peak in rates. there could be another 20 point run. >> inflation is transitory. >> you get that sense that a lot of traders will be caught offguard. tom: from new york city, for our audience worldwide, good morning, good morning. alongside tom keene, i am jon ferro. lisa is back with us next week. equity futures down 26. tom: too many people tell me monday is boring but it is not. the markets are fascinating.

they scream global slowdown. john: back to where we were in february. it is not just the bond market. it is foreign-exchange and dollar strength in the mix. tom: i know we will get to that in a moment. so many of -- it may be a critical time to decide which way we go. jonathan: we have to talk about the airline stocks as well. travel in europe is getting hammered. kailey: it is not just the airlines. it is the cruise lines as well. carnival, norwegian. jonathan: the president of the u.s. said it could be several

days before we find out what happens with travel. tom: on covid, i felt a seachange in covid. los angeles back to masks outside. this was an important weekend for the exhaustion of an 18 month pandemic. jonathan: your trading week starts right now. into the bond market we go. a little bit earlier in the session, we had a 124 handle. kailey: i want to talk about what we will get later today. at 10:00 eastern time, the housing builder sentiment indicator. it was 81 last month.

you have a rise in cost. lumbar futures down from june. we will see if that sentiment reads through in the data today. it is a big week for earnings. ibm do after the bill -- after the bell. i bet we will get some questions about the leadership shakeup. kim whitehurst who came to ibm is now gone. the first real shakeup under the new ceo. final think we are watching, it is freedom day in the u.k. it may not be as happy of an occasion as some i thought. 47,000 new covid cases in the u.k. on sunday. the health secretary has

covid-19. boris johnson is in isolation. it is freedom day but i am not sure people in the u.k. are feeling all too happy today. jonathan: t wave very much -- thank you very much. tom: do you know what is amazing about this? only jordan rochester what hedge his wedding. congratulations. we'll talk about the wedding that will take place in several days time. the dollar is back to where it was in march. this is a different kind of dollar strength. why is it different? jordan: in q1, we saw the big

move in u.s. yields. each time you test the resistance level, the support level gets weaker. when we get to the q3-q4 outlook, it is much harder. the next trade, you have credit impulses slowing down. that is the fiscal and credit side. then you have consumers. now is not a good time to buy a home or a car. we are seeing folks not being able to go into work because of covid cases. there is a chip shortage shutting down factories.

then you have what is going on in china. tom: good morning. i am absolutely fascinated, the great distinction here is this has been an adjustment in real rate expectations. a -1.12 would be a record low. how much is this about inflation adjustment rates versus all of the other mumbo-jumbo? jordan: what really works is the real way -- real rate.

right now, euro-dollar is trading 1-1. the problem is, it is all about fed timing. we might get a maximum in fed pricing. if you get the slowdown -- i am struggling right now. the charts i look at -- we are

in this painful macroenvironment. kailey: the one exception that is stronger against the dollar is the japanese yen. july, the start of the third quarter, has been pretty solid. what do you think the trajectory will look like from here? >> the dollar-yen should go higher. right here, right now -- q1, q2, that moves u.s. yields.

we are just saying the short competition squeeze -- seeing the short competition squeeze. jonathan: final question on euro-dollar. jordan: if we start -- very close to macron in the second round pulling. if we see lockdowns and a similar sort of environment that we saw in march, april, may. those are tailwinds. we need to see reasons for a

positive cash -- that could definitely drive it. jonathan: you can give us a comment on the wedding. where do you go? euro-dollar, 117.77. i have talked about this this morning. away from the equity market. are we 1% or 2% from all-time highs? tom: it is a global slowdown.

you are getting jordan rochester in trouble. what i see this morning, deutsche bank, carl weinberg will join us as well. both of them are looking for global slowdown. that is the monday headline. jonathan: the ecb on thursday just got a little more interesting. we might bring you the whole news conference as well. tom: jordan loves you. from new york city, this is bloomberg. ♪

>> opec allies have reached a deal to inject more oil into the global economy. saudi arabia met the uae halfway. it will start pumping more oil next month. boris johnson plans to get the u.k. back to normal, the plan is in disarray. pandemic restrictions are ending here in england today but covid cases are rising the most. 48,000 new cases reported yesterday. boris johnson -- reversed the decision. in germany, the devastating floods have shifted to the country's election campaign.

floodwaters searching for villages have shocked german voters. the conservative front-runner is vulnerable in his bid to replace angela merkel has created an opening for the green partner -- the green party. it will bolster zooms popular app against increasing competition. 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. and analysts in more than 120 countries.

>> what is important to help people understand that when you are talking about build back

better the infrastructure framework, you are talking about measures that put downward pressure on prices by helping to increase and improve the economy. jonathan: good morning. i am jonathan ferro. lisa is back with us next week. equity market down 32. coming off the back of weekly loss on the s&p, the nasdaq. the russell getting smacked around recently. it is a bond market weakened. you have to go back to spring for these kinds of levels. some dollar strength out there. tom: it is loony out there. the canadian currency is weaker against the dollar. smacked around for the small

caps here, you are absolutely right. look at the vix. i will not oversell it, but it shows you the angst of monday. jonathan: the consensus trade has totally broken down. tom: never on vacation, annmarie hordern. i think the image i saw in the post or the times of senator portman. there is chaos on the bridges and tunnels, right? >> i know the picture you are talking about. it looks like an opec scrum. he did get away but conversations continued. senator portman said he has been in touch with the white house and the cbo and with other

senators that are part of his bipartisan infrastructure deal. like you say, there is chaos. chuck schumer wants to go with the procedural motion to get the wheels working in order to get this on the floor on wednesday. they still do not have a deal. they have not sparred away how they will pay -- squared away how they will pay for the bipartisan infrastructure deal. tom: i do not know if you have seen this. 10 minutes ago, the conservative democrats are in absolute revolt. does the senate majority leader have an understanding that a quarter or a third of the democratic party is just saying, wait a minute, we have to get reelected? >> it has been quite out there and vocal under the press. senator joe manchin has said i have not seen a single document yet.

how do you expect me to give my blessing for this to go ahead? this procedural stuff. they would be debating this legislation. this is what some of the holdup is. the senate moderates, the democrat moderates are saying we will go for the partisan infrastructure deal and we will also vote for reconciliation. as long as the progressives sign up for the bipartisan. the progressives are saying, if you do not put what we like in it, we will tank your bipartisan deal. it will be some interesting days and weeks in washington. jonathan: what is the ultimate objective of wednesday? >> to get the bill on the floor to start debating it. republican senators arson, we want to make sure -- are saying we want to get right, not fast.

he is saying, we might need a few more days. they want to make sure when it comes to the floor, they can get it to the procedural vote in order for it to begin debate. they say it is not even ready for that yet. potentially, senator schumer's timeline might be pushed back. i think senator schumer is setting up a timeline as quick as he can to force negotiations. we all know how these deals work. everything happens at the last minute. kailey: why does it happen to happen -- why does it have to happen this week? >> this is the timeline that senator schumer put forward and there is in august recess. senator schumer said if we don't get it done, intentionally, there will not be an august recess. you can cancel your vacations

and holidays. they want to get it done before the end of the year. kailey: what about the debt ceiling increase? >> july 31, they need to make a decision. democrats could potentially put the debt ceiling limit part of reconciliation but there has not been a whole lot of discussion. as we get closer to july 31, this will start to overtake the infrastructure headlines. jonathan: i think language matters. the administrator -- administration going with the language continuously. >> they want to get out in front of these communities that are not getting vaccinated, that are skeptical of the government, skeptical of science. they want it to be led by local

pta meetings and local physicians. what they are saying, they are taking a sharp tone blaming it on social media. a lot of senate republicans are saying we need to take a more localized approach. this administration wants everyone vaccinated and you can see that in the numbers. the places where the vaccination rates are not high, you have the delta variant taking control. even canada, who had such a slow start of the vaccination rollout, is ahead of the u.s. when it comes to vaccination rates. jonathan: good to see you. down in d.c. equity futures down 32.

politico this morning, schumer channels his inner mcconnell. tom: he is grabbing this through. he has minimal support. they are not all on board with the senate majority leader. what do you make of that? kailey: i feel like we have a tendency to blame everything on joe manchin these days. as soon as i see anything in washington, i think, what does joe manchin think about that? jonathan: tenure is that -- 10 year is at one under 25. -- 125. tom: 99 basis points. that is a huge deal. jonathan: five basis points away

from that. we have to talk about a growth scare. i am not comfortable calling it that. we will have that conversation with carl weinberg next. from new york, this is bloomberg. ♪

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jonathan: live from new york city, fascinating start to the week. stocks move lower, down lower on the s&p. negative a third on the nasdaq. small caps getting hammered. small caps dunnigan 1.75 percent -- down again by 1.75%. your 10-year, one to 24 handle very briefly. -- 124 handle very briefly. 187 on the 30-year. yields lower, curb flatter -- curve flatter.

what is the bond market saying? euro-dollar with a 117 handle. the lows of march, 117, that is when we had the yield breaking down. very different kind of dollar strength this morning. much more defensive about the global economy. euro-dollar back to where we were. this is a different kind of dollar strength. hbc -- hsbc. for the ecb to say, no rate hike until the end of 2023. to formalize that, any kind of guidance would be quite a step. tom: there is a difference with

this dollar strength right now. 93.00. bloomberg dollar index out even more. on the russell 2000, 46%. it is down about 8% from recent highs. if you have concerns about the global economy, this is the interview of the date. carl weinberg is with us. a tour de force note this afternoon. one of the fundamental things you do is partition the u.s. and china from everyone else. why do you do that? >> the u.s. and china are growing right now. we are looking at industrial production, gdp figures, consumer spending. forecasts are not that great.

i am afraid the world economy is more a reverse j shaped recovery. tom: will the global slowdown you write about -- is that enough to affect powell's domestic policy? carl: central bankers, the thing that worries them the most is not inflation. they are worried that the world is going to fall back into recession or to a period of subpart growth. -- subpar growth. that is a nightmare scenario for central banks.

their job is to minimize the chances of the worst possible outcome. that is the worst possible outcome. that is why all central bankers say the conversation is in the future. jonathan: the winds of global recession are already in the data. people might be saying, which data and where? no sign of insufficient demand anywhere. what is the kind of data you would look for? carl: a lot of people are looking at tmi's. we have to remember that it is the economy that causes the pmi to move. everything that matters is grown, hammered together, or dugout of the ground.

industrial production charts -- all of them are pointing downward and all of them are continuing downward trends that started as long ago at the end of 2017, early 2018. it makes me think that we are in the process, a longer-term process of industrial decline that has a cyclical component. industrial production is lower than it was in march of 2008, except in china. you may want to connect the dots and view it as one longer-term episode. we still have to fix what is wrong. jonathan: can you help me understand the timeframe? when you talk about the cyclical downturn in the future, what is the timeframe? carl: let's start off with the immediate problem.

we are lower now on industrial production that we were in february of 2020 before the pandemic and we are not getting close to those levels. the longer-term problem is that we are also lower than we were in 2008. if you cannot the dots and the regression line from 2008 2 today, it is pointing downward. and that is a longer-term problem that involves infrastructure and demographic trends. kailey: can we talk about the physical part of this -- fiscal part of this equation? how do you factor in that long-term spending? carl: that is a really good question. you have to separate the long-term issues from the short-term issues. in the longer-term, the only way we are going to grow in any meaningful way -- our population

growth is slowing and productivity plus population growth gives you long-term economic growth. i think it is great for the longer-term outlook to get more investment spending in there so that over the next decade, we become richer instead of poor. in the short run, that is not going to help very much. the impact on gdp in the short-term term will be relatively small. that is the most important reason for moving forward quickly. it is a shorter-term problem. it has its roots in credit growth outside the u.s., which is flat or down in most of the economies i am looking at. kailey: while we are talking about economies outside the u.s., it is freedom day in the u.k. it should be a happy day,

restrictions are being lifted. not so great if the case of covid -- the cases of covid are increasing. carl: you are asking me to look into a crystal ball. we have never seen this before so we do not really know. we are getting anecdotal evidence that companies are having a hard time operating. 50,000 new cases a day, generating 500,000 absentees from work. that is causing production chain problems. this is something we have no basis to evaluate because we have never seen it before. at the end of the day, and the very short-term, the course of the virus is the most important short-term consideration. much more important than interest rates. tom: what is the timeline of getting u.s. gdp back to

something on the edge of normal? under 3%? is that sooner rather than later? carl: it is later rather than sooner. 2008, when everything went better after 2009 and still took us three or four years to get gdp back to where it was and to get the unemployment rate back to where it was, it took almost a decade. economies do rebound. and italy, they rebound quickly -- initially, they rebound quickly. this is a marathon not a sprint. we need to get the unemployment rate back down to where it was. this is what central bankers want to ensure. jonathan: good to hear from you. the chief economist and managing director on a less constructive

view of the global economy. equity futures down 33 points on the s&p 500. yields, lows of the session. tom: the real yield spread goes to an ever greater negative. moments ago, u.s. olympic gymnast tests positive for covid in japan. nowhere in the article do we say that they are vaccinated or unvaccinated. i don't get it. how can you be going to the olympics and not be vaccinated? jonathan: a lot of athletes chose the j&j vaccine, which may offer less protection. tom: it is bizarre. we have to focus on two things. cases are up, how does policy is

find? policymakers are starting to respond. kailey: you are saying that in l.a. county. you are seeing in the u.k., reopening. there is not much appetite to return to restrictive measures. i am not sure there is public appetite for that. jonathan: have we broken the link between cases and hospitalizations and deaths? that is a conversation we need to have. if you are just tuning in, equities are down. 125 on 10's. from new york, this is bloomberg. ♪ >> opec and its allies have

overcome an internal split that threatened its control of the oil market. they reached an agreement to inject another 400,000 barrels of crude a day into the global economy. saudi arabia met the uae halfway. the american father and son team -- they are going to prison. they pleaded guilty to aided -- u.s. companies in hong kong want assurances from china. that is after the biden administration issued a warning about operating there. the president -- the free flow

of information will continue. bill ackman will buy a stake in universal music group with his hedge fund. his holding will buy 5-10% of the music label. 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.

>> for children under 12, and i say this as a dad, our kids

depend on us being protected in vaccinated in order to shield them from the virus. that is why it is so important for us to get vaccinated. jonathan: the u.s. surgeon general on abc this week. good morning. lisa is back with us next monday. another weeks vacation. she deserves it. we are down 31. -7/10 of 1%. some dollar strength out there. yields are lower, down for basis points -- down four basis points. you mentioned real yields. -1.1, if you round this one down. if you look at where the lows were, we had 112 at the start of

the year. the positive growth -- we have unwound all of that. tom: there is a deterioration -- we have not seen a bid off of this caution. the vix down two points. this weekend was different in the great stretch of this natural disaster. we are thrilled to bring in our guest from johns hopkins bloomberg school of public health. mr. bloomberg leader and owner of this radio and tv operation. you were at harvard medical. you were at boston university hospital. you studied -- there was no

social media. how did guys like you and your profession adapt to virology and microbiology in the time of social media? >> we are seeing how challenging it is. the misinformation that is out there, the fact that people are hearing again and again and again things that are thought -- that are flatly untrue about the virus. it shows how important it is. we do not have that partisan divide on penicillin. we have it on the covid vaccine in the middle of a pandemic. they are not all the same. there are a couple of different ways of looking at them. there are still people who are open to getting vaccinated. they want it to be convenient. i have met them.

i see people who say, this is so easy because i can walk down from my house. that is great. that is why we are doing this big outreach campaign. other people you have to spend time with. i've been talking to people at different workplaces or friends of friends call me to talk it over. after a conversation. some people are -- they do not want to get vaccinated. that number -- initially, it was in the 10% range. it may be higher now with the misinformation. people get covid and they almost die and you say, what do you think about getting a shot? and they say, not so sure. how can you have that view given that there are 150 million plus people who have been vaccine

safely. it is really difficult. jonathan: we have to have a sensible approach to these conversations. there is a difference between anti-sirs and people who are just -- anti-vaxxers and people who are just hesitant. >> i do think it would help and it is important for the u.s. food and drug administration to be really explaining the process. what is the difference? what data are they bringing in? what is the timeline? a lot of people are confused. there should be more transparency. i think that will affect some individuals who are waiting for that. it will affect businesses a lot, particularly businesses who are

wondering about requiring vaccinations for their employees but waiting to see what the fda does. kailey: i was catching up with a friend down in florida over the weekend and she says that she knows people who are fully vaccinated and yet are sick and have been diagnosed with covid-19. what do we know with the surge of the delta variant? >> there is extraordinary protection against serious illness. it is not perfect, but it is very rare. i am guessing those 12 people did not get particularly sick. there is good protection against infection. people who are fully vaccinated, it is in excess of 90%. that does not mean there are people who are not exposed.

they might get a little bit sick or test positive, for example. in general, if you are vaccinated, very unlikely. jonathan: good to catch up, important conversation. we have to do a couple of things. let's start with the robinhood ipo. kailey: 55 million shares. the founder and cfo -- we have been waiting for what feels like a really long time for this robinhood ipo. we got the prospectus a few years ago -- a few weeks ago. jonathan: some of the numbers to look at. this coming this morning across the bloomberg terminal, china's state security involved in cyber intrusion.

four chinese nationals have been charged with computer intrusion. tom: this is from the department of justice. i looked to get an update on huawei and these fractious relations between china and canada and the u.s. that vancouver process is still in process in vancouver and now you have got this. jonathan: when these things play out publicly, more signs that there is a breakdown between the u.s. and china. tom: this is one discrete headline. nevertheless, frankly, it does fall over to what we do here. jonathan: that is a developing story. equity market lower on the s&p. a week of losses turns into a

morning of losses. -32 on the s&p. yields are lower, too. the dollar is stronger. from new york, this is bloomberg. ♪

that money will enable many people to go out. >> we have a framework. we have a new framework that is unanimously approved by the governing council and we are going to look at, as we always

do, every six weeks, we will look at the circumstances. what foreign guidance to revisit. we will look at the calibrations of all of the tools we are using to make sure it is aligned with the new strategy. given that the persistence we need to demonstrate to deliver on our commitment, for guidance -- forward guidance -- >> do they give you extra tools? >> it is going to be an important meeting because we are going to

♪ >> we may once again be surprised in the second quarter to see earnings much stronger than maybe we thought. >> we are going to see the economy move to excess demand. >> i think we have seen the peak in rates for the cycle. there could be another twin peak later on. >> we think the fed is correct that inflation is transitory. >> we do get the sense that they are looking towards tapering there at a -- tapering their asset purchases. a lot of traders are going to be caught off guard. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: it is a risk off monday morning. from new york city, for our audience worldwide, good morning. this is "bloomberg surveillance ," live on tv and radio. alongside tom keene, i'm jonathan ferro. lisa back with us next week. kailey leinz with us this morning. tom: