caroline: from bloomberg's world headquarters in new york, i am caroline hyde. joe: i am joe weisenthal. caroline: new record highs almost on the s&p 500. the dollar goes weaker. gamestop pushes to new heights come up in pecrypto, what a wil. stocks climbing after fed chair jay powell raised rates once again.

saying that inflation pressures are transitory. the dollar was on the downside. powell continuing to say that currency actually coming down over the past few days, rallying. we will be digging into currencies today, traditional and new. bitcoin taking investors on this wild ride, dropping below 30,000, before making a full comeback back, turning positive. before we go to that volatility, we start with powell. he still thinks that king dollar will be a reserve currency of choice. joe: still not going anywhere for fed chair jay powell. he testified before congress earlier today. take a listen to what he had to say. >> we will not raise interest rates preemptively because we think employment is too high, because we fear the possible onset of inflation. instead, we will wait for actual evidence of inflation or other imbalances. a pretty substantial part or perhaps all of the overshoot of inflation comes from categories that are directly affected by

the reopening of the economy. i will say that these effects have been larger than we expected. they may turn out to be more persistent. the incoming data are very much consistent with the view that these are factors that will wane over time. joe: here with more insight, brown brothers harriman head of global strategy. when we got the fomc policy decision last week, it was a little bit of a surprise, the degree of hawkish this, the focus on inflation. it feels like powell and some of the others this week have tempered that a little bit. in your view, how much is the current trajectory of fed policy consistent with that framework laid out at jackson hole? >> to me, it is entirely consistent. another is been some confusion among the media and the market.

to me, if you are going down an unknown highway at full speed and you come upon a curve, i think most drivers would probably take the foot of the gassy little bit. that is how i view this tapering. we are emerging from a pandemic. we think there is no wage pressures and what have you. but as mr. powell set, inflation could be even more persistent. for me, i think it is prudent for the fed officials to say, we are talking about tapering. as mr. bullock confirmed earlier this week, mr. powell has opened those discussions. make no mistake, we are at an inflection point. we look around the world, go down the checklist. global liquidity has reached an inflection point. i think that is something that markets are not quite taking into account yet. caroline: where then goes the great u.s. dollar? does it push higher and the fact

that we are expecting some sort of rate hike sooner than expected? or, does it go lower because we start to see it all being priced in and we worry more about a deficit? >> economists such as myself try to look at historical examples. unfortunately, we only have a sample size of one, the financial crisis. the dollar suffered during that time during the pandemic. first in, first out, the fed also set the groundwork for a riproaring recovery of the u.s. economy back in 2009 and 2010. tapering, the u.s. economy outperformed. it is not much to go on but it is the best we have got. i still see this roadmap being played out. tapering, hiking rates. i think the playbook and the

roadmap are out there. the pandemic is obviously something we have never had to deal with in terms of policy and what have you. but, a terrific job navigating these things. again, i think -- we should not go full speed ahead when we are going into sort of unknown territory. joe: they won sort of risk and the one thing that powell and his press conference last week did express some anxiety, could this period of inflation last longer? could transitory inflation turned into more elevated sustained inflation, good expectations become unanchored? do you see anything out there, perhaps in the data itself, surveys, anything else, that causes you to be concerned? >> that is a great question. i have more questions than

answers these days. i think the million-dollar question, what is going on in the labor market? people staying home because i was -- because of benefits. the san francisco fed did a study last month that suggest one in 28 is doing this. it is a very small amount who are staying home because they are being paid to stay home. we are hearing all sorts of shortage of labor. people are not going into low-wage industries. to me, there is some potential wage pressure. economists all recognize -- we will not know this for several months. that is what i think is so risky for markets, that we will have bought into this narrative at the fed, temporary, bottlenecks.

what is transitory? two months, six months, nine months. this could go on for longer than expected. i would say the bond market is incredibly patient. up 3.4% possibly on friday. it is so many moving parts. the risks, to me, are more inflationary than deflationary. caroline: pent-up demand, i understand the rollout of the vaccine has been similar everywhere. it does feel like inflation is something that the bank of england for example has to tackle. >> i look at the central banks around the world, the countries that went into this pandemic strong, that would be bank of

canada, rbs, the fed is talking about it. all these economies are doing well. bank of japan, ecb, swiss national bank, the swedish bank, they are all battling deflation. as a result, they sort of entered this period -- this diversion i think will become clearer and clearer as we sort of move through this year, the second half of this year. it is all being driven by underlying fundamentals. i think those currencies will outperform, as you mentioned, bank of england. the first get the vaccine rollout really going. again, it is sort of the haves and have-nots.

caroline: always a tale of two haves when it comes to the fx market. coming up, bitcoin bouncing back after tumbling below $30,000 for the first time since january. we will talk about that volatility with the vice president of institutional lending at genesis.

caroline: that was quite a ride if you were on that bitcoin roller coaster today. early this morning, it broke below 30,000 before making quite the comeback. are we in the green now?

joe: pretty wild. a standard day in the world crypto. but even by recent standards, the last couple of days have been pretty wild. just under 28,000 at the low. here we are, close to 33,000 again, still off highs from several weeks ago. joining us with more insight, the vice president of institutional lending at genesis. thank you for joining us. let's get started in terms of big picture. it looked like a lot of horizontal lines, data the lines crossing. how much was it a big moment where a lot of weakness came together and people got capitulated and washed out? >> thank you for having me. this recent selloff, there is no question there is a lot of pressure on spot. i think one of the interesting to highlight specifically on the genesis side here, with the prices kind of down where they are right now, we have seen an

uptick in put sellers. they are using that strategy. at the depressed levels, you get kind of a question all the time, where is it stepien? how does this look on the spot order books? people are willing to step in and say, if you are able to get down to certain levels, a little bit below. i think, as of late here recently, we have seen a lot more sick you on the backside. -- a lot more skew on the backside. caroline: when you are being questioned where is the bid, what are you saying? >> obviously, there is a spot market bid. the options market, which is the one i kind of want to highlight here, we saw quite a distortion of trading this morning on it. i think part of the reason, it

implies volumes are a little bit higher. it can be down from -- down to let's say ranges like 25-30 on bitcoin, 1500 to 1800 on eth. people sand, i am willing to sell the option side to get there. joe: one of the things i am looking at in the market, we have seen this pretty solid bounce back for bitcoin. a lot of the other coins, like some of the defaults, are looking really bad, the may 23 low. not bouncing back as much. do you think we are entering a new phase in terms of maybe we found some support here as we mentioned. >> i think kind of the way -- there is a lot more wariness on

risk-taking because they have exhibited a strong sort of data. the civilian majors before you see it roar back. they kind of violently ripped off 40%, 50%, or 60% up. of course, since may relative to bitcoin, not so much. i think you will have to see some stability. that could take some time. caroline: are they more interested in the alt points? have they been going down the food chain? cinelli bostick writing up, how it has been the same with nova gratz as well. it is really the main flow, not

quite into some of the other alt coins yet? >> that narrative has changed a lot over time. a cycle market, you saw bitcoin was a rite of passage, now i have it, maybe further down the risk curve. easier than ever to go normal dollars to alt coins, like non-bitcoin coins, ethereum, other competitors. we are seeing people deploy their first capital in the crypto market in something that is not necessarily bitcoin. joe: that is like a 2017 2018 thing.

should we nix that from our speech? >> some people say yes for some reason. i think it makes sense because you can call it whatever you want. it should not change fundamentals. joe: the changing nature of market structure is such that one does not need to use bitcoin as a bridge currency to get into these other smaller coins. that is the difference between now versus, say, 2017. using that as a base pair perhaps on some other changes. with the volatility we are seeing now, do you see a change in the price action for bitcoin that reflects perhaps a lack of centrality in the place in this market? >> may be some ways, for sure, look at some other things that are down way less.

since bitcoin started selling off. i think you are seeing the fact that people are holding things in different ways. bitcoin will have a terrible move down. i think you will see most of the alternate coins behave in a -- caroline: most of the institutions you are speaking to come are they bracing themselves? are they waiting to buy in? >> i think there is a good amount of cash still on the sidelines on the institutional side looking for better and better levels every time. they are less concerned about the market right now, where it goes in three months or six months, and more on the

multi-year horizon. you're trying to accumulate more units. it is less of a time concern i also think that it is very difficult to really nail a perfect bottom. using strategies like the selling or even call overwriting , buying and then lending it out, all of the things that it starts to generate. all of the other ways instead of trying to hit the perfect bottom. you have crypto and you can't really do anything. you can buy this and it does not have to stick in your sock drawer. there is useful financial functions. caroline: roshun patel, we thank

you. coming up, the race to run the big apple. it is election day in new york city. how long it could take to get results with the new ranked choice voting system. this is bloomberg. ♪

caroline: if they are brave enough to face the rain, new yorkers are currently casting pallets in a primary for new mayor. the new leader will determine the city's path to recovery. voters will choose from a pretty wide-ranging field but only on the democrat side. hide -- joe: multiple democrats running. multiple have a shot at winning especially because of the ranked choice voting.

should be an interesting night. on the republican side, looks like only two candidates. a little less drama or at least a little less complicated. let's welcome it bloomberg news new york bureau chief shelly banjo. what is the number one thing you will be watching for? besides whoever comes first in the first round. what other sort of data should people be looking for? shelly: the thing i am most interested in is turnout. this is arguably the most important election since recovery from 9/11. it is a really important moment for the city, it's recovery. but, are people really going to turn out? the rain actually does matter. i think it keeps people at home, makes them not want to take that extra mile. andrew yang for example is someone who has been counting on new voters and younger voters. if those people do not turn, is

that going to change the race one way or another? i think we will know who the leading candidate is within an hour or so of the polls coming in. to your point, it will probably take days or weeks to be able to actually certify a winner. caroline: remind us why it takes so long to certify a winner. shelly: it is a mix between ranked choice voting and absentee ballots. a lot more people can vote absentee. there are about 200,000 pallets out for absentee. it could be about 15, 20% of the voters. so, because of ranked choice voting, they have to wait for those absentee ballots to really certify that the winner is actually the winter. joe: is that going to be regional or sort of neighborhood -- the yang campaign is going to be like and what it sees out of

this neighborhood or the adams campaign. shelly: yes, manhattan and brooklyn for example, in early voting, we saw two thirds of the voters come from manhattan and brooklyn. manhattan voters, a lot of them have really favored people like kathryn garcia. brooklyn favored eric adams, brooklyn borough president, the most name recognition there. it really depends where in the city people come from. caroline: interesting that you said with andrew yang for example, depending on young voters. is it new voters most of all? are we thinking that demographics, the older voter is more discipline? shelly: a lot of the data the campaigns up going off our older voter counts. new registered voters, the question is, are they going to turn out to vote? in the campaign come on

instagram, social media, but it is one thing to take a picture with andrew yang and another to vote for him. caroline: it is not all about social media. tell that to our tweeter in chief, that is joe weisenthal. stay tuned bloomberg's special coverage of the primary starting at 7:00 p.m. ♪

>> from the heart of where innovation, money, and power collide in silicon valley and beyond. this is "bloomberg technology" with emily chang. emily: i'm emily chang and this is "bloomberg technology." bitcoin hovers around $32,000, much where it started this tuesday after dipping below 28. why is this