developed markets. >> the half-life has been shrinking. >> the volatile markets have gotten used to this new normal. announcer: this is "bloomberg surveillance" with tom keene, jonathan ferro and lisa abramowicz. >> good morning, good morning. this is bloomberg surveillance live on tv and radio. i am jonathan ferro. this market is starting 2022 in the right way. kailey: the question is how far can the gains last? it seems to be the consensus that 2022 will not bring the kind of returns we saw in 2021 or 2020 before that. we have a guest who begs to differ. jonathan: looking for a year of double-digit gains. looking forward to that

conversation. a year-to-date gain of 27%. in many ways, the issues of 2020 are lingering into 2022. matt: the question is can the issues of 2021 stay unchanged in 2022? just because the number at the back of the year portion of the day changes does not mean everything else does. we are looking at earnings growth. we are looking at a fed that, at least for the time being, is -- got a very loose policy in place. a supportive policy in place. you are looking at a government that wants to stimulate that. whether they can is another question. jonathan: the futures are up 31. a nice lift in the last 10 minutes or so. 151 on tens. we start the year on a 10 year yield, going nowhere.

the euro-dollar is slightly negative. -0.16%. kailey: matt miller continues to watch the as he gets closer to his move to new york. at 9:45, we are going to get some economic data, market manufacturing pmi for the month of december. expect a reading of 7.7, continuing off of the 60 handle. we have been crawling ever since. this could be the lowest read since december of 2020. at 10:00 a.m., we will get to construction spending. this is for november. we are expecting it to be stronger than october was. expected to be up 7/10 of 1%. at 10:05 is when we expect president joe biden to return to the white house after spending the holidays in wilmington,

delaware. this afternoon, he will be meeting with family and independent farmers and ranchers to reduce prices and meat processing. his return to washington comes with major questions hanging in the air over what the future is of his domestic fiscal spending agenda and the future of build back better. jonathan: looking forward to that. we have a tradition on bloomberg surveillance, to catch up with ian brenner. one of the top 10 risks is turkey. we will talk about that. matt miller, turkey, inflation in that country, 36.08%. a move of about half of 1% positive against the turkish lira. 36% on cpi, that is brutal. matt: it is unbelievable. we talk about the action on the

turkish lira and the rates there, all the time. we don't think of the human impact. it has to be difficult to deal with. you have to wonder how much of that drives bitcoin adoption. i know people will say it is too volatile and it is not an inflation hedge. if your currency loses 36% of its value, you start looking at other places. you are not getting it from gold. i think you got it -- i guess you got it from stocks. there is an out of place where you can get that relief. jonathan: that inflation is the highest since september of 2002. it is up from november. 21% in november, 36% last month. joining us now, a big equity market bull, ben laver. let's start right here and not bury the lead. we have had three years of double-digit gains. do you think it -- you think it

could be your four, why? ben: we are underestimating the earnings story. global earnings is under 10% in a year there gdp growth will be twice average levels. they are more than capable of offsetting these cost pressures. valuations can stay very high. bond yields are going to stay reasonably low. this is a market that has changed over the last couple of decades. it is full of vigor, more profitable and more sustainable companies. you put those two things together, earnings numbers, which should be twice as high as they are right now, and valuations, those are your ingredients.

kailey: let's focus on one of those points this thesis is predicated on and that is persistently lower yields, how low do they have to stay? what is the threshold for equities to still be supportive? ben: that has been a huge tell with equities. i don't think it changes that soon. we are coming off -- your typical fed cycle is three to four basis points. it will be slower and longer. that gives economies, markets and stocks a very long time, if you like to grow into this. the impact, the here and now impact will be on the valuations. i think the world has changed. not only are bond yields going to stay low, i think the tipping point is quite a long way off. yields are heavily, heavily

negative. even in normal terms, they are still extraordinarily low. i think the market has changed. the s&p 500 pe, -- is not relevant anymore. it still has a lot of growth. that is a huge change the composition of this market which we did not have 20 or 30 years ago. kailey: do you think tech will be able to retain its leadership of this market or will that shift elsewhere? ben: i think the everything rally continues. equal weight at s&p 500 outperformed the weighted s&p 500. it tells you everything did well last year. tech is important but it is not the only driver. last year was about a lot more

than tech. i think that continues this year. you want to own them. i think you want the cheaper segments and higher gross segments. i think that will lead this year. matt: are you worried about profit margins getting hit hard by inflation? ben: not really. that is a legitimate questions. the markets are worried about it, which is why you have these low earnings and expectations for this year. i think we probably had the peak of inflation pressure on margins. i think companies in this environment will remain strong. companies are showing you they can offset it and they can mitigate it. i think that continues. there are big segments for the market, where margins are super depressed.

that is a story we should be talking more about and will be an offset to -- the more mainstream companies see more pressure on their margins. jonathan: what a way to start 2022, every time you have joined us and been bullish, you have been right. this started in 2018. ben said i am looking for 20% plus gains in 2019. what did we get? almost 30%. we have had three years of gains and been thanks -- ben thinks you should get year four. matt: it would be unprecedented to get four years of those kinds of gains but it does not seem terribly unusual. we have had seven years of double-digit gains.

not 25% gains but seven years out of 10. if you look back, it looks fairly likely. the question is can earning hold -- earnings hold? jonathan: we look forward to that. speaking of plans, goldman's plans, we encourage those who can work effectively from home to do so. kailey: goldman is the last domino to fall. we have seen peers on wall street making these moves. jp morgan and citigroup encouraging their workers to work from home for the first few weeks. we still don't know when they are coming back but the omicron variant is disrupting the return work effort. please including goldman sachs, who was one of the fiercest proponents of coming back to the office, have changed course. jonathan: how may times have we seen this, the u-turn? i have seen it enough to conclude the following.

i will be surprised by more of what is remaining the same than what changes. these leaders of wall street firms are determined to get people back in the office and i don't think that is going away. kailey: that has been the story with goldman and jp morgan. they were the first to say no, we are bringing traders back to their desk. you have to adapt to the times. given this surge and how quickly it is spreading, they have to consider the health implications as well. jonathan: one of the risks we will talk about with ian bremmer, 20 minutes away. from new york city, for our audience worldwide, a happy new year two -- to you all. from new york, this is bloomberg. ♪ >> president biden has reaffirmed the u.s. support for

ukraine's sovereignty. in a statement, the white house said the u.s. and allies will respond decisively if russia invades ukraine. sanctions on russia banks are among measures recently being discussed. lloyd austin says he plans to quarantine over the next five days after testing positive for covid-19. he says his symptoms are mild and he will attend readings -- meetings virtually, when possible. his last contact with president biden was december 21, one week before he experienced symptoms. goldman sachs is encouraging people to work from home until january 18. goldman has been one of the champions of getting people back into the offices. a man was likely the person who

crossed the demilitarized zone. surveillance looks almost identical to the southeastern border in november of 2020. oil analysts expect the organization of petroleum to boost -- opec is set to meet tomorrow. -- boost production. opec is set to meet tomorrow. global news 24 hours a day, on the air, on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. ♪

>> people generally believe

inflation will remain elevated and they start asking for bigger wage increases. that start to perpetuate the inflationary cycle. we have not seen that in terms of the further out inflation expectations. jonathan: jay bryson on the story of 2021 and 2022. yields unchanged. the euro-dollar, -0.016%. a little later, we understand the administration will be announcing plans to combat the market power of giant conglomerates. what kind of plans are we expecting later today? >> it will be a lot of talk.

the administration is focusing on kitchen table issues. it is officially happy new year, an election year. the midterms, democrats -- the midterms democrats are gearing up for will be potentially bruising. $1 billion in grants and loans. all of this has to do with inflation. 16% was for meat products. that is how much higher they are up. these are the big ticket items and the administration wants to look like they are doing something about it. kailey: inflation has been a headache for this administration, securely -- particularly when it comes to argument against the build back better agenda. is this staged so that as congress returns, trying to get something done on the fiscal agenda, it helps ease the conversation a little bit?

>> i wouldn't say on one side of the aisle. i would point to the individual that is holding it up, senator joe manchin. that is what it comes down to, as we begin this new year in january, senator schumer said before going on holiday that they would bring a vote. they would bring a debate on build back better in january. he said he would do that in a vote before christmas. christmas came and went and now we are in january. potentially we could see some movement. this has to do with what senator joe manchin is willing to deal with. he gave the white house a $1.8 trillion plan. this means scaling back a number of programs or cutting them out. kailey: it is a midterm election year. how much time is there to get something done before campaigns are in full swing? annmarie: it will be about now

until the summer. summer, you have a lot of recesses. and then, of course, it is august, september, october. that will be key campaigning for these politicians, back in their states. so, they really have the first half of this year to play with and get a number of items done. it is not just build back better that needs to get done. they have a course, that anti-competitive bill, regarding china that is waiting in the wings. they have voting rights legislation they want to work on. there are a number of items that democrats want to get through before they have to go home and start campaigning. matt: at the very least, they have to be responsible for making sure technology that they sold to wireless companies does not bring any u.s. planes down, right? of course, because all of a sudden, i see this story that some variant of 5g, according to

an airline industry group, is dangerous, when it comes to landing commercial flights. if that is the case, and by the way, this was sold to wireless carriers for a billion dollars -- $80 billion in an auction. what is happening? annmarie: this has been going on for a while. the 5g rollout was supposed to start in december. the wireless company pushed it. it is supposed to start -- was supposed to start on january 5. lastly, you had the industry group on top of pete buttigieg. they penned a letter, saying please hold off for two weeks. sunday evening, yesterday night, we heard from the wireless company, saying this is a detriment to wireless subscribers, especially many who need fast access given the omicron variant and covid and working from home. this is a way -- they are saying

this is a way we can be competitive with china. there is an offramp. potentially some airports could delay the rollout. we are waiting to hear what the government will say. the department of transportation and the faa will review this. and it comes to safety, you will see the federal government lean into the aviation industry's concerns. matt: i want a fast cell phone too and i want to be competitive with china but i want to land my plane safely. pete buttigieg was a naval intelligence officer. he should be able to figure out is this dangerous or can it work fine? it is pretty binary, right? hopefully they move forward with that. in terms of the other issues that they face, giant geopolitical issues, we had a telephone call between president putin and biden on the estate of ukraine. donald ferguson wrote an opinion piece that putin will invade ukraine and there is little the

u.s. president can do about it. how important is this for the midterms that kaylee brought up? annmarie: two things. the call with president putin was at the request of the kremlin. president biden spoke with president zelensky of ukraine. this month, in january, we are expecting security talks between the u.s., nato ally members and moscow. that will take place. we don't know the date but they are gearing up for these security dialogs. if the administration is able to put a lid on what is going on at the border, where russia is amassing more than 100,000 troops and there is no movement into ukraine on the russian side, potentially this does not become an election issue. if president putin was to breach the ukrainian border and go after taking more land as he did

in 2014 with crimea, this would become a top election issue in terms of foreign policy. we know that americans, for the most part, vote with their personal pocketbook, less so than what is going on with foreign affairs. jonathan: good to see you again. we have this motto where there are exclusion zones in certain airports. 5g airports are working with similar frequencies. it seems like there is a model ready to go. matt: it would seem that way. i am not a scientist or a physicist. i'm not sure who deals with these kinds of bandwidths. you would have thought somebody would have figured out when they auctioned off of these wavelengths. on the other hand, you want to ensure safety. when you have a plane full of hundreds of thousands of people taking off and landing, you want to make sure they know their altitude. jonathan: i am more interested

in that than how my phone works at an airport. when do we stop saying happy new year? kailey: the end of this week. jonathan: the end of the day for miller. i am with matt. this is bloomberg. ♪

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jonathan: live from new york city, good morning and happy new year to all of you at home. equity futures are up. nasdaq, advancing three quarters of 1%. the russell, underperforming last year in a way that some people did not anticipate. the russell, of almost 9/10 of 1%. the next 12 months, the spread is 21. down to the bottom end of the sep 500 -- s&p 500, 44. this is where we finished last year. your 10 year yield, 151, coming into 2022.

-- 1.5 one, coming into 2022. -- 1.51, coming into 2022. quinn does this one open? -- when does this one open? kailey: when the u.s. market opens. jonathan: that is how we should do it. i want to look at dollar-where a, -- lira. that is some turkish lira strength. that inflation number, 36%. it has been ugly for that currency pair. not this morning so much. it has been ugly for inflation. kailey: it is now adjusted interest rate -- it's now adjusted interest rate is -22%. turkey is one of the risks

identified by eurasia group when we look ahead to the rest of 2022. ian bremmer joins us now, along with elizabeth. thank you both for joining us. with risk number one, no zero covid, this is for china. why is this the top one? ian: the good news is with a massive explosion, the developed world will feel more normal within weeks. that is not the case at all in china. the ability to live with the virus, and easily transmissible virus that is not as fatal, is the -- an easily transmissible virus that is not as

fatal, is the opposite of china's policy. they will stick with it. they are trying to impose strict quantities -- strict policies that will impact their economy. xi jinping can't back away from it. they have not had a lot of people with covid so they don't have a lot of antibodies. they will fight harder and harder over 2022 to deal with a strategy that looked to be the best in the world in g20. this year, -- in 2020. this year, it will be the worst. kailey: this is the second largest economy in the world. how much do you think there is a risk of that being extended globally in terms of supply chain issues and a slowdown in general? ian: the ability of the chinese government, given they are the most important actor in the chinese economy, to ensure there is a stable level of growth or chinese domestic citizens is high.

-- for chinese did mystic citizens is high. if they are shutting down cities, that will include significant amounts of production. you will have this spike and pullback and spike and pullback. the kind we felt in the united states and in the west. suddenly, you get that in china. of course, that means we will continue to have supply chain challenges across the world in 2022. it means inflation has the ability to persist longer than you otherwise would have expected. this is a politically driven challenge. it is not primarily a virus driven challenge. it is one the chinese can't get out of the way on. matt: elizabeth, let me get to you and ask about china's economic growth and strength. despite that zero covid problems, are they still expected to overtake the u.s. economy? are they still expected to rule the world economically, so to

speak? elizabeth: i think we have seen in the past year that some of the economists have pushed the date, the anticipated date for china's economy to be larger than that of the united states from about 2030 to 2033, now you have people saying it is possible that the chinese economy will never exceed that of the united states. that it may fall prey to the middle income trap. one of the things we need to look at is how well china is managing out of this real estate crisis that it is experiencing right now. there are a number of real estates in china that are overleveraged. that could be an increasing problem for the chinese government. chinese people have about 70% of their overall wealth in the real

estate market. this is a big problem for china moving forward. on top of the covid issues that ian just detailed, they have a lot on their plates right now. this will be a challenging year for them. matt: exactly. they have the common prosperity issue as well, which i think is fascinating to try to understand. how do you read it? elizabeth: it is an effort to redistribute wealth. china became one of the most unequal societies in the world, as unequal as the united states, despite being a socialist country. which is predicated on a fairly equal redistribution of wealth. it is let's take from the rich and give it to the poor, to some extent. even though they are not trying to put it that way. china is at $10,000 per capita

right now. she jinping has pledged it will double its income -- g jinping -- g jinping -- xi jinping has pledged it will double its income. that is what i think we need to look forward to to see whether he can make that happen. they have a lot of issues. they have a pension system that is overburdened. an educational system that people can't -- many middle income people can't tap into. marriages have dropped by 40% since 2013. the divorce rate is skyrocketing. they are having fewer children than they have had at any point in the contemporary history in the people's republic of china. that is 70 years.

that means the number of young people, the most innovative and early adopters of technology, that group is declining in china and has been declining since 2012. there are a lot of longer-term challenges being put into this system that the president is trying to wrestle with. i have not seen any forums in place that will address those challenges. kailey: risk number four is china at home. you say the conditions in china won't undermine political stability. what about geopolitical security. -- geopolitical security? ian: that is the good news. it is not the u.s. and china falling into a cold war.

they don't want a crisis. in other words, it is not like president putin and russia, that see weakness and he is pushing right now to see if you can grab something off of ukraine and change the european security environment. the biden administration does not want another foreign policy challenge before their own difficult midterms coming up in november. we don't trust each other. there are all sorts of areas where you will see headlines because we don't have an agreement on how we should move forward. it is intellectual property, none of these things blow up in our faces in 2022. because the chinese are incredibly focused on and challenged by this failure of

their zero covid policy. the fact that xi jinping has not traveled anywhere since january of 2020 has hurt their diplomacy. they have turned more inward. they are trying to reduce the level of equality in china. and a chinese populism, it is make china great again for average chinese. it is much less focused on china's power internationally. that is what we will see more of in 2022. jonathan: we will break down some of these top risks in 2022. we need to talk about the two way political risk the multinationals face. matt miller, they absolutely smashed their quarterly deliveries. matt: they absolutely crushed it. tesla is approaching one million cars a year.

we were looking at roughly half of that last year. this is not just good news for tesla, although it is great news for tesla. and, especially comforting as the founder gets rid of 10% of his stake. it is great news for the entire auto industry. automakers and auto parts makers are the biggest gainers on the stoxx 600 today. for everyone who is investing in electric cars from general motors to ford and volkswagen, it looks like that investment will pay off. jonathan: this is a $1 trillion company. that stock is up by 7.6% in the premarket. from new york city, good morning to you all. alongside kailey leinz and that miller, i am jonathan ferro. from new york, this is bloomberg. ♪

>> u.s. allies greeted the new year with more than 6.5 thousand weekend -- 600-5000 weekend flight cancellations -- 6500 flight cancellations. the ceos of the two companies say they would -- hong kong's online media portal says it will shut down on tuesday. it is the third pro-democracy outlet to fall in six months. the announcement comes days after it collapsed under

national security investigation with seven people arrested. singapore's economic recovery was pushed to its fastest for your growth in more than a decade. gdp grew 2.6%. that pickup helped propel growth . tesla delivered more than 300-8000 vehicles worldwide, crushing its previous record. global news 24 hours a day, on the air, on quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. ♪

>> the cdc decided that they would cut that down to five days if the person remains

asymptomatic. you are right, there has been some concern about why we don't ask people at the five-day period to get tested. that is something that is now under consideration. the cdc is very well aware that there has been some pushback about that. jonathan: the messaging on this particular issue is all over the place in the last week. that is dr. fauci. the equity market is up 31. the s&p, advancing 6/10 of 1%. we are pleased to say that we have an annual tradition, we catch up with ian bremmer and the team at eurasia group to go over the top 10 risks. eurasia group's top 10 risks. number four is china at home. firms will face an increasingly difficult environment in china.

the task of keeping both washington and beijing happy. perhaps we can extend it further, the task of keeping an aggressive consumer in america happy and a nationalistic one in china happy too. how tough will that be? elizabeth: it is a significant and growing challenge. many companies are trying to navigate a growing sense that not only do you have companies, not only do they need to be concerned about national security issues, which have long been a presence in u.s. foreign economic policy, to ensure companies are exporting technology that can be used by other countries. but now, increasingly, we are dealing with human rights issues as well. human rights abuses. it is important in the context of china, where we see a very repressive regime from xi jinping. we have over a million chinese

citizens in labor and reeducation camps, against their will. how does american business respond to this? i think congress and the biden administration are taking a tough line on it. you are finding american companies trying to figure out how to navigate in a new environment. and as you suggest, the chinese consumer, when companies stand up and say we are not sourcing from this region, we are not taking any products that are the result of forced labor, then you have the chinese consumers on the other end, threatening to boycott. we have seen h&m and nike face these threats or actual boycotts of some sort as a result of these companies trying to do the right thing in terms of human rights.

it is a very tricky situation. jonathan: for a long time, companies have been able to sit on the fence, play the progressive card at home and go and do whatever. we have a government in america, refusing the chinese communist party of genocide. what do you advise for america and china to do? ian: how do you be a woke ceo for domestic audiences and participate in an expanding market that you want to be in when the american political leadership is saying that country is coming genocide? you have to speak out of two sides of your mouth. you get caught when you are doing that. it is difficult. it is very uncomfortable. most american ceos, despite all of the problems that elizabeth and i have been talking about

this morning, want to do more business in china. they believe china will continue to expand. it is an enormous consumption market and they don't want to leave it on the table. yes, they know anything they say about that or said about that to them will be problematic. you saw someone get hammered in the united states for saying i'm talking about human rights, where will i invest? i'm just trying to make money. we are talking to capitalists and yet the domestic audience is saying that is not enough. you have the u.s. with the beijing olympics coming up, the biden administration is trying to square the circle by saying we will diplomatically boycott. the american companies can still sponsor. we know that so many senators and members of the house will be scrutinizing and criticizing those companies for doing that. one more i will mention. elon musk. wealthiest man in the world, he

has been enormously critical of the u.s. government, the fcc for going after him and making life challenging for him. in china, he is incredibly supportive of the chinese communist party. it is becoming incredibly difficult for him to continue to do that. his spacex company in the united states, which gets a lot of money from nasa and the pentagon , the chinese government is saying what is going on? you almost hit one of our satellites. all of that is a very serious problem for american corporate's that are trying to avoid politics. politics will avoid them. matt: elon musk is a special case in so many ways. i see it here with the leaders, especially of german export oriented companies. they are not alone. it is not just the corporate's. the governments also seem to

want to build and hold onto strong ties with the chinese economy that -- in ways that the americans and washington, d.c. would not support. ian: you talk to american leaders privately and they recognize that the private sector wants to do more business and they recognize that the interdependence of the united states and china is important to our own national interests and our own national security. they can't say that publicly. you know why? because joe biden lost votes in 2020 because he was perceived as aging biden, soft on china. the republicans hit them hard on that. they won't make that mistake again. they have to come across as much tougher on the corporate's and tougher on the bankers and tougher on anyone that says china is a great place to be. that is why you see the biden administration talking about the chinese coming genocide.

that makes it more difficult to operate. jonathan: it is extremely uncomfortable. thank you to ian and elizabeth. we will catch up with ian bremmer in 35 minutes to go over the top risks in 2022. things are getting tougher. harder, not easier. kailey: we have seen that. nike in 2021, intel had to backtrack after it asked suppliers to avoid a product. it is difficult. for wall street, trying to capitalize on china, how do you do that? jonathan: the conversation continues. your equity market is up 32. as we kick off 2022, a lift to

the equity market after a gain of 27% in 2021. heading into 2022 with a 10 year yield at 1.51. this is bloomberg. ♪

♪ >> will not a repeat of what we had in the last few years. >> we will see less in return when it comes to developed markets. >> the buy the dip half-life has been drinking. >> the market has essentially gotten use this new normal. >> why should it be any different than 2021? >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: your equity markets flying out of the gate for 2022. good morning. this is "bloomberg surveillance, " live on tv and radio. adding to last year's monster gains. kailey: 27% gain for 2021, following big years before that. three years in a row of double-digit gains.