♪ >> i don't fed is trying to tighten financial conditions. i think the fed is still very growth supportive. >> these are very accommodative financial conditions. >> they are trying to reestablish their credibility as inflation fighters. >> the withdrawal of stimulus isn't going to be enough. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone. an eventful friday before the holiday season. russia making strident comments on eastern europe. you know the story on an ever-changing pandemic. jon ferro off today. caroline hyde on duty for us in london. it is getting restrictive to travel in the continent of europe. caroline: yeah, i am unable to

go to france unless i have family or a significant reason thereof. of course, the u.k. numbers are sensational in terms of how high we got. a record high for the entirety of covid-19. no wonder countries are going it alone. even in the eu, you are seeing eu nations putting restrictions around each other. it is getting tough. tom: ed bastian with bloomberg yesterday of delta airlines. you really wonder how this factors into travel. what does it mean for an adjustment of american economic growth? lisa: i've read this morn that just two tourists went to bali over the last couple of months. just two. you haven't seen a central bank response. you haven't seen economists really price this in. this does not seem like a major story in the economics field, and inflation seems much more the forefront despite the fact

that we don't know much about omicron and it does seem to be spreading. tom: usually valuable, dr. peck -- hugely valuable, dr. peko sz moments ago. the bond market, you nailed it. the bond market was transitory. lisa: basically, the bond market is saying, say whatever you want, jay powell, but we don't buy that this inflation is going to have a longer-lasting larry summers feel to it. you see a very suppressed benchmark number yield, and real yields still steeply negative. to me, the idea that the nasdaq sold off so much yesterday, is this noise, or if this signal that policy tightening does not matter until it does? that is the question for me and for many people throughout the day. today a pretty quiet day. at 11:00 am, treasury secretary janet yellen will be hosting the virtual financial stability oversight committee.

she will be talking about crypto assets, the fed coin, climate change risks. how much does she address the conundrum the fed faces, trying to tighten policy at a time when so much of the world's economy hinges on the u.s. asset pool continuing to be elevated? 1:00 p.m., we get the baker hughes rig count. this gives you a sense of how much is coming online after that huge dip in the pandemic. how much does that come back at a time when investment is incredibly expensive we see incredible inflation and some of the materials used to build and to drill for oil in the united states? i want to talk p.m., we also get fed governor chris wada, san francisco fed president chris waller -- chris waller, san francisco fred president -- san francisco fed president mary daly. the message from the bond market is that we are still heading into a secular stagnation kind

of feel. they dismiss it as something technical, as jay powell seemed to do this week? tom: on the bitcoin observations, kenneth rogoff of harvard university was stunning, how he stated that he got wrong the pace of regulation on bitcoin. that will be something to watch into 2022 at the sec. we watched david riley always because of his great perspective at bluebay asset management. he joins us now to reset and recalibrate. how do you reset and recalibrate after powell, after bailey, and after lagarde? david: i think what those three meetings have highlighted is that we are going to 2022 with a story around divergence across central banks. we've got the ecb that is still very much in the inflation transitory camp, i think more or less for the right reasons in the case of europe, and it is

going to continue to expand its balance sheet. we have the bank of england increase rates by 15 basis points, but by march it could be actively reducing the size of its balance sheet. most importantly, in terms of the fed. but i think what the fed, what was interesting, the fed meeting validated what we have seen in short-term interest rate markets, but it doesn't really challenge the interest rate hikes. that is one of the reasons i think why long and yields continue to be as low as they are. caroline: i was surprised -- lisa: i was surprised by the initial knee-jerk stock market reaction in the united states. evidently, policy tightening is a good thing and everybody got comfort from this. yesterday, the nasdaq sinking the most since september. how much are people taking

advantage of this global tightening push and saying maybe we haven't priced it all in? david: i don't think it is all priced in, and certainly the initial reaction we saw out of equity markets surprised me, at least. i thought it was somewhat complacent, and really reacting to a picture being painted by the fed in their forecast where policy rates still remained negative in real terms, even though they are now predicting rate hikes. the economy continues to grow above trend, and inflation just gradually moves lower back to a 2% target. that is a goldilocks scenario. i can understand why investors took some cheer from that. but there's a lot of if's and unknowns around that scenario and engineering that kind of profile i think is going to be very tough. i think the potential for a

shock will be quite damaging for risk assets. caroline: so already, we have seen some risk assets feel the pain today. talk to us about the very non-goldilocks scenario you and i currently live in london. how much should we be factoring in omicron? david: it is interesting that we've had this pivot, we had the bank of england that started to raise rates despite the uncertainty from omicron, and we know it is having an impact on the u.k. economy. i think there is certainly in the short term some meaningful weakening. we saw the pmi's for the eurozone, the service is pmi's were quite a big miss to the

downside. i do think that we are in danger of underestimating at least fee short-term economic impact of uncertainties from omicron because we will get another big wave across europe. we are going to get another big wave across the u.s. even without mandated lockdowns, it impacts people's behavior, who are going to be going out less. that kind of cyclical trade is going to have another setback. hopefully it improves relatively shortly, and we are past the worst of that into the first quarter of next year. but i think this is something which markets have pretty much ignored as they focus on this raft of central bank meetings. tom: the confidence in the next year, and i go to one observation, which is ellen

zentner and morgan stanley suggesting core inflation will continue to rollover with the ascendant economic growth supposedly coming on. how does that adjust to your investment view into a rollover of core inflation and during a rollover of core inflation? david: i am actually less convinced that we are going to get a very meaningful decline in core inflation. i think the inflation dynamics within the united states are quite different from the rest of the world. it is not just about covid related supply shocks. there is excess demand within the u.s. economy. it continues operating above potential. demand is growing very strongly. as jay powell said in his press conference, it is starting to broaden out, and i think along with things like a pickup and shelter costs, inflation is

going to continue to surprise to the upside, and i think the fed is going to have to react to that, and we are going to see rate hikes probably on a quarterly basis through 2022 and into 2023, and that is not priced. tom: david, thank you so much. wonderful briefing in december of 2021. it is a conundrum, and it is worldwide. so much of our audience working from home on television and radio. christopher is working from home and that -- and is appalled at our suggestion that jon went to capri. he should go to san moritz, and he needs a sweater to do that. we don't go that route. we go with the beautiful christmas sweater, this from celine at $1300. i am sorry to say, the dancing kid who would be jon ferro, come on, this is completely sold out. lisa: we have to do a road trip to saint moritz, a "bloomberg

surveillance" road trip. i am surprised you did not get that end. but we will find out from jon when he gets back. tom: jon loves off-season capri. he told me that. it is about the fairy lights and the important food. we need him here. lisa: you are crushing it, tom. you're doing great. tom: i don't want any confusion here. switzerland, frankly, has serious pandemic issues. i'm comfortable that he is in capri and not send moritz -- not saint moritz. anna han will join. stay with us. futures at -14. this is bloomberg. ♪

leigh-ann: president joe biden is warning unvaccinated americans that they face what because a winter of severe illness and death. the president urged initial doses and booster vaccines in the midst of the surge of coronavirus cases. he did say the spread of the omicron variant has been slow before now. more evidence of the omicron variant's ability to evade vaccines. vaccines were found to produce fewer antibodies against omicron. emerging research is prompting governments to speed up booster vaccination campaigns. bloomberg has learned the u.s. is pushing the eu to finalize a package of sanctions against russian banks and energy companies. they would be imposed if the kremlin attacks ukraine. the u.s. believes agreeing on sanctions would send a firm signal to the russian president

vladimir putin. in the u.k., it was a stunning political defeat for prime minister boris johnson. his ruling conservative party lost a key parliament tree election to the democrats -- key parliamentary election to democrats. elon musk is on the verge of selling 10% of his stake in tesla. the sale was to pay for taxes on the exercise of stock options. musk has now sold 3/4 of the shares he needed to get rid of to reach the 10% threshold. i'm leigh-ann gerrans. this is bloomberg. ♪

>> it has been our sense since the beginning that the inflation

we are seeing is due to the mismatch of the pandemic. this pandemic was a catastrophic blow to our economy, to the worldwide economy. it generated supply disruptions because our supply chain was highly calibrated, and any disruption was going to perturb that system. tom: she is from one of, if not the most distinguished african american families of america. her father was one of my father's heroes, carl rouse. this is cecilia rouse of the council of economic advisers and princeton on the present economy. we have the sterling josh wingrove with us as well. what kind of weekend is the president going to have? josh: he's going to be in delaware, and i guess they finally back burnerd= -- back burnered this build back better

agenda. they hope to pass it in january. in the meantime, some things are going to expire, like that child tax credit. the last payment went out on the 15th of this month. they were hoping to avoid a gap, and it looks like there will be a gap. of course, senator manchin is the one who remains unconvinced. . him and 50 republican senators, i should say. bidens statement yesterday said he still thinks manchin supports the total dollar value. tom: for our international audience on a friday, we need the wind grove -- the wingrove translation of a man who will be 80 years old next november and your translation of what next for the president. is this an actual conversation going on?

josh: it is a conversation they have been trying to tamp down. they said, for instance, vice president herod it -- vice president harris and signatory buddha judge -- secretary butti gieg are two of the people who might be a nominee in the future. they sent them out together to try to minimize the talk of it. joe biden is saying he is running again, but of course, right now the problem is a lot of the white house staffers, the democrats, they want to come here to do stuff. they all grew up watching too much aaron sorkin, and some cases. so they are here and there window is may be closing. right now, if you are outside the u.s., democrats are widely thought that they are on the brink of losing the house. they might not, but that is the betting case. so their window to do stuff, given the partisan window in washington, is now or never. that is why they are begging joe manchin to let them know what

they can get through in this bill. lisa: one reason why i like wingrove land is because it is we'll speak. how realistic is it that we are going to get anything in the next few months? josh: there's a lot of outcomes in a few months. early january, probably unlikely. it is not clear to me how much joe manchin is actually watching the inflation data, or if it is just the political blowback to the inflation data. in other words, if the price of gas starts to fall, does joe manchin warm up to this? the big question is where they claw it back to satisfy him, and the parliamentarian is doing some of that work also. he news that some of the things they went to cram in this thing will not make the cut. this is going to get whittled down. immediate january is not all that likely to me, but i've been wrong before. we will see. i thing it is more likely towards the later months,

february or march, but then we just simply don't know. it really is up to joe manchin. we have said that 1000 times, but that is the case. it is the same thing on things like voting rights. they need 60 votes or they need to change the filibuster. they just don't have the votes for that. caroline: as our tv and radio audience enjoys the birdsong behind you in wingrove land, talk about how much biden is going to be focused on the pandemic now rather than the build back better. josh: it really feels like march 2020 all over again, and some ways. the pace of cases we have seen these last few days. the political reaction is interesting. what we have seen his other countries under pressure to do something, to lock down to respond. biden is under pressure in the opposite way. lockdowns have been unpopular. he himself is not really soaring in popularity right now. he does not have a lot of currency to spend in that regard.

they are flatly ruling out lockdowns. they say they are going to keep schools open, they are going to keep business is open, and they are betting everything on the vaccine. the booster shots, the uptake has been middling in the u.s., and there's still a lot of updated -- a lot of unvaccinated people in the u.s. everyone is sort of bracing for this to be a pretty bad winter, and particular in colder states, where folks are more likely to be indoors. it is going to be a political problem for biden, but not necessarily because the cases are bad, but because the stuff he might need to do to stop it or slow it or put it cap on that is really politically unpopular, and republicans would pounce on it. every health expert we are talking to is warning that we are in for a grim coming weeks and months, and biden warned yesterday it will be works for the unvaccinated. lisa: there is a sense from jon ferro that the year was over as

of wednesday, and that nothing particularly noteworthy will happen over the next few weeks. it seems like build back better is not going to get passed. however, we are talking about russia and what is going on in the geopolitical sphere. anything you are expecting on that front and the next couple of weeks, or will that get pushed out into 2022? josh: i think they've got one eye on it. they have been warning that cyberattacks could warnock -- could ramp up over the holidays. they are not shutting down entirely. joe biden knows going to delaware for the weekend, he doesn't really love spending weekends here at the white house. a beautiful house, you know? but he seems to be a delaware boy in some ways. but the big question remains what will happen if the u.s. does see some of these cross the line. it has not been defined what that line is. tom: not shocking, and somewhat expected, but nevertheless,

there they are. a strident tone to the west. part of that south to turkey, and as mr. erdogan looks at a span of seven years of turmoil and the recent unwind, i am not going to go into the mathematics right now, but it is an absolutely textbook lira we getting. it is stunning over the last four days. lisa: this is a capital flight from the nation. this is a fire sale of the nation's currency leading to social unrest. at this point, it is a complete political liability leading to calls for regime change. honestly, the scale of depreciation, just to give you a sense, there is anger sweeping among highways, where people are protesting because their money is not worth anything, and that leads to an inflationary spiral that is absolutely prohibitive. tom: with great respect to the true expert of this, stephen hankey of johns hopkins, we are not yet to the extreme, the

first and second derivatives that are out of control. but nevertheless, this is something to watch into the weekend. coming up, we begin two important interviews on the stock market. christopher grisanti later. next, anna han of wells fargo. good morning. ♪

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♪ tom: "bloomberg surveillance." mr. ferro on sabbatical. thrilled caroline hyde is with us. let's get to some data. caroline: let's get to that risk off tone to end this week. ups and downs directed primarily by central bank policy and the fears of omicron. we see s&p 500 futures down once again. we are off by zero point 5%. we have seen significant moves in big tech. we are talking nasdaq 100 futures currently off by 151 points. yesterday we had the worst performance in the nasdaq since the end of september. we fall almost 1%. we got risk aversion creeping in

, 3.5 points lower. the vix creeps higher by less than a point. i see it in the green. there is this light reversion to risk concerns going into the weekend. it is triple which in going into the trade today. we are going into the bond market where we see a flattening yield curve. i'm looking at twos-tens, down by 0.9. the two-year yield flat on the day. your five year just treading water. the 10 year yield may be catching a tiny bit of a bid, at 1.40%. clearly they be a little but of a risk aversion trade there going into the long end. what the federal reserve really means for growth as we see that flattening yield curve, i look at this, more risk aversion creeping into markets as well.

$113 yen. the aussie dollar as well, these currency pairs on the downside. aussie dollar down by the tune of 0.5%. i'm looking at money come out of the norwegian krone. we are seeing overall this worry about oil price coming into the for as we look at a hawkish governor and hawkish central banks worldwide. we know that we've got this focus on risk coverage and. what about the individual names? there's been some could a good earnings after the bell. i'm sure romaine bostick has some great individual movers for us. romaine: good morning. keep an eye on oracle and cerner. this is the big corporate story of the day. a report saying cerner has been in talks with oracle to be acquired.

this would be about a $30 billion deal that manages to put off. not a huge premium, but seeing cerner shares higher i about 18% in the premarket. oracle shares down about 4.5% on the day. we did get earnings last night out of fedex. they were good overall. the growth story still certainly in question, but you are seeing the story of pricing power here, able to pass on a lot of those extra costs onto consumers are you basically come of the businesses that use these packages, that was the main story. there's also a stock in play. that is part of the reason why you are seeing shares higher by 5.8% in the premarket. the company still dealing with huge labor costs, as well as an on-time delivery numbers that are well below what we are seeing with ups and some of the other competitors. executive changes over at general motors. the head of the autonomous driving unit is said to be leaving. he was pretty instrumental in

bringing crews on board to gm. they did not really give a reason for his departure, so that is why you are seeing a little wood of skittishness -- a little bit of skittishness here. a ceo change at darden restaurants. they share is down about 4%. i don't know if you remember back in 2014 or so, when starboard was really rattling the cages on darden restaurants, and they put out that epic report basically saying salty pots interest your -- pots and treat your customers better. eugene lee was who they brought in, and he has done a good job turning around the olive garden and outback steakhouse. nevertheless, the president of the company will fill that role, at least in the interim. some of those issues appear to be finally sorted out. there's going to be a union vote on the latest contract sunday. tom: on the equity markets, anna han joins us from wells fargo,

always wonderful, particularly on the dynamics she observes within the markets. i am not going to mince words about it. use a high quality is where to be. we are hearing that from wells fargo. we are hearing that from goldman sachs. others disagree. it is the risk of acquiring low-quality shares? anna: as we get more late into the cycle, that monetary accommodation decrease, this puts pressure on the funding markets, and we see time and again that equity volatility is tied to credit and rate volatility. as you see credit spreads widening, we expect more equity volatility, and those are the situations where we are not particularly fully risk off here, and newly like -- but we are more protected here, and we like it in the form of quality. look for wider profit margins, a little higher r.o.e. in that

scenario. lisa: does that just mean you go into big tech? anna: actually, i would shy away from certain parts of the tech market. what we are still a proponent of is cyclicality. right now, with yields rising, you get monetary coming off, we see what happens to the very high slayer growth at any price kind of sectors. they are a little bit in trouble, and we think that kind of volatility or pullback isn't over yet. rather than pour into tech as a whole, i think look broadly for somewhere we can get high quality, but at the right price. lisa: this is important because a lot of people cheered after the fed's hawkish tilt and the market response, which was it is all good. keep on partying. yesterday we saw the nasdaq and big tech stocks tumble. is that more of what is to come? is that a signal of what we can expect in terms of the potential for correction and big tech? anna: none of us really want to

leave the party too soon. we don't want to miss out. but at the same time, we are realizing that some parts of tech have run very hot. in that scenario, as you start thinking about what is going to happen next year for compressing multiples compression, you want to look at really what has run hot and maybe take some off the table here. you may be seeing a little bit of those dynamics, and even though we are coming from a place of very liquid markets and a lot of accommodation, the directional change in the pull forward in the taper schedule and the potential rate hike schedule, this is a velocity change, and that is really what the market is digesting. caroline: i don't want to pick strategist versus strategist, but i am reading the note from bank of america saying they are remaining bearish until we get full-blown capitulation in the market. i'm interested in your perspective as to what makes you

feel that markets should still go into equities at this point. where is market sentiment, and where is positioning, from your perspective? anna: we have actually seen capitulation in some parts of the equity market. earlier this year, use of investors reduced china exposure. that was a painful thing for portfolio managers throughout the year. he also saw there was a lot of crowding of some of the tech favorites, and some of that is being washed out. one of the reasons why we have seen so much pressure on the tech parts of the market or get but going forward, we don't to get his time to give up on equities as a whole because we still think there is a game to be played in cyclical parts of the market. that is why we are barb elling -- we are barbelling that here. we are not risk on, but we are not heading for the hills. tom: i'm sorry, caroline. go ahead. caroline: thank you, tom. such a gentleman. i'm interested in your perspective on does the u.s.

remain the only game in town. do you still see u.s. equities outperform the likes of europe, even though europe has a little bit more value to it? anna: in the near term, we like the u.s. because we have a little more clarity on it. what will be very important here is where different nations are in their tightening cycle. as you start to see growth divergence or different timing on when people are hiking versus when that accommodation is coming off, that is going to have a big impact not just on equities, but really the underlying here, which is the currency market. these other kind of things we need to consider going into next year, and there may be more opportunities that open up later in the back half of 2022 depending on where we are in our tightening cycle. tom: anna, thank you so much. anna han with wells fargo, greatly appreciate that this morning. i look as we go from anime hunt -- from anna han to chris gersch sandy -- chris croissant a -- chris grisanti.

the dow up 17% year to date. the nasdaq topped up 18%. double digits. lisa: a lot of people are saying this can't really continue, so they are stepping back to 10%. tom: but they have been saying that the last three years. lisa: and i was talking about how they can't be bearish. they want to remain invested, but they are changing their approach. how much can the index keep going up if you get a big selloff in tech? if you get the big tech names early having a problem, how much does that lead everything in a way we haven't seen? tom: the nasdaq of 23% now, 100 basis points behind s&p 500. you and i have been really good about this. we use the word plunge when we have to. it is a descriptive term.

it is not a plunge. nasdaq saw two days in a row well behaved, well within two standard deviations of a recent trend. that is not a plunge. lisa: no, so we can't really carry what that we can't really judge what the carryout would be. what if we get a wholesale removal of faith in the accommodation? work in these stocks go, and how can the other stocks not followed to some degree? tom: we will have to see. i am crushed. andrew tweets in and says my italian needs work. i guess i butchered the chipotle. lisa: you're just making it worse. tom: the show is over, i am doing dual lingo -- doing duolingo. stay with us. this is bloomberg. ♪

leigh-ann: with the first word news, i'm leigh-ann gerrans. chinese spies have been accused of using away technology in a secret telecom -- using huawei technology in a secret telecom hack. australian officials say it begun with a software update from huawei loaded with malicious code. u.s. authorities have warned for years that huawei product posed a security risk for any country that uses them. some positive news from south africa on the omicron variant. authorities are reporting a much lower rate of hospital admissions. still, the number of cases remain high compared with previous waves of the coronavirus. south africa announced a

discovery of the omicron variant on the 25th of november. the u.s. economy is on track for a strong finish to 2021 and a solid start to 2020 two. that is according to bloomberg's latest survey of economists. they say the economy will expand annualized 6% in the first quarter before downshifting to a still solid 3.7% in the third half of next year -- the third part of next year. negotiations reportedly for the biggest takeover ever. recording -- according to dow jones, a deal could cost oracle around $30 billion. i'm leigh-ann gerrans. this is bloomberg. ♪

>> energy prices have gone up significantly, and in some

industries there are shortages of materials, equipment and labor. these factors are restraining economic activity and are a headwind for the new term outlook -- for the near term outlook. in the course of 2022, we expect energy prices to stabilize. tom: the always wonderful christine lagarde holding court in frankfurt at the ecb. i go back to the 60 minutes interview that madame lagarde did at the imf from her manse, and you wonder what the utility bill is going to be for the lagarde household. lisa: how much does this allow them to remain on hold when it is such a serious pressure? they can't really do anything about gas prices. can you imagine madame lagarde pumping gas? tom: no, i can't see her pumping gas. she's got people that can help her do that. kriti gupta is here to save the day for us. she is looking at oil towards $100 a barrel. kriti: it wasn't too long ago

that everyone was saying the price tag was a total given. we will get there as the global economy recovers from that 2020 halt. now you're starting to see a lot of pressure on oil, back to the low 70's for brent crude, even lower for wti. goldman saying that $100 oil call is not gone yet. we can actually see it in 2023. my chart of the day evaluates that call and really prices brent crude in 23 dollars -- in 2023 dollars. what it shows is that we were not that far from that $100 oil call, if you look at the dollar in that inflation-adjusted term. we were hitting $92 once again in 2023 dollar terms. the distinction is the way they are talking about why there

isn't going to be a lockdown. government's are now choosing to pursue testing instead of pursuing lockdown. at the end of the day, this $10 dipped is akin to a drop in demand that isn't very likely. tom: we can move on to amrita sen, who is truly expert in these dynamics. do you buy it? i've get deutsche bank looking for oil prices, it select set looking for a dash over $100 a barrel. how certain can you be of any direction of oil? amrita: i don't think you can be very certain in the near-term. it has been a very mild start to the winter. there's obviously concerns with the u.s. government still releasing strategic reserves. in the near term, i can see why prices are under pressure, but we have held a $100 plus price forecast for 2023 for the past few years because as demand

recovers, the real story is around underinvestment, that opec just doesn't have enough spare capacity as we progress through next year. if you look at latin america, brazil, ecuador, mexico, russia is struggling, we just haven't been investing enough, and with all the focus on esg, we aren't putting any money into oil upstream. lisa: walk me through what this means in terms of production. doesn't mean they just haven't been drilling and there are less resources available, or that the actual supplies they use are more expensive, and there is a restraint supply of labor to help them do it? amrita: it is a great question. it is a bit of both for the u.s., particularly now. you are seeing a lot of constraints with regards to labor availability, equipment, or just high-quality rigs. i was in houston just recently, being told that if you order a reg, you have to wait a year now versus three months in the past.

fundamentally, i think the first point to make is there's plenty of oil underground. there always will be. it is about what's price at which you get it out. what is more important now, whether there's any appetite to get it out. i thing this whole focus on cleaner energy is leading us to this path were nobody is being incentivized to pump oil, and that is why you are seeing the kind of discrepancies between demand and supply. national companies still have an incentive to drill, but because of the price crash last year, budgets have been absolutely hammered, and that is why there have not been enough rigs put into the world. caroline: we into spate baker hughes, of course. i am interested in your perspective of wti versus brent at the moment. not much from a price perspective, but could that widen at any point? what will get us there? amrita: i think it could actually narrow over the course

of next year if what we talked about with u.s. production disappoints. right now the u.s. is almost pricing because all the oil from the u.s. is coming to europe and asia, in part, and i know you were talking about madame lagarde over there, because natural gas prices are so high in europe. it has become a pull, but if u.s. production doesn't grow as much, u.s. refiners are going to want to pay up to keep those barrels at home, and that is why i think wti and brent can actually narrow. caroline: talk to us about gas prices. we saucing in drops in europe as russia decides to turn on the taps. are we just going to ride it out? amrita: it is going to be very volatile, and it hasn't even been called yet. we predict very low stocks, and i think on this, the nord stream 2 can start up, which we don't

think will happen until september. we don't even think we will begin to refill over the summer. if it does get cold over the next few weeks, then stocks will get to extremely low levels. i absolutely expect a lot of volatility in europe and gas prices. tom: greatly appreciate it. we've got to go all fx now. i got dollar-canada through a 1.28 level. be that is oil. maybe it is the montreal canadiens. but the joke is aside -- but the jokes aside, turkish lira is shocking, moments ago printing 17 lire per dollar. how do they get to monday? amrita: -- lisa: great question, especially because what president erdogan is doing, he is exacerbating the move. at this point kamala people, and we heard this from damian sassower plenty of times, looking for regime change. it is important to her court --

to report this is idiosyncratic. how much does this have to do with the rest of the world and what they are dealing with? tom: caroline hyde, i need to go to you on electricity prices. it is very different than america. do you month-to-month in england or in france or wherever really not know what your electric bill is going to be? caroline: from year-to-year we don't because they guesstimate your month by month, so you are paying a certain amount, and you might come to the end of the year and realize you are way behind in terms of payments. you have to do a big one off, or question some of the overall measurements you are taking. i am not sure how it is working over in germany and france. german electricity prices yesterday rising to a record high. tom: they pulled back on whatever, russia came to the rescue, but is it that kind of volatility as we go into the season? caroline: i think it is more of the utilities point. it is whether the power companies can survive this. we have already seen 20 or something in the u.k. have to

shut down over the course of the year. do they have the capital preservation to be able to ride this out? tom: it makes you grateful for con ed. i can't believe i just said that. make a note. chris grisanti coming up on value. good morning. ♪

>> there's always this tension between the market and policy makers as to where is the breaking point. >> omicron and covid more generally is going to take a bite out of growth. >> the market is whopping -- is welcoming the fed to move. >> this has been an earnings led market. >> we want to see balance across sectors. we want to remain a global investor. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: here comes the post central-bank han