>> as this global recovery is unfolding, investors need to think more global in their portfolios as well. >> as countries move out of covid, the demand is going to be very strong. >> this quite a bit of momentum. it is going to spread out into 2022 and 2023. >> you may see some deflationary forces work their way back into the system. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone.

on radio, on tv, a simulcast. a midyear simulcast area really interesting to see what we have in 15 minutes. jonathan: payrolls coming up on friday. in our estimate, 700,000. tom: we all missed it in the first half area that huge miss on unemployment. maybe we will see where we are this time. ronnie walker with jan hatzius, talking about the supply constrained inflation, and when will it drift away. jonathan: we are talking about the end of summer, the start of fall. august, september, october. if you've got to wait until then to get a clean read on the data which is the pressure to move for we see that i, data? -- that economic data? tom: what is so important here,

yield always leads the way, and yield and spread is speaking right now. lisa: the yield is going lower, confirming the transitory view of the federal reserve, but you are seeing tighter credit spreads. it goes back to what jon was talking earlier, goldilocks. we back to goldilocks -- are we back to goldilocks? tom: issuance is a big deal. was there issuance, and was there a change in that dynamic in the first half? lisa: in the first half there was a record pace of issuance, particularly for riskier debt. a lot of it did go down to paying existing obligations. collateralized loan obligations, which would be leveraged packaging of leveraged loans, the clo's, the record pace of sales. all-time high. tom: very good. jon ferro, we sort of missed it the 6:00 our this morning, what is your observation here of this exceptional victory of england?

jonathan: i was surprised, but the players got it done. raheem sterling. to be the best player at the moment on that england team. you have to imagine on that half of the draw, i think it is easy to say they are the favorite to get in the final. tom: but seriously, do they play italy at some point? jonathan: that would be a final. italy played belgium on friday. they play the winner of spain, and i believe they play switzerland, so the clutter on that side are the stronger teams than the other side of the final. that is what the bracket looks like right now. tom: let's look at the data right now. equity markets. i'm sorry, that was the close we saw yesterday afternoon. jonathan: it was a squeeze. another all-time high, just about. a fourth straight day of gains on the s&p. yields are coming in the basis point or two to 1.4528%. your 10 year, yields down on the day and on the quarter.

in the fx market, a break of $1.19. we come in 0.1%. magnus macro on twitter, i am going to quote this, "inflation is transitory does not mean prices return to pre-change at tory effect levels -- pre-transitory effect levels. what is amazing is we spent six months of this year arguing past each other about two different things. it is about the rate of change." sue if you sit here and say the price has gone up, it is permanent, you are arguing about two different things here. it is amazing how we have a basic discussion about what is happening in this economy. tom: jon will discuss that on "the real yield." i have a show in development, down in flames with calculus. you can listen to [laughter]

[laughter] that transitory discussion. -- you can was a that transitory discussion. [laughter] jonathan: it sounds brilliant. tom: save me from 10 seconds of bitcoin talk. do we care? lisa: would care simply because of the regulatory environment. there is a hearing at 10:00 a.m. in the house of representatives on crypto assets. perhaps we will get something on that. tom: we bring up bitcoin and she nailed it. she nailed that. let's save ourselves with seema shah here. june 30, 20 21. seema shah was principal global, what do you change in your midyear outlook? seema: in terms of the changes, i think how we started the year isn't too different. i think most people are expecting inflation to pick up. we had a timeline for tapering. if anything, the summer is going to be a little more difficult. i think we sit -- we should see a little bit more volatility in

the market, but we are still holding onto our 10 year target of around 1.85% by the end of the year, and i don't think much has changed on that. jonathan: this goes to the quote of peter tchir of academy. take some gains, reduce risk, and enjoy a few weeks of less stress. do you agree with that? seema: for investors, they need to look through some of the noise over the coming months. there isn't too much to be worried about if you are looking at six months to one year. there is still a strong economic recovery underway. you may get a few concerns around the fed, concerns about inflation, and given how expensive equities are, there's certainly vulnerability for a bit of a tumble here or there. but the long-term view is continued strength in equity markets. jonathan: it continues to be either or. cyclicals, value, or growth. it comes down to big, energy or financials, take your pick on

the sector. i am trying to understand, can you envision a scenario where the s&p 500 finishes the year lower from where we are right now? seema: i think it is entirely possible. one of the reasons why increasingly, investors need to look under the surface, start thinking about the sectors and companies you are looking at, the reason for that is that we still have a generally positive long-term view for secular growth stocks. but if you get to a point where cyclicals start doing really well and you have the yield curve once again generally rising, tech gets into a bit of difficulty. given its rating in the s&p 500, there's a possibility you have a lower s&p 500 even in a really strong growth environment where cyclicals do well. so this is the time that investors really to understand the various sectors they are investing in. lisa: on a broader level, i am wondering, do you see goldilocks being a perilous zone to begin, that it has an expiration date that at one point, either

inflation will have to break out to a high or the credit cycle will have to start rolling over? seema: i think it was interesting in that people have become more and more aware of the bearish risks. we had a client asking us how we add inflation protection to our portfolio. there is that recognition that there are many different risks out there at the moment. but i think the really interesting part of his comments were about the structural changes taking place in the economy, which may end up in slightly higher inflation numbers than we have had the last decade. how are these companies thinking about their inventories? even was for guards to central banks, the way they are viewing inflation. these are fundamental changes which are going to take some time to play out. that is where we need a bit more focus. lisa: how do you price in the very specific inflationary pressures of this modern era? seema: we still think we do have

as of eight it inflation, and even after the so-called transitory effect, we still think we will have inflation higher than we had over the last decade. it is certainly around the 2% to 2.5% level. in the medium-term, investors need to have that inflation protection. we talk about cyclicals, and the best area to have that protection is within real estate. you don't suffer that volatility, and as long as it is accompanied by a strong growth environment, real estate tends to do better in these kind of environments. that is where our favorite pick is for a disinflation environment. tom: what do you do on a strategy basis with profitable technology companies? seema: we have actually maintained an overweight tech, and there's a couple of reasons. one reason is for the long-term basis, these companies have a strong cash flow. they have the balance sheet. most companies, if they can

survive over this difficult period of last year, this year and next year, they need technology to pay for their business models -- to pivot their business models. the other thing is it is a defensive trade. when we talk about the growth outlook, tech tends to do well. for us it makes sense to have that within your portfolio and hold it through the long-term. the key risk is the regulations. tech seems to be able to deal with those kind of pressures. jonathan: can i get everything you just said by owning the index? seema: sorry, i misheard that. jonathan: can i get everything you said in the last 10 minutes by just owning the s&p 500? seema: no, i think you really need to actively look at what you are investing in. this going to be some cyclical sectors that do well. you need to have a little bit of growth. but you absolutely need to pick well because over the coming months, as the reflation trade

becomes a bit more normal, some of those companies are not going to do as well as those over the last few months, so we need to be a little bit more cognizant, a little bit more active in the way investors are looking at things. jonathan: it is good to hear from you. we've got some data for you in about four minutes. we get the adp report. payrolls on friday, 700,000. tom: you just asked the most important question for american wall street, if not global wall street. let us focus. in the last 12 months trailing, s&p 500 up 44%. you know what, jon? i know you loaded the faang stocks. jonathan: i wish. tom: that question is so important not only --, but for everyone. jonathan: from new york city this morning, good morning. alongside tom keene and lisa abramowicz, i'm jonathan ferro.

some data just around the corner. the adp report in the united states of america. the appetizer before the payrolls report, the main course, comes on friday. 4279 on the s&p. we close out to q and the first half of 2021 area good morning to you all. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. president biden is reportedly planning an executive order that would rein in the power of big is this -- big business. the order would direct regulators to tough enough oversight -- to toughen up oversight of industries. it would most likely be challenged in court. a big foul up in vote counting in the race for mayor of new york city. the city board of elections took down previously reported results and the democratic primary after mistakenly counting test ballots. that produced about 135 thousand

dummy ballots that skewed the results. the inaccurate count showed brooklyn borough president eric adams losing a large part of his lead over the former city sanitation commissioner. russia's president vladimir putin has accused the u.s. of playing a role in what he's called a provocation in the black sea last week. putin said a few hours before a british warship engaged in a standoff with the russian navy off the coast of crimea, a u.s. reconnaissance plane took off from greece to observe the kremlin's reaction. russia says it used warning shots to force the british ship to leave. kim jong-un faces a grave situation from covid negligence that has created a crisis. they deny that north korea has had any infections. state run media is not taking any details. quarantine steps have made its

economic crisis even worse. 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. ♪ ♪ >> i don't think we get a resolution this week. we expect 700,000 jobs. we expect the unemployment rate take down. as fed officials expect, it is likely we have to wait until the fall to get labor supply coming on fully and get a greater resolution of this real dichotomy we are seeing in the labor market. jonathan: that was the deutsche bank chief u.s. economist. good morning. alongside tom keene and lisa abramowicz, i'm jonathan ferro. live on tv and radio, the adp report 20 seconds away. here's the price action. 4279 on the s&p, down three on

the day. up over the last four sessions. yesterday just about to another all-time high. stringing together a fifth straight month of gains and a fifth straight quarter of gains as well. potentially most likely at the close a little later today. in the bond market, as we strike 8:15, here's mike mckee. michael: 692,000 jobs. that is the report from adp in the private sector. we will call it restored still in june. that compares with 978,000 in the month of may. of course, the u.s. payrolls number has undershot that significantly the last couple of months. let's take a quick look at the breakdown. it looks like evenly distributed , was a little over 200 thousand jobs created in small, medium and large businesses by sector -- businesses.

by sector, manufacturing up by 47,000. last week we had a week construction number. the service industries provide the most number of jobs, 601 4000, of course. leisure and hospitality, 332,000 of those as restaurants, bars, hotels start to reopen. so a good news number here, just about what was forecast for the payrolls report which was 700,000. the forecast comes in stronger than anticipated. we will see if this get people to start to raise their forecast for friday. jonathan: and a market unmoved. equity futures still down about a point. 1.45% on the u.s. 10 year. a lot of people will see this data and ask a basic question. why do i care? michael: it does point to at

least a strong labor market, whether or not it matches up with the nonfarm payrolls number. we had a number of numbers like that. yesterday we got a really interesting number from the conference board that showed people's belief in jobs readily available exceeds the number of people who believe jobs are hard to get by the highest margin ever. it looks like people think there are jobs out there, which should draw people in, which should raise the participation rate, and perhaps does give us a stronger-than-expected a roles number -- expected payrolls number. tom: the zeitgeist right now is the reality of laois and. the real wage, the atlanta wage tracker, less inflation is a stunning negative number. do you care? michael: you care, but i don't think you can make much of it yet. it will be interesting to see when these numbers work out because we are still dealing with base effects. the people who lost their jobs were lower paid, so that raised

average hourly earnings during the crisis, and now they are coming back, and that is going to push down on earnings. it is probably going to be october before we get a team read on payrolls, if we have to wait for jobless claims benefits to get everybody back in the labor force. lisa: one thing i am struck by is the number of quits. peripheral data has shown people feel a lot more empowered when it comes to job prospects. we saw that with the university of michigan consumer survey sentiment survey as well. do we have a sense of how that is affecting employment, how much that is pressuring wages up? michael: people are taking advantage of higher wages at this point or career changes. they maybe don't want to work for a company that is going to force them to come to the office every day, something like that. it is not going to have a significant impact on wages. it is more of a following number. people feel there are jobs available and they can probably more money by switching. tom: michael mckee, thank you. mike mckee tomorrow on claims,

and then jobs on friday. right now, he's from the six district of >> -- the sixth district of lexington, kentucky. what andy barr knows is that the elections are run a little better than the new york city board of elections. they can count the votes down there. to go to the votes in your election, you are not a borderline congressman. you won 57.3%. what do the republicans need to do right now that are in much tighter districts to make 2022 a good outcome? rep. barr: i think we need to address the concerns of the american people. you just were talking about the labor shortage crisis in the country, concerns about inflation. these are real. the fed says and janet yellen say it is transitory. i am not so sure. when you talk to the homebuilders, when you talk to the people who have to purchase the lumber and the steel, and you talk to the restaurateurs

buying food and the trucking companies that are dealing with higher fuel costs, inflation is real, and it is a crisis. so speaking to those basic pocketbook concerns of the american people is what is going to deliver the majority back to us. but it is not about the politics. it is about solving these problems, and we do have challenges facing us in the country. tom: what should jerome powell do in his policy? should he address lexington, kentucky, or something look new york city? he's got to address us all. how does he do that? rep. barr: i think what the fed should be doing is listening to robert kaplan, the president of the dallas fed, who has been the most hawkish on this inflation question. to his credit, chair powell has encouraged these dissenting voices to talk about the real issue of inflation. we do not need to be buying $40 billion a month in mortgage backed securities, with home prices going through the roof. this is fuel to what could be

another bubble, and we need to watch and guard against that. we've had extraordinary levels of monetary and fiscal stimulus pushed into this economy. we are in a recovery, but this is fueling a potential asset bubble that could create major problems going forward, and we don't need to situation where the fed is forced to slam on the brakes and push us into a recession. lisa: let's talk about the infrastructure spending plan, the $579 billion bipartisan deal that was struck. at what point would you be willing to sign off on that, even if there were a reconciliation bill attached to it that democrats were pushing through? do you have a price tag on how high you would be willing to accept for that bill? rep. barr: it is not as much about a specific price tag. it is more about are we focused on core real infrastructure. we are not tying it to an unrelated green new deal or social spending agenda that has nothing to do with the needs of the country. we need a bipartisan deal to

rebuild our country's infrastructure. look no further than 75 miles north of my home district. you see the brent spence bridge falling into the ohio river. this is a major source of interstate commerce tying detroit to tampa through cincinnati and northern kentucky. this is a critical infrastructure project come but there's more of these all around the country, and we need to rebuild our country's infrastructure for growth, for safety, for the efficiency of our economy and productivity. but the key is, are we going to do so the right way? are we going to do so through streamlining and cutting red tape? are we going to do it through private capital as opposed to imposing huge new taxes on the american people that would make us uncompetitive and force u.s. corporations to move towards inversions again and move outgoing jobs overseas? what does it look like, and is

it really a focus on core infrastructure? lisa: would you be willing to sign off on a 579 billion dollar plan regardless of what happens elsewhere because of the need you are talking about to rebuild some of those bridges and roads? rep. barr: the bipartisan deal struck in the senate looks good, but what was very discouraging is when president biden, i think his hand was forced by the extreme far-left and the progressives to tie it to this reconciliation bill that would massively expand the welfare state. i think him walking that back gives us more hope, but the democrats are having a really hard time right now internally, deciding what it is they do. lisa: but would you sign off on the $579 billion plan regardless of what happens on the other side? rep. barr: i've looked at the broad parameters, and it looks positive. much better than where the administration started. so the details have yet to be put into a bill. i would want to see that for i

would commit to it. certainly this is much closer to her in the ballpark than what we were seeing earlier from the administration, and an tethering it from all of the other -- and un-tethering it from the far-left agenda gives us hope of a bipartisan agreement. i would be surprised if we got there in the fall because of the demands of the far-left in the house. the president can show some real leadership here by pushing speaker pelosi to abandon the far-left fringe of the party and come to the center and really focus on core infrastructure as opposed to the green new deal or some of these other social spending priorities of the democratic party. jonathan: congressman, always appreciate your time. let's catch up soon. congressman andy barr of kentucky, thank you. endorsing the words of dallas fed president mr. robert kaplan. we will catch up with kaplan later today, sitting down with

michael mckee. tom: it is not a small idea. i believe you mentioned it earlier, this new percolation of language. michael mckee, when he visits jackson hole, you wonder where we will be that third week of august. jonathan: are we going to see dark to see some -- going to start to see some formal dissent at these meetings? lisa: and from the big three, jay powell, clarida, my question is a more nuanced one. ken the federal reserve stop buying as many mortgage bonds without disrupting the market more broadly? can they have a surgical move here, given the fact that this will foretell a rate hike in the market will act as such? jonathan: governor waller said

this in the past week. "well aware of the broader signaling that any reduction would provide impositions." tom: one of the high points of the first half was your interview with john williams. there was a real delicacy. jonathan: was that a compliment? tom: it is i, meant to you. john williams didn't want -- it is a complement to you. john williams didn't want to purchase a bit. jonathan: this is bloomberg. ♪

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jonathan: from new york city this morning, good morning alongside tom keene and lisa abramowicz. 48 hours away from a payroll report. claims in 24 hours. yields 146. unchanged on the 10-year. they come in following the adp report. euro-dollar, 1.18. down on the s&p 500. tom: it is nothing like the west coast but it is summer in new york. it is hard to concentrate. jonathan: that you, tom. -- thank you, tom. tom: they refused to go outside

when it is that hot. we have michael mckee give in a report. we will dive into jobs day and then the huge amount of economic data on friday. tom is is with us and he is optimistic -- promise -- tom this -- thomas is with us and he is optimistic. thomas: we are more likely to get over the summer, in july and august. i think we could get there. let me frame this payroll report. all indicators i am looking at are strong, especially with regards to high-frequency data. even electricity use, passenger travel, they are all very good. they're going up. i think that bodes well for

payroll on friday. tom: do you just assume that we mop up eight or nine or 10 million unemployed next number of quarters? thomas: i think the momentum could ease because the gains will be in services. we have summertime coming so that is a big job growth in services. after that it will be more difficult to add new jobs. the gains could slow in the second half of the year. let's focus on the summer jobs data which is likely to be very strong. we have time to focus on what happens later this year, that will be another story. i think the pressure will grow on the fed to announce qb tapering.

i think the debate at the fed is shifting. we are looking at this loss of employment since february of last year which was around 8 million jobs. they are having a more granular approach to the labor market because i think it is much tighter than what the look at the unemployed would say. if you look at job openings versus the unemployed, i think it shows you that the labor market is tighter than what it looks. jonathan: what is your base case for the participation rate in america? there are some who believe it just recovers. rafael bostic saying the u.s. is 9 million to 10 million jobs short. do we get there? thomas: i think we will get there but i think there are structural issues that have nothing to do with the fed or monetary policy. we know many people retired so

we need to cap them out. i know jobs have -- so many to count them out. i know jobs have changed as well. at the end of the day, the view is that there is still some cyclical slack left. but not that much. we could get there sooner than what many expect. there are still some lingering structural issues in the labor market, that is probably yacht what the fed can address with monetary policy. lisa: i am preparing myself for the debate about whether enhanced unemployment benefits have hindered people from getting back into the labor force. the wall street journal is saying that early numbers suggest that for places like missouri more people were coming into the labor force after the decline in benefits. what are you going to be looking for to confirm or deny those arguments people use to chart

out policy going forward? thomas: right. i think the high unemployment benefits have had any affect on labor force participation. the question is how much. i think the problem is that the state level data comes with a lag. we want to have it on friday. we will have to wait until the summer's data do you have a better picture because many states are in the process of canceling those extra unemployment benefits. i don't think we will get the true picture until one or two or three payroll reports later. by august it is when the fed is likely to send a signal about qb tapering. lisa: we have reached a point where people dismiss the phillips curve as irrelevant. are we going to go back to a period where the labor market gets tighter then people have been expecting?

we will see resurgence in the phillips curve and this relationship between the number of people applying for jobs and he reaches they're getting paid? thomas: it is a difficult relationship. the marginal increase in wages coming from labor markets -- labor markets like is quite limited -- labor market slack is quite limited. you have two relationships here, you have one from the labor market slack to wage growth and one from wage growth to inflation. you have two relationships that are quite fragile. we are not yet in dangerous levels in terms of wage growth. the u.s. economy can absorb high wage growth without creating higher inflation. what i am going to be looking at is inflation expectations,

especially from the business side because they're are the ones setting prices. you chp pub in inflation expectations. that is where i am vigilant, the fact that expectations are starting to move up, including those of businesses. jonathan: you just stumbled on a problem a lot of people have with these conversations where economists say things like "dangerous wage increases." i am not sure anyone has been on the receiving end of a dangerous wage increase. what is a dangerous wage increase? thomas: right now, the one metric i'm looking at is the wage growth. we are around 3%. inflation is way above that. loss of purchasing power, -- if we go up to 4% or 5%, we

won't get directly between a wage growth and stronger inflation until i think we get to 4.5% or 5% on wage growth. i think there is room to go before i sound the alarm on inflation. the one thing i am looking at is inflation expectation because that is where you can have a look between inflation expectation and actual inflation starting to kick in. so far we are seeing a slow creep up in the inflation expectation, especially from businesses. jonathan: thank you, sir. i'm not sure anyone has been on the receiving end of a dangerous wage increase, i'm sure corporations feel like they have given those out. tom: june 30, the team at ubs comes out with a blistering note. this is what you see at the end of a quarter where they stake are territory.

ubs says go the banks and go deep global banks. their map as they are trading at a forward price compared to earnings ratio of 12 times. jonathan: and they make three points, three basic arguments. earnings growth looks set to remain robust. valuations remain compelling. and three, the trend toward higher payouts will not be limited to the united states. lisa: this comes after the stress test, the banks flying with -- passing with flying colors. expectations are expect it to some out to $50 billion. yet you have earnings going forward at a time when we are not seen consumer loan growth and loan demand picking up. we are not seeing interest rates pick up all that much. i wonder how much you can

divorce the view of the banking industry of the rates view. is this just going to trade in tandem with the macro cost? jonathan: let's think about what we have done over the last year. the last year was fantastic for financials. over the last month, down about 6%. against the nasdaq which has advanced 6% over the last 30 days. that is some huge divergence between what big tech has done on the nasdaq 100 and the other performance in the financials. the other point ubs is making is that we acknowledge the underperformance recently. we think that won't last. tom: this will go into a guest you have coming up, i believe you have richard bernstein scheduled. he wrote the definitive book on this, i will say 20 years now. it was on style investing. what we are saying, cyclical growth and all of that, is what are we comfortable with?

what is the style we are going to have? it is a great time to talk to him. jonathan: he has been committed to this cyclical story. it goes beyond reopening, that this can persist, that this is more durable. it is not just about turning the lights back on. this continues, there are more chapters to go. lisa: people also look at these dividends. the fact that it percent to 9% payout in the market cap is pretty good when you look at high-yield bonds yielding 3.4%. jonathan: coming up, richard bernstein. from new york city, good morning. 4277 on the s&p. can we repeatedly performance of the first half in the second half? the men from del monte says -- what is he said? tom: i thought the second half was a little better. jonathan: i think it is

important that you got take goal -- that he got a goal. that is really good. tom: what is ukraine football like? jonathan: good last night, explosive on the brick. we need to see more of that. we have some pace going forward. you can talk about football and he will always sound like an expert. new york city, stay safe. this is bloomberg. ♪ ritika: the u.s. and taiwan will discuss semiconductors and vaccines today at a long-delayed trade talk. there is a global shortage of computer chips and taiwan is one of the main suppliers. its biggest manufacturer is building a new factory in the u.s. their eventual goal is a full trade deal. in china, president is so the re-think the communist party's 100th birthday.

he will make the case that the party with him at the top is china's best hope for more growth. it will include flyovers by the country's most advanced fighter jets. goldman sachs is looking for a new office space in dallas. it would be the largest presence in u.s. outside of its new york city headquarters, inviting alternative work environments is becoming a trend. private equity firm opened an office in miami in addition to its san francisco and chicago locations. orlando bravo said it is important for colleagues to be in the office together. >> by offering different locations on the east coast with a very different lifestyle, different culture, different norms, we are able to offer our colleagues two different places to be where they can collaborate in an office environment. ritika: $8 billion under

management and deals exclusively in the software space. 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. this is bloomberg. ♪

>> we can't wait to see everybody. our businesses and residents

sacrificed a lot in 16 months. they are eager to bring it their workers back and have everybody come in to cs in washington. -- to see us in washington. i think we are on our way to a comeback. tom: the mayor of washington, d.c. yesterday in attendance on bloomberg. for those of you internationally and across this nation, it is no surprise, the board of elections with a small snafu last night. we all know about it. there was an election missed counting and they came out at 10:30 and said we screwed up and we will have dated today. shelly banjo joins us on a fractured mayoral election. i guess it is a news item, what will be learned today from the board of elections? shelly: it is basically groundhog day all over again.

erase any notion of what those results told us yesterday because what happened is that they included 135,000 dummy ballots. basically what happened yesterday was useless and we go back to where we will get you results today. tom: absentee ballots, it is 15% to 20% of the votes. do you know or can you guess which borough they are from? our absentee ballots a manhattan think or a bronx thing? do we have knowledge of that? shelly: you can tell which districts they are coming from and so a lot of the districts they are coming from our from districts that eric adams and kathryn garcia lead in the general election. you can try to make some guesses that it is going to come out the same or a similar fashion, but it is hard to know. lisa: how much does this snafu

undermined the tier devoting that new york was rolling out? -- the tiered voting that new york was rolling out? shelly: i think it is pretty natural for the general public to be like it is because of the ranked choice voting when really it had nothing to do with that but had everything to do with the board of election which has a spotty record of handling elections. it will be up to the city to continue this education campaign if they want to get going with ranked choice voting getting all that happened. this was not what happened in a ranked choice but he system, this is what happens when a board of elections does not do their job right. lisa: it does raise the issue of nuance which can be hard people to digest. this idea of what if eric adams does not emerge victorious after being the leading candidate. what is the liability of people being skeptical of the results

if that should happen, if eric adams is upended? shelly: people should be skeptical of all that comes out and look at it with a fine toothed, -- fine toothed comb. even once we have a winner, you better believe all these candidates are going to be taking a closer look to make sure everything was done right. this is the first time the city has done an election like this. the first time they are using this new software. this is the first time there have been so many candidates. there are so many firsts that everybody will be looking closely at what happens. tom: are we going to reform the board of elections? i am by no means an expert on this, but to be compare and contrast with austin or philadelphia or sacramento? is this the point where there could be revolution? shelly: there was a deep

investigation in 2013. it found misconduct, legalities, and other issues with the board of elections. the problem is that it will take a state action to fix this, not a city exit -- city action. tom: why is that? the city council appoints the board of elections, right? shelly: correct. but the makeup of who appoints it, everything is done by this system of patronage where the political parties get to a point these people -- get to a point these people -- appoint these people. lisa: taking a step back, the mayor election for new york city, where are we in terms of the economic recovery given that new york has lagged behind other states. our office is opening back at a

faster pace than they were a year ago -- then they were a week ago? shelly: the big issues for new york is that the unemployment rate is higher than the average -- national average. there are office buildings that remain empty. some things have been bringing workers back to offices. it is going to take a lot to get the city going again, especially when crime remains elevated and unemployment level -- unemployment levels are high. tom: doug collins, just let us know when you figure out what the results are. shelly: [laughter] will do. tom: shelly banjo, running all of our new york city coverage and driving forward 731 lexington avenue. we talked about ubs with a blistering note, carl weinberg was on fire this morning about something john mentioned earlier.

-- something john john mentioned earlier. he said this is not inflation. for most people listening, this is like what? but he is saying this is a one-off event and it will subside. down -- calm down. lisa: and you are saying that used car values. you're seeing some of the areas that got bit of the month -- the most starting to come down from incredible highs. my question is what is the level it is going to come down to and what will the fed tolerate? they will probably reach their 2% target on a longer-term trajectory. what is the overshoot they are willing to allow to happen? it is transitory. the pace of the increase is, what is the mutual that is okay? tom: goldman sachs says yes, it will come down as you say. they look for support of real estate inflation that gets them back to the 2% level.

-- 2%-ish level. you like how i said ish there? lisa: real estate rates are going up, too, because of the increase of housing prices. as you pointed out, very different story for new york city versus austin, texas. tom: what are you going to listen to from kaplan and mickey? lisa: his relevance and his connection to the rest of the key members. the idea of how much there is cross listening going on in board meetings, how people are trying to use other people's ideas. tom: i want to hear what he says about texas. kaplan reads the data across this wonderful district. robert kaplan, an important interview.

look for that the 12 noon hour. michael mckee has that interview . dow futures at -36. stay with this on radio and tv. ♪

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jonathan: from new york city to our audience worldwide, good morning. early minutes away from the opening bell with equities at an all-time high.

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. ♪ jonathan: we begin with a big issue closing out the first half. >> the first half of the performance -- >> two stimulus checks in the first three months. >> we know the stimulus was bigger than expected. >> all the surprises we have been on the upside. >> very strong consumption growth. >> economic data has more or less been better than expected. >> the data cadence has been faster. >> the markets have digested this well. >> growth has pete in the u.s.. >>