>> the fed has pivoted, but it hasn't really done anything. >> the covid stock itself was narrow and severe, and the policy effect wasn't readily widespread. >> there is some modification of what the fed can do given where these pressures are coming from. >> what the long-term treasury yields are telling us is that the fed can't hike that much. >> we are heading towards a midcycle slow down for 2023. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. [fireworks] ♪

matt: from sydney, berlin, london, and new york, for our audience worldwide, this is "bloomberg surveillance." you can see australia celebrating the new year there. the markets were indeed open in sydney today, and they are celebrating a 13% gain, the double digits there, nothing like the game we have seen on the s&p 500. kriti group do with us out of new york, dani burger in london. tom keene, jon ferro, and lisa abramowicz are off today. but 27% is the year to date again we have seen on the s&p 500, and this follows a 17% gain last year, and i think i 29% gain in 2019, so we have seen some incredible gains.

the s&p 500 up 134% when you include reinvested dividends over the past four years. kriti: it is really clear that a good chunk is thanks to tech and that defensive trade. how much of that really continues when you start to see decelerating growth? do you continue to see the tech trade, and that mean that we perhaps progressed past that early part of the market cycle? that is really the question going into 2022. how do you play a lot of the concerns that persist from 2021 into the new year? dani: it does just seem like the cycle doesn't exist anymore, but we could have known perfectly what inflation would have done. matt and i were talking to she manpower -- two seaman power earlier today. would you have guessed the 10 year yield would end the year at 1.5%? i would guess not. it is a market where inflation

is unpredictable and the market reaction seems to be up, regardless of whatever it is. kriti: let's take a look across cross asset correlations. you were the star of our cross asset team, so you know better than anyone else when you start to see the stock market yell he -- the stock market rally, yields rally, it is one pocketed bundle trade, and we haven't really seen that. where we are seeing the stock market hit record highs, the bond market is compressed while you see our restraint. even today you are seeing commodities really show the strongest move, even on this very quiet trading day. oil, for example, down 1.4%, even the face of a stronger dollar. oil has rallied quite a lot this year. dani: it really has. go ahead, matt. matt: we see the biggest moves we really do see in commodities. we were talking about this about four hours ago now.

you are seeing, for example, huge moves once again in iron ore. big gains overnight in asia as some orders are put in in china. you see huge moves in natural gas to the downside here in europe. the dutch contract off 13%, 14%. you saw big gains in u.s. natural gas contract, more than 2%. we see the biggest moves on the board in oil today as well. nymex crude down 1.2%. it is really commodities moving the most today. kriti: it certainly is. i feel like i am all tapped out on my commodities knowledge. we should rescue our radio and tv audience. jusco for it -- just go for it. matt: let me just quickly jump in and give you a "surveillance"

correction because i said the s&p was up 134% with reinvested dividends over the last three or four years. that is actually a five-year stat. the reason it is stuck in my head is because i use the comp function on the bloomberg terminal all the time, and it gives you an instantaneous five-year look. so with reinvested dividends over the past five years, the s&p is up 134%. if you look over the last three years, the gain is 102 point 5%. so that makes more sense. if you take out the dividends, just a straight price change. it has been and a credible run no matter how you look at it. christina hooper joins us, global market strategist at invesco. we have been talking to so many investors who have told us they see lesser returns in 2022 then we have become used to. do you agree? christina: i agree, but i think

we will see less returns when it comes to developed markets. i think 2022 could be a great year for emerging markets, and that is a year for outperformance for em in particular, and china, which is had a disappointing 2021. matt: so china is one area we are watching incredibly closely, not just because of the low up in the property market, but also because they seem set on increasing stimulus and making it really focused. do you expect that to bring decent gains, both for china and the global economy? christina: i do. i think it will be a combination of monetary and fiscal stimulus that helps the chinese economy stimulate in 2022, and i think we are likely to see fewer regulations. we saw a lot of regulatory actions directed at reform in 2021. i think we are going to see less of that in 2022, and that should

be another positive catalyst for china equities. but for developed markets, i think what we are going to see is more of a convergence of asset classes forget that typically is the case when we enter a slowdown phase of the economic cycle. it is nothing to be scared of, but i do think we will see more muted stock market returns. dani: in terms of china, we saw the golden dragon china index, the adrs listed in the u.s., return 9.4% yesterday, their biggest gain since 2008. of course, it is still very far off the highs. his china tech a place that interest you? -- is china tech a place that interests you? kristina: absolutely. china still has policy goals that are part of its common prosperity solution. there could still be more regulation to come, but i think it is pretty understandable the areas they are focusing on, like for example, data security. having said all of that, there's a lot of opportunity for chinese

technology stocks. i do think we need to be more patient with that. this may not be a 2022 phenomenon. it may be something that is a good story for longer-term china tech holders. kriti: let's talk for a second about the omicron variant because we have to hit about the impact. the wall street bet is that it will not have the same hit that the original virus did come of it i am curious how much of 2021's gains were based on the fact that we would have much bigger progress on vaccines. how much of those gains might we have to pare back in 2022 as we face reality? kristina: i don't think we are going to see a big paring back of gains because the omicron variant represents negative outcomes in the shorter run, but could actually be a positive in the longer run.

i that, i mean that it is incredibly contagious, and the numbers we are seeing are like nothing we have seen with any other variant. having said that, the silver lining is that it does seem to be far more mild, and it moves through populations rather quickly, so we can take south africa as an example. cases peaked on december 16. now we are seeing cases at less than half of what they wear than , so this is a really fast move through south africa, already burning out. so if we can use that as an example and that does happen with other countries, and it seems to be the case from early indications and some other areas , that suggests it will move through the population rather quickly, create some real issues in the shorter run in terms of supply chain disruptions, exacerbating inflation, but then we can have that residual effect

of having immunized populations far more rapidly than any vaccination program. so it could be a positive again if he remains as mild -- if it remains as mild as it seems to be. matt: are you worried about the fed in 2021? the market is expecting three rate hikes, and march is reportedly a live meeting, but if they don't start until later, they will have to squeeze them in pretty tight. kristina: i am not worried about the fed. certainly, we always want to be following inflation and inflation expectations, and that is a wildcard because there's an element of behavioral economics to all of this. but having said that, i do believe that the fed will have only three rate hikes in 2022 or less, and the market expects three rate hikes. so i think that creates a relatively supportive environment for risk assets. certainly we are going to see some volatility. there's going to be some

uncertainty along the way with regard to monetary policy in the united states, but i think ultimately, we won't see the fed get nervous and overreact to any kind of high inflation print. matt: thanks very much. we wish you and your family a happy and healthy new year's eve. kristina hooper giving us her outlook for 2022. it has been a banner year in the u.s. in 2021. we are looking at a 27% gain, even with the drop we are seeing now in futures areas the s&p 500 on five points. nasdaq futures leading the way down. euro-dollar unchanged and the 10 year unchanged, but we see nymex crude moving 1.5% to the downside, right now trading $75.74 a barrel.

coming up, daniel tannenbaum at oliver wyman. this is bloomberg. ♪ dani: let's get to the first word news. the kremlin says russian president vladimir putin is satisfied with the outcome of talks with joe biden. phone conversations set the stage for three sets of negotiations on european security next month. the white house says president biden urged putin to de-escalate tensions with ukraine. the president warns that the u.s. and its allies will respond decisively if russia invades. the omicron variant is hitting some grim records. for the first time, the number of new day be coded -- of new daily covid cases reported was over one million. that was a record reached earlier in the week. the devastating wildfire in colorado has destroyed hundreds

of homes and forced thousands to evacuate. the disaster took place outside the city of boulder. the fast-moving fire spread through neighborhoods in a matter of only hours. one official says close to 600 homes may have burned down. so far, no reports of casualties. in china, president xi jinping vowed to take on risks that disrupt the country's march towards develop and. in a brief new year's eve addressed, xi is preparing for a communist party congress during which he is expected to secure an unprecedented third term. 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 dani burger. this is bloomberg. ♪

>> the last thing we want is for them to have to pivot quickly to

a hiking cycle because remember, they are dealing with an economy and with a market that has been conditioned for years to live with low interest rates and massive and predicable liquidity injections. so this is quite a change, and that is why you don't want the change to be too abrupt. matt: that was mohamed el-erian, bloomberg opinion columnist and queens college cambridge president, speaking yesterday to jon ferro on the open. always great to get some time with mohamed. right now we are looking at markets, futures indicating a lower open on the s&p 500. in most of the world, markets are closed. all across europe, we have closed early. the markets that were open to trade, for example the ftse, was open this morning, but closed early. the dax has been closed all day long. the u.s. stock exchange, the new

york stock exchange, jon looked it up in the rulebook, cannot close on the last day of a quarter or a year, even if they want to give you a holiday for when it falls on a saturday or a sunday, so that is why the new york stock exchange is trading. the u.s. 10 year not doing a whole lot, at 1.5032%. the euro not doing much. we have seen some dollar strength this year, bringing the euro down to one point 13. i noticed earlier the dollar buys ¥115. even without much movement today, still a relatively high level, the greenback against the euro, against the yen, against other currencies. the interesting thing is that nymex crude continues to move down, now off almost 2% at

$75.53 a barrel. we have seen it come off, although still, nymex and brent crude are hovering near their one-month highs. let's talk about geopolitics right now. daniel tannebaum, and have financial crime leader at oliver wyman -- anti-financial crime leader at oliver wyman, joins us not only on the call between president biden and president putin yesterday, but also the issues russia has with the west as it amasses troops on the border with ukraine allegedly. how do you think the call went to could get off? daniel: it was a perfect call for both sides. realistically, i think both putin and biden got their messages in where both sides can declare victory. it was largely reiterating prior points in terms of russian demands of what it was looking

for from an assurance standpoint , from security, what biden was looking to put out there in the event that russia escalated issues which were largely further sanctions on invasion into ukraine. so realistically, both sides were able to walk away with a win, and it set the tone nicely for talks to commence on january 10 with the working level within both governments to try to see how they can de-escalate the situation. but as a reminder, this is largely a crisis of putin's creation. there was no imminent security threat against russia. this was a preemptive move to move troops and begin to threaten ukrainian sovereignty. kriti: in 2014, i could exchange a dollar and get 36 rubles in return. now if i exchange a dollar, i get about 75 rubles, really since that crimea annexation that spurred a lot of sanctions

from the united states in addition to the big drop in oil prices we saw. ruble has never recovered. oil prices did, but the russian currency did not. a lot of that is thanks to sanctions. how much further of an impact can sanctions have right now? daniel: the sanctions were very targeted, focused on certain aspects of the financial services, energy and defense sectors, but there is more that could be done, threats that have been levied that were focused on cutting off russian institutions from access, further sanctions to significant oligarchs then what was done in 2018. there are more sanctions that can be imposed even on nord stream 2, potential he cutting off the usage in europe of the nord stream 2 pipeline, which would have an adverse impact on the russian economy. so there is still more that can be done. the 2014 sanctions were very

surgical in nature. what is being threatened now is more of a broad approach. matt: wouldn't cutting off nord stream 2 be a problem for germany as well? clearly they rely on russian energy surprise. isn't that a faster, cheaper way for them to get it? daniel: it is, and it is not really the best time of year to start to talk about cutting off any sort of access to cheaper fuel. it is still something that the u.s. has been pressuring its german and other european allies hard, and one of several options and potential sanctions that could be imposed, but it is probably one that has been less interesting to the biden administration to push forward something we have seen from congress and the u.s., where both we publicans and democrats have been pushing for more action on nord stream 2, even though it is completed or get this is picking up off of an issue that wasn't dealt with properly on the trump administration side.

dani: beyond sanctions come on over stick u.s. officials have waived is the possible augmentation of nato forces. what impact would that have come considering putin's narrative has been that nato continues to move east? daniel: i think there is no imminent threat as we understand it of permanent nato forces into ukraine unless there are certain actions on the part of the russians to escalate. i think there is certainly talk of using troops to put down any sort of russian escalation into ukraine, but that certainly seems to be a last measure. that being said, we have certainly seen sanctions have impacted the russian economy, but not necessarily scared off president putin. president putin seems to understand force above all else. matt:matt: great to get some time with you. thank you so much for joining us.

i think we really gained a lot from your insight. daniel 10 about -- daniel t -- daniel tannebaum of oliver wyman. coming up, we will talk to mercedes karn is on -- mercedes carnathon at northwestern university. the u.s. 10 year yield unchanged. crude is where is that that's where it is at -- is where it is at. the move is really in commodities. we will be back with more on covid. this is bloomberg. ♪

>> this is bloomberg surveillance live on television and radio. matt miller, kriti gupta, and matt miller in. many markets in europe lighter volumes than usual, off as much as 90% on a some indices in europe. we are seeing s&p 500 futures near lows of this premarket session down more than 1/10 -- .1%. an area this seems to be protected is nasdaq 100 futures, those are basically unchanged. when we see small caps continue to decline, down .2%. it is the more economically sensitive type equities which are underperforming. this is a reversal from december. december, it has been the small caps that started to edge ahead

of the large-cap stocks. that has not been the trend for the full year. when it comes to the bond market, things look sanguine as they have been for the year and volatility. bond markets not reacting too much. we do not have moves between 2, 10, and 30 year yields that are greater than one basis points. we see slight buying across the board. we are on track for treasuries to return to negative 2.5% this year, the first yearly decline since 2003. according to vanguard and blackrock, they think declines could continue next year as inflation eases. historically, losses are followed by gains but the warning is that might not continue. looking at the euro-dollar, we have been fluctuating between gains and losses, having a hard time finding direction and we have the dreaded unchanged on the euro-dollar. the dollar matt heading it for its best year. matt: thanks for that.

dani burger with an excellent look at your markets. let's get to david wilcox, director of u.s. economics research app bloomberg economics, and david, i was thinking as i read through your notes, it would be great if you could explain for us, as we mark the unofficial two-year anniversary of covid, how the u.s. economy has performed during the pandemic. david: thanks for having me on. it has been an incredible macroeconomic journey. the collapse in march and april of 2020 was unlike anything any living economist has seen. with the unemployment rate reaching a level close to 15%. that was well on its way toward great depression levels. that proved to be a brief collapse and, if anything, the recovery has been stronger than many analysts expected.

we have made an awful lot of progress over the past year, and in total, 80% of the jobs lost in march into april of 2020 have been recovered. next week we will get another employment report. that is expected to show an unemployment rate close to or at 4%, quite a low level. so we've made a lot of progress in the recovery. matt: what do you spec in terms of the recovery -- you expect in terms of recovery of 2022? there has been a ton of infections in covid. we had more than 2 million globally today, the fourth day in a row of over one million. there has not been much concern about negative impacts on the economy or bad data yet. david: an interesting characteristic that is going to play prominently in 2022 is the economy seems to becoming less

sense to the latest turns in covid. we are seeing record-breaking numbers of cases that you are suggesting, creating some severe problems, but nothing like the shutdowns that we saw early in the covid period. there are substantial challenges to the u.s. and global economies for 2022 and those trace back to covid. the surest way we can have those challenges is get the vessel to the ground. >> we are hearing constantly about the severe shortage in workers, products, inflation skyrocketing as well. how quickly does addressing those concerns turn into an inventory surplus. -- surplus? is that something to be worried about? david: i don't think so.

over 2022, the more predominant challenge will be solving some of those issues. workers remain reluctant for understandable reasons to come back into the workforce. maybe they have caregiving responsibilities in the home. some workers still face childcare situations, they're not stable. young children are unvaccinated, so not able to be in group settings, the high degree of assurance parents would like to have. these problems will take some period of time to resolve, and i expect it will be the second half of 2022 before we see progress on some of these. >> just following up on supply chains, one of the new montrose from corporate america has been bringing your supply chain closer to your end consumer so you are not dealing with

shipping delays. how much could that impact those here in the united states? david: the supply chain issues will be quite difficult to resolve. to build a new chip factory, one of the key chokepoints in the economy today, takes two years to having them fall off the line. these are not quick fixes. the faster way to get these problems in the rearview mirror is get covid solved in a more thorough manner, and that will have all kinds of therapeutic effects that will cause -- to take one example -- it will cause the incredible demand for goods at the moment and shift that to services. some of the areas will be robust in spending lately, in entertainment, and travel. taking some of that strong

demand for goods and shifting it to services will take a lot of pressure off of the supply chain. dani: it is interesting. i have certainly heard that argument of the shifting from goods to services. i do wonder, though, once we get the shift, once the economy starts to normalize, what does the labor market look like afterwards? how fundamentally changed is this labor market? david: that's one of the great questions for 2022 and beyond. i think we will see profound changes that persist after the covid period has passed and after the normalization has occurred. i think we will see more flexible work arrangements. perhaps we will see a resurgence of worker power. one thing interesting we are seeing right now is workers clearly are in the driver's seat. they are quitting current jobs in favor of situations they

think will be better for them, they are demanding higher pay and in many cases, they are getting it. this is a tight labor market and that favors workers. dani: if it is a tight labor market, does that mean -- the concern is covid but credit also be a wage price spiral as well with the power being in that of the laborer? david: it is a possibility. that is something we have not seen since the 1970's. really not in the professional lifetime of today's economists or other analysts or policymakers at the federal reserve. we are not really seeing that today except in limited sectors like this area you are seeing higher wages into prices. broadly, we are not yet seeing that dynamic take hold. if we don't, those -- that

situation will be much easier to deal with for the federal reserve and other central banks around the globe. if that wage price dynamic you are referring to does take hold, the situation becomes more [indiscernible] kriti: can i finally ask you about the sub -- matt: can i finally ask you about the supply chain problems we have had? if these difficulties are a baseball game, what inning do you think we would be in right now? david: i think we are in the for thinning. a long way to go and better go get yourself another soft drink and maybe cracker jacks. this is, we are not at the seventh-inning stretch at. these problems are proving more persistent, more difficult to resolve. they cascaded on one another. what we are seeing is the one difficulty feeds to another. just to give one example, shortages of goods has led to

preemptive ordering. preemptive ordering means there is more demand being pushed through the pipeline, and that is creating additional shortages. on the bright side, as these problems begin to resolve, you will see a sort of cascading of the situation too. this won't be quick to resolve but once it does, i think the clouds will clear recently quickly. matt: thanks for joining us on this new year's eve day. david wilcox talking to us about the economic situation in the u.s., really in global. he is the director of research on bloomberg economics. we are looking at markets that are just about to kick off in under an hour on the new york stock exchange.

s&p futures down five as they have been for the last hour. i little change in terms of the fx market, in terms of rates markets. of course the bond market will close early today. it will only be open for a half-day, typical of the bond market to get out of work before the equity guys get off of the floor. it has been the commodity markets moving the most. crude it down now almost 2%. $75.53. you have to wonder what is happening in those markets, especially as we see other commodities rise. iron ore was up for another day overnight in asia. big trade in terms of natural gas, down in europe, up in the u.s.. coming up, mercedes carnethon vice chair at the feinberg school of medicine. >> let's get to the first word news. in israel, the health ministry

approved a fourth does of the coronavirus vaccine for highly vulnerable populations. that is a step back from the original plan to give it to everyone 60 and over. the extra shot will be available for people immunocompromised, residents of nursing homes, and patients at hospitals for the elderly. in the u.k., boris johnson's governments at every adult in england has had the chance to receive a covid vaccine booster. it is a critical part of the prime minister's strategy for tackling the omicron variant. still, they caseload is putting more pressure on hospitals. british consumer spending rose 5.9% this year over pre-pandemic levels. according to berkeley, the increase was driven by a shift in experiences at home. spending on takeaways and fast food rose 62% in 2021 while spending on digital subscriptions was up 47%. the fourth quarter is turning out to be a good one for exxon mobil. the company says higher crude order and natural gas who stood

results by $1.9 billion. shares of exxon are up 47% this year and are on track for their best annual performance in at least 40 years. tesla and elon musk may have extras to celebrate new year's eve. record quarterly deliveries in the last hours of 2021. if they succeed, that would cap a year in which the electric car companies market value zooms past $1 trillion. 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 dani burger. this is bloomberg. ♪

>> the idea the home tests are probably not being reported as effectively to public health

officials, all of that is contributing to a real undercount in the number of cases we are seeing. outside of hospitalizations and deaths because we can get accurate numbers on those. matt: that was the professor and virologist at the bloomberg school of public health delivering a reality check on our accounting of the pandemic earlier on in the program. we had another day of more than one million -- in fact more than 2 million new infections globally. andy peck auch said it would not surprise him if the real number is 5 million or 10 million. he thinks we are drastically undercounting. if you test positive at home, especially if you don't have to call into sick at work, or even if you do, who will you tell. who are you reporting that too? how is that data getting out

there? as long as you are feeling ok, you will not go to the hospital or probably call your doctor, right? dani: one of the issues also and we were talking about this earlier, the symptoms for omicron tend to be of a more common cold, a runny nose, perhaps you are not even testing yourself. but for the economy, the issue is if you are going out and getting covid, perhaps it is not severe but you are isolating and that has an issue for the labor market. kriti: an factor in that you have several different states giving you different guidance in terms of what you need to go to restaurants, bars, movie theaters, and it does become a story of messaging about what is safe and what should be normal practices. matt: we will talk more in a moment but why don't you run us through what we are expecting today at the open in new york. kriti: light volume and light liquidity seems to be the name of the game. like he said during the entire show, all of the action will be

in the oil market. i want to hit the other markets too. euro-dollar about flat. up went to percent, just barely moving. it went a little volatile in the session. futures for the s&p 500 lower. the 10 year yield basically unchanged, hovering around 150 basis points. the vix at a 17 handle, dropping below a 20 handle for a couple days -- a couple weeks i should say. that will be the key metric into 2022. dani: i just want to point out nasdaq 100 just slipping into the green, matt. so positive news there for tech to round out your 2021. matt: we could see maybe a reversal of what we saw yesterday with gains most of the day and then selling in the afternoon into the close. maybe you will see a turnaround to the into the end of the year. as we all know, windowdressing israel. you see often fund managers stocking up at the end of a

quarter or year, or this is obviously both, and this is a definite possibility. let's get back to the virus. the numbers we have seen are eye-popping. more than 2 million confirmed new cases in one day globally yesterday. it is the fourth day and around, mercedes joins us, vice chair at the northwestern feinberg school of medicine, vice chairman of preventative medicine. this is preventable, but we see the numbers just popping up. is there any way to turn this around or does everybody eventually get the omicron variant? mercedes: it is a really scary situation. thank you for having me to talk about it. all along we have known this particular variant was highly contagious and was infecting people even before they knew they had significant symptoms. then with it being slightly less

vera lent -- virilet, the symptoms can be so subtle that it is spreading. i hate to say we throw in the towel and expect everyone gets a. that is not what we want to do. we don't know what the long-term impacts will be. i think we will need to double down on the masking, emphasize and encourage vaccination. dani: when schools return next week, watch it they be doing, what measures should they be taking if they are in person to prevent the spread of a variant which has been spreading exponentially? mercedes: that is a real concern. i have got young children heading back to school and i feel strongly that they are safer in school than on play dates happening and in much more casual setting, and even some general, public places you might take them to have fun. i think returning to school must a priority.

i think an essential strategy to keeping children safe in school will be testing. it will be surveillance testing so that you can get a picture of the background rates of the virus within the community and population of the school, and it will be testing symptomatic and asymptomatic people so we can isolate them quickly. dani: let's talk about the isolation period. we heard from the cdc recently and it now if you are a symptom at it, you only have to quarantine for five days, a ruling that has some industries, the airline industry is what i'm thinking up, up in arms. kriti: what are your thoughts on the safety and effectiveness of that strategy? mercedes: i think when the cdc and other organizations have to select a strategy that involves individual behavior, there are always trade-offs and it is a choice between two least bad options. the reality is the recommendation is

science-driven. we have seen throughout the infectious period can be relatively short, particularly in individuals who are vaccinated. what becomes more challenging is the unvaccinated and really needing to have separate recommendations, and the cdc chose not to do that and to make the single recommendation, certainly upon release of isolation, masking should still be used in order to protect other individuals. matt: thanks so much for joining us, really appreciate your time on this would be, should be holiday on this new year's eve day. mercedes carnethon there of northwestern university joining us to talk about the seriousness of the covid challenge that we still face. in terms of the market, we are still seeing s&p 500 futures down ahead of the open on the last day of trading. now only down less than 4% as

dani burger just mentioned. nasdaq futures are rising. i made a windowdressing, and. was i wrong? dani: i do have to say matt miller at takeback says the last quarter is not always boring. the end of the first quarter we had big sides to the downside. there is speculation that the expiration of some year-end options could produce the exact opposite move. of course we are seeing the mix -- vix rise higher today. kriti: it is rising higher and the move follows a, hopefully good news for us and hopefully there is more action because matt and i have a couple of hours to go, right? matt: it is good news for michael purves because he closed the shores. as he rises, he sees he made the right decision, at least today. thank you for joining us. monday, surveillance will dive into the eurasia group's top risks for 2022 with ian bremmer,

elizabeth -- as well as elizabeth economy of the hoover institute and jane hartman of the wilson center. stay with bloomberg. the open is next on bloomberg television, surveillance continues on bloomberg radio. happy new year. ♪

romain: i am romaine bostick in for jonathan ferro. the countdown to the open starts

now. >> everything you need to get started for this -- get ready for the start of u.s. trading. this is bloomberg the open with jonathan ferro. romaine: we begin today with a big focus oprah 2020 one, gearing up for 2022. >> the timing question is a big open question. >> the fed is going to be more aggressive. >> does the market pullback late 2022 as the tightening happens? >> inflation is super over heaps and will force the fed's hand. >> early next year with inflation at peak levels -- >> the problem will be the story of 2021 -- >> because we have inflation -- >> will it come down fast enough to prevent the fed from going for a rate hike -- >> critical for market outcomes next year -- >> we have a lot of facts t