consumer we are spending and the credit card spending, that is going to shift to the business sector. >> consumers are understanding that what happens this year is not expected next year. >> it is clear whether it be the september meeting, the senate is going to have to address the tapering. >> we do not want to jarr markets, but it is time to end these emergency measures. announcer: this is "bloomberg surveillance" with tom keene, jonathan ferro and lisa abramowicz. jonathan: just one more day. from new york city, good morning. this is "bloomberg surveillance" on tv and radio. i am jonathan ferro. tom keene taking a long weekend. good friday morning. equity futures advancing about seven points. retail services around the corner. lisa: we are accepting a decline into that ongoing rotation from goods to services. services perhaps, the biggest

wildcard. how much are they peeking up with the delta variant keeping people home more than expected. jonathan: we start this morning, what we are doing at 132.38 on 10? lisa: that is a question that nobody has a good answer for. is it a fed mistake? is it a feeling that we are going back to a low growth environment? the answer to that is unclear and frankly, i am not sure what data points we will get that will give us any answers before five years from now. jonathan: we need to talk about covid, don't wait? we have been talking all week about the delta variant, how would policymakers respond, how would consumers respond. we are getting a taste for the policy response, not just in singapore, but in l.a. county. kailey: going back to indoor masks, even if you are vaccinated. my question is does the science say that is necessary. as it relates to covid policy and watching travel mother biden administration says it is

expecting to have a decision on the travel corridor opening up the other way. europeans being able to come back to the u.s.. lisa and i landed here in new york, we had no problem because we were american. jonathan: you left together and you returned together. lisa: we held hands the whole time. jonathan: we can talk about that later if you want. lisa: delta airlines is having an issue with the delta variant because it is an unfortunate name for them. they just call it the variant. jonathan: are you going to call me tom this morning? we have forgotten each other's names. we went through the -- let me go through the price action and get you set up on this friday. equity futures up seven. we advance more than .1% in the fx market. 118 on euro-dollar. there is the move in the bond market. yields are higher on the session, but down on the week,

higher by a of basis points. lisa: we are going to be getting retail sales at 8:30 a.m. we are expecting a decline. -0.3% decline. the expectation shares cd ongoing rotation from buying stuff to buying experiences, services. i wonder to your point about the delta variant, how much that it has unexpectedly suppressed the activity we have seen in services. i want to see if we have clues as to why people perhaps are not spending more. at 10:00 a.m., this may arguably be the datapoint of the day. we get u.s. made business inventory, but that is not the data point. we get july university of michigan sentiment data. the expectation for what consumers think about inflation going forward could potentially determine the behavior and fed chair jay powell indicated what he may be watching more than anything, what do consumers expect and how are they changing their behavior.

to your question earlier, why are treasury yields so low, will we get some answers in may treasury international capital of -- capital flow that comes out? please give us some indication of the foreign buying we see in the treasury market. people have been blaming this from what we have seen with respect to yields going so low, because this is a high-yield from japan, germany, some european countries. how much has that been the reason behind the treasury yields move? jonathan: you're making a bold call this morning. you don't think retail sales is a data point of this morning? lisa: i am wondering how messy it is going to be given the rotation. i don't understand what we can clean in terms of long-term trends. the people -- the thing that people are watching is the rolloff in the stimulus tax are from march could lead to a decline -- the stimulus checks in march. not saying it is not important, however, fed chair powell

pinpointed consumer inflation expectations as being a key driver of their view on price rises and that is -- has underpinned all the price action. jonathan: looking forward to the data later this morning. we start with retail sales at 8:30. the airline stocks premarket shaping up as follows. since the highs of mars, we are down 20% on the s&p 500 airlines. individual names, delta, positive .6%. america up by 0.49%. kailey, the conversation, perhaps these names get some good news in several days. kailey: it is still a wait and see mode when it comes to the biden administration. we are seeing a bigger move on the european airlines. aig was up more than 3% this month because we know on the continent, trying to return this way to the north atlantic, they have been waiting for this for a long time. jonathan: the president's quote alongside angela merkel, "i am

waiting to hear from our covid team as to when that should be done," related to the travel ban. lisa: i am very confused. when i was going through passport control, there was a lot of yelling, a lot of confusion. people checking their news flows to figure out what the covid restrictions are and what -- where the pandemic is. what signs are they looking at? what are they waiting to see? this is a great unknown that a lot of people are asking. jonathan: margaret patel joins us now. i start with a question, your 10 year yield 138, why are we down here? margaret: we are down here because the treasury curve has kept suppressed for what the fed is doing. they have buying a lot of longer duration treasury bonds long-term and so really there is no place for the demand for treasury securities to go, so you see them expressing emotion in the middle part.

people are worried about inflation, but they are also worried about what if the economy slows down from deceleration or from covid. compared to yields and the rest of the world, the dollar stabilized. the 10 year at 130 looks like a decent investment. lisa: based on your view that this is driven by what the federal reserve is doing, do you count on yields remaining around here for the foreseeable future when you decide, equities still looked like a buy? margaret: yes. number one because chairman powell told us so. he thinks inflation is transitory. he wants to lengthen out that period where we reduce the amount of purchases they are doing with treasuries and mortgages. i believe what he says, they have the power to do that. i think he is holding his breath. when they think about what if we vary slightly taper and we see some explosion in the marketplace. they don't want to see that.

they are going to keep on this course. what they think about inflation coming down is more important than what the market thanks. they still claimed there is a lot of slack in the labor market. even if inflation does not really do what they would like it to do. lisa: how important have earnings seasons been this year? margaret: they have shown what people expected, very strong in the first quarter. we may be surprised in the second quarter to see earnings being much stronger than they might have thought. they might have looked for margin pressure. we will see companies continue to operate with less. their sales are going up. they maintained their labor force cost. i think we may have another pleasant drive and the second quarter. kailey: not just this earnings season, but last earnings season, we have seen the russell 2000 down 7% from its peak and over the same time, the nasdaq is up 13% over that time.

what do you want to do with small caps now? margaret: that is a thing you see also in nasdaq. there is very large high growing stocks. the faang has outpaced to rest of the market. a good example would be airlines. that is difficult. small caps are really down from their peak in march by 10%, 15%, maybe 20%. that shows that next year, as people want to be in the market so they want something safe, so they keep sticking with the faang and the rest of the market seems to be turning around. jonathan: quickly and finally, you and i have chatted about this in the past. how much is left in this market? does the cycle matter? margaret: i don't think we have a cycle anymore. i think the fed has determined that we are on a secular path of low growth around a very low rate of yields. jonathan: what a call. we have to follow up on that

another time. i am fascinated by this call of yours. margaret patel, senior portfolio manager. lisa, we no longer have a cycle in the market. the fed controls everything. lisa: i buy the argument. i think that there is an idea, especially as we see a record number of upgrades relative to downgrades by the credit rating companies over the past couple of months that basically the federal reserve saves companies that otherwise would have gone bankrupt. the fact that they borrowed trillions of dollars of debt and now they look so much better, even with the extra debt on their books simply because borrowing costs are so low. why are they so low? because of the federal reserve. jonathan: are we seeing the data in the earnings no longer matters? kailey: has it mattered for some time? spreads have widened out in july, but we are still at 282 basis points and that is the story when you look at a one-year chart.

it is remarkable. i am not sure anything fundamental has my -- has mattered much for over a year now. jonathan: this is the trouble with this credit market. it was j.p. morgan that said spreads are supertight, valuations are rich, but i am not sure what would take them wider from here if the fed is in the game. lisa: the concern, delta announced that they are going to buy back billions of pandemic era bonds. this shows they are taking their cash and putting it to that rather than investing in the future. what is the consequence of that overall for the economy? jonathan: we will talk about this credit market at 8:00 a.m. eastern time, the chief investment strategist just 30 minutes before we get retail sales in america. here is a set up. equity futures 43.56. for our audience worldwide, this is bloomberg. ♪ ritika: with the first word

news, i am ritika gupta. president biden and xi jinping will address opec leaders at a virtual summit. a tick has 21 members including the u.s., china, japan, australia, and canada. while the coronavirus is a topic, the meeting is bound to reflect rising tensions between the u.s. and china over a variety of issues. for the second day in a row, jerome powell defended central banks stands in front of lawmakers concerned about inflation. powell told the senate committee that the reopening of the economy inflation well above 2%. he reiterated the fed forecast says the high inflation will be temporary. president biden says the administration will warn u.s. companies about the risk of doing business and hong kong. he says the situation there is deteriorating and the chinese government has not kept the commitment it made it to the city. the advisory will warn companies about hong kong's new national security rule which declared

that anything construed as supporting the authority of the government. in germany, 81 people have died in the worst flooding in decades. anymore are missing. belgium and other parts of western europe have also been hit. several days of heavy rain forth rivers to overflow. people climbed onto rooftops and into trees after their houses were inundated or collapsed. china has surpassed apple to become the world's second biggest smartphone maker. that is according to preliminary estimates. the research firm says it increase shipments by 83% over the past quarter. samsung had a 19% market share in the second quarter followed by them at 17% and april at 14%. i am ritika gupta. this is bloomberg.

♪ >> this is a shock going through

the system associated with the reopening and it has driven inflation well above 2% and of course we are not comfortable. this inflation is just unique in history. we do not have another example of the last time we reopened a $20 trillion economy. we are trying to undercut -- understand the best case and the risks. jonathan: the two day testimony is done. nothing from the chairman today. i know a number if you find it tedious, but the testimony is behind us now. good morning. alongside lisa abramowicz, i'm jonathan ferro. tom keene is out of the beating -- out of the building. equity futures 43.53 on the s&p 500, advancing one single point. a big focus on the bond market. yields coming up to basis points. down on the week in the session to 132.21. the news out of washington,

d.c., we have this advisory coming from the administration on the risk of doing business and hong kong. the president confirming yesterday with chancellor merkel that would be coming. reuters alluding to that this morning, adjusting that that advisor is out today. lisa: a lot of uncertainty with how much this will have peter. how much will the u.s. administration go after companies for acting in ways they are uncomfortable with and hong kong. we are not hearing a great deal of concern just yet. jonathan: to use the president's words, it is more as to what may happen in hong kong. it is as simple and as complicated as that. kailey: we are not expecting the biden administration to say companies need to pool out of hong kong, that they need to pull back your investment -- pull out of hong kong, that they need to pull back their investments. jonathan: let's head back to washington, d.c. for some clarity.

annmarie hordern joins us. the situation in hong kong is deteriorating and the chinese government is not keeping its commitment. one country, two systems. that feels like a long time ago. annmarie: the president really is just warning and what the president said is it is an advisory. we are not telling you to stop doing business in hong kong, but we want you to know what the risks are. one of the things that this advisory is supposed to outline is that there is a legal risk now that the chinese, and his party has a grip on hong kong. it is one of the things put out by the biden administration that businesses need to keep in mind, some of the legal threats that are more subject to the chinese comments party and mainland beijing and would normally be. lisa: i gotta say, find me a.c.l. that says, i never realized that about hong kong. -- find me a ceo that says, i never realized that about hong kong. what is the purpose.

it is this purely messaging to the chinese government that if they start cracking down on data and u.s. ipos of chinese companies that the u.s. will retaliate with these types of measures? annmarie: part of it is messaging, after we saw what happened with bb which many u.s. investors were a part of given that ipo in new york. part of it is that they want to map out the framework that there has been a change in hong kong and we have seen that since last year with the national security threat law, what is happening in terms of press freedoms in hong kong with the apple daily edition. there are a number of things that have been stacking up. as you say, it really is just another layer of the tit-for-tat between beijing and washington and while many were expecting a softer tone from this administration on beijing, it is not happening. they have kept those guardrails in place from the trump administration and they are going harder. lisa: the biden administration has the backing of congress. this is the one bipartisan issue

that they agree upon and we are hearing some agreement on putting money behind competing with china's belt and road. what is the latest on that in terms of how it gets rolled out and how much is behind that? annmarie: the house warm relations committee advanced a bill and there is bipartisan support in washington when it comes to wanting to invest domestically in terms of being able to compete with china. this bill yesterday had pushback from republicans because they did not like that there was a little bit of working together with china in terms of climate initiatives, but at the end of the day there is support and this is about making sure there was infrastructure to make more chips in the united states, also to help other countries in terms of countering the nelson road initiative, which president biden spoke extensively about with g7 leaders recently on his trip to europe the other thing is that the united states is working with other countries about a digital trade pact and

this would be 100% to deter china in another way to combat china. the difference between and to differentiate the trump administration and abide in the administration's they are both talking tough on china, but they want to do it in a multilateral approach. kailey: while we are talking about u.s. adversaries, you have china on one hand and rush on the other. we glean anything about the approach to biden's meeting with merkel yesterday? annmarie: they did not go into details regarding russia in the sense of nord stream 2 except for the fact that they both agreed that they should work hand-in-hand in terms of wanting to make sure that russia does not use nord stream 2 as a way to coerce and to use their energy supply against europe. this is something that president biden said, although we are friends, you tell your friends the truth and he did bring up he is worried about nord stream 2 with angela merkel, but at the

time he got in office, the pipeline was pretty much done. the pipeline is more than 90% done. it will be done by the end of august. we did get details of what reassurances germany is going to do to really protect ukraine and it is quite awkward for merkel. her district in germany is where the russian vessels are floating on the end of this pipeline. we know that they had a united front in terms of how they can work together. jonathan: that is the issue for so many people. the news conference started yesterday with the president of the united states celebrating the tenure of chancellor merkel. this has happened on their watch. we talked about the end of one country, two systems, this has happened on their watch. what can they actually do about any of it to change the path we are on now? annmarie: when it comes to russia and nord stream 2, there is nothing the united states can

do except to sanction some of these companies work on the final layers of building that pipeline or sanctioning germany. that is not something the administration is going to do because germany is an ally and there is a lot of transatlantic trade and partnership there. they want to keep a closer eye on it and they really are at this point just stuck with it. germany and europe is also in a precarious situation. russia is their direct neighbor and it is where they have to get their energy supplies. right now with the biden administration -- what the biden administration was to focus on, how do we protect the interest of ukraine. jonathan: annmarie, good to catch up. lisa, these issues are going nowhere. lisa: what it does highlight is that the fractures between germany and the u.s. have not necessarily been breached post president trump and this is going to be an ongoing theme with president biden. jonathan: they're going to be seen holding hands, aren't they?

a clear disagreement on some big issues there. lisa: do you think they have campfires? jonathan: i don't think so. lisa abramowicz, kailey leinz. tom came back with us on monday. some new york city this morning, good morning. this is bloomberg.

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♪ jonathan: live from new york city, friday morning. good morning. equity futures advancing about two points. up by 1 -- .1%. on the nasdaq, just a bit of weakness came through from big tech. the nasdaq positive by almost .1%. but down on the week by .2% after 8 straight weeks of gains. the big tech on the nasdaq 100 this week. check on the bond market. your yields just a little bit higher, ending last friday at 145.95. we are lower on the week, higher on the session. this is happening. even with cpi and ppi coming in

hotter, a dovish chairman at the federal reserve, and still you cannot get lower yields on the week. you have to pay attention to this market. it is fascinating how it is responding to the data. this week, it is yields lower. the airlines on the s&p 500, get to the chart. over the last year, up to 1%. since the march highs, down almost 20%. there is a broader theme and a laser focused theme i want to zoom in on. the broader theme was the reopening trade. right now, that chart looks like a reopening theme, another durable cyclical play. the thing i want to zoom in his these airlines seeing some good news. i wonder if that good news could come from this administration later. we know about the domestic travel story and what may or may not happen with business travel. we need to find out what happens with international. that new york-london corridor is

so important to some of those airlines. lisa: it is such a mess. the international airlines are benefiting more from this news, but you have to wonder whether that is enough to get people going again and to get travel restarted. i will note there is a question of the hangover cost for these airlines as they deal with pandemic issues, whether it is standards or the debt overhang. this is one of the key questions, what happens to markets if the dollar strengthens from here. we were talking about dollar weakness, the expectation being part of this recovery trade. that has gotten turned on its head and how damaging could a stronger dollar be. cibc capital markets, the head of fx strategy gets this question every day from his office, in his home, or he is itching to get back to his work office and away from home politics, i am sure. thank you for being here. what is your sense in terms of how off-site traders would be if

the dollar strengthens from here? bipan: i think there is a bit of that. if we look at the positioning gauges that are more prevalent in the fx world, they are highlighting that the market is short u.s. dollars. if you do get this sense from the federal reserve towards tapering their asset purchases, a lot of traders will be caught off guard. we expect that to materialize against some of the other majors. lisa: what is the argument for it to weaken given the fact that central banks have made it clear the fed has to be the first mover? bipan: you hit the nail on the head. it is whether or not the fed is lagging the move a little bit. that is the risk we are monitoring at this point. that requires us into incoming data, especially to unappointed information and what the fed says as well. if it does seem like the fed is going to drag its heels with respect to monetary policy, then those dollar shorts in the do not look out of place -- those dollar shorts

do not look out of place. jonathan: the high for the euro-dollar was the start of this year. euro-dollar, $123.27. many people thought this was the starting point and if you push back towards $130 and continue breaking down. traditionally, if the rest of the world starts to do better, that is a weaker dollar environment. what has gone wrong this year with that theme? bipan: that was the theme to pay attention to earlier this year, especially q1 and q2. what people forget especially with respect to the euro is that fiscal policy matters. in europe, we are talking about them reverting back to the old fiscal policy and looking about curbing spending and debt limits going forward whereas you don't have that same straitjacket in the united states. the fx does not respond to fiscal policy as much as monetary policy. if you get that stronger impulse

for fiscal policy in the united states, monetary policy does not need to be as dominated over the long-term. that is what a lot of people are starting to understand. the ecb is going to be accommodative from -- for long longer -- for a lot longer. certainly, notwithstanding the mandate shifts we saw last week. we do think the ecb will be on hold for longer and the fed is pivoting toward a more hawkish policy. that suggests there is a ceiling for the you are dollar. -- the euro-dollar. jonathan: earlier this week, we had some understanding that we will be given an advisory from the administration on the risk of doing business and hong kong. that advisor is out, we can confirm the here at bloomberg. the united states has issued the risk of operations in hong kong. risk based in china increasingly

present in hong kong. this is formalizing some communication from this administration that the air of one country, two systems is over and that is important to recognize that this morning, that it is a very formal recognition from this administration. lisa: what do ceos do with this? what do legal counsels advised them that they have not in the past? this is the beginning -- is this the beginning or is there going to be more? jonathan: i am with you. when you speak to multinationals, when you speak to the leaders that run these companies, ask them about these issues, they don't want to talk about it. they don't want to risk their access to the mainland. kailey: i wonder if this advisory is aimed at those american companies or if this is a message for beijing as it relates to china's policy in hong kong. jonathan: bipan, great to have you with us.

from your perspective, where we are from -- from u.s.-china relations and what it means for your world? bipan: we have not seen the political interference play into the trade. it has been more of a function between the dynamics of growth so far. mid 2020 is a story driven by what is happening in china in terms of domestic recovery and how that contrasts with the united states. there is more concern with respect to the credit impulse in china. also, other commodity currencies being on the defensive as well. it is primarily based on economic growth. i would not tie it to politics at this point. kailey: have the rumors of china's slowdown been exaggerated? we saw a retail sales and they are starting to see growth forecast being revised -- growth forecasts being revised. bipan: given the fact that we

did hear about them earlier this year interested in curtailing some successful creditors. i don't think they were overplayed. i think there is a sense of their could be some slowing onshore in china. there is a mix of both. i would not want to lean too much into suggesting that a lot of this is imperative. but i do think there is something there. kailey: i want to come back to the dollar. our colleague put out a macro view saying the dollar yield was on the same page until they were not. what do you make of that weakening correlation? bipan: for us, it suggests that there does seem to be this growing sense of concern with respect to global growth prospects in terms of events leading a bit toward long end and helping to flatten the curve to an extent. we are seeing a different dynamic with u.s. dollar in terms of this being more of a position cleanup more than anything in anticipation of a hawkish fed that potentially in

august and september. there are two different factors in terms of fx and rates and new cannot rely on the same degree of correlation as before. jonathan: good to catch up and good to see you. senior ivc capital markets, head of fx strategy. i want to bring you the news. bloomberg reporting with many others that we have the advisory from the u.s. administration on the risk of doing business in hong kong with the following quote from the state and treasury, "homeland security and commerce department, development over the last year in hong kong present clear operational risks from multinational firms." who is this for this morning? the multinationals operating there for a warning shot to beijing? lisa: you have to wonder what follows it and that will give you an answer. i doubt anyone in the regulatory front in any of these companies is going to stay this is shocking. who knew of these risks. jonathan: it will be interesting

to see if you get a response who operate on this advisory. the other issue is related to some of this, tension between the u.s. and china. we talked a lot about it in the last month. a chinese company that had the u.s. capital markets up with a significant degree of cash and a regular at home clamping down on things and it raises the risk of doing business here in the united states, never mind in hong kong. additional reporting from bloomberg suggesting that maybe mainland china, beijing is opening the door for those ipos to go to hong kong and avoid coming to america altogether. kailey: the cybersecurity regulatory review, they are going to see exemptions for it potentially if you live in hong kong. china is trying to get companies to list there where they might have some more control, not in the u.s.. we have seen this not just with dd, but a chinese delivery and ledges this company reportedly was planning on listing in the u.s. and is now moving to hong kong because of some of these regulatory fears and now china

is obviously trying to entice that a bit more. jonathan: what a story. a definite administration same issues. a different approach. would a different approach generate a different result? jonathan: -- lisa: what is the result they actually want? we talked about how it is two different countries, one system, it does not really work. it also shows how much data in the fight for control over it very much is at the forefront of all of these tensions. jonathan: very much so. we are going to talk about this pandemic. just a baby step backwards in l.a. county. you are going to have to wear a mask indoors even if you have been vaccinated. we need to talk about that change in a moment. we do that with andy pekosz, johns hopkins university professor. from new york city this morning, this is bloomberg. ritika: with the first word news, i am ritika gupta.

l.a. county residents must wear masks indoors even if they are vaccinated. authorities are reacting to a surge in covid cases and the highly contagious delta variant. l.a. county added 1000 new cases yesterday for the seventh day in a row. 10 million people live there. u.k. is holding out the prospect of restoring some of its pandemic restrictions just three days before he plans to drop all social distancing rules. the number of people hospitalized in the u.k. has risen 43% in a week. the country's general told the news that if the situation increases, researchers can be imposed. in cuba, the government is promising it will learn from the protests. authorities believes researchers on food and medicine imports. thousands took to the streets to demand freedom and food. cuba's economy shrank 11% last

year. white house officials meet with representatives of the homebuilding industry to address the housing shortage. builders, labor unions, lumber companies will be among those attending. they will discuss high prices from materials, supplies, and a shortage of skilled workers as their biggest problem. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am ritika gupta. this is bloomberg.

♪ >> we are preparing, whatever

the circumstance is, and the extent of the games, excitement, and emotion by the position of the athletes. we are accelerating the pace of vaccination as much as possible. vaccination is delayed compared to other major countries. but we are accelerating dramatically. jonathan: the tokyo governor. from new york city, good morning. i am jonathan ferro. tom keene is back on monday. kailey leinz is here to help us. 43.58 on the s&p, advancing a little more of .1%. firmer on the week, softer on the session. yields higher. euro-dollar rolling over little bit, but holding onto 118. negative almost .1%. we talk a lot about this delta

variant. we talked about what may or may not happen with the policy response. the policy response from l.a. county, reintroducing a mask mandate for indoors even if you are vaccinated. this is what the county's health officer had to say, "we have to give -- get these numbers down. masking ads that layer of protection for fully vaccinated people." the issue is for fully vaccinated people, do they want that extra layer of expectation. nevertheless, a step backwards. lisa: what is the messaging, that the vaccine is not effective, or we do not trust people to verify that they have been vaccinated, let's just have everyone wear a mask. jonathan: that communication around everyone getting vaccinated with these measures, i think lisa is right. it blurs things. kailey: when the cdc put out the guidance that you do not need to wear a mask anymore, that was seen as enticing people to get

vaccinated. you can take your mask off if you get your shot. now you are saying you have to put your mask on even if you have had your shot to protect the people who have not had their shot. it gets very complicated. jonathan: let's bring in the expert to get rid of this complication. andy pekosz, johns hopkins university hula bloomberg professor. -- university school of bloomberg professor. andy: in places like los angeles county, you are seeing a massive surge in cases driven by delta variant infection. it is being driven by infection of unvaccinated people. when you have a high level of community spread, even if you are vaccinated, it is a good idea to have one more layer of protection because the vaccines work, but not 100%. masking and vaccination will help you, especially in a condition where there is a high likelihood you will come into contact with other infected people. lisa: i got a message this

morning saying that one of our listeners and his wife have curtailed their vacation because of the delta variant, they have changed their behavior. i don't know if this person is vaccinated, but i have talked to friends who are and they are curtailing their vacation schedule. is this what people should be doing? should they be less mobile even if they are vaccinated? andy: it really depends on where you are going. if you are moving to an area or going to an area where you know there is a high amount of covid-19 cases, it is a good idea to continue to wear masks and think about social distancing. if you can put it off, i would put it off. the delta variant is a scary variant in terms of how quickly it is moving in the population. if you are vaccinated, you are protective, but you do not want to rely on one thing particularly if you know that there is going to be a high number of cases around. kailey: you can understand the confusion. we are being told vaccines are

effective against the variant and then you have health professionals saying it is a scary variant. you should be more careful, even if you are vaccinated. what is the consequence for vaccinated individuals if they come into contact with the delta variant? andy: the outlook is good. even if you are vaccinated, you have a less likelihood of getting infected. a much lower likelihood of symptomatic disease and an incredibly low likelihood of getting severe disease, meaning hospitalization or death. the vaccines are working. the data indicates they are working well against the delta variant. you are in a good situation. the data that will be coming out is going to be essentially pretty clear. when vaccinated people get infected, they pick up the infection from unvaccinated people. more and more we are seeing that the unvaccinated population is posing a general risk to the population with respect to whether or not you are vaccinated or not. this really comes down to a

better method of communicating the safety and efficacy of the vaccine so we can get that vaccination rate up. that is going to solve a lot of problems. kailey: if you were advising the biden administration, president biden said he is waiting to hear from his people about reopening travel with europe and we should have an answer in the coming days. would you tell him not to do that given the concerns around the delta variant? andy: i think travel is the lower end of the concern. we have the delta variant here. we need to think about ways that we can limit the spread of this virus here in the u.s.. one of the things that i think might be important for us to -- in terms of getting more trust in the vaccines is to get full fda approval for the mrna vaccines and the j&j vaccine here in the u.s.. a lot of people are waiting for that final stamp of approval before they get the vaccine. we need to move that forward

faster to really reassure people that the data we are seeing here about safety and efficacy is really overwhelming and there is no real reason for us to keep using these emergency use authorization's. we should approve these vaccines. kailey: we are waiting to see if there will be emergency use authorization for children under 12. do you expect that and the future as we get closer to the new school year? andy: absolutely. i expect that the mrna data, the vaccine data from pfizer and moderna is going to show really good efficacy in those younger populations. those children in schools are going to be the critical thing right now as we think about the fall. we expect to see a bit of a surge in the fall anyway as people move more indoors and schools are going to be an environment where the virus spread could be maximized. it is great to see the data showing that kids are less susceptible to severe disease, but they are not resistant to disease so we have to think

about protecting those populations, especially if we are going to put them in situations where virus spread is going to be optimal. jonathan: what would it take for you to endorse the position of individual responsibility and move away from these broader societal measures? andy: i think it comes down to vaccination. i cannot stress enough how wonderful the data is on vaccine safety and efficacy with these covid-19 vaccines. they are successful beyond the wildest dreams of any clinician or scientist would have said a year ago. we have to find a way to get this into the population more broadly. jonathan: let's hope that move in l.a. county does not move things the other way. andy pekosz of johns hopkins, thank you. things get more confusing, lisa. lisa: there is an idea of should we just be afraid forever. when is the end? if they are vaccinated, why do they have to go backward?

you do wonder when does it become an issue? jonathan: if we are going to be masking forever, we can talk about this through the next couple of hours. from new york city, good morning. 43.57 on the s&p. equities advanced a little more than .1%. this is bloomberg.

>> one of the key sins, our stocks -- key questions, our stocks in a bubble? >> the credit card spending data is going to start shifting to the business sector. >> consumers are understanding that what happens this year is not what we should expect next year. >> it is pretty clear that whether it be the september meeting, jackson hole, the fed is going to have to address the tapering. >> i think it is time to end these emergency measures. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: what a fascinating week. from new york city, for our audience worldwide, good morning. this is "bloomberg surveillance ," live on tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. tom keene back with us on monday. joining us this morning, kailey leinz.