. to the market was expecting a

more dovish outcome then they got and the market always stays a little ahead of the fed, so the futures market is pricing in more hikes than even the fed expects, but the two hikes in 2023 caught people off guard. caroline: we saw that reaction in bond yields, but we are still up about up 1.5 percent and sure we have some big standard deviation moved particularly in the two-year, but do you think we have further to selloff when it comes to the u.s. treasury market? josh: it is just what chair powell mentioned which is it is a very uncertain time and very unprecedented, i hate to use the word unprecedented because it is used entirely too often, but it is. we should not read too much into the data, we should see how things ultimately play out because the kind of inflation we see locally, those things tend to work themselves out, so the real question, does this require a more aggressive rate hike path, and you can see from

the projections over the medium-term, the 21 forecast moved up, but the medium-term really has not changed. i think those two hikes in 2023 that everyone is focused on early reflect the risk management and academic honesty of the committee, basically saying, we don't really know, but the possible outcomes are skewing in the right direction. joe: let's talk about the risk management approach because i thought that was interesting. every time the subject of the labor market came up, chairman powell sounded very optimistic. we are going to get back there and if there is any slow down, maybe it is due to covid or the expanded unemployment, and that is not being worried about the jobs market. all of the risks, and his view, could be more on the inflation size. is there any consistency between what was laid out today versus the sort of jackson hole

framework that we have been operating on since last august? 's josh: i don't think so, they are keeping rates at zero through 2023. we are talking about a very unusual level of stimulus that persists for a sizable time. the fact that there is two hikes at the end of 2023, the rates are at zero through well i the reopening assuming every thing goes well on the public outside, so they are definitely willing to let inflation run through the target, consistent with their framework for it and it means the economy overrun hot for a while, and i do not see any consistency here. the reopening is generating more reflationary pressure on the front and and frankly going better than a lot of people expected, and the risks still lie in the medium-term path, the rise of variance in public

health concerns, and all these other things are not my day job or training, but we are sort of focused -- force to focus -- we are in an unusual environment, but to recognize the fact that the distribution of risks, that the tail outcome is slightly to the higher side on policy rates. caroline: your day job is monitoring rates, even short-term rates, and looking at financial stability and it is indeed a part of the fed's role as well. there were some fed rises, we have seen record amounts, giving a little bit of a reprieve that are trying to find places to park all of this cash that is going on at the moment. how do you monitor and how do you feel about financial stability at the moment and the role the fed plays? josh: there are no acute estate ability risks here and i think the concern the fed has is if this were to continue and money

market funds are essentially working for fee, they will be turning away money, those are soft closes that everyone is concerned about and then the question is where does the cash go and threw them back to the fed, because ultimately what we are finding is the fed's ongoing purchase program combined is putting too much cash in the system, the cash is not needed and it is finding its way back to the fed. q still has stimulative effects beyond the creation of new cash and substituting in for securities, but that cash us to find a home and what the fed is trying to do is ensure the excess cash ends up back at the said instead of other areas in the market working because more instances of instability. caroline: joshua younger, always great to have you talking about the day job. we thank you so much. meanwhile, we are going to be speaking about all of the jobs in the equation, senior advisor at the book, and author of

the memoir, we will be discussing the diversity lacking across the business outlook. this is bloomberg. ♪ ♪ ♪

♪ >> i am mark crumpton with bloomberg's first word news. president biden's aboard air force one on his way back to washington after meeting with russian president vladimir putin had an 18th-century lakeside via in geneva. the two men met for more than three hours, as shorter time than expected and then held separate news conferences. pres. biden: i did what i came to do. number one, identify areas of practical work that our two

countries can do to advance mutual interests and also benefit the world. communicate directly, directly at the united states responding to action that -- and lay out our country pass priorities and values so we hurried straight for me. marco: president putin hailed president biden as a constructive and highly experienced leader, and mr. putin said that he believes that he and mr. biden were speaking the same language despite sharp disagreement on a variety of issues. he said the conversation was constructive and that mr. biden was "extremely experienced." the u.s. economy while on the way to a post voter recovery. janet yellen testified before the senate finance committee and she thanked congress surpassing the 1.9 trillion dollar pandemic

relief bill in march, but challenges remain including wage inequality, declining labor force participation, racial gaps, and rising inflation. she urged lawmakers to back president biden's proposal for a multiyear 4 trillion dollars spending plan on childcare, infrastructure, and green investments. a bipartisan group of senators still trying to reach a common mise on an infrastructure plan. you taught republican senator mitt romney says he is optimistic about striking an infrastructure deal. he is a part of the bipartisan group negotiating a package. still, inpatient house democrats a are ready to move ahead without republicans if there is no deal by the end of next week. the white house says no deadline has been set for a deal. 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 am mark crumpton, this is bloomberg. ♪ caroline: that biopharmaceutical company, coming out with the mrna coming short at a 47% efficacy and it says even to complete the phase three study, but as it stands, the most cases were caught by variants, and efficacy comes up short. joe: federal reserve may be holding rates at 0 about looking at changes within the bipoc community. fed chair powell: the economic downturn has not fallen equally on all americans. caroline: that was short.

joe: let's welcome ursula burns, former xerox ceo and author of the new memoir "where you are is not who you are." thank you for joining us. let's start and talk about the big macro picture. obviously, we heard from the federal reserve today, one of the big goals and theory of economic policy is to decrease the spread between white unemployment, black unemployment and so forth, and how much do you think that policymakers are taking this seriously and can do better than previous economic expansions at resolving this? ursula: we are at a point in america policy progress where this is front and center for political leaders. i am not sure how effective all of the attempts and policies will be, but i do know, i do feel that there is clarity about the fact that without some real

attempts to actually close this gap, this diversity of earnings and unfortunately, we have two camps, a lot and very little and we have a lot of people earning very little and a whole small number of people who earn a lot, and that is not sustainable, the good news in this country and i believe around the world and highly effective countries also are believing that, so i'm hoping like heck that not only do they see it but they also have some policies that will help to close the gap. caroline: what is so amazing about your experience is you have earned a lot and you also, very likely, you earned very little. the writing in your book, so many emotions. he talked about an apartment you lived in new york, what poverty looks and smells like. your mother making you study hard, though -- do not get

caught up in the neighborhood. but also you saw certain impediments when you wanted to go to university and the fact that this is so amazing to me, and it is because i am so fortunate, but the fact that one of the universities that you wanted to go to wanted you to swim a lap and how much that discourages inner-city kids. now that you have the luxury to earning a lot, what have you seen? taylor: the example -- joe: the example -- ursula: the example of swimming a lap sounds ridiculous, why would that be an impediment, isn't it better for your health, isn't it safety, and the fact is we don't have any place to learn how to swim a lap, so it should not even be in the criteria and i do not know if it is purposeful. i say it is either purposeful or worse, they have no clue where we are, what what we look like, where we live,

what opportunities we have, and is not just me, the small number, the five of us. the vast majority of the united states of america is struggling with some significant gap in a basic need. so i think that what happens now is that we literally have to back up a little bit, the people in power like me, the people that are a part of the 10% have to get closer to the other 90% and understand how they live. this is not a desire to do it poorly, or that we are slob and lee, it is none of that. a lot of us were just stuck, we had no money, we had nobody think attention to us, we are trying as hard as possible. my mother was maniacal, my mother was literally a maniac on this thing, any energy she had, any energy she had is put to these three kids, and i know that people can say, with my mom

did it, everybody's mom should be able to do it. i think it is too much to ask. she died at 49 years old, not because she took drugs, she did not drink, she died at a tired and formerly -- poorly cared for. we deserve better, humans deserve better, particularly from though wealthiest most privilege, most resourced nation in the world. we just need a better start. people need a better starting line. joe: who do you see as the ideal reader, who do you envision reading it, and who could benefit in your view from reading about your story? ursula: i wanted it to go to younger people more than anything and it did not matter what race or gender, i wanted people to understand that, i wanted them to get in their minds that if you have a lot, a little help to someone else can

make a huge difference and if you don't have a lot, a little help from someone else can make a huge difference. we should be able to work better together as individuals, as humans to actually make sure that we do not have zip code laid in poverty and zip code laid -- ladened health. we should build bridges. please young people, understand that this is your world. we are going to leave it to you, now on the other cited 50, and they have the ability to look at what we have created for them, keep the things that are really good, and throw away the rest of the crab, and build new vehicles that have a better society as we go forward. we have one of the best in the world, but we know we are struggling.

we are struggling because we don't understand each other and in some cases, we just don't like each other, and many cases, we have no care for each other. that is not sustainable. by the way, i am fine, i live in a nice apartment, i have another place, i am fine, but i know i cannot live in the world happily and everybody around me is living in a disaster situation and i am walking here with mink coats on, so we have to make it to that we can lift everybody's boats a little bit. i am not a socialist, but i do want to start. caroline: let's talk about meritocracy and affirmative action because it was really interesting the couple of weeks ago, there was a ceo, snowflake, a tech company, came on bloomberg and sort of laid bare his thoughts, and he said, we are actually highly civet that it to diversity, we just do not want it to override merit.

because if i start doing that, i start compromising the companies -- company policy mission. he goes on to say, all of them are privately there, but publicly it is difficult to be that way. before we rant on him too much, he did go on to apologize and walk back those remarks and said, i do not think that diversity and merit are in any way mutually exclusive, but you are a woman who is working hard to make boards, executive committees more diverse. how hard is it to keep on talking about meritocracy wind behind the scenes my people are apparently thinking like this? ursula: i do not know the ceo of snowflake. based on the short interaction that i have had over the past couple of weeks that i have heard his thoughts, it is probably a good idea that i don't know him, he is wrong.

the problem, this is pre-apology, there probably is that he is probably right that there a lot of people who believe what he said. the comment before his apology is what he thinks and i think it is how he governs and interacts with "this other group of people." the women, the black people who depend on affirmative action. i am saddened by the comments, but i tell you what, one of the ways that we have this comments come true, one of the ways that "they win," as if we shut up and stop whining. if we allow, people who look like me, people who look like you who believe like me that everyone deserves a chance that we have a system and structure that does not allowed or -- allow or afford everyone that chance. the reason why meritocracy, and this society is so difficult to

get into reality is because we start so unequally. we are judged so unfairly and i don't mean we me, groups of people by structural racism, structural -- any quality is there. if the ceo does not see it, by the way, god bless them, i am glad he has lived a life where he has never run into literally where someone thinks about who you are and judges who you are, i am happy that he has not expensed it. trust me, mr. ceo, that is not the way it is. women are expected, more than expected, they are left with the burden of taking care of the full burden of trying to make a living and taking care of the children back at home. that burden did not fall evenly to men and women, guess who got it?

women. affirmative action is not there because we just like people but affirmative action is there because of uneven distribution of opportunity, structurally uneven. we have uneven distribution of wealth. it is there to try to balance the scales not to jump in front of anyone, we just want to get in the same line is people. it is narrow to believe that we are past that, we are past that and it is all done. it is unfortunate. joe: as you mentioned, it is certainly plausible that there are other ceos who think like him. how do you tell the difference? as he was saying, he how do you tell the difference between someone talking about these issues in good faith and this it just a member of looking at hard numbers and just a matter of

great rhetoric, but it is about measuring the data? ursula: this is how i think about it, some government leaders said, trust, but verify. i want to hear the rhetoric change. it has to. it is discouraging as a young female employee to hear the comments that some believe, really do believe in business. so the rhetoric has to change, but i think that the rhetoric changing his step number half, not even step one. the rest of the steps are set goals, and that has to be the step two, step the goals -- set the goals, track progress, adjust your approach, check the numbers, it is going to take a wild to get here.

we did not get here overnight, so i know it is going to take a while to fix and if we see progress, that is good progress, you will see patients and i don't mean patient sitting back, but patients helping to engage to move it along, we know there are things that we have to do as women of color are latinx to actually addressed our approaches and thinking, but we want to see on the other side some believe, and the idea that there is all the ceos out there, these white ceos basically are being dishonest, i refuse to believe that that is the outcome, and by the way, you should get some of those white ceos on this program and they should be pushing on this guy, because basically what has happened is he has bought them all to the same place that he was. which i have to say, is close to the gutter. i do not think that is the way it is. i hope that is not the way it is. caroline: let's get some of those ceos to come on and push. ursula burns, ripping up the

script when it comes to private equity and also the author of "where you are is not who you are." joe: bloomberg technology is up next. this is bloomberg. ♪ wanna help kids get their homework done?

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>> from the heart of where innovation, money, and power collide, in silicon valley and beyond, this is bloomberg technology with emily chang. emily: this is "bloomberg technology." coming up, president biden and putin weeds in geneva, the u.s. president says he wonders russian counterpart against more cyberattacks on american infrastructure