and tom keene. bonds bid, price up, yield down, equities bid, price up. we have seen this before. lisa: changing this morning. we are seen yields pickup as we

hear that the ecb is thinking about tapering bond purchases after higher inflation reads. i wonder if this will be a turning point as we see a growing number of central banks recognize inflationary courses and start tapering. tom: we have been seeing turning points for years. three years in to double-digit equity returns, and from what you studied, you say, hey. lisa: this is the question. if bond yields remain low, if they don't increase all that much, what does that tell you? are they not pricing it in? is there something else driving the price action? does it tell you we will enter a slow growth world no matter what? this is a huge question given

what you pointed out earlier, the yield curve not doing anything. tom: exactly. 109 basis points. i look at it all in the background of the exit of afghanistan, and it shows the turmoil and into q3 and q4, do we have an understanding of what 2022 looks like? no. taylor: a lot of it has continued to be positive. the bullishness behind big tech, but on the other hand, you get strategists like stuart kaiser talking about the technical weakness we see in september. we have blown through pretty much all the strategists price targets india here we are. tom: let's continue.

we are slightly green and now we go to negative. maybe on the ecb negative two, s&p negative five, the vix a 15 handle, backup to 16.4. it has an august feel to it. the yield curve eight basis points, the difference between the 10 year and two year yield 0.9 percentage points. i want to mention the real yield absolutely unreal, down to -1.08. there is no movement to a lesser negative number on the real yield. there is a movement, the wall is moving. lisa: it does feel like an august. you do not want to make too much of it, but there has been something going on, a sea change with the ecb saying it may be

appropriate for them to start tapering. are we seeing a turning point? we will get the faha housing price index for june. this is important. we are seeing home prices continue to climb at some of the highest paces observed in history at a time when there is a shortage in supply, faster than salaries are growing up. how much does this crimp confidence for consumers? how much does this crimp the market? how much does this bleed into a broader inflationary print? we get an august consumer confidence reading. the expectation is resilience even though we have the delta variant, supply chain disruptions causing higher inflation, even though some of the input prices of things like aluminum are at the highest levels in a decade. these things people have shrugged off.

president biden is planning to deliver remarks on afghanistan, marking the end of a two decade war, the longest war in u.s. history, talking about the road ahead. my question will be the international relations. how is he going to navigate conversations with pakistan. we will talk about that with john bolton shortly. and of course with european allies. tom: the president in the afternoon. we will have full coverage. we're joined with an extraordinary research note that goes back to the point in the classroom where you are looking at christ makers -- looking at price makers, and you think of a monopsony, a rubber plantation in singapore. the people farming the rubber are price takers, they take what they can get.

our guest is in search of a price maker. he joins us now. what is a price maker? what do they look like? >> homebuilders are price makers at this point in time. most of the industrial sector is a price maker at this point in time. i think that the question as to whether or not retail are, you know, price makers or price takers -- but it seems, and this is what is different about 2021, that they can actually still make prices. the consumer is willing to pay whatever the, you know, whatever needs to be done, so ultimately a price maker. tom: are the big stocks of this era -- amazon, apple and the

other brethren -- are they price makers? michael: yes. i think they definitely are. all the services they need to be able to charge whatever they need to and definitely as far as consumer electronics are concerned, apple is a price maker. lisa: i saw your parenting experience this morning as we all do. adorable son. great to see that. it highlights the fact that we have delayed the return to the office. we have delayed mobility as we watch the delta variant. there is a question of what this is going to do economically and with respect to company's abilities to pass on pricing increases. what is your sense of how that has played out? michael: delta has had an impact but on very specific services.

it certainly has an impact on the speed with which workers go back to their offices in a city like new york, where the expectation was that, post labor day, we will be back to a normal midtown. that really only affects a small segment of the city -- of a city like new york. it certainly has an impact on the travel industry, on the leisure industry. it does not seem to have much of an impact on the restaurant industry, but delta and prior surges in covid, i think the vaccinated population is much less scared it -- scared than it was, and the unvaccinated -- there will be a severe beating at the end of this interview -- no, great kid

-- anyway, the unvaccinated portion of the population seems to believe this disease is some kind of a scientific hoax, so i don't think delta, if you are trying to draw a correlation, my feeling is the delta outbreak will be much less. i think the biggest impact and still the biggest problem will be keeping schools open. i do think it makes a difference whether parents are working from home. it is one thing to work at home with your kids standing around you. it is another thing to work from home with your kids the classroom -- kids in the classroom. i do think that the economic projections on the impact of delta are significantly overstated.

lisa: is that what the 10-year is telling you? is it all fundamental or are there technicals at all? michael: i think there are technicals. a big short at the long end of the curve got wiped out. i would expect yields to move higher here. i would not be surprised to see yields challenge their 2021 hi. -- 2021 high, which would still be a remarkably low level for the tenure. -- the 10 year. tom: i have good and bad news. no question that -- is trouble. the good news is we are looking for an intern. maybe we could keep him busy here. you be nice to him, michael.

lisa says be nice to him. lisa: michael and i both give our children breakfast, new tele-on some form of starch -- breakfast, nutella on some form of starch. thank you. tom: thank you. we are observing here, with all of our advantages. this is a huge deal. the kids at home in this pandemic. lisa: it has been a huge psychological impact that will be borne out in years to come. tom: maybe if they serve the kid tang they will go to school. we will see. dow futures up 20. the child is safe. on radio and tv, this is bloomberg. ♪

>> the u.s. military presence in afghanistan has ended after nearly two decades. the final flight caring american troop left kabul yesterday. some americans who wanted to leave were not able to get to the airport in time. new orleans managed to escape floods from hurricane ida but mentions -- but now faces days or weeks without power, and not just new orleans. more than 2 million people across the region lack electricity. -- inflation in the euro area at the highest level in decades. prices rose higher than predictions of all economists and a bloomberg survey, testing policymakers.

in china, the economy took a hit from the delta virus operate this month. the service industry shrink for the first time since february of last year. confidence amongst more businesses weakened and consumers cut back on spending. apple is looking to add space for an iphone upgrade. it will allow users to send texts to first responders without cellular coverage. the feature is not likely to be ready before next year. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am ritika gupta. this is bloomberg. ♪

>> there is a lot of heartbreak associated with this departure.

there still would have been people disappointed. it is a tough situation. tom: the leader of our military effort in central asia, kenneth mckinzey. green on the screen. watching markets closely. john bolton is scheduled to be with us for an hour -- in an hour. emory, are we on good terms with any part of pakistan? >> complicated question. we talked about this yesterday. at the moment it is not so much good terms.

president biden has yet to even call his counterpart. there is a lot of distrust between pakistan and the u.s. this stems following the capture of osama bin laden. i believe the new york times reported that when the taliban came to kabul and went to the afghani central security intelligence the language spoken was not pashto, it was another language, and many believe it was pakistani intelligence along with the afghans taking those details. tom: speaking back to the partition of india and pakistan. my head is spinning with all this history. the president today, does he articulate our future and central asia -- future in central asia or does he focus simply on the exit we made yesterday afternoon?

>> i imagine that when he takes the podium around 1:30 d.c. time he will talk about the americans left in afghanistan. you heard general mckenzie say it is heartbreaking. "we did not get everybody out." and we have no diplomatic presence in kabul. that is finished. anything we do now is out of debt. we have no presence on the ground. the u.s. has to entrust -- they say they have assurances from the television -- to get those americans out of afghanistan, a diplomatic hurdle. lisa: i wanted to go into the idea of what the u.s. relationship with the taliban will be given the history of them considering it a terrorist organization. >> good question.

we do not know yet. if the u.s. were to ever recognize the television, it would be along with other g-7 countries, not alone. about $9.5 billion sitting in the fed on hold. the imf paused money that was supposed to be going to afghanistan. you have china saying this morning that money should continue. this is the leverage the international community has over the taliban. it is a poor country. it was poor when america got there. it was poor during the withdrawal. that is probably the biggest piece of leverage. lisa: when we got the images of the chaotic removal of u.s. troops, president biden's approval went down significantly . is that still a discussion or

has that been tabled and people have come to terms with the reality that's happened? >> it is twofold. on one hand, you will have congressional hearings. there are democrats and republicans who are very upset about the chaotic withdrawal. there are a number of lawmakers i have been in touch with who are deeply involved with trying to evacuate americans and afghan allies and went answers about why -- and want answers about why this was chaotic. one nbc poll was prescient. when you asked americans what is most pressing on their mind, afghanistan is not even on the list. it is covid, the economy, concern about the inflation and consumer prices. americans vote with their kitchen table. taylor: before we get to next

year, the immediate path forward . what is the debrief? what does the analysis of this look like in coming months? >> there will be a hot wash, the secretary of state has said, to make sure they go through what went wrong, and a lot of that stems from the fact that no one in washington expected the taliban to enter kabul in the short time they did, bcomes nexy can get those americans out. we don't have a presence there. there are no flights leaving afghanistan. who will control the airport? that is key. tom: lisa has been in washington and is using this jargon. what in god's name is a hot wash? >> it is a postmortem, going through every detail. that is a hot wash. when shows do not go well, don't

you have postmortems? or do they always go well? lisa: we will have a hot wash of this. tom: we will hot wash this. take a shower. lisa, this jargon garbage goes to the heart of the matter. bolton and others can talk about it. whatever the political persuasion, i am sorry, the elites are in retreat on all of this. there is no other way to put it. lisa: and when we talk about the sanitized words versus the stories that have come out on public opinion. jon ferro pointed out earlier -- he talked about how it is not that people disagreed with exiting afghanistan. it is the method that will be parsed through in detail in the

years to come. tom: ok. hot wash. ok. taylor, i looked at the jobs report and i am sorry. arguably the jobs report on friday is more important than jackson hole. taylor: you could say that. we continue to see wide dispersion. what is the low estimate? four to five. ubs looking at 1.1, at least over one million, so it is a wide dispersion that shows you how difficult it is to be forecasting. lisa: hot washing data. tom: we are going to have a hot washer. lisa: annmarie sent us the definition, so we have it. tom: would you like to enlighten us? we have 12 seconds. lisa: the immediate after action

analysis of an agency's performance. tom: ferro through a beverage at him. we have to go hot washer right now. joining us after the hot wash, this is bloomberg. ♪

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tom: bloomberg surveillance. good morning. jonathan ferro off. unsure when he is returning. taylor riggs helping out. green on the screen, 16.45. 10 year yield 1.29%. in the foreign-exchange space, as they say, euro with some nice strength. on individual and selected securities, taylor riggs. taylor: we will start with the indices, climbing higher. you are getting this underperformance of some reflationary trade, similar to what we saw yesterday with the

underperformance of the russell 2000. big tech is the story that drives the s&p 500 higher. we talked about bonds catching a bid. yields were trying to rise but we remain unchanged pretty much, 1.29%, and back below 1.9% on the 30 year. if you have a 10 year that cannot even break above 1.3%, how do you do what i said you want to do? robinhood catches my attention. romaine: zoom one of the movers premarket. revenue growth 54%. that would be good. the problem is, in q1, revenue growth was 191%. based on the guidance, analysts say by the time you get to q4, the growth and revenue will

-- growth in revenue will only be 15%. fine if it was a mature company, but it is supposed to be a young growth stock. remember, zoom agreed to require -- to acquire five9, and docusign lower by 1.5 percent. other news that broke was that news about robinhood, specifically about the fcc commissioner and the interview he gave where he suggested he was open to the possibility of banning the payment to order flow model, a critical model for robinhood, how it makes money. competitors yesterday like

schwab are slightly higher. this was just an interview. he did not say there was any sort of imminent policy change here, but something to keep an eye on. also biontech, shares slightly lower. we got that recommendation on booster shots yesterday. it was a recommendation but there were so many caveats attached to it, a lot of people concerned. later tonight, tom, crab strike earnings will be after the bell. taylor and i and caroline will be here to cover that. it has rallied nine straight days prior to today. tom: looking for the close this afternoon. i look at the payment for order flow, paper tickets and all the sprawl on the floor over to the modern electronic era, i simply, lisa and taylor, i do not get payment for order flow. lisa: the idea here that people

can profit from just getting a mass of orders. that is why you have robinhood offering free trades. you have the likes of citadel on the others of it raising these questions, which is what gensler was raising the issue of. taylor: not to jump in, but the robinhood issue, 80% of their revenue comes from payment order flow. and it was not just them. charles schwab also took a dip. the industry perhaps under pressure given maybe some of the gameification this represents. tom: the jobs report a three-day extravaganza. tom, i want to go to wages. we have a wide dispersion of nonfarm payrolls, unemployment rate. is it a mystery, the wage growth of america, or can you give us a

statistic? tom: good morning, team. i have said this many times, probably too many, there are many measures of wages, and one is the wage pie, the index of aggregate weekly payrolls, and that continues to move along at a constructive pace, and just looking at it sequentially month on month, however you want to look at it, i think the idea that, you know, the consumer remains in fairly fine shape from a wage perspective is intact. when it comes to this payroll report at large, i think everyone appreciates we had some sort of quirky seasonal issue going on last month with education. in the coming months -- you know, look, i do not know anyone who is building in some quirky

thing like that this month, but you have to keep in mind that the economy is opening and seasonal factors are looking for a specific pattern in july and august and september. i don't know that's necessarily going to hold true. something to bear in mind for not just this report but coming reports as well. taylor: and issues heading into these reports is how tight the labor market is. do you have a sense of that? this bleeds through to what those wages increases could be. -- >> i am sorry. there is crying in the background. lisa: you are having a great morning. are you making an argument for working in the office? >>. i cannot wait. lisa: i am asking about the

tightness of the labor market and if we will see more tightening than the numbers would reflect. >> for sure. this is something we have talked about quite a bit and i am sure i have mentioned it on your show as well. if you look at labor force participation, particularly for the older age cohorts, 65 and older, near retirement age cohorts, and worse yet, when you look at people who have left the labor force from 55 and older, the numbers are quite big. it is funny. we have tried to draw this parallel to gfc. after the gse, most retirement accounts were decimated. people had to leave the labor force. it is different this time around, when older people, near retirement, probably have improved quite a bit.

i think that is true for just about everyone who has an investment account, so you have a disproportionate share of the older age cohort leave the labor force. i don't think there is a compelling reason to have them have to come back. i think that will have implications for the fed, further bookies -- the fed, for the bookies if we want and employment rate of x, it may not be that simple to get there if you have additional retirements above what is typical in an 18 month window. so people have done a good job saying we need to look at the prime working age cohorts. i think that will get you a better look at the surface. taylor: how are you thinking about the consumer inflation? and if consumer sentiment drops

in reaction to these higher prices, is that the natural, well-behaved function? >> what has been interesting to us as we look at consumer confidence is this weekly measure, we will get that back. we get that back tomorrow, i believe. sorry, on the second. the weekly measure has bounced back from that lull we saw in a week of delta really accelerating, so the consumer seems to be shaking it off to some extent. tom: we had another guest on earlier whose offspring was walking back and forth on camera. what we want to know from you, your daughter is in tears, the poor child, but is the dog in tears as well? >> he is freaking out too. i am the only adult in this house. my wife just left.

she is in education. and i am on with you and letting my daughter cry and the background -- cry in the background. tell her arbitration doesn't work. appreciate it. tom percelli. lisa: looking at the markets. just look at those markets, all the different disruptions with the offspring and dogs, just counting down the minutes until everyone goes back to school. tom: what is amazing, taylor is in shock. taylor: we never get this much action at 4:00 p.m. lisa: the highlight of my day is the closing bell. we need to be on in the mornings with kids and dogs. tom: it makes you feel younger and it is great birth control as

well. maybe john bolton's grandson will be on. let's go to the hot wash right now if we can. annmarie hordern giving us the idea here of what a hot wash is, and it is an immediate after action agencies perform after their performance in major events such as hurricane katrina. thank you for that briefing on washington jargon. thank you. the president on this afternoon. we will continue. kathy jones. charles schwab will not be as in -- as eventful as tom's daughter. stay with us. taylor riggs, stay with us.

on bloomberg, good morning. ♪ >> the taliban have -- hours after the final american soldiers flew out of afghanistan after 20 years of war. the taliban leaders walked across the tarmac at the airport in kabul. rescue crews are looking for people stranded by hurricane ida, many using boats. at least three people were killed in the storm. governor of louisiana john bill edwards -- john bel edwards says he expects the death to rise considerably. many are without electricity. in northern california, thousands of people have been ordered to leave south lake tahoe, a fire threatening it. interrupted more than two weeks ago near sacramento. it has destroyed 417 buildings and burned 177,000 acres.

the price of aluminum at a 10 year high in london, a rebound. china has tried to cut electricity and curb emissions. demand for the metal is surging. in -- in japan, trying to promote the use of english to attract foreign investment. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am ritika gupta. this is bloomberg. ♪

>> there is one big difference post-pandemic, which is the

enormous amount of fiscal spending. my worry is if they don't account for these new forces, they may be behind the curve. tom: very important, certainly on the liquidity. i am tom keene. we will be joined in a moment, but we want to frame where these equity markets are and where they will go with david wilson, bloomberg stocks editor, starting out as hot wash coordinator 15, 20 years ago. david: assuming stocks don't fall out of bed today, you are looking at the seventh straight monthly gain. there were 14 earlier instances going back to the 1950's where you saw streaks that long or

longer, so what i did, jumping off from their data, was say, ok, how does the s&p 500 perform after you get past the seventh month? and there are three scenarios that may play out. one is the streak ends, the index falls. second, you get a relatively small gain, 3% or less. the other is you make it a gain of 10% or more. tom: a lot of predictive force. >> it is all over the place clearly. you have a relatively even distribution among those three scenarios. given where the market is now, it is hard to figure out where it goes next going back. if you assume stocks will fall, maybe not. tom: going to dr. wilson here in

the studio. let's wander over to mark in london here to come to grips with the wall of money. our stocks going up just because there is a wall of money? >> not just. there are some fundamental decent reasons, it is just that they are very expensive, but other asset classes are possibly even more expensive, i.e., bonds, so little choice but to continue dollar cost averaging into equities. lisa: ecb officials saying they should probably start tapering their bond purchases sooner as a result of the faster than expected inflation. how much does this change the backdrop for fixed income markets in europe? >> coming up with i think is due

on september 9, which is, if lagarde can perhaps for once get a little bit of ground, currently the purchasing is around 8 billion euros. it will going to something else. she could reduce that to 60 billion. they increased it at the start of the year. why not decrease it to be back on pace by the end of the year? it is a tool. that might be one compromise. still having negative interest rates. the banks can borrow as low as -1%. just tweaking bond buying might be a smart way of heading that off. lisa: i was expecting a bigger response in italian bonds, fed,

german bonds considering the peripheral bid has been underpinned by the ecb. that is not the case. it has been pretty much equal to anything on a relative basis. what do you think of that? >> it has to survive. one thing they have got to get right, they are pouring 25 billion worth of fiscal response into it this month. you will get more by the end of next year. the bond buying is consistently going to be there. it does not really make much difference. i think everyone should continue to prefer the highest yield. taylor: when you talk about a low yielding world, we are showing negative rates overseas and that is what makes the 1.3% on the 10 year it look attractive. it is all on a relative basis.

what is the role of a bond in a portfolio given that they look more expensive than equities? >> that huge 1.3% on the 10 year. it is there for security, safety. the fund managers are not being crazy. i would like to be a almost zero on bonds, but you have to have some balance in a portfolio, and for people who have to invest in euros, invest in fixed income. tom: august. there is no self-respecting banker in europe working today. they are all on holiday, as you call it. when you guys finally show up to work again, will we see a consolidation in continental banking? >> i think not. there is no way we could in europe.

it is not allowed. it is simply too regulated. we cannot even do intra-country mergers, so you will have to wait a long time before we see substantial merging. that is about the only thing on the horizon. tom: marcus ashworth there from london and david wilson as they're giving us his perspective. what is interesting to me -- lisa, let me go to you. with david wilson's chart, there were only 14 equivalencies back to my youth, and that is really something. it is rare where we are right now. lisa: it is and that is why people are having such a hard time understanding what perspective to take. i was struck by one at bank of america. they said if you look at leverage it is at an all-time low, so if you look at debt to equity, it is not so bad.

you wonder which is the bigger bubble. how do you even create a metric to give you a sense of where we are in the cycle? tom: it is a single-digit world. in the last 10 years, the s&p 500 is up 16.5% per year. that is a terrible return. taylor: terrible, great? -- it is unbelievable. where do you go, what do you do? i would argue it is corporations who have done a good job of taking out the cash, issuing debt -- why not, it is free? -- but the problem is the use of that cash, buybacks versus capex, perhaps the more responsible choice. tom: the industrial company 3m, debt load 13.4%. you can do that on the bloomberg with the wacc function.

david wilson taught it to me over the beverage of my choice 20 years ago. we will hear from jeffrey yu of byu mellon. stay with us on radio and television. this is bloomberg. ♪

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♪ >> delta does have an impact, but specific services. >> there's is still a lot of momentum but, we are seeing headwinds from the delta variant. >> a think next year we're probably looking at 3% inflation. >> the economy continues to pick up and inflation continues to stay above 2% in fact, well above 3%. the fed will have to move sooner. >> it will be sometime until the fed becomes the major market driver again. >> this is "bloomberg surveillance."