>> powerful growth will continue into next year and it is still too early to get positioned on the market. >> this growth could be extended as we continue to deal with the bush for covid. >> earnings growth not valuations will drive markets higher next year. >> the fed starts to taper in november. maybe december. either way they are tapering. >> we are adding interesting point right now with chair powell and the fed in the crosshairs of what's going on in washington. >> this is bloomberg

surveillance with tom keene, jonathan ferro, and lisa abramowicz. p lisa: good morning, countdown to a virtual jackson hole. tom keene, lisa abramowicz, jonathan ferro. johner if row off today. taylor riggs in on this day of a deepening consensus that every dip will be a buying opportunity. tom, we see a turn in markets yet the upgrades continue to come out as people expect stocks to continue to do well regardless of what happens. tom: a lot of people publishing. earning sheets coming up in moments. lisa, moments ago steven with a blistering note from standard charter, the great looks for a dollar negative. he said this is a fed. can't be aggressive. they can't be hawkish. he sees the first estimate for nonfarm payrolls september 3 and says it ain't happening. lisa: how much is countdown to jackson hole will be count done to the payroll report. as people look at the data. tom: exactly.

better said than ferro could do it. lisa: i don't know about that. he's off meditating. we'll have his take when we come back. taylor, honestly we were talking about meme stocks, but how much this indicates the peripheral desire for stocks at a time when it seems like you can do no wrong. how much are you seeing retail traders dial it back in as they see things chloroquine to climb? taylor: anything can i do to get meme stock in the morning as we go forward to the afternoops at 2 to 5. you bring up a great point as we think some of the retail buyers back in this market. the savings rate we have had, how many people have been more wealthy coming out of this pandemic. the savings putting that money to work and what it fueling this market higher. you certainly see that pretty much across the board. lisa: there is a question about the influence of the fed. we could talk about moral hazard and what they should do. what they are doing is also a huge question at a time of low interest rates. but also incredible corporate profit which has been really

arguably the main driver of what we have been seeing in the equities. tom: in the cash flow and calculus of those cash flows i know andrea will talk about t what is so important here is what corporations are doing and how they adapt. lisa: the idea the big tech world is accounting for a huge portion of those cash flow was a smaller proportion of employees. what does that mean for productivity but also distribution of wealth. tom: 10-year yield higher today 1.30%. 30 year bond not up to 2% yet. 1.91% gets my attention. andrew sheets of morgan stanley in charge of herding cats at morgan stanley. what's great about the morgan stanley view is invented by doctor roach everybody argues and argues and argues and get in the have a sinity of same james -- vicinity of the james gorman page. what's your disparate that steve

invented. what's a distinction of the morgan stanley in-house debate? andrew: thanks. good morning. it's nice to be with you. i think there are a couple of areas where we differ. i think we are more bullish on the dollar than many investors. i think that's linked to the idea we do think the fed is not just going to be embarking on a tightening cycle, but that tightening cycle will continue to be well ahead of many of its major d.m. peers. that's one of the reasons we are more cautious in emerging markets than maybe other investors out there. and i think when we look at global equity performance, where we are really forecasting underperformance of the u.s. equity market relative to what i call d.m.x. u.s. markets. europe, japan, australia. we think those are the markets that have already derated and

will have very easy policy over the next 24 months and we think that will allow them to outperform the u.s. market. lisa: given the fact you look across assets, how much will low yields indicating something of a warning sign at a time when a lot of people are forecasting big earnings growth and some kind of recovery that actually even if it slows down is still robust. andrew: i think it's fascinating. there is the storyline in the market that nothing matters because of q.e., low yields. yet the market has really taken a hammer to many cyclically related assets. lumber prices are down 70%. iron ore prices down 30%. stocks in china were down over 20%. small caps in the u.s. have been dramatic underperformers versus large caps. i think all that have is actually very consistent with the markets still being concerned about growth. i think that's also what's reflected in the yield story that i think pent of invepsors are still worried about some

combination of the growth story and margin story. ultimately i think the most effective way to think about this is that it's not about major risk to growth but it is about a usual transition market as you come out of recession, you start to see prices rise, as that starts to squeeze margins. i would say there are plenty of other indicators in the market that i think reflect some of the same growth fears we are seeing on the yield side. taylor: within leverage are companies consequence pli paying pay-as-you-go down some of the debt? are we still borrowing because it is free to do so? andrew: i think it's been remarkable companies have been pretty responsible despite the fact -- i think you could argue this is the best time it's ever been for companies to borrow. we have the lowest corporate yields in the u.s. since 1953. you have on a nominal basis adjusted for inflation, adjusted for growth forecasts, those yields are even more attractive.

so far a lot of issuance has been to refinance debt. pay down old debt. i think that will change. we think that issuance picture will get more aggressive going forward. companies will look at this and say this is really maybe the last train out or one of the last best opportunities to borrow money at these historically low levels as the fed's starting to shift policy. inflation is starting to pick up. and there are opportunities to deploy that money in either buying a competitor or doing your own capital expenditure. tom: to a theme we talked about and this folds into your research note as well, which is the nonlynn yaret of moving from the fiction of the real yield now to some form of normal real yield. there is no evidence i see in the research that that's a linear function. i want to pin you down here. on a 10-year real yield, negative 1.0%, where does the nonlynnairity pick in. is it negative .75, negative .50

or some time when red sox pitching gets good again? andrew: i think for certain segments of the market i think if you think about the nasdaq, the growth complex, taiwan equities in there as well, there are -- there is a real bifurcation, there are many parts of the market trading with the negative correlation real late and other trading with a positive. when you think about when is the market going to start rotate out of some of those very highly correlated segments, i think it would happen quickly as yields start to move up. again, i think they are very extreme. i think once they start moving they could really start moving. that's certainly the view of my colleagues and global ma crow strategy team. you have -- macrostrategy team. you have a number of assets that have been showing you they are sensitive to even relatively small changes. sure, maybe the first 10 basis points the market could ignore.

beyond that the market would switch back. lisa: andrew, dumb question wednesday, why buy bonds? why not just have cash? andrew: i don't think it's a dumb question. we are underweight bonds. we forecast worse returns than cash. i think where there is an important asterisk further out the yield curve, i think you have more and more buyers buying those bonds for regulatory reasons not total return reasons. they are buying it to match a liability. that probably does give more support to the longer end of the bond market, corporate bond market than might be there for economic reasons. on morgan stanley's forecast, bonds will underperform cash over the next 12 months. we don't think investors should buy them. tom: thank you so much. andrew sheets with us. nice update there from morgan stanley. i know mike wilson, his colleagues some real caution about this great bull market. lisa, i think the end note is

really important. he speaks there about beginning to frame up what september 3 looks like and then trying to figure out in some way what jackson hole and what the fed will do. lisa: there have been a number of studies coming out showing the states ended the enhanced unemployment benefits earlier actually saw consumers spend much less. it didn't necessarily get into the labor market that much more quickly. there is a question of how much of a drag on the consumer this will be. it's highlighting that degree of uncertainty at a time when the delta variant, yes it's on the wane in certain states, how much are we looking at the potential for this to dampen some of the jobs market momentum we have seen so far, tom. tom: it will be interesting to see. taylor, your thoughts, on getting to the jobs report and the market that's out two standard deviations plus. it's amazing linkages right now. taylor: it is amazing as you think about where we are in terms of the bulls and bears.

it's just fully invested bears that are in this market. frankly because of some of the acronyms we joke about. there is no alternative. you could argue that an acronym within the bond market itself. lisa asked a point why buy bonds. buy equities. bonds after inflation are giving you zero. tom: we have been making jokes about it. are the memes doing? what they back in vogue? taylor: they are back. i just had a report from vander research, three minutes go in my inbox. a.m.c. one of the most actively traded yesterday. tom: do we check that box, lisa? lisa: we checked it. tom: checked the box. ferro never would have done that. lisa: no. tom: where are we here? futures flat. dow futures up five. the vix 17.35. the dollar was a little bit of stability. 73 on d.x.y. this is bloomberg.

ritika: president biden is sticking to his plan to remove all u.s. troops from afghanistan by august 31. he's ordered his national security team to come up with contingency plans if he decides that a delay is necessary. the president says that complete the u.s. mission by the deadline depends on the taliban continuing to cooperate and allowing access to the airport for those the u.s. is evacuating. $3.5 trillion budget resolution president biden will approve the resolution without voting on t house speaker nancy pelosi avoiding a shutdown and used a procedural maneuver that deemed it passed once the house adopted a rule governing debate for two other bills. next, committees will write the details of the budget framework into tax and spending bills. democrats will use the reconciliation process to push it through the senate without the threat after republican

filibuster. senate democrats are push agnew plan that would penalize american companies that shift protchts abroad in a draft proposal released today, the senate finance committee chairman outlines his vision for how to reform the global taxes and multinational corpses. democrats say for decades companies have been allowed to move profits and jobs outside the u.s. johnson & johnson says a booster of its covid-19 vac is enprovided an active and strong invees of antibodies. supporting use of a second shot amongst people who previously received j&j's sing the dose. a second shot led to a nine quold invees. -- increase. powered my more than 2700 journalists and analysts. this is bloomberg.

>> we need to find ways to pressure and raise the pressure, frankly, on beijing.

to abide by the united nations convention on the law. and to challenge its bullying claim. tom: vice president harris on her tour in speaking here on some of the important issues widely scheduled, widely anticipated trip, i should say, drowned out by all going in afghanistan. aside the pageantry, one of the things greg vail year -- val yea is getting to the point. he writes a report agf toronto. greg, i'm going to get out the calendar. tip o'neill exited at 75 years old. speaker pelosi of baltimore and san francisco is 81 years old. is she legacy building with this legislation? greg: yeah, i think, tom. good morning. it's one of hers. she obviously wants to get a

bill. i think there is a decent chance after the 2022 election she will step down. tom: she'll step down. will she step down as the minority? if she's having a cup of coffee this morning with joe manchin, they are talking about the future of the democratic majority in washington, did she risk it last night? greg: i have been a minority. do i this is -- i do not think last night was a victory. i think there is fatal flaw in the logic of house progressives. they don't appreciate the fact that the senate has a couple of democrats who will not go along. so this reconciliation process which needs every democrat to vote yes i think will not succeed. there is going to be a knockdown, drag out all during the fall. you are going to have to give the second bill, this $3.5 trillion bill a major haircut to get it passed. lisa: one reason i love speaking with you you handicap and tell us the likelihood some of these bills will get passed.

based on what we saw yesterday, how did that change the handicap, the percentage chance of the democrats getting through the biden $4.1 trillion agenda? greg: didn't change a lot. chances of getting the 3 $5 plus another $1 trillion zero percent chance. a chance of this whole thing breaking up, total gridlock, 40%. but the 50% chance is that there will be something. the tax hikes are not going to be as ambitious as they were hoping. the spend something not going to be as generous as they would like. but i think we can get something, if, this is the important issue, if pelosi and the progressives are willing to take half a loaf. if they want everything, the whole thing falls apart. taylor: how in peril is the $550 billion physical infrastructure bill given some of the disagreements for this other piece? greg: it's ironic because a lot of people like this, including a lot of republicans. like the idea of spending more on highways, dams, bridges,

wifi, water. that i think still has a decent chance of making it one way or another. it's the 3 $5 trillion that has every republican -- $3.5 trillion that has every republican opposed and a handful of democrats opposed as well. taylor: can you tell us the issues of why they are opposed? is it because we are concerned about how eventually we are going to pay for this all? greg: it's part of it, taylor. the deficit -- it looks like in a year or two we'll be over $30 trillion in u.s. debt. that's more money than tom keene makes in a year. i think part of it is the price tag. part of it is a dramatic increase in the role of federal government. and part of it, let's not forget, is taxes. even democrats like joe manchin, don't like the magnitude of the taxes that other democrats are talking about. taylor: was this two-pronged

approach going to prove to be the wrong way to go? greg: there is no easy way. i point out to everyone. the main problem for the democrats is that they didn't do as well as they thought they would do last november. they lost a lot of house seats. they never expected that to happen. they didn't do all that well in the senate. they have tiny, tiny majorities to deal with. it makes it difficult if you have just one or two mott rats who dissent. tom: i look, greg, at all this back and forth and it's about the clack. when does the 2022 race begin? benchmark's labor day, i think i'm wrong. is it march of next year? greg: oh, i think by labor day they'll be raising money. the real actual campaigning doesn't start until march. if you force me to make a bet, i would bet the republicans take the house. senate is way too close to call. but i think the republicans have a decent chance largely because biden's got problems whether

it's afghanistan, crime, illegal immigration, inflation. there is a lot the democrats have working against them. lisa: one of the other reasons it's great to speak with you you dovetail washington policy with the market response, with the market understanding of what policymakers will do. do you think that wall street has it right when it comes to what will get passed in washington, the magnitude of the fiscal impums? greg: i think that maybe wall street doesn't fully appreciate how much trouble the stimulus, the infrastructure bill is in. i think there is going to be a lot of arguing over the debt ceiling getting raised. the big issue is that the stimulus, both monetary and fiscal, coming out of washington may not be quite as big as the markets were hoping for. tom: greg, all in all, what's interesting here is literally where are we next week? very quickly here what happens

now after this vote last night? greg: well, committees are now going to be working on bills, putting this all into language. tom: really? greg: yeah. they are not going on vacation. they are working through mid september. tom: i didn't know that. greg: i think the big overall story in washington right now, tom, is the lack of political capital that joe biden suddenly has. his political capital has eroded dramatically. even if we get 200,000 people in afghanistan, he still is going to bear -- going to bear a lot of the blame. i think it makes it tougher for him to get his agenda. tom: extraordinary summer. thank you so very much before this important vote. we respect the copyright of all our guests. you can get his note on a.g.f. i said this at the dining room table the other night, it's the oddest summer. it's amazing what we are in.

lisa: the idea also of the fiscal impulse. everyone expected it to be dramatic. beginning of the year we were talking about $5 trillion, $6 trillion is that enough. should we throw at an extra trillion? now we are talking about a significantly lower number, and a lot people saying it's positive because the tax hikes aren't going to be as big. the narrative has changed so much, tom, it's hard to really understand where the direction goes. tom: taylor, on the delta variant the reading is it's here. maybe it's ebbing a little. taylor: it is. i would argue we -- best thing we love about the terminals we have charts for all of this because the data is objective. you can see the spike up. and beginning of the rollover. nowhere near where we were before. so how much can the markets read through that? everything, chris ailman we had him yesterday, said we just have to get through it. tom: lisa, she's a promotion

machine. for the close. lisa: it's the new normal. tom: starts at 12 noon and goes to 6 p.m. right on the screen. the market's deteriorating a little bit. futures negative 2. stay with us. coming up, i look forward to this. mark zandi, moody's analytics.

(announcer) back pain hurts, and it's frustrating. you can spend thousands on drugs, doctors, devices, and mattresses, and still not get relief. now there's aerotrainer by golo, the ergonomically correct exercise breakthrough

that cradles your body so you can stretch and strengthen your core, relieve back pain, and tone your entire body. since i've been using the aerotrainer, my back pain is gone. when you're stretching your lower back on there, there is no better feeling. (announcer) do pelvic tilts for perfect abs and to strengthen your back. do planks for maximum core and total body conditioning. (woman) aerotrainer makes me want to work out. look at me, it works 100%. (announcer) think it'll break on you? think again! even a jeep can't burst it. give the aerotrainer a shot. pain and stress is the only thing you have to lose. get it and get it now. your body will thank you. (announcer) find out more at aerotrainer.com. that's aerotrainer.com.

tom: bloomberg surveillance. jonathan ferro, lisa abramowicz, tom keene. jonathan ferro out, taylor riggs in for jonathan ferro this week. we have data coming out. in the old days mckee got all of this stuff at 4:00. he does not anymore. we will let him in 3, 2, one. there is. durable goods. michael: supposed to fall .3%, so i guess that is good news. you are looking at a problem with automobiles, without going deep into the data. we cannot get the chips to get them out. capital goods orders ex aircraft , this is what economists like to follow, it is flat. that is a disappointment because

it was up point 7/10 -- it was up .7% last year. better the last months .6%. we did get some work in during the month of july, but we did not get a lot done lately. tom: two questions. one of durable good and then i have to sell forward on all of your hard work on jackson hole. the idea of durable goods -- in a service sector world like a passively use elation, -- capacity utilization, do we care anymore about durable goods? michael: the problem with the durable goods orders is they are very volatile. it is hard to separate out. tom: even if -- even in a pandemic you have to take a three month moving average. michael: and their -- and there are always problems with the

data. tom: you start strong. your chaps, your cowboy hat, talking to esther george. wyoming is in the kansas city district. you speak to her tomorrow. who is she and why should we lean forward when we talk to this most original president? michael: she is the president of the kansas city federal reserve, normally the host of the jackson hole gathering. she is cautious and has been something of an inflation hawk. interesting to see what her latest view is, especially in the covid world. i want to point out before i go, interesting headline need to follow up on and see what he is saying. philip lane says the ecb is willing to move if fed policy creates spillovers. lisa: fascinating. tom: interesting.

a research project in august for michael mckee this morning. we have someone qualified to talk to zandi about economic spillovers. lisa: the idea of the interconnectedness of monetary policy. mark zandi sifting through, moody's analytics chief economist. a well respected economist who has been often cited for being accurate at time of great uncertainty. thank you for being with us. we start to look out september, october, november. regardless of what the fed does how can you characterize the momentum behind the labor market? mark: very good. we created almost one million jobs in july on top of one million jobs in june. i do not think we can sustain that pace, but because it would be great to have one million jobs per month, that will big -- that will bring unemployment back post-e full employment --

close to full employment by late 2022 or early 23. it is good. lisa: everyone degrees it is good. the degree to which it is great is up for debate. there is also a question of the enhanced unemployment benefits, what the roll up will do. will it allow more people or push them back into the labor market or will it reduce the buying power of consumers to see their income depleted? where do you weigh in on that? mark: around the debate whether the supplemental uninsurance -- unemployment insurance people were getting in half of the states that is part of the american rescue plan, i do not think that had a major impact on the willingness of people to go to work. it is on the list of reasons but it is towards the bottom. we have data points regarding that late last week and state employment data for july.

in july, half the states to limit that supplemental unemployment insurance benefit. there was no employment in those states compared to states that kept the insurance. a lot of data to come. i expect some impact but it is on the margin. tom: in late 2000 08 to 2009 you were the reigning optimist. you said we will recover from this. it took time but mark zandi nailed the economic recovery of 2012, 2013, 2014. you have a note saying what everybody calm down by the overheating effects of this trillions of dollars of stimulus. why should i be calm about overheating? mark: the first thing i would say is there still is a lot of slack in the economy.

full employment something in the mid-threes or low threes. we stuff millions of people who stepped out of the workforce during the pandemic who are not counted as unemployed. we have a long way to go. we are headed in the right direction. we have a deep hole to take out of. this is the ashtead -- we have a deep hole to dig out of. some version of the big back better initiative does not kick in until 2023 or 2024 to the degree i do not think that is an inflationary issue. i would quickly point out there's is a lot of aspects of the plan that address inflation. a big part of the plan is to increase housing supply. we know there is a severe shortage of affordable housing and is driving up rent. rent growth is the single most important aspect of inflation. that will go wrong way to -- a long way to addressing that aspect. tom: there was a group years ago

that was outstanding. they played coffeehouses all through pennsylvania. david stubbs in london with j.p. morgan is brilliant on the technological overlay in our underestimation of productivity. you have studied this with the former vice chairman of the fed. how do you take in the technology overlay right now and what it will do to wage growth? do we grossly worry about wage growth where we should not? mark: that is a great point. wage growth has held up well during the pandemic. i expected to continue to accelerate. i'm not concerned this is inflationary because productivity growth has also accelerated. part of that is cyclical, related to the pandemic. extracting from all of that, it feels like productivity growth

is accelerating and there are many reasons for that. one is technology. there are a lot of technologies taking time for businesses and business practices. i think they are and we are seeing productivity improvement. if that is the case, that is weed-when. -- that is win-win. it is a win for workers, reason to feel more confident about our long-term fiscal situation, this will mean more tax revenue, endless reasons for optimism. hard to know, but it feels like productivity growth is improving. taylor: you mentioned we may not get some of the fiscal stimulus until 2022 or 2023. by then what of the argument it is too late, maybe the economy will not need it?

mark: the support we are talking about now, the fiscal package is not about short-term growth, it is about long-term growth, about lifting long-term growth, lifting productivity growth because of better public infrastructure from roadster broadband. it is about -- from roads to broadband, about lifting labor force participation. low income households, support for child care and paid family leave will make it more likely they can go to work. right now they cannot. a lot of low income households cannot go to work because they cannot keep a job and this frees them up so they can go to work. this is about long-term economic growth and making sure the benefits of the increased long-term economic growth accrue to lower and middle income households. lisa: -- tom: this has been wonderful. mark zandi, thank you so much, moody's analyst asked.

-- moody's analytics. a decidedly optimistic cast. i wonder if that will be a precursor to what we will hear from chairman powell. he will say here is where we are, we are not fully employed. lisa: he has to sound optimistic to support people's confidence but not too optimistic to make them think he will remove accommodation. it is always the dance we hear from fed officials. too positive is not good. good news turns into bad news. tom: on a rate basis, how do we frame a jackson hole at 1.0% january yield without her history of 1.12% and lower in crisis. lisa: how do we frame this out without talking about the negative yields around the world. this goes to the philip lane point we heard from the united kingdom, this idea other banks are watching the fed as closely if not more so and adjusting

their policies. what the fed does, the fed sneezes, the rest of the world catches the flu. tom: what we have a 9:00? dan: will be speaking -- lisa: we will be speaking with james athey about how much jackson hole matters in the employment data but also the read through the markets. what is the message? yields will remain here for the for siebel future and a time of such incredible growth in profits in companies. tom: we will continue. we have given up the tape a little bit. green on the screen. interesting to see how it unfolds after durable goods. bitcoin, $50,000, down to $48,000 vicinity. stay with us. this is bloomberg. ritika: with the first word news, i'm ritika gupta. the biden administration has

called refugee age groups -- eight groups to get ready to help resettle as many as 50,000 afghans. refugees are being admitted under program known as humanitarian for all and will target afghans at risk under taliban led government. the house is taking a final vote on the bipartisan infrastructure bill. the white house pressure campaign and insurance from house speaker nancy pelosi -- they adopted president biden's 3.5 chile dollar budget resolution and that clears the way for the vote on infrastructure at the end of the month. fcc commissioner gary gensler's morning hundreds of chinese companies listed in the u.s. to submit to more scrutiny or get kicked out. he told bloomberg the clock is ticking. the ftc plans to support a three year deadline that requires chinese firms to permit inspections of their financial audits. in vietnam, vice president,

harris urged countries in southeast asia to -- the u.s. wants to upgrade its relationship with vietnam to a strategic partnership. the u.s. may give vietnam another former coast guard ship and is donating more coronavirus vaccines. a wall street bank is trying to improve working conditions for its youngest staffers, include allowing junior staffers to take two weeks off by the end of september. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am ritika gupta. this is bloomberg. ♪

>> historically driven by the

threat or perception of threat. it is not a particularly safe world at the moment. number two, president biden has been a lifelong supporter of national security. this budget he submitted to capitol hill was a nominal increase. tom: she is the chairman and the chief executive officer of the electric boat company. when you are on the train between boston and look across the water at the secrets of the general dynamics company. phebe novakovic has resurrected general dynamics. this is a really important interview with david rubenstein. peer-to-peer conversations. tom: since she basically rescue general dynamics, there is no beating around the bush. what is the novakovic method?

david: she is very tough, smart, knows the pentagon well. when she took over in 2013, the previous year general dynamics had lost about a hundred dollars or $700 billion. now the stock is up 120% since she has been the ceo. a good turnaround story. tom: as you know at carlyle group, this is so much a contract by contract business. does she mckinsey that into a different kind of company or is it the same defense contract you and i used to stare at across the bay. david: many defense companies are making money on all of i.t. or electronic related things related to cyber. the bread-and-butter of general dynamics has large been tanks and submarines and they're very good at that.

the gulf stream is been extremely popular. tom: i did not want to go there, francine did. is it a bolt on business or part of revision? david: when they bought it many years ago it was seen as unclear what the tradition was because it was not a defense part of general dynamics, it is not a general dynamics industry kind of company. in recent years jim stern -- is clearly the elite of the jet business in the united states and they have done quite well and so forth. it is very profitable business. taylor: it is incredible the timing of this interview given the events in afghanistan.

any insight you can glean from that interview before the taliban took over coal at where we think about the future of defense spending. david: there is always a thought in washington when presidents of the united states are democrats in the congress is democratic, defense money will go down. the events in afghanistan or make it or likely defense spending will go up more than president biden proposed. it is clear there is still a lot of uncertainty. with what happened afghanistan, without assessing fault, will embolden people think we have much better defense budget. tom: one form or question that folds in from taylor's question. in our relations with china, do you look at afghanistan is being a change agent for how we speak to china?

david: afghanistan will make it more difficult for the guide states to persuade our allies to follow our lead. china is probably going to have a closer relationship with afghanistan in the future than we are going to have, and i think as a result it will change the dynamic somewhat. our own relationship with china is not dependent on afghanistan, the -- it is a complicated relationship, and i do not think president biden and president xi are likely to meet anytime soon. the sooner they meet i think it would be good. tom: david rubenstein, thank you so much. it inspired peer-to-peer conversation. taylor, i look at this, and you and lisa have been on me all day. this cyber meeting in washington. i guess it is a big deal? taylor: it feels off the mark. everything else that is going on. i would argue that dan ives of

wedbush argues it might not be the future of physical -- the new were on terrorism -- we talked to colonial pipeline, they would say the same, whether you think about china or russia. you could argue you could fold this in to the zeitgeist is where we are with afghanistan. tom: also with invest -- also with investment. i would say does good days away from chairman powell speech, widely anticipated, whether you think it will be a nonevent. the theory is you will tilt dovish. taylor: i would argue, we have been remote for a late teen months and a lot has happened remote. maybe something might happened. be aware you are due a lot of complacency in these markets. the vix said a 17 year handle.

tom: tell us about the close coming up. i know you do not know the planning because you did not begin the planning until 1:00, but is a mean day. taylor: september we do discount rates in fundamentals and margins. it is not always memes. we do push forward to some of the earning sales were courses. tom: we have salesforce today? taylor: you'll have to ask dan ives. ever bullish on salesforce and the acquisition of slack. we will do economics, some investment, the works. tom: the usual. taylor, thank you for stopping by. good to see once a month. taylor: i am back friday. tom: i will be here friday. very good. taylor riggs. i want to frame up where we are into the week.

we are into the oddities of the summer. what we really have is a crisis in washington. annmarie hordern and our team watching this day unfold, all of us coming off -- the president's comments yesterday with an abrupt ending being, not controversial, but unsettling to see how the white house rallies off of that at the news from speaker pelosi as she advances forward three point -- 3.x jillian dollars of support for social programs in america. i will call it a remarkable stasis after last week. monday up, tuesday up. on wednesday we catch some kind of did waiver further news flow. i measured the surgery. as greg peters said, we are

extending out our timeframe. q3 into the part of next year. it tightly interview -- a timely interview on governor kathy hochul, governor pataki. this is bloomberg. ♪

lisa: stability at new all-time highs. i am lisa abramowicz in for jonathan ferro.

"the countdown to the open" starts right now. >> everything you need to get set for the start of u.s. trading. this is "bloomberg: the open" with jonathan ferro. ♪ lisa: more capitulation from the bears. >> a wall of worry. >> more signals from the fed. >> we still have a very healthy and accommodative backdrop. >> equities perform very well. >> profits have exceeded expectations. >> there's so much liquidity. >> equities continue to move higher. >> most of them have capitulated. >> there is auy