increases. >> are they transitory or are they sustained? >> we have taken well from the public sector and given it to the private sector. >> in this world of great uncertainty, if you are pushed by what happens -- >> this is a bloomberg surveillance. jonathan: from new york city, for our audience worldwide, good morning, good morning. this is "bloomberg surveillance." alongside tom keene and lisa abramowicz. tom: i got it right once 10 years ago and vowed never again. you know the office pool. lisa bought 5000 square feet. jonathan: equity futures up a single point. tom: i am sorry.

lisa bought 5000 square feet on the upper west side because she got the pool right three months in a row. jonathan: and cute. do you want to continue? -- thank you. do you want to continue? tom: our job is to put into perspective how important this jobs report is. jonathan: we had 50 k at the low end. -- 350 k at the low end. tom: i was in a cab in new york city yesterday and the cabdriver was adamant that the reason you don't see more cabs on the street in new york as they are home on unemployment. jonathan: plenty of demand. lisa: just to do a brief fact check, i did not buy 5000 square feet on the upper west side. going forward, the question is why there hasn't been a faster flow into the labor market.

people blame the advanced unemployment -- the enhanced unemployment. but those who dropped out early have not seen an uptick of people into the workforce. jonathan: you take a break. equity futures up a single point on the s&p. yields up to basis points on a 10 year. going into payroll, the median estimate in a bloomberg survey 858,000. do i do this for the next 90 minutes? -2/10 of 1%. lisa: that is the uncertainty with respect to the data. we are getting alive payroll report at 8:30 a.m.. how will the market respond? we have been talking for weeks about what happens if it is upside. how big of an upside surprise

doesn't have to be before they think of tapering? a sinner taper means lower long-term growth -- a slower taper means lower long-term growth. president joe biden will speak about the jobs report. how much is he going to spin this into the infrastructure vote this weekend? will he say look, we need to create jobs and fundamental infrastructure for this country. how much will he lobby and signify unity in the democratic party with a reconciliation bill hanging out there? at 1:00, one of the more interesting features of the recovery. we have seen discipline and they have not come back online with rates quickly that some would have thought. how much has that changed as we get a period of stalling out in one of the biggest weekly

declines of oil prices as people look at asia. something a lot of people are looking at. jonathan: lisa, thank you. it has been rough. let's bring steven wieting in -- let's bring in steven wieting. let's talk to the chief economist over at city. what are you seeing? steven: we are looking for a strong report for the month of july. i would tell you the message you are getting from the bond market, that there are somewhat larger risks beneath the surface and employment rebounded in the first half of the first half of their will not be sustained in the second half. the delta variant, we are taking

very seriously. hopefully it will be a short-term surge as you saw in the u.k.. the gains in the hospitality sector but with the employment data being critical, take a look. numerous things are important. what happens in august and beyond is what markets should focus on. tom: on trade and international economics, you on the high ground on linking the american economy to corporate finance and profit. the big surprise has been how corporations have adjusted to deliver earnings. with your economic view, do you suggest corporations will be malleable and continue to adjust toward profit and cash flow? steven: adaptability across the

economy has been amazing. there are small pockets of distress. hospitality and leisure, there is no joy. international travel, still incredibly weak and has been trying to rebound. for the most, the economy across the country has not stopped. technology has really allowed companies to adapt. we have had more than 60% growth in the first half of the year. that cannot accelerate from here. is our ability to continue to grow and model and get past this crisis a good story? i think it is. lisa: when we hear about the uncertainty in the labor market and it raises the question of why we have seen -- whatever happens they will provide a backstop and if there is weakness there could be a bigger fitted -- fed mean rallies more.

how much do you bet on the ongoing fed pushed no matter what? steven: i don't think there is much in the long run here. if you take a look at the levels of asset prices generally across the whole world, every asset class, would we be here, 4400 on the s&p 500? had we not had massive macro stimulus. this whole terrible event for humanity has generated asset price inflation. that is not a horrible story for where we will be in the longer run. but the longer we persist with monetary policy easing deeper into recovery, to create some sort of risk if this persists in this is one of the reason why

yields, thinking about normalizing later in an economic recovery, that is one of the reasons why we are not getting long-term yield pressure. jonathan: do you think some of these issues bring will overwhelm the cycle? steven: hopefully it is marginal. the delta variant went out fast in india. it is fortunately apparently leaving the united kingdom but is rising in the united states. the federal reserve would have been your probably -- would have been here probably looking to normalize monetary policy at the middle of this year. the fact that there is the delta variant having negative effects across the economy, is this a reason to hold off? they probably doesn't matter much in the long run but we can't say that for certain. tom: let's get out of the research of monday. you are not on speaking terms with tobias levkovich.

you have a bond call toward higher yield. what is it 2%? jonathan: looking at a move back to two. tom: dovetail your economic view. steven: we think that yields can rise some, but i think the range, for the reasons i said, the uncertainties probably limit the extent of us reaching what we thought of before, during the middle cycle period going forward, 10 year yields to be 2.5%, that we could reach 2% by year end, probably puts that off some. if the federal reserve tightening later in the cycle, it makes it harder to reach those targets. on equities, we feel good about the u.s. market. the fact that growth stocks have very little comfort tissue from the bond market period, -- very little -- from the bond market

period. that continues to be the story and we have the strongest, not encyclicals but in health care shares. jonathan: -- not in cyclicals, but in health care shares. jonathan: we have to leave it there. dead flat, unchanged on the s&p 500. talking about the federal reserve and political influence. senator manc saidh,in -- manchin said, i am concerned it will lead to inflation that the hard-working people cannot afford. tom: what is more important is the cbo came out yesterday and

agreeing with him, the infrastructure bill will do a quarter of a trillion dollars adding to the deficit over 10 years. it is not just powell but senator manchin and the others. jonathan: it is running hot. lisa: it is interesting that he decided to release it now. it is the infrastructure vote perhaps that he is speaking to. jonathan: we will head down to washington, d.c. and catch up with our correspondent. coming up, the former new york fed president and bloomberg columnist, ahead of your payrolls report. equity futures unchanged. yields up three basis points. from new york city this morning. good morning. this is bloomberg. ♪

>> the senate set to approve the infrastructure package, the largest infusion of cash in decades for roads and bridges and mastic -- and domestic projects. they will hold the bill until they vote on the largest package. today's jobs report is likely to show the u.s. added just about 850 8000 jobs last month. the rollout of the vaccine has encouraged businesses to reopen. more than 30 u.s. trade groups have called on the biden administration to renew negotiations with china and remove tariffs. they say they are hurting the american economy. those groups include the u.s. chamber of commerce.

the fastest pace in 24 years, increasing competition and jobs opening with the loosing of pandemic restrictions. struggling to fill gaps in workforces. china reportedly will pay a billion dollars for abusing market position. they will be required to revamp operations. it is the latest in a series of crackdowns on china's tech industry. global news 24 hours a day, online and at quicktake on bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. ♪

tom: -- we are near the top end of the range.

>> i am in the 750 area. >> i feel it is a good estimate. if anything, there is a favorable seasonal factor. >> i think the seasonal factors are a little screwed up given the volatility last year. jonathan: this is such a difficult one to call. the guesstimate so to speak. all-time highs on the s&p 500 into friday. equity futures this morning basically unchanged. we advanced by 0.05%. u.s. 10 year yield has been all over the place through this week. here we are near the highs, 125.83. tom: is this any different than may 7? jonathan: you think this smells like may? tom: i don't have an opinion why is it different?

jonathan: where we will be right back. then? i think that speaks -- where were we back then? i think that speaks volumes. tom: washington focused on this infrastructure bill on a quarter of a trillion dollar expense. last night i was looking through the 2000 pages and i noticed on page 649, there is a very important paragraph. you have to be from england to know that it is a low-lying dam that is important. does anybody know what is in this bill? >> yes, everyone knows what is in the bill. maybe not to the extent that you do quoting what is on page 649, but it is the structure we have been talking about in this

country for weeks in terms of this deal, but maybe other ministrations, it is bridges, broadband, highways. tom: in honor of the wonderful richard president trump and his tragic death -- richard trumka, and his tragic death will it create jobs? >> it will create jobs and you are investing into the economy. it is said to add $256 billion to the deficit. the potential republicans that do not want to increase the deficit they may not get those votes. but they do not calculate some who work on the bipartisan agreement say the long-term macro economic effect of this, things like adding to the jobs, the boost the economy that they are not focused on. jonathan: the one key voice to this. what is senator manchin up to

writing to the fed chair? annmarie: i was surprised by this. he notes what the fed is doing, saying they need to pull back on monetary policy but also the fiscal stimulus part of this. as we go to the bipartisan deal that is expected to pass, we will have the democrats go to their budget resolution and then it will come back to discuss the budget reconciliation. i think this is his warning shot saying that $3.5 trillion is too big. the other thing intentionally, is this a nod, as we have been talking about for weeks, is what will happen with fed chair jerome powell's seat when his tenure is up. is this him saying we need to keep a hawkish fed? lisa: does senator manchin --

and urging them -- have company in urging them? annmarie: he has company on the republican i'll eared in his own party, -- on the republican aisle, but he does have some moderate democrats. i would point you to the arizona democrat, kyrsten sinema, and they have been in lockstep with a think the party is going and the direction of the economy. lisa: can you give us a sense of the process you will have a vote on the infrastructure bill house speaker nancy pelosi said she wouldn't bring it to a vote if there wasn't another bill having to do with the pre-$.5 trillion act -- with the $3.5 trillion bipartisan act they are sitting.

annmarie: it was sent this morning that the procedural vote and then they get 30 hours of debate. we could see some amendments being added. likely the end of the weekend and the beginning of the week it will go through. this is what the red line speaker pelosi has said that she will not ring the bipartisan in the structure agreement to her chamber unless there is reconciliation. what happens next in the senate is that senator schumer wants to bring forward the framework of the reconciliation. they want to get out of washington for their recess but the resolution in terms of what that could look like. september will be huge in terms of how this two-pronged approach is going to go forward. jonathan: we keep hearing about september on every single issue. thank you annmarie hordern.

senator manchin writing to the fed chair saying that the proposal for additional stimulus will lead to our economy overheating. the chairman receiving a letter from the senator on unwinding qe. lisa: just to give a sense of the timing, the fed is not meeting today. they just had their meeting. perhaps it singles more to the infrastructure vote over the weekend than it does the federal reserve. perhaps giving some color to the jobs report we are going to get. jonathan: another jobs report on september 3 and the fed's meeting on september 22 hearing -- september 22. we have some things to get through. tom: this is really important. it is not a three-month moving average. each of these reports is

discrete. i have to believe that everyone involved in this project is doing just that and saying wait to see for the first week of september. jonathan: we are distracted by the jobs. what are the most read stories on the bloomberg terminal today, a departure is a mess that everyone can see. messy, ugly, one-off if not the greatest player for barcelona. they admit they have to let him go. he says the following, is this how you run a business? the bill currently represents 95% of our income. that is the barcelona president in a news conference. tom: it sounds like my tuition bill. can he keep it going? jonathan: i think he has a few good years left.

tom: you are killing me this morning. jonathan:, and the next hour putting things straight in the jobs market. we will catch up with a chief economist. good morning on this payroll's friday. this is bloomberg. ♪ is bloomberg. ♪

jonathan: live from new york sitting for our audience worldwide, morning. payroll's friday, looking for something around 850,000. record highs and europe on the s&p 500. right now, futures positive. 0.05%. on the nasdaq, softer, down 0.14%. 2, 10, 30, 112.58 for a brief moment on wednesday. looking for a big range in terms of estimates on payrolls. north of one million at the top and peered what with the central bank do? you take -- at the top end. what will the central bank do?

let's go to the board. the line that keeps coming from governor low in australia, they are not think about raising interest rates into 2024. that is the conversation down in australia, down under, the aussie dollar. 0.73.92. weaker by .2%. tom: are we starting to look at 23 or 24? over the weekend with this jobs report, you get a look at 2023. jonathan: my favorite line is the most important payrolls report since the last one and until the next one and we are still going to get to september before you get to the september 22 meeting. tom: if you do aerospace at university, guess what, you think about dynamics.

carl riccadonna our chief economist is truly an expert. he is looking at the dynamics of this american economy in a single mathematical phrase, we are lurching lower. he joins us now. how are we lurching lower? carl: we are seeing a point where we passed peak growth and we need to consider the dynamics around inflation and weight pressures as we look at and economy that maybe will grow -- looking at an economy that may grow 7% this year and maybe half as much next year. some fat hawks are talking about raising rates and we are looking at an economy growing 2% of the be a strong case to raise rates when it is growing at 2%? tom: what is the lurching now on the people out on unemployment

for the conservatives make a huge deal about this. carl: folks that have been looking at initial claims have had real problems with her casting models for job creation, because -- with their forecasting for jobs creation. what is a driving factor is the shortage of workers and those workers in low-wage jobs where they can basically get just as much money are close to the same amount of money by staying home and collecting unemployment checks. we have seen an increasing number of states ending the expanded jobless benefits, which we then go to presumably at least some individuals back into the labor force. if we look at the collection of continuing claims plus the pandemic assistant claims and emergency claims that were added on during the course of the crisis, those have finally started to lurch lower, which means enough states have joined

onto the bandwagon of eliminating the expanded claims. there really is going to be a meaningful drift, about a 2 million person decline between the months of june and july, almost double the pace of the prior month. i don't think we need to wait until september peered we are starting to see strong down grasp already. jonathan: what if, i want to understand how the federal response to the following conditions, what if the supply side constraints persist to this year into 2022? how do they respond to that? carl: i think we are starting to see evidence that that is the case. we need to look no further than the last in gdp numbers, huge inventory drawdowns in the second order. that will not be alleviated in the next quarter or two. kind of squeezing the toothpaste

to, squeezing some of that growth into the back half of this year and some into year. and with microchip shortages looking on a longer time horizon for a resolution. a realistic scenario, but the fed has told us as long as it is jay powell's fed as i assume be the case, the fed will continue to look beyond those supply shock disruptions and thinking about price pressures in the economy, and that is the correct approach. if it stretches longer, than transitory becomes a little hotter and longer than they anticipated, but the demand-side inflation rushers really will motivate the fed to say things are getting too hot. lisa: what can the fed do if this is a supply-side constraints? what does easy money policy help

with that particular issue? carl: in a longer run, it doesn't fix it in the quarter of two, but holding interest rates lower, that reduces the cost of capital and enables businesses to go out there and make the types of adjustments to expand capacity, invest in equipment and software, and address the higher level of demand. they build the infrastructure to basically address that. lisa: he doesn't think the balance will shrink and will probably grow in line with the gdp. do you think that is a realistic assessment, that we have moved that we need a central balance sheet that is a commensurate size with the gdp as they monetize increasing debt? carl: the fed has held its card close to its vest on this issue and have been pushing this issue to try -- i have been pushing to get answers.

when tapering is done, do we decrease the size of the balance sheet potentially in concert with interest rate increases or do we wait and grow into the balance sheet, which is pretty much what happened after the last crisis, a little bit of shrinkage. i think the fed policymakers and central bankers in general are increasingly coming to the view that in a low interest rate regime for the fed will be constrained by the zero and not entertaining negative interest rates, that they will have to lead -- lean on the balance sheet more peered they do want to shrink it but just the dynamics and natural occurrence of recessions in the economy will prevent them from shrinking it too much. i don't know if it needs to grow with gdp but you will see the balance sheet continue to expand even once we have gotten past the tapering and the reductions where we currently stand. jonathan: news from singapore, singapore to resume entry

permits from workers and to allow dying in -- dying in -- di ne in. tom: why is the united states different question mark i looked into the numbers of hospitalizations in america, whether it is singapore, indonesia, mississippi, florida, it is every state for themselves. jonathan: headline from yesterday, black-market and wells fargo pushing back on return to work. we have seen this increasingly by big american countries peered what does that mean for your calculation for this recovery? carl: what that means is we can consider a very light version of the kind of lockdown returning your you mentioned amazon and other large companies. i saw a headline that garth brooks contemplating whether

he will have his concert. we are looking at a guard works phenomena -- a garth brooks phenomenon where people are afraid to fully reopen the economy. they may be going back to work and many kids are in school, but whether they are taking a cruise or going to the music park or sitting indoors in a restaurant or crowded theater, those will continue to be depressed. when we look at the mobility metrics and things like open table reservations and whatnot, we see things are starting to roll over and some of that garth brooks effect. i don't see it happening in today's report but could be a phenomenon we have to look at and continue to weigh on that. tom: i just threw out all my big vertical striped

shirt. -- shirts. jonathan: country and --carl: country and western. tom: let's go back to the goldman note from a couple weeks ago. remember we were talking about the outlook for the u.s. economy and why the core of that piece was about delaying a full-service sector recovery. the delay of blackrock and wells fargo, just a couple of companies, and there are others but it speaks to that. tom: it is going to be in the data. as carl started his conversation, from a boom economy and then middle road, and it was said score down under 3%, why not under 2%? that is unimaginable now with 7 million unemployed. jonathan: so difficult to make a

call on the economy. lisa: i wonder how much people are going to look at this and say it is backward looking and we have to look forward. the data does look downward when you look at airlines. a chief economist saying that credit card and debit spending was materially down in the past week. we don't know how much this had to do with the delta variant. it is a moving target, quickly moving economic recovery. jonathan: this is the target, 850,000 going into payrolls. your payrolls a couple hours away. all-time highs to friday on the equity market peered futures up on the s&p 500. we are at 0.04 percent. this is "bloomberg surveillance." ♪

ritika: the senate headed toward a weekend vote on the infrastructure legislation. senators were on and off the floor discussing final changes to the bill which is 2700 pages long. if it is past, it faces an uncertain church in the house. the delta variant slowing the pace of u.s. economic recovery. bank of america says it will pull back credit card -- a pullback in credit card is likely due to the surge in cases. talks begin with last year's oil prices tumbling. iraq is looking reactively to help cover its budget deficit. a quarterly profit missed estimates, concern that gaming demand may be peaking as we emerge from the pandemic.

jobless fell. a thousand salaried positions for an automaker. ford is trying to realign operations while transitioning to electric vehicles. the company has 182,000 workers. global news 24 hours a day, online and at quicktake on bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. ♪

>> how do you grow? >> after the crisis of covid-19, everybody is concerned about health, in particular when it comes to the question of how you get very fast access to the health system? how do you have a very good health coverage given illness has increased and longevity is

still increasing. access can help to gain access to the system to find hospital and help the patient. we see this is very much on the rise. >> how does the spread of delta in the u.s. and the threat of more variants, how does that impact your outlook? >> it is true we are all confident. >> the big issue that we mandate

is we have to mandate it for writers -- riders. for a company to mandate ex nations over 100 million people moving around is probably the right call. we are going to work with performance, based on mandates and we are going to follow them. jonathan: the uber ceo. anyone who has tried to order one knows that company needs drivers. this is "bloomberg surveillance." here is the price action, on the s&p 500, 0.04 percent into the bond market peered huge bid for about five minutes. deals are higher by three basis points. euro-dollar 118.10, negative 0.2%. tom: from where we were two weeks and two months ago, we have seen a dampening on everything but equities.

we are going to shift on this jobs day. you just heard from the gentleman from uber on the pandemic. i want to go to the leadership necessary as we just heard from the ceo. i can take it to you where we got the horrific issue that the father supports arsenal and the kids support manchester. do you see in italy, it says you've got to be vaccinated to the players. >> there are lots of paths forward. i know we worry about delta. i worry about delta a lot. there are paths forward. it may require a little bit of

individualization in terms of what happens. it may be that different companies want to put different things in place, staggered work weeks, vaccination mandates, saliva testing has turned out to be a quite efficient way of tracking initial cases of virus. there are ways we can get our economy back and going, we just have to be very creative in terms of how you do that. tom: did we have this argument with typhoid? andrew: no, but that's a very different disease, varied way of dealing with the infections, because of the source of the infection and how it's spread. respiratory viruses are by their nature very different disease to control because of the way it's spread, because of the contact that's needed to spread those viruses. so we have to think more creatively about this.

we also have to realize that this country right now has many different snapshots of infections. maryland is nothing like what is going on in louisiana florida. -- louisiana or florida. we have to have the interventions to what the gravity of the situation locally. lisa: should vaccinated individual still be tested for covid with respect to people going back to the office? andrew: right now i don't think that is needed. if you are vaccinated, your risk of infection is very low. i know we are talking about breakthrough with delta but they still represent a minority in the vaccinated populations. a strategy where vaccinated people come back to people with proof of vaccination. on vaccinated people have limited access and have to go through testing to make sure they are not coming in positive. those are things that can work very well, particularly if you

know your workplace is vaccinated to a high degree, 75%, 80%. lisa: do you think the messaging has been wrong when it comes to the delta variant and vaccinated individuals. we see everyone wearing masks and some report saying you should wear a mask in your home if you have children on vaccinated. you think this sends the wrong message of the accuracy -- the efficacy of vaccinations? andrew: the bottom line is they are still working against the delta variant. we are seeing some breakthrough infections, more than previously, but there are a lot of factors that could come into that. when we have community spread that is rampant, you don't want to rely on one thing, you need multiple levels. that is where masking comes into place. it is an additional tool for a specific situation, large-scale spread of the virus in

unvaccinated individuals. we are backing away from that getting muddled in that the vaccines are working but that is not really the message. we have to be better at communicating the true use of these things and why we are doing these in this particular time. jonathan: communicating to who? something sat is developing in this country and people have been -- something sad is developing in this country and people have been writing about it. the following stat is horrendous, 51% of white 12 to 15 percent have received one dose while just 14% of black youth have received one. what is going on here? andrew: the communication methods that we thought would be able to reach large swaths of the population turned out to not be the most effective way to get to the smaller groups that are no ones that are suffering most

from disease and have the lowest vaccination rates. we have to rethink communication. we have to think about where the populations are that are under vaccinated and how to message to those effectively. some of the things that we think are good are not reaching those populations. i know from talking to one on one that there are a lot of people who are just looking for that information and just haven't gotten it in a way that makes them feel comfortable about it peered that is where we have to rethink everything about -- about it. that is where we have to re-think everything about the communication. jonathan: quite clearly, more work to do. lisa: there was a recent kaiser survey that showed a majority of unvaccinated individuals thought that the vaccine could potentially harm you more than the virus. just to talk about failed communication. that has not been proven to be the case.

the fact that that is the perception gives you a sense of the messaging and the work that has to happen. jonathan: that mistrust of government is far more pervasive through society than some people are prepared to acknowledge. tom: social media has advanced all of this, facebook and the rest. i look at the cdc this morning which is incredibly accurate per capita, hospitalizations, florida is an unmitigated disaster. there is no other way to put it. i don't know how you communicate that other than mandates. jonathan: it is very sad at the moment. let's go to the price action and prepare you for the payrolls report. equity futures up a single point on the s&p. into the bond market, all over the place on a 10 year yield, up three basis points. in the fx market, euro showing

weakness, dollar showing strength. and crude climbing back to 70. advancing by 1.26%. from new york city this morning, good morning on this payrolls friday. this is bloomberg. ♪

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>> we've been waiting for vaccine. we've been waiting for supply to pick up, and supply is exploding. >> we are going to see a lot of price increases in the short run. the key question is are those transitory or sustained. >> we have taken wealth from the public sector and given it to the private sector. >> the fed believes they have flexibility. >> in this world of great uncertainty, if you are pushed by what happens in one or two meetings, you really haven't got the plot. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: the payrolls report 90 minutes away. 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. equity futures up two on the s&p, basically unchanged. just going into the jobs report a couple of hours away. tom: equities grinding over the past couple of days to a better fix. that is a new -- ar