underestimate how much inflation is going up. >> the fed does not know, either, when this will go away. >> the fed has to be very careful about his communications , not just verbal communication but all types of communication. >> this is "bloomberg surveillance." tom: good morning, everyone. good morning on an unprecedented monday. there is no other way to put it, the bond market, correlations, equities, commodities and the rest is absolutely extraordinary. lisa abramowicz -- matt miller in for jonathan. surviving father's day. lisa, the 30 year bond, briefly,

asian morning, stunning. lisa: basically, people are pricing in the ramifications of a hawkish fed before the fed comes through on even being hawkish. a couple of members coming out and basically indicate they would be willing to raise rates in the market extrapolates out into the future. exceptional moment. tom: we want to go to the research board. we have a ton to bring you. we summarize global wall street. ceva major dyer and the team at hsbc, we noticed this note. we maintain our 1.0% forecast for 10 year treasuries. then on the movement, a new policy moves more slowly and a taylor rule but it does move. the trend is likely to be benign based on gdp and pc projections. i go to gdp and what we're seeing is a guesstimate of where

to be -- gdp is going. lisa: the ramifications of higher gas prices, higher prices in staples, leading to lower purchases, the dreaded "s" word, stagflation. tom: matt miller, i want to go to what this means for europe. we are supple rating -- we are separating. matt: i think lagarde and the ecb have done a great job playing this to their advantage. you see europe coming back down to 118. my question is, does the fed strike back with the speakers today? we will see a lot of people talking about the big central banks jockeying for a better position in terms of currency. tom: i want to emphasize the market coverage worldwide absolutely extraordinary right now. toni kroos nz will be joining

us. matt miller, you mentioned euro, 119. yen weaker as well. the dollar not breaking out, is it? matt: it is not but we have seen the euro and the pound come down pretty substantially over the past couple of sessions. what you see is could be a dead cat bounce. the euro is not trading at 1.22 as it was prepared meeting last week. tom: weaker in asia and now they surge of half a percent. we do the dow futures for jonathan ferro. nasdaq leading the way but not so much right now. bitcoin, 32,033. lisa: we will get to bitcoin, i promise later on.

matt: i thought dow futures were fascinating. lisa: let's move on to what we are expecting today, number of officials to speak. jim bullard of the st. louis fed, following his hawkish discussion on friday. john williams of the new york fed and robert kaplan post virtual events by the federal reserve possibly getting some color to the dots, bringing forward some of the rate hikes. one, president biden will meet with financial regulators. -- 1:25, president biden will meet with financial regulators. what can i because the financial system could global warming be? a conundrum at a time when it is not a clearly can we still have a lot of other issues to work out within the financial system. today we have the bloomberg -qatar economic forum. we have some amazing speakers.

the paradigm shift we are sick reflected markets, the depleting of the reflation narrative. how much they buy into this and how much we will hear cash is still trash and we will get inflation pick up dramatically or whether the fed takes more hawkish tilt or not. tom: lisa, thank you. we will dip into doha and moment. right now david page with a say with us. -- axa with us. people looking for higher yield, others simply say, no. which is it? david coat we think -- david: we think it is higher. and it will happen in the next few months. the story on inflation is a

transitory one. we think there is increasing evidence that is rolling off. that will add to the story. they key is the fed is not that worried for now that what is happening at the short-term the next couple of months. trying to guess what is going to happen in 2022, 2023, 2024 if they don't move. need think about not moving, they are dissipating inflation much further. -- much further out. i think that will come through in real yields. lisa: what could trigger the increase in yields? what could possibly convince the rest of the market they are wrong, especially if the fed is showing a willingness to take inflation shouldn't rear its head? david: i don't think the fed is suggesting that.

it increased its forecasted 2.2, two .1 and that led to the ship. the overshoot the fed was looking at for 2023 was not as much and i think that is wrong. i think what the fed is concerned about is after 2020, you'll see increased inflation that will be higher if they do not put themselves in a position to restrain that. they have extreme accommodation at the moment. rates are as low as they can be. the qe program is extensive and they are still not talking about tapering stop -- tapering. there's a huge stimulus going through. we could see the liquidity. i think the fed needs to work out how it is going to retrace that. i think that is the story that will indicate, that is what we are coming through. matt: what we see in treasuries right now, in the early year coming back below 2%, is this investors all getting out there looking for duration?

>> i think to some extent there is a global factor as well. we are still saying -- seeing an ecb that has taken advantage of these national situations. still trading at negative. you still get quite a positive carry from a lot of european investors if they allocate overseas. i think perhaps some of that allocation into the u.s. market is continuing to be there and will be -- not looking at a huge surge that i think some pickup coming over the medium term. tom: how do you interpret trillions of dollars with no place to go? the literature over the weekend, overnight repo and the rest of it the fancy math inside of six duration. it is also the assumption all of

that money will go into bitcoin to keep matt miller positive and maybe equity markets as well. oror but how do you rationalize how do you frame out trillions of dollars of the sidelines? david: i think you have to see it is how the fed reacts. it has been exacerbated to some extent by the government of its own cash positioning at the fed. we know there is a lot of liquidity coming through, creating a deposit issue. all of that is affecting short-term and that is rolling to the longer end as well. i think the fed needs to -- we saw a tweak last week in the rate. try and offset some of the short-term pressure. the short-term pressures will maintain when there is that amount of liquidity through their. the only way you can reduce that liquidity is to stop creating

excess reserves. what we think the fed will likely consider is a quicker taper that in the market at the moment. the muster of the opinion that taper program will follow-up with the last time around. we think they won't start until january. we also think it will probably do it a little quicker. we think they will close that taper within six months. i think maybe when markets start to enter a quicker taper, the possibility of not only a rate hike, that is something that will help the liquidity situation. there are seven members that also -- the six-month one. i don't think seven people can vote for a in 2022 if they think the fed is closing at the qe program. tom: in english, thank you so much, david. clarity to the complexity at the moment given the regular disc

record stimulus -- record stimulus. lisa with the word i'm using here, deutsche bank is responsiveness, which is english talk for arcane word called elasticity. do we know the elasticity of the spread market? we don't have a clue. lisa: right now it is highly elastic, incredibly resilient. you see spreads very much tame but right now there's still money pouring into anything with yield and we have seen that process regardless of concerns about growth. tom, that is why the fed is not that concern. they're not seeing any material disruptions to financial conditions, even with the hawkish tilt. tom: i agree with what we see is a lack of instability, and that is what everyone is watching for. we will try to address that worried. 20 with us i believe in this

hour. some other good gass -- some other good guests. a perfect ended talk to ben emons about all of the speakers. who is speaking. ♪ >> the two main contenders for next year's french presidential race both fared worse than expected in the first run of the country's regional election. marine le pen's national rally got 19%, most 10 points behind the last election with president macron's party taking 11%. turnout was at an all-time low. many citizens did not even know what the elections were for. u.k. prime minister boris johnson once the u.k. to become a superpower, harnessing nearly $21 billion in annual r&d

spending to find solutions for the public good. the new office will be headed up by the government chief scientific advisor patrick sullins. prices grew more slowly in june is the last availability trade momentum from the market with prices rising .8% this month after 1.8% gain in may. the increase still the largest for this time of the year since 2015, boosted by people seeking to leave london look for more space. the tokyo olympics will limit the number of spectators to 10,000 people per venue to reduce the risk of the world's biggest sporting teams turning into a super-spreader event. the organizing committee chief says the number will be set at either 10,000 or 50% of new capacity, whichever is less. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is "bloomberg." ♪

>> we have proven over the

course of the past few years we can reimpose sentience and at devastating weight and the iranians understand that. so we retain substantial level. we will come to the table not just with sanctions leverage, but a united front of the world powers that will post to iran a choice. tom: jake sullivan. we think a fox for that moment on iran. good to see golnar motevalli, a true authority on iran. much more through the week as well. right now, and this is difficult to admit because he really was not my first choice for 618, 6:18 in the morning, but marty schenker was our third choice is guess this morning which begins to filter out ranked choice voting. marty: my wife was third choice as well. lisa: my goodness. tom: let's get back on track.

they tried in oakland and here, republican, democrat, they have try to. what makes new york city for our listeners and audience internationally, what makes new york so compelling as a rank choice experiment? article and this is the first time new york city has tried -- already: this is the first time new york city has tried reg choice. some people consider being the mayor the second most important job. it is causing confusion and anxiety and people have a hard time understanding what it is. tom: i am fascinated in the complexity of new york city. how it affects turnout because of its complexity. this is a serious issue. matt: is a complex? marty: yeah. matt: it doesn't seem that complex to me. marty: you must be a math major.

tom: just looking at the ballots, what to do. marty: the idea that you really have to examine the entire field . when you go in the ballot box, will be faced with picking five of 13 democrats ranked by your preference. it is that second choice that is critical in this whole process. the person with the most first place votes, if it is not a 50%, then the second place choices -- the last first place vote getters is eliminated and that person's those are allocated to the second choice. it could be the person who was elected mayor went not be the first choice of a majority of the voters. tom: you got through that at 6:18 in the morning. matt: which is white andrew yang has teamed up with catherine

garcia to try to push adams out. as i was reading this fantastic coverage over the weekend, my question really goes to the crime in new york. how bad is it and has crime gotten worse because of the pandemic? or is it because of the current administration? marty: many of the experts attribute to the ancillary effects of the virus, the depopulation of the public transportation system -- making it less safe. but the point is, i do think public safety, quality of life is the number one issue that will decide this race. eric adams clearly staked out that as one of his most important points. andrew yang has done that, too. so it will be very interesting dynamic to see who wins the race. tom: loses going to vote -- lisa

is going to vote and leave the first four votes open. lisa: i'm just going to put tom keene, tom keene, tom keene. there is a question, i will say, all of the advertising ice on the sidewalk, people pestering you to vote were saying, if not for number one, put them at number two. people are tried to cater to this rank system. looking to washington, d.c., there is a question of this bipartisan bill that seems to be gaining steam. i am interested in the headlight number of a just north of $500 billion. is it really coming down all that much or is it being viewed as a siphoned off infrastructure plan with additional support for a bigger project down the line? marty: that seems to be the biden strategy. apparently, joe biden will get briefed by this bipartisan group in some way today. the biggest question is how to

pay for it. the bipartisan proposal of the graduated gasoline tax is a nonstarter as far as we can tell from the biden administration. but if they can find a pack -- aim for this, it looks like joe biden once to get this bipartisan bill through the congress and then take on the multitrillion dollar social welfare plan that he has proposed for america. lisa: i think he is basically conceding too much smaller physical spending package than he initially set out to do sibley because it seems a lot less likely for them to get consensus among democrats to push through this larger multitrillion dollar plan. am i wrong? marty: you are right. the key thing -- i think it looks like they can get this smaller infrastructure bill through and i think both sides can claim victory. the biggest problem joe biden has is keeping his moderate democrats in line for their bigger spending plan. joe manchin and kyrsten sinema

have not said which way they're going to go. without them, it is impossible to do. conking marty schenker -- tom: marty schenker, thank you. lisa, i want to look at the 10 year yields. keep vanilla. we broke through the 144 level. the shock of these lower yields and the tendency as hsbc says, even more shockingly low yields is that in the market. lisa: i don't think so. i would think the economy would have to slow down materially for the yields to really make sense. and if that were the case, wouldn't we see more risk off tone? are we looking at a more stagflation environment where the fed forestalls inflation and growth by raising rates sooner, leading to these ultra low yields? shouldn't that mean lower profit margins for a lot of these riskier -- tom: but we don't know the

sequence. i focus on this last because well. the real frame out here is the sub 3% growth rate. will that occur and when will that occur? lisa: i think there is the global nature. we have been talking about this, but how much is this boring investors coming in we saw last week? how much can it rise in the u.s. at the rest of the world does not recover at a pace? you see pockets about bricks. i don't understand exactly how this can continue. tom: are people in germany following on the street, following what the fed -- matt: not on the street so much but certainly followed in germany by those in finance incredibly closely. it is so important because the ecb and the bundesbank had to follow it closely as well. i think everybody on the board is waiting for lisa's next opinion column. when is a coming out? lisa: should be this week

sometime. tom: we ranked ed. fourth place. lisa: wending. tom: the three on top did not get a majority of the votes are you still have a chance. the interview of the day coming up. this is "bloomberg." ♪

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tom: good morning, everyone. "bloomberg surveillance." to get you through fascinating markets. futures up 18. the vix goes out 15 up to 20. a little bit better today. 20.19 right now on the vix. this is the interview of the day on the shock and awe. it is arcane, complex. yet to read the 14,000 pages to understand a little bit of it. we don't have the time to do that so we will talk to him instead. where we are stuck tony this where we are.

tony, the fed is organized in providing stability the overnight market search we've seen in repo is no big deal. another cap says, baloney, the world is falling apart. bring the chart up for tv. i and radio, it is a spike like you've never seen. thank you out jeff bezos going up in space -- thing about jeff bezos going up in space. what does this mean? tony: it is as though the fed wrote it on disappearing ink. august 27, said it would not raise policy rates until the inflation rate had gone about the 2% target for some time. it is not really done that for some time, so it's the idea of disappearing eke. the spike in rates relates to the fed's medication. an advisor to pemco has famously said fed policy is to present action, 90% communication. it goes to show -- 2% action,

90% communication. it goes to show the words were taken strongly. the rising rates tosum up, it as if the fed has put the inflation cut back on the beat. it wanted to regain control of the inflation narrative, public's hype over inflation had gotten too high. the fed got spooked. it will probably be good final words does probably good for the equity market, credit market, private investments including real estate because it looks like it will rain inflation fears. tom: let if you're telling me the fed got spooked, that is important. what about the responsiveness and the malleability, the dynamics come the elasticity of trillions of dollars? i don't understand the

theoretical model of what that money does that came from this pandemic. tony: it we see 750 billion avid nfl repo facility. there is still a lot of money sloshing around. it is the reason why the federal root served -- reserve raised technical policy rates. it does things to tweak behavior in the money market in this we get raised by five basis points. there's so much money floating around that it was putting downward pressure on money market rate. that money is still out there so to speak, and it will be removed for a long time. the fed is still purchasing $120 billion of new securities per month. it is printing another $120 billion each month and will do so again next year and will not shrink its balance sheet for a while. why?

it will reinvest the principal and interest payments. tom: i don't interrupt this is so damn important. the phrase "for a very long time." that is what the market is arguing about. lisa: the issue is people i try to extrapolate ford with the trades of dollars excess cash sloshing around, clearly begs any that are struggling to know how to handle. what the ramifications of this will be. writing in a recent no, by paying trillions in reserves five basis points, the fed planted the seeds of the next liquidity crisis. tony, you agree? tony: no. the markets understand the federal reserve's reaction function which if it were a liquidity problem, the federal reserve would stand up and eject additional liquidity. this is something we learned after the gmc, the global financial crisis, some doubts about whether the fed would

stick to it in 2013 when there was a so-called paper attention when there is a fear like down the fed not reserve -- remove its accommodation. today, federal reserve has communicated in idea a market to believe in previously yet the reaction was that much of a reaction. it is rather tame. you are not seeing meaningful movement in global markets from this, i downward movement in equities, credit. it is a rather benign notion related to the reaction function of idea since -- this notion there isn't enough liquidity, the liquidity crunch is not happening. one quick notion to think about, the idea of chaos in periods with credit cycles and. -- cycles end. this leads to brighton of the

so-called agent model which is their 70 debt securities in existence that when the investors go to sell, the system cannot handle those securities because there is no intermediary to bid for them. that is where there is a liquidity crunch in financial markets in debt securities because the problems -- the principal agent model. lisa: that speaks to the so-called taper tantrum, particularly in credit because it is untreated in the same way. here we are with two-year yields moving and a number of analysts noted people expressingn the hawkishess heard i've fed members but not as you point out in credit. we are not seeing the stress in risk assets. how do you make sense of this? tony: the first thing that came into my had when you said that is corporate office story, cash flow.

what investors care about, cash flow. bond investor cares about getting his or her money back. the earnings were is quite good. we think the equity -- should be overweight equities, overrate does overweight credit. -- overweight credit. we would project is what earnings will grow 10% next year and 10% hereafter. federal reserve's communication if anything will be elongate the economic expansion i tapering -- i should say bringing down inflation fears, the type that might have truncated the economic expansion. the story is looking good. i refer back to the notion of the fed's reaction function, most believe the federal reserve would step in and take action if the markets got into trouble. matt: i wonder about the renewed

-- hey, good to talk to. he says there is a renewed quest for duration. i wonder if that points to market expectations of real volatility coming back at rates? tony: i am looking at several years in a so-called forward rates and even out five years, the market consensus is interest rates across the yield cripple be in the low 2's. that is down 20 basis points in the last week or so. i would say the 60/40 model is alive and well. returns have been quite good. call at 7% or 8%. we believe in the hedge value. i said earlier we preferred to be overweight credit, overweight private including real estate but that is not a very balanced portfolio. we can say then the way to

balance that is through the use of duration, having fixed income in a portfolio. in the long run, adverse scenarios will affect treasuries in a way that benefits a portfolio while the other instruments don't fare so well. we believe in the hedge value of treasuries and the 60/40 model. matt: that is a shock. i have been terrified to check my ira the last couple of years as we continue to hear the 60/40 model is dead and gone. i was that? -- why was that? how come he think it is healthy? tony: the returns, which are quite respectable, a fair return, very difficult to surmise that in an adverse scenario, longer-term treasuries -- this has been demonstrated in

the past week -- would not fare well in adverse scenario post of last week a microcosm perhaps when the dow jones industrial average was falling 500 points, longer-term treasury yields falling. this is the sort of behavior we would expect in other adverse scenarios that could be prompted by numerous things, difficult to predict. but we do believe investors would move in that way. i should add it is a global story and this is obvious in germany where yields where you are, yields are still in negative territory and also in japan. matt: out to 30 years practically. tony: the reach for duration, the need for -- the final note, in 60/40 models, because of the performance of equities, there is likely to be some adjustments a large pension funds another investors following it into fixed income, especially given

some of the volatility. tom: tony, have to leave it there, tony crescenzi. lisa, i want to go back to what you said earlier this week, the difference in yield between the five year and 30 year. what does that signify? lisa: slower growth long-term. basically, people are pricing of the reflationary push we saw earlier in the year. my question is, how consistent is this with risk assets rallying? how much do we start to see lower growth scenario priced into acids that have been flying high on the expectation of perhaps we're entering a new period of time of fiscal spending and low rates? tom: you jeff tell those two conflicting ideas with the -- you dovetail those two conflicting ideas. this wall of cash we have. it is really unique position.

we will stay on this through of "surveillance" this week with a lot of fed speakers coming up on the pandemic, india, delta. this is "bloomberg." ♪ >> 30's in hong kong were shortened quarantine times to seven days for fully vaccinated residents traveling for most places. they are said to cut the requirement for nonresidents who are vaccinated. these are the most significant moves yet to ease one of the strictest border curves in the world. the board of next digital quarterly suspending operation of the pro-democracy apple daily newspaper in hong kong after police arrested top editors the flexion newspaper was of the media tycoon and officials froze

the bank accounts. it will apply to hong kong security bureau to unfreeze the papered assets says it will decide on friday whether to seize apple daily's operations. european natural gas extended its unprecedented rally, prices to the highest level in nearly 13 years. the gains about inflation, gas is so scarce some utilities have turned to burning more coal. a setback against the fight climate change. the new foreign minister to travel to the united arab emirates next week, the first ever visit to the gulf country battop he's israeli diplomat. the foreign minister visit is after the two countries normalize relations afternoon agreement brokered by the trump administration. global news, 24 hours a day, on air and at quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is "bloomberg." ♪

>> if we were able to do it for profits, why not for cancer?

why not for alzheimer's? other diseases? there are some lessons to learn and thinking out-of-the-box and engineering processes and investing in r&d, creating a culture that can the impossible possible and investing in digital is key for success in bringing new printer innovations to the world. tom: is he going to lineup for a nobel prize what pfizer and maturinga -- moderna have done? i cap looking for a definitive article on the indian delta variant. the financial times with a tour de force i believe it was yesterday on the dynamics of this variant. joshua sharfstein points us from bloomberg school of johns hopkins. dr. sharfstein, everyone is looking at the united kingdom and lisbon and portugal seem to

be the worst right now at indian delta. why are pros like you looking to the united kingdom? dr. sharfstein: seeing an increase in infection and overwhelmingly these infections are the delta variant. it is the next chapter of the covid pandemic and reminds us for every move that humans may, the virus has another one and we just have to continue to press the case against the pandemic. lisa: how is the delta variant from from others? the idea being if you are vaccinated, you're so highly protected against it, right? dr. sharfstein: you need both shots. one-shot does not do that much with the mrna vaccines. but in general, vaccination is the best protection against the delta variant. is that there are still a lot of people who are not vaccinated, have decided to wait it out, and that is not a good decision given the transmissibility and

the lethalality of this virus. lisa: there is still the prevalence of the one-shot vaccinated people in the 19 a. the additional pylon variations that could spring up. our wheezing evidence of further mutations? dr. sharfstein: the virus is constantly mutating, so i am sure there is evidence of that in countries around the world. as long as the virus has billions of chances to replicate every second, really, new variants can come out. they constantly are very actions of the virus. the question is, which ones make it more transmissible and legal? we are fighting against an enemy that is constantly changing. the best and we can do is give it fewer opportunities to do that. matt: fewer people are dying, for sure. do you start to think we need to shift what we are counting in

terms of counting infections, counting deaths, counting hospitalizations? dr. sharfstein: those are the big three. i think the number of overall cases is the leading indicator for hospitalizations and deaths. personally, if your people, few people can get more intensive care, different treatments and hopefully more treatments coming. but our goal should be to prevent as many infections and hospitalizations and deaths as we can. we should be looking at all three i think. matt: when you look at our map of the u.s., are there places do you think are vulnerable to a u.k.-type resurgence? we have the coast vaccinated, but the middle baby a problem. --. . maybe a problem dr. sharfstein: i was in the south and there's not a lot of mass going but i know the state several totally low vaccination rates. that combination of low mask-wearing, low vaccination

rates, and people thinking the pandemic is over, was overblown or something like that, is a dangerous combination. we know the delta variant is going to be spreading pretty soon. tom: late in the padres game yesterday consistence and 90 red, myers of san diego hit a ball down four feet inside the foul pole. he would at third base and there was a throwing error and then he ran home with what is called a little league homerun. the roar of the crowd shocked to be. that is how much we have been affected by this pandemic. would you sit in that crowd? dr. sharfstein: outside i would probably sit in a crowd like that. i am vaccinated and vaccines are very effective in the virus does not transmit that much outside. the people who are not vaccinated, not wearing masks, inside at the concession stands, they can pick up covid, particularly the delta variant.

i don't think that is a safe environment necessarily for everyone. the bathrooms and other places in the ballpark. it is just that we are not there at the point where we can stop thinking about the covid pandemic. this is like the end of the game. we need the closer to come out to take your baseball analogy. tom: there you go. dr. sharfstein: in order for us to move past that. that means helping, talking to people in your life, helping them get vaccinated. that is really important for us to put this in the w column. tom: dr. sharfstein, thank you so much for joining us today. matt miller, it is time for the obligatory bitcoin talk. bloomberg reporting out of china , basically, the chinese government going further -- are critical to you within the

synthesis of this is the support at 30,000? matt: the support at 30,000 is critical. technicals, which i've never thought too much of, they are really important and something like bitcoin because there are very few fundamentals to trade on. but i'm not sure how much's's china crackdown on mining has to do with this. it also has to lot -- has a lot to do with the reflation/deflation. keep in mind, the chinese people are still huge buyers and users that bitcoin. if you look at all of the unicorn startups that have been reporting on, they're all out of china. they are based in hong kong. tom: i was sitting on fifth avenue having the obligatory cigar and it was a porsche that pulled out. i thought of matt miller. matt: responsiveness.

they are more responsive cars. that is why they are better. now they are sourcing their own batteries so they will be even more responsive. tom: what we get out of miller will we start with the obligatory bitcoin and car talk. like a different person. lisa: i would be coming too, if you bought me a porsche. tom: did you survive father's day? matt: for the first time in my life, my dad called me to wish me a happy father's day. very cool. tom: very, very cool. lisa: happy father's day to both of you. it was a lovely day. tom keene, are you buying bitcoin? tom: god no. well, i'm looking for it on amazon. it is prime day. matt miller, thank you for joining us. greatly appreciate it. coming up on the fed speak this

week, we have the perfect guests to start strong. ben emons will join us a medley global advisors. please stay with us. the 10 year yield, 1.43%. ♪

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>> we still see there being more to go in this restart narrative. >> we are still being affected by concerns. >> the biggest risk for me is that i underestimate how inflation is going up. >> the fed doesn't know either when this transitory notion is going to go away. >> the fed has to be very careful about its communication, not just verbal communication, but all types of communication. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. a simulcast, bloomberg radio, bloomberg television. we welcome you on a day of turmoil in the markets. there's no other way to put it. equities, bonds, currencies, commodities all have a dynamic story to tell, and all of this around fed speak this week. it is a theme this hour. ben emmons to join us. let's get dowt.