beyond the virus. i think it is too early. >> fear is driving prices. >> this is bloomberg surveillance with tom keene, and lisa abramowitz. jonathan: from new york city, good morning. this is bloomberg surveillance lift. alongside tom keene, i am jonathan darrow together with kailey leinz. the equity market on the s&p up 0.8%. not many people convinced by this balance. -- balance. -- bounce. tom: we are back in halfway, but it does not feel like it. jonathan: governments unwilling to change their forecasts until

we get more detail on this variant. tom: we lack the data. just restart -- joshua sharfstein will be with us later what i see is a wall street saying, we need more data. jonathan: kaylee, we still do not know. kailey: i wonder if that is why you are not seeing a more convincing bounced in equities. the s&p is up 0.8%, but that does not even cover half the loss on friday. the market still seems iffy. jonathan: we have got a few more weeks of this. three weeks until the federal reserve decision. the fed stuck between a rock and a hard place. tom: the u.s. economy is

humming. we may see that in the jobs on friday. jon, you'd like the ism stuff. we know air -- our greek letters. this is omicron. bloomberg has been great about all of the adaptability, the crisis, the weekend we have been through. jonathan: your equity market positive. let us whip through the price action. on monday, we bounce back from a big loss on friday, up 40 points for the s&p. kailey leinz, this is unconvincing.

yields up five basis points, tends back to 1.5277. kailey: 11 basis points higher than thursday. there is a long wait go to get back but there is not a long way to go from your couch to your computer. it is cyber monday. adobe analytics says that as much as $11.3 billion could be spent online alone today, which would make it the largest shopping day of the year. there are some serious policy conversations we need to have. president biden is going to speak on the on the content variant from the white house, probably going into more detail about why he implemented travel restrictions. i wonder if he is going to push his will back better agenda. economic uncertainty created by the virus, maybe he is sending a

message to capitol hill. later, we will be hearing from jerome powell and john williams of the new york that. -- the new york fed. does he address the variant and implications for monetary policy? we were having a conversation about an accelerated taper, but does uncertainty give the fed more cover? it will be interesting what he says today ahead of his testimony on capitol hill tuesday and wednesday. jonathan: if you think about what we have heard so far, how do you feel about a faster taper now? tom: this is a key message. within the panic, what you are going to do for your portfolios,

we wait for the science. jonathan: how sensitive will this market be to incoming economic data, including payrolls on friday? >> economic data will be hard to trade, given that we are in this wait and see mode. early indications over the weekend positive, but everybody acknowledging we have further to go. for the moment, we are focused on how markets are trading. people have had a good year so far. part of the reason we have seen the pullback is people trying to lock into those gains. tom: do you readjust for 2022? is the sense that you have that all of your wonderful team recalibrate its? elsa: at this stage, we are more focused on the central banks

that were about to hike and are put off by uncertainty. i put the bank of england in that category versus other central banks that do not have tightening decisions in the near future. by the time you get to 20 52, things will look different. tom: i was surprised on friday. two recalibrate the euro 1.1289. elsa: the euro will depend on the omicron outlook. typically, the euro-dollar has been treating in-line with equities. week sought a break in that on friday. it makes sense to me. lockdowns, the impact of covered already having cut the euro.

we sense that that should rotate to the dollar. i have a cult lower into next year. i am not changing it. but that is based on the cyclical strength of the u.s. dollar. kailey: we saw the flipping to euro strength on friday. we also saw a massive bid committed to the japanese yen. it that just a one-off bid? or do you expect we could see a more persistent reversal there? elsa: the closer you get to fed normalization, the more you will anticipate that change. everybody likes the position with the dollar-yen higher. but at the moment, the yen, the swiss franc, the euro are safe havens. the dollar is more mixed, but outperforming. jonathan: the dollar lire.

we will hear from the turkish leader this morning. he says he will never advocate for a rate hike a lot of people see him as the de facto leader of the turkish bank. elsa: all i will say that the visioning of the mirror is not crowded. we do not think the massive is along the dollar lire. i do not think that creates real concerns when the central bank is not willing to hike rates. jonathan: dollar-lira up to 12.72. tom: from 2002 to 2006 and then it unravels. we have seen in the last couple

of days a mixture of erdogan politics, his position in the labonte and down -- the levant and down to egypt. with the financial reality of turkey, it is all about the banks. jonathan: we need to talk about more than what is going on in this market than just a mutation of the virus in south africa. tom keene, so much was going on on friday. there is more to this than what meets the eye. it is not just about a mutation, a variation, look at what is happening in credit. if you are going to fate any move, do not fade friday. tom: i am going to go is along and of the curve. a 187 from 2% into -- in the 30

year bond. so much of that is the move we saw in the two weeks prior to omicron. how much was a pullback? how much is just the virus? jonathan: there is more going on than the variation. it is about credit, the federal reserve pulling back or quickly, the federal reserve stec a rock and a hard place. kailey: you could take the other side of the quite in that maybe it does give the fed covered to normalize policy at a slower pace, not an accelerated one. also to your point about maybe there is something else going on. we have to consider that this market was priced as if the pandemic was over and being reminded of the fact that that is not the case. asset prices in general, how rich valuations are.

it gives us an opportunity to unwind some of that. jonathan: yields are higher after shifting much lower on friday, up by five or six basis points. we had to move lower. this morning, we are up on prude. tom: i am looking at the bloomberg commodity index. it is a crisis. the dow has moved back to where it was mid august. jonathan: we are in the same room and you are quoting the dow. waking up in new york city, up 0.9%. coming out, the president of young co-research. from new york, this is bloomberg. ♪ ritika: the new omicron

variant could lead to surges. the. first detected in south africa. scientists say it appears to spread more easily. airlines are down, businesses have to respond to travel restrictions. initial flight bands have given way to wider reading azure's that will make travel more expensive. inflation has risen. 5.6% in november and higher food prices. that underscores supply issues in europe. traffic remained below pre-pandemic levels. it rose 40% from a year ago but still -- 40% from a year ago but

still down from 2019. trial selection began today in the trial of ghislaine maxwell. she faces as much as 40 years in prison. 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'm ritika gupta. this is bloomberg. ♪

>> this is a clarion call as far as i am concerned, saying let

others put aside these differences and say if you are not vaccinated, get vaccinated. if you are fully vaccinated, get boosted. jonathan: dr. fauci over the weekend. alongside, -- tom keene, i am jonathan ferro with kailey leinz. the s&p advancing 0.9%. this is your monday morning balance, not that convincing. yields a lower friday, a bit higher this monday. that is the extent of the turnaround in crude. 71.69. tom: brent crude, 84, down to 76. the present speaking later this morning on omicron. remove to the president's

comments. emily, i have spent the morning looking at the vaccination matrix of the u.s. they calculate that unvaccinated deaths are 13 times vaccinated. what will the president say to use omicron as a tool to get more vaccinated? emily: you talk president biden use the delta variant as an impotence for getting more people vaccinated. we can expect similar from the administration. we have seen the travel ban be put into place on south america and seven other countries, but even some of biden's advisers have admitted that a travel ban will delay the arrival of the variant but not prevent it. the biden administration have

type so much of six -- type so much of their success to getting over the pandemic. the only way they are going to do that is through vaccines. tom: mario draghi running the ship in italy. he put out a non-mandate mandate a few days ago. are we going to state non-mandate mandates from president biden? emily: we have already seen biden have mandates for federal government workers, companies, putting those things into place. this could lead to more mandates as more americans experience them, more companies get comfortable with and forcing them. a lot of mandates are still at the local level. here in d.c., we have had part of the mask mandate lifted, but the surrounding areas are having

them put back into place. this is still a local and state game, but the one thing that the government has are vaccinations, boosters. we are expecting president biden to talk more about that later. kailey: art week still seeing a correlation between the case curve in the u.s. and the approval rating of president biden? emily: we have seen a vaccinations increase while we have seen biden's approval rating decrease. part of that is because a lot of americans do not feel like the pandemic is over. americans are also dealing with things like high inflation, which the biden administration is saying is part of covid. the pandemic needs to fully get behind the u.s.. a lot of factors here, but a lot

of what president biden has at stake is going to relate to how many americans feel like the pandemic is over. kailey: president biden may be looking for a win as it relates to his legislative agenda. is the build back better plan at the top of the agenda? is it more about the actual deadline items? emily: it has to be about those deadline items. if they do not pass a short-term funding measure for friday, the u.s. government will be experiencing a shutdown. have until december 15 to raise the debt limit. that is going to become a bigger priority then bill back better. that is something that senators are going to be working on, that the biden administration is going to be keeping an eye on. but because of the deadlines, that cannot be a priority today. tom: aren't they overwhelmed by

omicron? you are talking like it is business as usual. i do not buy it. emily: there is only so much congress can do about omicron variant we do not know how transmissive it is. we have seen a couple of lawmakers say that there does need to be more assistance to help people with covid, thank the pandemic is very much in effect, but you have until friday to keep the government open, two weeks to make sure you raise the debt limit. these are pressing measures, something they can do something about, whereas with omicron, there is a huge question mark about what needs to be done. jonathan: takei, were you surprised by the move we saw on friday? tom: this is the t-e function.

i did a standard deviation study. from the top, we came down 4.6 standard deviations. i would use the standard 500 for this careful survey, because it is a better index thematically. jonathan: given what we have heard from south africa and from a covid advisor, the cases have all been mild cases so far. we should keep making that point this morning. tom: this is so important. this is the science that we try to lead with. i cannot emphasis this enough. we are going to look at the science. the science is -- i take real

issue with banners in the media that say, high alert. there is not high alert. there is a virus. jonathan: if it is more transmissible but less severe, is that not ultimately a good thing? that is for the doctors to advise us on, but is that not the end game? tom: this is an event to get vaccinated as you go from 59.1% can we even dream of, 65%? emily: that is the message from the admin -- go out and get your booster. tom: did emily have her booster? jonathan: we can ask later. you mean kailey? kailey: i have my appointment

next monday. jonathan: coming up, portfolio manager of morgan stanley investment. this is bloomberg. ♪

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jonathan: live from new york city, here is monday morning price action. bounce back. friday was vicious. up 0.9% on the s&p. talk about an unconvincing ounce. we work through a wide range of outcomes. this is what it means elsewhere, a taste of foreign exchange. the yen with a huge move on friday. this morning, 0.5%. that is nothing. in the bond market, the federal reserve stuck between a rock and

a hard place. two year yield up for basis points, -- up four basis points. for many people, we have got to wait for data. there is so much about this variant which we still do not know. what we do know is that the cases they have seen so far are mild to moderate. so far, so good. tom: exactly. i agree with you that we need to look at medical professionals who are tactically involved with omicron they are saying, lose the hysteria and wait for the science. jonathan: look at how people are already responding -- travel bans, restrictions. tom: i have a warm call with

china about this. i can tell you it is tangible in the street across the pacific rim. they will reaffirm zero-tolerance. jonathan: is illegal still corbyn zero? what does that mean for -- is the goal still covid zero? what does that mean for supply chain disruption? tom: i want to of these statistics. in the buy-side game, there is not a lot of discussion. you just look at percentile performance -- five year, three year, one year performance. all of this discussed with a beverage in your hand, done in 12 seconds. with andrew slimmon, we see a three year 94th percentile. in the last 12 months, he is in

the 90's percentile. over -- out of 100 managers, only two did better. how do you generate those numbers? what is the slimmon religion that generates those stunning numbers? andrew: it is flexibility to being open-minded to what the market offers. last year, travel and leisure got obliterated we bought those stocks. this year, it has been more value oriented. it is my belief that is much as people talk about inflation- sensitive stocks, most are over weighing other stocks. most people talk about that, but they are not invested that way. tom: i did a bloomberg study. i did a standard deviation move.

we had a 4.6 standard deviation move in the last four days. andrew: i do agree with goldman sachs -- more transmissible. people tend to not react the same way to the issues. there is a of complacency. the market has done so well. i understand the market was down on friday, but i saw retail money coming in. it will get a bounce back, but i do not think it is going to be dramatic because of that. complacency to this issue over and over if it morphs into something more serious, that could be a concern. jonathan: the first time i sensed real hesitancy in your voice around this market.

what has happened? andrew: here is a simple rule. the third year coming off a bear market is harder. the market does not do as well because financial conditions start to tighten. central banks say things are getting better. we do not need this level of liquidity. conditions will tighten. that will be offset by better earnings than expected next year , but the result is a single-digit year. you know as well as i do, you can have a 1% or 2% move any day. that is a lot of volatility. i suspect that year is going to be tougher to make money unless you stay focused on fundamentals and buying companies that are

being -- beating estimates. jonathan: i want to read what he said. fort lee first attempt since the pandemic started, we face a software it is unclear what central banks will do. no guarantee of easy money going forward. does that resonate with you? andrew: yeah. you have tighter monetary policy coming, potential corporate tax. i think that will be offset by better corporate fundamentals. it is not going to be a great year next year. this year, the game has been on, but it will get tougher. we will bounce big today, but those are high beta stocks. i have not so short you want to

have a lot of risk as you go into next year. kailey: how much of the tough picture for equities is predicated on potentially higher yields? andrew: that is part of it. but i think it is tighter financial conditions. at the end of the day, whether the 10-year is a 1.5% or 2%, stocks are still cheap relative to bonds, but higher inflation will get the fed nervous. the market will start to reflect that. that is why the third year is tougher? kailey: does that mean stay away from growth in 2022? what do you want to own? andrew: going back to what tom said initially, my view is investors do not have enough inflation-sensitive stocks.

look at energy. it is the unloved sector i have learned with energy stocks they keep going up until everybody gets on board. i do not think that is the truth. i see banks, they had a big selloff on friday. that is a better opportunity to be a buyer today than the reopening stocks. multiples remain low. i think it is in the inflation overgrowth. i do not think we are in a situation like 2000 where stocks are that expensive. the high-octane ones have come down. but it is really this concept that inflation-sensitive stocks remain under investors portfolios. tom: are we going to see higher inflation? steve major at hsbc was heated

this morning. longer-term duration yields shows a bout we will not see persistent inflation. do you agree? andrew: we are in and period like the 60's, higher inflation, higher growth. the dual mandate of the fed of stable prices and maximum employment seems to be tipping towards maximum employment. that reminds me more of the 60's then the 2010. the s&p did fine, but inflation sensitive stocks did better. tom: right back to the 1960's. andrew and i want to get back. there is a new beatles documentary. it was great. it is how it naked it is. they even say while they are filming at that they are not happy that they are filming it. there is a scene where george

person talks about eric clapton. -- george harrison talks about eric clapton. you can watch it on disney plus. jonathan: did you see what they did in hong kong with that episode of the simpsons? they got rid of it, mention of tiananmen square. kailey: the difficulty of doing business in china. we thought that many times last week. jamie dimon's comments made a lot of news, but if you are operating in china, you have to play by the rules. the substance feeling that one. jonathan: that is the first time i have heard andrew slimmon a little bit cautious on this market. tom: i will go with that. i did hear a little bit by the dip there.

jonathan: we always obsessed with the shot closest to the boat. right now, that is omicron. even if we get past this, is it a green light to risk assets, given what we talked about in the middle of december. tom: jon ferro channeling winslow homer close to the boat. there is a lot of worries, but the economy is coming. what is the economic data we will see for q4? jonathan: and how responsive will we be? coming up, joshua sharfstein of the bloomberg school of public health. up 0.9% on the s&p. i have seen how they put that song together. tom: everyone younger should

watch it. it is marius. -- it is a glorious. jonathan: from new york, this is bloomberg. ritika: the world health organization warns that omicron could fuel virus spread. it was first detected in south africa and appears to spread more easily. travel restrictions trying to contain a transmission, but moderna says it could have a new vaccine ready next year. biontech is trying to adopt its vaccine to handle omicron. they put plans into place months ago to ensure a new version could ship within 100 days. new steps to cramp down on

people smuggling into the english channel. 27 migrants died last week trying to reach the u.k. the latest sign of tension between the u.s. and russia, moscow's ambassador to washington says that more than 50 diplomats will have to leave the u.s. by the middle of next year. the u.s. taking a tougher approach after russia ban -- banned the u.s. from --. -- had battled cancer for several years. he was 41 and a known for his influence on sneaker culture and revitalizing louis vuitton. global news 24 hours a day on-air and on bloomberg quicktake. powered by more than 2700 journalists and analysts in over 120 countries. this is bloomberg. in over 120 countries. this is bloomberg.

>> we have got to do more in the developed world to get vaccine

to the developing world for humanitarian reasons and reasons of self interest. the suppression of variants need to be concerned about the developing world. jonathan: that is in the message from the vanderbilt university center medical professor. kailey leinz in fort lisa abramowicz. the equity market up, big on treasuries. the unwind of the unwind that a muted one. crude lowered by more than 10% friday. this morning up by five. tom: brent crude down from 84. we have peter hotel is joining us later. we are paroled -- thrilled to

bring your joshua sharfstein he has been a measured voice for bloomberg surveillance. jon and i feel we should lead with science. we have felt frenzy the last 24 hours. how do we constructively generate a measured alert even our fears? andrew: we have been talking about the potential of more variants. they could form in places that are under vaccinated. this variant has a number of concerning mutations that resemble some of the other variants that we had. none totally escaped the vaccine. we have to go through the process of studying this variant while we continue to take precautions to prevent spread.

this may well not be as dangerous as other variants, but it may have the capacity to infect people who are vaccinated. tom: what will this do to the unvaccinated? unvaccinated are 13 times more likely to die than the vaccinated. do you presume we will see a trend to vaccination? andrew: people who are unvaccinated 10 to get vaccinated when they receive more of a risk. you sought with delta suddenly more people in the south were getting vaccinated, but it may take things worse before more people get vaccinated. this weekend, i heard people saying, if there is a another variant coming, maybe i should not get the current vaccine.

but the more people are vaccinated, the more protected they will be. that will protect the entire area from a variant that is more transmissible. jonathan: help us understand the history. should we expect this to become more transmissible and less severe? andrew: over time, but how much time? not over this period of months versus decades. there was a pandemic at the end of the 19th century that may now be our common cold but that is not a lot of solace with -- for people who were getting sick back then. it could happen, but it may take some time for it to become mild. right now, the virus is just trying to spread.

some of these mutations make it more likely to spread. some may make it more severe. we will have to be smart about the kinds of cautions that he take. -- that we take. being careful about travelers makes sense with testing and vaccination. i am not sure that travel ban beens -- bans make sense given that this has probably spread. jonathan: what would you need? how much time? andrew: it is going to be a bit of a buckle your seatbelt moment. we are going to see individual stories before the picture emerges. based on the studies that have been launched, i would expect 2-3 weeks for a clearer picture. i would not panic over any one headline.

kailey: we talk about natural immunity when having the conversation about vaccinations. is there a difference in response to a variant between someone who has been immunized with the vaccine and someone who has had covid? andrew: it may depend on which variant they got in the first place. immunologically, you can put these different variants on the tree. the original virus is any close to deltek, which is white the vaccine works well for delta. some other variants worked -- were different for -- from delta. this looks more like that. it depends on which virus. if somebody had one of those earlier variants, there might be more protection than someone who had the vaccine. jonathan: good to catch up.

joshua sharfstein of johns hopkins. we start out saying it is going to take time to get a full picture of what this new mutation means for this global economy. tom: coverage has been measured all and all, but you see the media frenzy and think the president is going to put a clamp on this. how the president addresses this is important to say let as keep going, let us move on. we are moving on with a bag of economy. retail sales online -- jon, what are you doing for cyber monday? jonathan: now we have kailey leinz a christmas tree shortage. is it just victories, or real trees, too? kailey: i think it is real and

fake. if you are in need of one, try tribeca whole foods. tom: that is below 59th street. kailey: i forgot, you do not tread in that territory. tom: hon i mentioned that today's word is gagenpressen? why do germany coaches and up in england? jonathan: they play this game, which i think is what you are alluding to. if one has got a role to play, they will fulfill it fantastically. capturing the essence of that effort. maybe we will get a flavor of that. tom: it is like hockey. go to the net. jonathan: jim of bianco research

will have something to say. what this new variant means for the supply chain, inflation, fed decisions. this is bloomberg. ♪

♪ >> we have definitely seen some signs of euphoria. >> a lot of people are looking beyond the virus. >> i think we need to remain reasonably calm. >> the fear that is driving prices, and i would not as get in the way of that, is like catching a falling knife. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: getting your trading week started. good morning. this is "bloomberg surveillance ," live on tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. -- alongside tom keene, i'm jonathan ferro, together with kailey leinz. tom: we wait for the president speaking. we wait to see if this economic recovery continues. greg valliere saying it is