♪ >> if you look at every thing we've been through, it is not clear we went through a recession, so therefore it is not likely we are going into a recovery. >> there's endless reasons for optimism if intact growth is accelerating. >> monetary policy is getting a bit more rational. >> the big problem if we don't start tapering is the pressure of inflation. >> i would watch the debt ceiling. i think you've got to fear the debt ceiling. september is going to be a white knuckle event. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: countdown to jobless

claims. countdown to personal spending. good morning. this is "bloomberg surveillance" on bloomberg radio, bloomberg television. jon ferro off, francine lacqua very much in. we are about 30 minutes away from these initial jobless claims. does any data at this point matter? tom: i think the data matters, frankly. you got a disparity between the so-called hard data in the soft data, the emotional data, confidence and all of that, which shows a lot grimmer picture. but the trend of the weekly claims data, which is its own beast, i would folded in with the jolts data to get a better picture. but it is very constructive. we hear that from the equity bulls. lisa: i'm looking at some of these speeches, and i heard what esther george said, and there's a whole lot of we are doing a lot of watching. it is not clear what they are going to do in terms of doing. francine: no, but it was a fantastic interview that michael mckee had with esther george because it is very clear she was

ready to go. i know this is partly because she's president of the federal reserve bank of kansas city, but in general, she just says policymakers at this point need to get started, and i do feel that may be the last two to three weeks, there's been more of a tilt from policymakers that the bigger worry is actually a policy mistake because you don't act quickly enough, rather than leave accommodation too late. lisa: this idea of the balance of risks and where ed lies, is it more towards overshooting inflation or perhaps not being easy for long enough? this all comes at a time when the stock market cannot go high enough for anybody. this to me i think is the key aspect. how does the fed respond to a buoyant and ever more buoyant stock market? tom: i am going to stop the show and say it is real simple. the data is as ex post as i had ever seen in my life. there are some new fangled theories that are going to be in those papers at the fed. you trumpeted the inequality

debate, the new mission for the fed. that's great. but they are going to do only one thing, wait for the data. lisa: but francine's point, the data is bifurcated. you are seeing inflationary pressures and data that might support where they are going. the idea is if they wait too long, do they have the tools to counter inflation? do they have the tools to potential he tamped down on trends that are independent of their purchases? tom: it will be interesting to see tomorrow if chairman powell brings in one of the inflation summaries like the dallas trends or the atlanta inflation data, and my favorite, the cleveland fed as well. let's do data. futures red and green on the screen. the vix boring, 17.31. we round up to 1.36 percent on the 10 year yield. i'm sorry, this is a trend that bears looking at into thursday, into friday, indeed into next week as well, as we have seen yields come back very nicely.

i am going to leave it there right now because what you want to hear about is the equity market. dow 35,405. sam stovall a few years ago was considering the dow at 350 or whatever it was back then come up with cr foray -- with cfra, their chief investment strategist. what is the level of your bullish belief right now? sam: good morning, and thank you for that intro. anyway, the feeling is that the path of least resistance continues to be higher, even though we have seen a creeping up of the 10 year yield. we are still seeing investors gravitating toward the growth side of the equation, also looking towards real estate, etc. so 4620 is our target. tom: lisa, please, go ahead.

my fault. lisa: no worries. i just got to jump in because you talk about 4600, you sound like a bear. this is a market where people can't get bullish enough. are you also thinking 5000, 6000, 7000, and projecting out incredible earnings and returns for the foreseeable future? sam: what is the old saying? you target a price, but not a date, or you forecast a date, but not a price. but yes, those numbers you mentioned will be obtained sometime down the road. but i think we also have to make sure that we are risk meditators at the same time. we have gone three times as long as we normally have between declines of 5% or more. i think that the market is vulnerable to some sort of an upset, where it comes from a policy misstep, from geopolitical factors, etc. so i think that we really have to just not assume that the sky is the limit.

francine: how do currencies actually play into some of your equity calls? sam: good morning, francine. currency is an important part. we look at the technicals of the euro versus the u.s. dollar, the we getting that has been experienced over the intermediate term implies that investors do expect interest rates here in the u.s. to be picking up, possibly because of the fed initiating their tapering in the fourth quarter of this year, possibly because of the continued improvement in economic activity and maybe even the peaking of the delta variant. tom: you are acclaimed for understanding evoke of the moment. the fad. the world stopped like 14 times a day to look at the tech data, and there was a put call ratio put on. what is the fad right now where you say get your radar up and be cautious? sam: no pressure there, huh,

tom? tom: none at all. sam: well, i think the fed really is growth versus asked the fad -- the fad really is growth versus value. investors are chock-full of growth stocks once again, whether is tech, consumer discretionary, and the real question is when or if, and i think it is more win, not if, that we see a rotation back into the value side of the equation because the economy is expected to be improving. we are likely to be seeing passage of one or both infrastructure packages, and we will start to see the 10 year yield creep up once again. lisa: jim b uncle was on bloomberg -- jim bianco was on bloomberg yesterday, talking about this belief in stock investments that if there is a big draw down, and a big drawdown could be 5% to 10%, the fed will step in. they will decelerate their

tapering. they will become even more accommodative. do you agree that there is this sort of implicit stop baking to valuations -- implicit backstop baked into valuations where they are now? sam: i think the fed will be stepping and should we see a 5% or 10% decline because those are fairly natural in the stock market, and i think if we do start to see the stock market fall into bear market territory and there is an actual risk to our financial system, then by all means, the fed will step in. but i don't really think the fed is going to be stepping in if we trip and fall and scrape barney -- scrape our knee. tom: we spoke yesterday of the anniversary of steve jobs resigning from apple. everybody, including me, got that wrong. steve jobs died tragically on october 5 10 years ago, and this guy tim cook, he can't do it. you have chronicled apple to the moon. how do you know when to get off

these stocks that just go and go and go? sam: well, you look at the fundamentals. you look at the technicals, and you listen to your analysts. what is the old saying? the analysts do the work, but the investment strategists take the credit. tom: love that. sam: i hear what angelo zeno says about apple and wait for his commentary from a fundamental perspective. tom: what does he say right now? sam: right now, still a favorable outlook for apple. we have it ranked four stars, so we are willing to bet our bonus on it. tom: so much of this is not making money, it is not losing money. when i lecture on this, and stovall doesn't get a royalty, i say nothing helps you not lose money like the star system of cfra. it is a great and beautiful thing. esther stove all, go away. thank you. that was a clinic.

you so much. sam stovall, i can't say enough about his work over the years. the star system, everybody is like, boring. it is dodgy. -- it is stodgy. it is like watching paint dry. man, when they fall out of love with something on the star system, get your radar up. lisa: this idea that people take notice and there is respect for that. i just wonder how the star system accounts for valuation and how the input of the 10 year into that. i'm going back to dave wilson's chart earlier in the week, where he was looking at the correlation, the inverse correlation between bond yields and tech stocks. i wonder how much that can continue. if you have these revenues and this secular story, how much do these have to be linked, or are they potentially going to try to go their own ways the world becomes a rosier place? tom: it is going to be interesting to see. francine, quickly here, the equity markets, many people saying go long europe, that

you've got to own europe. francine:francine: a lot of people, and that is also a currency call. so if you were listening to salmon some of the others, janet henry this morning, it is also a eurodollar call. when you look at some of the budgets, it could be disrupted because of elections. if you look at the uncertainty of the elections, be it germany, france eight months from now, you don't know what comes next. so that could change the trajectory for some of these european equities, unless european equities skew towards the u.s. market. tom: ira jersey with us. no, not on premier football come on what we are seeing in liquidity and the wall of money out there, particularly overnight repo. really looking forward to catching up with ira jersey. john ryding after michael mckee and claims. really strong 40 minutes to come. stay with us. this is bloomberg. ♪ ritika: with the first word news, i'm ritika gupta. the u.s. and u.k. are warning

citizens in afghanistan not to travel to the kabul airport. they say there are threats of a terror attack. divided in adminstration says it knows about -- the biden administration says it knows about 1500 americans still in the country. the is really prime minister plans to discuss strategy on iran -- the israeli prime minister plans to discuss strategy on iran today at the white house. the u.s. favors a double medic agreement to halt nuclear activities -- a diplomatic agreement to halt news the activities. vice president kamala harris said she brought up the issue of dissidents serving prison terms, but when questioned, she did not ask plane how vietnam's human rights record is different from that of china, another communist country that does not tolerate dissent. the boeing 77 was grounded more than one it -- 737 was grounded more than one year ago.

i federal regulators have now cleared the changes it has made. bloomberg has learned western digital is in talks to merge with japan's kyosha. the companies are a long time joint venture partner. it would create a bigger competitor for samsung in the market for memory chips. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪

>> i think it's unlikely. i don't think a lot of information has come out to really change the forecast since

they had their last meeting. i don't think jay powell wants to tip the apple card. i don't think he wants to push people in one direction or the other. obviously a lot of different views around that fed table. i don't think he's going to try to say here is my view and everybody better follow in. tom: the mathematician from the booth school, randall kroszner, first rate financial economics, always good with the booth school in london. we are thrilled to get his comments on the events forward. we will digress right now and talk liquidity. ira jersey is definitive on this. he drives forward bloomberg intelligence rate strategy. he's looking at the 30 year bond, the austrian 90 year bond. i just want to know about the overnight money. i'm sorry, it is inching $1 trillion, one $.1 trillion. how and when does the overnight repo market stop its assent -- stop its ascent?

ira: the overnight repo facility is going to continue to grow because the economy doesn't need cash at the moment. all that the fed is doing by buying all these assets is creating more cash, which then people say, what are we going to do with this? we don't want to make zero because our alternative is the repo market, and that is not making any money. so they put the money to the fed for a whopping five basis points. but it is above zero, right? so people are putting their money there. our estimate is it is going to get somewhere between $1.7 trillion and $1.8 trillion before it is all said and done, but that is assuming that the federal reserve starts to reduce debt purchases, the dreaded taper in november. tom: a smart guy like you who says calm down, $1.7 trillion. others say to trillion dollars. whatever. do you have any experience in how we come down from $1.7 trillion? ira: we do have a little experience because at the end of when we tapered last time, the

federal reserve had the reverse repo facility or had something largely similar, and what happens is over time, the economy continues to grow. more cash is demanded. less and less people use the repo facility. that is something that i suspect will happen again. of course, now it is significantly larger. the fed purchases have been significantly larger. the market is just vigor. one of the oddities that has occurred over the last decade and a half or so is when you go back and look at 2005, 2006, when i first started in rates and moved from credit, the repo market, the nonfederal repo market is about the same size now as it was then. meanwhile, the treasury market, which the repo market, the repurchase market helps fund, is 5, 6 times larger. so there is a funding in the

economic gap out there. tom: lisa, do you understand that in the fixed income bracket , to move from rates to credit is like going to the darkside? lisa: but to move from credit to rates is traditionally thought of as a downgrade come of it in this world -- downgrade, but in this world, it is the opposite. it is the same story in many cases, apart from some of the securities selection. when you talk about the repo market, we are talking about the functioning of the world's guest and deepest market that is actually starting to function a little less well. you are seeing liquidity dry up in certain corners of the treasury market, at a time when people say there is potential for some sort of disruption. what is your view on the fragility we are seeing under the surface? ira: the issue with the treasury market right now is there's what i call an illusion of liquidity. there's liquidity, and all

sometimes there is not. you so that last march. that's one of the reasons why the fed stepped in and did those massive $1 trillion worth of treasury purchases. you saw it at other points over the last decade or so, too. a big reason for that is the bank regulations. the battle with three regulations, some people talk about dodd-frank and the volcker rule. it is not as much that as the fact that angst and dealers owned by banks in large portion can't expand their balance sheet and trade their balance sheet at will. they have to keep within certain lanes. because of that, when there is a significant demand of selling or buying, you can see these wild swings and liquidity just dries up. i think that is going to be something that once or twice a year, is going to rear its ugly head, you will get outside moves , and people will do studies and everything else. but at the end of the day, there is no circuit breaker to allow demand to be absorbed when there

is a significant amount of selling or buying. francine: why do we not have those circuit breakers? is anyone looking at putting them in place? ira: the regulators talk about this as saying they want institutions to be safe and sound. in order to do that, you have to hold e-cig and amount of capital. keep in mind, before battle to was implement income of the treasuries had zero risk weight under the basel regulations. so bankers could hold as many as they wanted at any rate they wanted. a lot of interest rate exposure could be basically taken on balance sheet. they can't do that anymore because the basel regulations so you have to hold a certain amount of capital, even against the safest assets out there. that's one of the reasons why the repo market hasn't grown because repo, when you do repo now, you have to hold equity

capital against that. even though the underlying is secured by a treasuries security. tom: you know, it is august. i am worried about ted lasso having a christmas show in august. what was that all about? does it matter that you're coming back to coach richmond? does that really work in soccer? [laughter] ira: player coaches can work out very well. you look at some of the highest level coaches, some of them were players, and some of them were not even necessarily some of the best players. you look at a guy at liverpool who's one of the best managers in the world, and he never played. he never won a champions league. you go across the other side and look at someone at manchester city, and of course, he won everything there was. so i think it is important for someone to know the game and be a student of the game, and a lot

of times those are players. tom: i miss jon so much. lisa: oh my god. i was just writing that. you are clearly missing him a lot. tom: did you see ira jersey totally change there, talking about richmond and all of that? francine: i still can't believe you know the rules. what, 18 months ago, you didn't even know what was. tom: i can't even spell that right, richmond. lisa: i thought you were saying soccer. [laughter] tom: ira jersey, thank you so much onyx planning $1.1 trillion plus -- on explaining $1.1 trillion plus. we are five men its way from claims. lisa: this is important -- five minutes away from claims. lisa: this is important. to see another post-pandemic flow in the number of claims highlights that the problem is not with people leaving work or getting fired. it is about getting people hired, and that is what the fed

is trying to get their hands around. tom: michael mckee will join us, and then we are thrilled to bring you john ryding of brean capital, their chief economic advisor. stay with us. this is bloomberg. ♪

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tom: the yield 1.35% as we prepare for important economic data. francine lacqua, lisa abramowicz, and myself. not only the gdp second look but thursday claims data. we are waiting, and waiting, and waiting. michael mckee, we are waiting. there we are. michael: we have the numbers you want to see. the jobless numbers for last week. 353,000. that is an increase of 4000 from the revised level because we have to look at the revised level. that is just noise. i would not read anything into

the movement about difficulties in the labor market. on the basis of how many people in total are getting claims, this is interesting. it is two weeks delayed. this would incorporate all the states that stopped paying extended unemployment benefits, and it still rises by 182,000. a little over 12 million. tom: the delta variant? michael: it is impossible to say. i suppose it could be. you are looking at companies that did not come back rather than companies letting people go because of all of the anecdotal evidence about how hard it is to find people. tom: the thing i see on the bloomberg terminal is gdp second look, 6.6%. are there any papers at jackson hole that will address how america comes out of a boom economy different than the last

boom economy of 1947? michael: it does not look like that is a topic, how it comes out of it. there will be talk of how monetary policy deals with the new environment we find ourselves in. you have to establish what your new environment is. you mention 6.6%, which is .1% better than the initial report, .1% worse than the forecast. personal consumption .1% better, 11.9% compared to 11.8%. not a major adjustment. what i was wondering about is inventories. i will have to look for that in a second. that will be the swing factor going forward. lisa: it is interesting to me that markets are not moving much on the data, even though there is some surprised, especially the downside consistently across the board. not just the wrong kind of upside surprise, jobless claims

higher, which is bad, but it is also personal consumption coming in softer than expected. i wonder to what degree market shrug off any data as simply backward looking at this point? michael: i think you have to with gdp for the second quarter because that ended in june. we went into july with some momentum. 11.9% is not bad. now we do not know because of the delta variant impact on people's spending habits. we saw in the retail sales report for july a surprising drop in the number of people who are buying or the amount they bought online, which is what you would expect them to do if the variant was keeping them home. we will have to see when we get the spending numbers tomorrow on what services were like for july. tom: we will see. michael mckee, thank you so much . the papers released at 7:00.

the yield is 1.35%. norway with news. the central bank -- to step down february of next year. i assume a measured and esteemed economist that is something along the case of expectations. we have to get to john ryding of breen capital. thank you so much for joining us. do we understand or do we have any inkling of how we get from boom economy to 6.6% with a glide path down to whatever potential gdp is? this is original, isn't it? john: it will be very difficult with monetary policy still in full easing mode. that is obviously going to be the key thing people are looking for from this conference is what hint chairman powell gives in terms of the timing of a tapering announcement. i want to point out one thing

you did not pick up in your discussion of gd report -- of gdp report. that is we get the profit side of the economy for the first time. corporate profits were up a non-annualized 4.2% in the quarter and that is important for driving the economy. economists like to think they are looking at the demand-side consumer spending, but we also have to remember the incentive to invest, the incentive to hire. the profit data were very strong in this report. francine: overall, do you believe the fed wants to move so they do not miss the boat? john: i think the fed is divided and i think chairman powell has to decide which side of that division he wants to come down on. we have a significant number of presidents and at least one

governor who thinks 2022 is probably the time to lift on rates. to liftoff on rates, pre-much everyone is in agreement you have to stop buying treasuries, otherwise it gets messy. i think it is divided. i do think, coming back to tom's perspective, how do you transition from a boom economy to a more stable economy? you cannot do it with monetary policy in full easing mode? lisa: just to bring headlines from one of the fed officials who have the idea that perhaps 2022 is time for liftoff, jim bullard speaking on an interview on cnbc saying there more inflation than expected, he expects at least 2.5% inflation in 2022 and says the fed should get on with tapering. this echoes comments from esther george that she does not see the

delta variant as potentially delaying anything going forward. based on what we are seeing, do you think there is more of a liability for the economy if they hold out for longer and do not start tapering by october of this year? john: i think there is, and for one reason. the fed can raise rates when it has to raise rates. the later you wait to start tapering, the faster you have to reduce the pace of your purchases at the more disruptive that might be for markets. that is the first thing. at a very low level of yield, prepare the market for taper and asked why are we still using with the federal reserve? jim bullard has 2.5% for next year's inflation rate, we are at 3%. we all see the risk to the upside.

a lot of the surveys continue to come out with very high price readings, the kind we have not seen since the early 1980's. if you are managing risks, the greater risk to me would be losing the gains you made against inflation than the risk the delta variant is going to -- we have a very effective policy tool to deal with the delta variant. it is called vaccination. we will get booster shots, and states in which people are not as highly vaccinated have much higher breakout rates. that is real, personal, human tragedy, unnecessary deaths. monetary policy does not speak to that and the claims data does not suggest the delta variant search is having a material impact on the economy. the third quarter may be much slower than the 6.6%.

i do not think the consumer, with excess savings will be a major factory in the recovery and putting the brakes on. tom: john ryding, thank you so much. too short a visit. francine, you sit in london and you listen to these talks, and it has to be foreign discussions , but yesterday we were talking about how jay powell is central banker to the world. is he a central banker to the united kingdom, the tapir and the rates and all of the dynamics. the fiscal stimulus. how does it affect governor bailey and the rest of the united kingdom? francine: everything is late. i would suggest it affects the ecb and the eurozone as much if not more than the u.k. because the u.k. is a small open economy. everything is linked. you can see it with the covid-19

supply chain. we are talking about the bank of korea. whenever the fed does will translate into possibly higher inflation, tightening of markets. the other thing is do you stop tapering and raise rates, it is very similar to conversations the ecb and traders in europe are having. tom: we have to stop and digressed to a transaction. long ago and far away i went to new hampshire to one of the primaries and i sat there with the guy from new jersey whose name was al, and we sat in the little rotunda of primary new hampshire, i believe in new hampshire the radisson hotel. msnbc was over there, bloomberg doing its thing. i was doing interviews. everyone was on their cell phones, and everybody was looking at the same thing.

it was a strange thing called politico. lisa: yes. tom: i am like, what is politico. lisa: you're talking about the headline that axel springer will be buying politico. i think to myself where is he going with this? are we going to be talking about going to new hampshire. are we going to be talking about cell phone use? tom: what politico invented is linkage into how all of bloomberg look at the cell phone. absolutely stunning. lisa: the idea of the media and the role ahead. we will not be discussing that is much as markets ahead on the open. john hancock co. chief strategist emily rowland joining us to discuss it all. this is bloomberg.

ritika: with the first word news, i'm ritika gupta. rising coronavirus cases are limiting what jerome powell can say about what is next for u.s. monetary policy. he speaks tomorrow at the jackson hole symposium. the conference has turned into a virtual one. jay powell is expected to reinforce the message it will probably be appropriate to begin scaling back the fed bond buying program by the end of the year. workers in manhattan have lowered their expectations for a return to offices. a survey by the partnership for new york city says 41% of office workers are returning. that is down from an estimate. australians are not eager to travel overseas after 18 months of being cut off from the world. demand is so great for bringing its -- the airline ceo gives the credit to the australian vaccination program. >> what you are seeing happening

at the moment is a rate of vaccinations higher than the u.s. or the u.k. at the start there was overwhelming demand and i expect that to continue. we are comfortable we should be able to get to the 70% or 80% target. ritika: flights from australia to the u.s., singapore, japan, the u.k. and canada will start in december. 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. ♪

>> like so many of the passenger airlines are ridership

contracted significantly in march and april of 2020. now we are at 65 to 70% recovery , with stronger bookings into the fall season and beyond. good ridership recovery which underscores the essential nature of the services we provide. tom: william flynn of amtrak, the chief executive officer on where they stand on infrastructure as well. what he knows is he needs people from tribeca to go up to penn station and climb on board amtrak, particularly the new and wonderful morning hand development. they have to live somewhere. we saw that yesterday with steve ross coming out with a huge announcement of optimism on new york city. with blackstone it is a quarter of a billion dollars to redo. truffles tribeca. what kind of name is that for a building? honest to god. truffles tribeca is what they

call it. he used to play truffles in australia. scott crowe joins us with center square investments. blackstone, a quarter of $1 billion. that is optimism on new york city real estate. scott: absolutely, from a live-in standpoint. new york city is already back. rinse are at or above -- rents are at or above pre-covid levels. people want to live in cities. they like the excitement, the amenities. the bigger question is will people be working in cities? that is why the office market continues to be in a funk. the essential side has come roaring back -- the residential side has come roaring back. tom: you have been research-based. what is your research on if, how come and in what way we will return to our offices?

scott: office is the new retail. that does not mean office is the new mall, it means offices the next major sector that will be disrupted by technology. we can shop from anywhere and now we can work from anywhere because we are letting technology help drive how we work. what it means in a nutshell is we are going to go back to the office, but in a different way come and we will use office less than before but it is a different way. a lot more collaboration. it will become more of a hospitality based model with a lot more flexibility built in. employers will have to have office space that is very attractive to employees from aesthetics, from amenities. the whole game will change. think of the apple store. it is beautiful real estate.

apple's in 1000 malls across the united states. tom: i am looking -- francine: i am looking at prices in manhattan. in soho it is $40,000 per square foot. why would i not live outside in rent somewhere a couple of days a week because i'm working there. scott: it is a great question. people like being around people. people like being in soho, people like being in manhattan. there are more people who like being in manhattan than there are condominiums. they're probably not more companies that want to be in manhattan than there are office buildings. if you look at dollar per square foot pricing, it is $1800 for apartments and $800 for office. that is the reason for that. francine: are people changing what kind of real estate they

want because of the hybrid working from home model? scott: there has been a value trend away from commercial real estate the residential real estate because we are doing more of activities at home in our residences. the kinds of real estate, people are investing more in residential real estate, they want that extra bedroom. that will be where they are spending a lot of time doing work. tom: tell me about the malls in the suburbs. everyone is focused on the cities. it makes for great press. but you have so much experiences of not so much strip malls and the megamall, but the in between malls that have a starbucks on one quarter, chip ole the other corner, how will they do? scott: the mall industry is going through huge consolidation. one of the things that is helpful for companies like simon

property group is covid accelerated a rationalization of the supply. lots of malls close. we are getting closer and closer to equilibrium as related to the number of malls we have in this country. it is a big exciting part of retail is doing well right now and we are a big investor in the center square service properties. that is because services are taking up a larger and larger share of everyone's wallet. we are all going online. your starbucks, your chipotle, your hair salon, your dentist, your massage parlor, we are spending more money on these things. it is a very bright spot within retail that not many people are seeing because everyone is concentrating on the headlines, the local mall closing. tom: scott crowe, thank you so much.

with center square. we did not spend enough time on commercial real estate and those dynamics. francine, what is fascinating about the fed speak is we have esther george talking to michael mckee, time to get taper started. bullet -- jim bullard is around the debt start saying time to get taper start -- is over on the death star trying to get taper started. where the people saying wait on taper? francine: i do not know if that will have much of an impact. it is interesting that jim bullard talks about getting taper to non--- getting taper done early so that gives little bit of flexibility to the fed and options on raising rates. there is a beautiful piece by liz mccormick on our bloomberg terminal that argued we are so focused on tapering. what the market is worried about is when you start rising rates. tom: strongly agree.

francine: that is what used to be watching. jim bullard just brought that up minutes ago. tom: we saw that from ira jersey as well. the partition that is out there. we have loads and loads of data to come out as well. as we had through the morning there'll be a lot to talk about including washington. distressing news out of afghanistan. we will watch that story, particularly around the beleaguered airport in kabul. a 6.6% american gdp. that is for the second quarter. markets taking it in stride but critically, looking at the tea leaves, 1.36 61 on the 10 year yield. that is a higher yield and bear scrutiny as well. the vicks 17.48 -- the vix

17.48. david westin with mary barra, look for that later today. we continue on bloomberg radio and bloomberg television. good morning. ♪

lisa: drumbeats of fed chair powell. from new york city 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: let's begin with the big issue. waiting on chair powell. >> all eyes will be on fed chair powell's comments. >> chair powell. >> fed chair powell. >> will be visiting very closely. >> the july fomc minutes stole the thunder. >> the consensus now is jackson hole will be less exciting. >> you have to look beyond jackson hole. >> the fed communicates tapering. >> we look toward the september fed meeting. >>