group -- fewer growth. >> there a lot of pricing in the market. i'm still a seller. question got enough of the downside, whether you are bullish or bearish. we have a near term to catalyze it. >> this is bloomberg surveillance with tom keene, jonathan ferro and lisa abramowicz >> the equity down states from new york city and our audience worldwide. the morning. this is bloomberg surveillance, live on radio. >> i'm jonathan ferro. equity market is down .2%. we stay as the session progresses. >> has been doing it throughout the day one session to another. how much further does the repricing go. >> the nasdaq is down 15% year-to-date. that is the worst since october.

>> i will catch up a little bit later, but this is his mind. despite policy tightening, that would be my nightmare. you talked about that repeatedly. the prospect of the last 12 months. >> how much does inflation get away from the fed. how much that the fed not necessarily tackle the inflationary pressures if they can't deal with supply-chain disruptions, and frankly, our they going to apply the momentum in the housing market. >> we will talk about that although bit later. we are starting with some stunning numbers. then, we have to talk about apple. you can frame it. >> absolutely. that is a stellar quarter for apple, even in the face of all the supply chain challenges we were talking about. everything except the ipad, and it will show up, this is a company with a hundred $24 billion on one holiday. , and you are seeing apple react to that even if the futures are off the session high. >> let's talk the nasdaq and as

we close things out for the trading weeks which feels like a trading month. it is a quarter. >> equity futures on the s&p are down five. we are a little negative .1%. we stay in positive territory. we are up .4%. and the yields are drifting higher by three or four basis points. saw a lot of flattening come through this time yesterday. the yield right now -- 183. >> a lot of people are exhausted by your point. it has been a long weekend and even longer months, but what i think might be the most interesting moment of the week, it comes at 8:30 a.m.. if you remember, this is the index that really keyed off some of the pitting we saw in the february -- in the federal meeting. we also get income spending for the month of december, and to me, it is where the question

lies. how much do we see a decline in spending even if we see ppe, the key figure and key metric. we search for the highest level. also, at the university of michigan january sentiment survey, this is the difficulty right now. how much does inflation become a decelerate her itself and it really invades people's confidence in the outlook ahead. how do we get ongoing creation, and how do we deal with the view that some people say that they think the fed is perhaps premature. and at 1 p.m., we get a bigger rate town. the oil price is a key factor right now. it is searching at levels going back to 2014, and that shall producers are the marginal producers that are not going back online. they have not recovered for production. how do we see them ramping up versus the physical discipline that was injected after the 2000 14 crash? without that production, how is

it allowed prices to really be at the mercy of opec plus with all of the geopolitical tensions right now? works i love that. we're good friends, but when i think of rate hiking as justified? >> i don't. >> what do we need to see? works -- >> people are spending less on a real basis. it may keep declining, especially as people have wages that are not keeping up. either you get away spiral, or you get a real deceleration, and it is a cautionary kind of environment. how does the federal reserve feel? >> i would like that too. lesser that out. the two-year yield is 121 right now. at the front end, and back out. let's get to dean kern of, the founder of metro risk assignment. i remember a year ago, nine months, whatever it was, you said it was just transitory. it is the new subprime as contained. what did you see in the data that you think people got wrong?

>> i saw a relationship between the markets in the fed that was so linked to this notion that the fed is infallible, and the fed had reason, and they are very well meeting, meaning, public service, but what i think about the. just before this, 2008 crisis, i am minded -- i am reminded that the subprime was contained, and the degree to which they trueblue -- truly believe that, and the mortgage spikes that were in plain sight. it's different of course than a subprime contagion, but the fed misread the degree of inflation, this notion that it is transitory, and that his strategy was simply to wait and hope. as they say often, hope is not a strategy. i think, what we have learned in

a very unwelcome fashion through the volatility, is intertwining of the fed and the markets at an all-time high. it is extremely unhealthy, and the fed crowd control effort, it i like to say that the fed is crowd controlling, they are coming undone, they are being compromised by this thing called inflation. >> when you say subprime is contained, the key difference between that euro and this era is frankly, the credit. the credit markets are completely behave. a lot of people appointed to that. we are seeing that, and because, there is more from some sort of way to rein it in. do you think the credit market has lost its ability to be a leading indicator for distress in the economy and market? >> i think you can make some of the argument. the fed is done so much, and it is such a part in fabric of the market. it is the right signal.

i would say as well, you are right. credit has not been a big part of this drawdown. but i think that is for the problem for equity investors. the fed will respond to plumbing issues in rate markets and credit markets. they come to the records -- rescue in the name of justifying this market function and oversight that it has. we are not that sort of plumbing issue and credit issue, that becomes, frankly, a problem for the equity market, but what we do is burn off so much of that valuation excess that came about through the combination of just incredible fiscal response from the pandemic, and it was justified but cindy pickett -- significant, but it is going too far. from the equity markets perspective, in some ways, the credit market risk off would be

a good thing because it would usher in more federal restrictions to raise the fed strength overseas, and my concern is that the fed risk objectives, which are from a disinflationary standpoint, they are always trying to get to 2% per below. those were very premarket. the market hit the skids in the economy hit the skids, you have this air cover of low inflation. it is just so much different from now. where things get high inflation and it complicates things. >> are you saying that there's not room for equities, but there is for credit? >> there is. in a pinch, the fed will and should be there. i think that that is just a long ways away. i think that is the issue. when you

you will get a tradable balance. we don't see the 30's forever. the prices and structure send to solve itself. my concern is that we are in a early stage of recognition for a wholesale regime shift, where the fed duties are to be a risk manager of inflation, and for the pandemic. in the anti-market, and the policies and risk management of inflation. >> with that mind, do you think we have seen capitulation, or that yet to come? works i think when we get to the 38, which we got to earlier this week on a yesterday basis, it is not to say we are not close, but capitulation on the violence of the moves is one thing, but we are working through a lot this week. if you look at the real-life volatility, they are incredibly honest resting -- they are

incredibly underestimating things. in that sense, where closer, but i think that there are some trades for folks who are needing to be on the market, the market volatility. only a third of the stocks have a three-month downside put in place for volatility. that's very high. you can use that, if you are trying to get along the market. you can use premiums as a way of getting into some of the delta exposure you want in the market. again, i love the return but the concern is that we have not fully appreciated the degree of tightening, and we are just so far from anything close to normal. and the market has not fully embrace that. >> always one to catch up. thank you. a mask -- macro risk advisor. we are in the earliest stages of her seamanship. with the tightening we actually

need from the federal reserve. the reserve does not recognize how much production will actually impact what we are talking about the moment. we'll have to figure that out, and they haven't done anything for it were just talking still. >> we have not necessarily seen the global tightening cycle. what we were expecting later this year. is not just the fed reducing the balance sheet, it is not just the fed hiking rates. lisa abramowicz with kailey leinz. i am jonathan ferro. dk is having a nice long we can. futures are down. that smart. were down a third of a percent. nasdaq 100 is up 2/10 of 1%. the yields are higher across the curve, with 183.91. with new york city, good morning. on radio, on tv. this is bloomberg. >> the russian foreign minister has a response to demands come

but key points were ignored. president biden warned the ukrainian president that the russian attack was possible next month. they also discussed ways united states could help the economy. president biden says he will fulfill his campaign promise and dominate the first black woman to the supreme court. the president says he'll announce his choice by february, and stephen breyer has always told the present he will be retiring in june or july. they will have a successor confirmed. north korea has now confirmed that it will launch more missiles this week. they will launch to long-range missiles that could give kim jong-un the capability of hitting almost all of japan. they have wrapped up weapons testing to signal unhappiness with united states over economic stations. it is been at least six weeks, and 96 the population is 30 years old. that could be in the middle of

march before they could start to eat those restrictions at restaurants, bars, and gyms. in the developed world. sales are higher, and it will easily be expectations over the supply chain issues. meanwhile, apple has a sales growing by double-digit percentage points in. on aaron bloomberg take take power by 24 hundred journalist and analysts in more than 120 countries. i am ritika group to, and this is bloomberg.

>> our intention is for the president to consult with members of both parties, and his intention is to nominate a qualified candidate who after completing a rigorous process in working with excellent decency. >> jen psaki, the price -- press secretary. from your city, to morning. alongside lisa abramowicz and kailey leinz, the s&p 500 is down 22 points. we are negative about half of 1%. just rolling over into negative territory. it's the nasdaq 100. we are down 24. 2/10 of 1%. that's just for a moment. aching up about 12% of the nasdaq 100 prayed one single name is apple.

we'll get to apple and the free market. we have a lot of pop of numbers come out of earnings. quarterly results, and the stock is up 3%. that rally is fading. is fading fast and lost claimants. we have really seen it turning, and the yields a writer on the highs of the session. they have something to do with the tech sector, but it is interesting. we are fresh out at web saying the commentary is the supply chain issue looking better in the margin. it should be a positive readthrough across the technology sector, and that is not really what we are seeing. >> those numbers cannot give a healthy front to the market, but what can? >> just the inflation data. it is weaker than expected. at a certain point, we are seeing a rate pricing as people try to understand what we are pricing into the future, and what kind of rate regime we are facing in the future. how do you begin to do that? >> the nasdaq 100. looking forward to that in about two hours. joining us from d.c., a bloomberg government.

the call between the french and russian leaders. there is a call between the u.s. and ukrainian leaders, and it was a fusion of of that with the united states. what have we learned about what is been said by either side, at the moment. ex-white house came out and said that the call was a productive one, but now we are hearing from health officials within the unite -- within the white house. there was disagreement between president biden and president will and ski over exactly how immanent this threat from russia is. it really was part of a larger narrative we have seen of the united states, and its allies not being on the same page. the u.s. is saying that it has attacked at any point, but we haven't seen the ukrainian president really agree with it, from that message. it goes to show that all of these -- everyone is try to get an unified front against russia, but it's just not the area. what happened. i've heard the president of the ukraine, and we see a hastily organization.

>> we know that there is a discussion. it was a long discussion of more than an hour. they talked about the economy. they talked about potential sanctions, potential aid to ukraine, and certainly, that is something that is being considered by lawmakers if russia does invade and it sanctions or levy. how did they make sure that they are still supporting the ukraine at this time. we know that it was definitely a component of the fall, and for the record, the white house has denied cnn's reporting that there was a disagreement between biden and will and ski over exactly how imminent this threat is. how much does it actually ignite some of the tension between russia, as it seems like it is getting closer to the nato integration is really triggering them? >> at this point, the white house is saying that it will try to keep a diplomatic solution. they did provide a written response, to some of russia's demands, as far as nato, as far as military action? and the president is looking for an offramp.

with his calls for more discussion, more world leaders, getting together, trying to figure this out, but it is rigorous from the white house, and it really has been. they feel attacked, but it could happen any time. that's what we heard from the white house press secretary jen psaki. i was speaking with ukrainian ambassador, and earlier this week in, he said that the problem is a really harsh rhetoric, with countries like united states pulling people of ukraine is it creates a lot of fear, and this from the ukraine people who are attacking people. that may be part of the disagreement stemming. but the reasoning for the harsh rhetoric is that biden administration is being so firm. vladimir putin feels more clinical pressure, and therefore, they might not have to take the action they are threatening. >> that has been a part of the u.s. strategy. to have the first dance, to have the united states. even see that in the partisan and divided congress. you hear from lawmakers in both sides of the aisle. they recognize that any action they take our sanctions on

russia and they have to be bipartisan because they don't want to seem divided. this is a strategy for the white house, to come across as aggressive as it possibly can and rate to move, but they also made it clear that they are trying to continue talks, and continue negotiations. they have closed that defamation now. >> rbc, we are focusing on the conversation be the u.s. and ukraine. what about between the united states and its western and nato allies. we know that emmanuel macron will be speaking with putin later. how much consensus is there between the biden administration and serbian leaders? >> we have seen it has been different between biden and european leaders on what they are willing to do. you've heard various types of hesitancy, you have to realize, that the situation between the u.s. and russia is very different from the situation between europe and russia, in terms of trade, in terms of gas, in terms of anything. they are trying to think a

little bit about how they can make sure that the european allies, as well as ukraine, and we really have two not be hurt. the sanctions are put on russia. >> we will, and thank you. reported on in washington dc. the time a little bit up. in the last play for hours, is coming from the organization, and suggesting a russian inflation that was almost a virtual certainty, and courting to the president. we have that cleaned up, and the spokesperson for the white house, and they say to the following. it is not true. president biden said there was a distinct possibility that the russians could invade ukraine. he said it publicly, and we have been saying this, we have been warning about this for months. the official on the record statement from this white house. it is really hard. what's real, what's rhetoric, negley, if there any cohesive understanding of the yield that is approaching. honestly. even the ukrainian call, we didn't get a sense it was happening for it we didn't get a sense of what it would actually be, or what the motivation was.

other than to express support. to be clear, this is not a big focus. the big focus is been the federal reserve. we had a call just moments ago. they published it. they hit the light. now we see there is a hundred 25 basis points for the end, and it will announce the reduction in the july meeting. we have come from, say, to may be sincere. then to three and four. then divide. it's been fast-moving, and i've been talking with the bank of america. they may even get out to six or seven because of that is where this goes, that may not help the market. it may go ahead. we have seen a dramatic ramping up of expectations read my question is, are we still under praising the fed, or are we overpricing it? >> futures are down 4/10 of 1% on the s&p. this get you up to speed. we are down on the nasdaq. very briefly, and now it's unchanged. clinging onto gains. a third of that in the bond market. yields are higher across the curve.

93 120. through 180. 45 basis points, and 18445. is bouncing back my 6/10 of 1%. $87 print around $.12. from york city, on radio, on tv, on our audience worldwide, this is bloomberg.

>> life from new york city, this is the price action right now. the s&p. it is dropping lower. the rally phase, we are down 13. a negative .3% print the nasdaq 100 is down three percentage points readjust about holding onto gains right now. yesterday's move is lower print up nine. .1% print the remember the weightings here. 12% of the index is made up of apple. apple still up by a little more than 3% rid really nice numbers, and doing ok. just about holding on. talking about just holding on, a 5% move on the open over a year. i am talking about pmh. that move is here, and it's basically unchanged. up 4%. you can't buy a rally for some of these names right now. you go back to between 19, and i'm talking 2019. revenue growth is organic.

in the fashion and goods. it is up 40%, not from last year, but from 2019. that is where we end up. . where do we end up with the pricing where it seems to be that risk is off, and we are getting a little bit more on a macro level. is not just isolated to a specific name anymore. >> we are trading off the bond market. we have been doing that for much of the year so far. let's look at that. 6/10. we have seen a big move. heavenly. 20. and we are seeing 2160 one. another three basis points on tens. or five basis points. 18040 five. we are seeing a catch. lisa, what is happening less .4 hours, with price hikes, and between five basis points, and a banishing production starts in july. is that basically were the market is that? >> honestly, five rate hikes are being priced into the market. through the end of the year. they feel that the fed will believe the economy is incredibly strong, and frankly,

there is no risk to the economy for them to hike rates that many times. however, it seems like inflation is increasing risks, both politically and economically for them. the fed assessment of the way they portrayed the economy, and high-frequency economics, they join us now. why do you disagree with the positive assessment of the u.s. economy. we have heard from that. >> good morning priya think you for having me. we don't see the impetus for growth that we saw last year, or during the pandemic. it is difficult, and what we are seeing with wages and high prices, it in the budget, as it is, we are coming into 2022 on a strong momentum, and we are trying to really assess the business demand, and organically slowing earlier than what we part. we were expecting a slowdown in the second half of the a. and now, it be happening sooner. that doesn't mean, the fed will

abandon its inflation right now. it really has no choice, but to move on rates, but to move away from the budget and support accommodations. but i do think that there is a risk to growth, especially the second have the year. i do think that there is a risk that the fed will work prices into the market. and be more aggressive. >> there are number of different ideas that here. what is the fed do. we have seen growth slowing down materially, but you've have seen inflation continue to rise or even the space, and we are not even decelerating as much as they expect. that is the risk. if you look at just the rate hike right now, you look at the next month, in terms of the cpi data, we do actually think there will be a scale of acceleration, so i think the fed has been in a very tight spot. it is a matter of figuring out, do they have the message right now. the agenda is that they have to invest inflation.

the actions, anything, with the monetary policy actions, some of the like, these actions are not going to necessarily address anything that is going to happen in january, fabric on march. we do think that there is a position, with the economy going at a very modest rate, it will have potential for 2022. i think what they can do, is they can raise the rate, they can actually maybe move at the next two meetings, and then take a step back to assess, i that point, they expect growth to slow down anyways, and expect inflation to slow down well. that might give some breathing room. >> run loading potentially for the next two meetings. 50 basis point hikes in march. is that on the table? >> not for us. i do think that they, unless something really goes wrong, on the inflation front, if we start to see inflation move up, it will be very substantial. maybe 2% or 3%. nothing is off the table. but i do think, i'm not

expecting to see 50 basis points hikes in the market. >> let's talk about the factors in the inflation data. wages. caterpillar earnings have crossed the wire, we have talked about higher labor costs that we have taken, and supply china -- supply chain challenges. are we already in a wage price spiral? >> i've listened to the fed, and if that is what we believe, i do think there is a lot of inflation into play here, including the fact that we are not seeing the supply coming back, so the risk is that the market is going to continue to outgrow, and the stock will be that we have savings, and as savings diminished, we will see a decline in real earnings and we'll -- real rate -- real rate -- real wages. the labor market, and if we do that, there will be a supply as

well. we do expect to see some relief on wages as well. >> there is a question about how much the fed can actually affect inflation right now. that is based on the fact that a lot of these impulses are out of their control. people staying home, to take care of people, or whether it is supply chain disruptions with zero covid policies. what is the transmission mechanism. we have seen that so far. it is not enough, with respect to the market. >> transmission mechanisms are very strong message on inflation. this is what they've done. they've really limited, they've said that we are going to do whatever it takes to get inflation down. that is really something that they wanted do with inflation. they want to make sure that inflation doesn't get entrenched. they want to make sure that inflation expectations remain accurate at 2%. i think right now, if they can do nothing about the supply chain, what they can do is they can impact demand. demand may already be slowing, and they are looking for signals

for that. we are already seeing deceleration, start deceleration, and spending. these are the things we are watching from the fed perspective. inflation is just not acceptable. they have to send a strong message about that. >> there was a piece yesterday where they talked about how last year, the group of seven central banks have had $3 trillion in bond purchases. that number will shrink this year to 330 million. there was a reduction. in quantitative easing. how do we factor in the global tightening cycle, in terms of the ramifications in the slowdown, and the quick higher up financing because in the united states. i think that is probably something that is also underappreciated, because global economies have not really performed easily. the u.s. has been at the forefront, and i do think as you see an impulse state, it will have ramifications for them

worldwide. soy think that is underappreciated, and i do think also it limits how far the fed can go in terms of considering policy normalization. in terms of rate hikes, five rate hikes, i think that we have remain focused that we have to address the fleet and problems now. that means, they are going to send a very aggressive signal, and in the front half of the year. but i am not really sure, if we get to the middle of the year, we expect to see it go down. i think it will be a different nature. >> different picture, just in terms of the rate hike mechanism of the transmission, or in terms of when they may start to spread the balance sheet? >> i think bouncy reduction is, they have been very clear about that. i would not be surprised if they do start in july. but they do want to move for what they're doing. that has been very clear in the message. they want to start the conversation, and they have

normalization. and they will start bouncing. in our view, listen to what they are saying. this is their message. >> wonderful, as always. high-frequency economics. we talked about on the treasury market, what they will more do. the gilt market in the u.k. as well. they moved onto things. >> the highest level in decade. 1% on the two-year yield. really seeing a lot of movement on the short end across the world, and from the fed this week, maybe the boe next week, and all that will be more interesting is the market prices up. ramping up expectations of what they are likely to do this year. this not just the federal reserve story. >> can they sit this out? how may times we talked about this on this program. have you seen survey that came from bloomberg? to from a little earlier today. we surveyed a bunch of economists, and they asked when the ecb was going to hike, and it is more than a year and halfway. can they sit things out for that long? >> given how much is going up, it is hard to imagine that they

can, and given that there's going to be tightening cycle the united states, what does it do with respect to the currency of the pound. i just wonder how we factor in the fact that we are seeing a tightening all around the world. the magnification of one another as this goes. >> 111, and the data this morning, it was stressful. let's be clear about that. quarterly numbers from the biggest economy in the europe. that's just not good enough. the price of technical recession, and maybe we could bounce out of it. there is a hope that the inflation story will a. the ecb can wait. perhaps they can wait it out. >> the message, that christine lagarde is trying to push, is data is falling decline in confidence. my confidence question is about progression. in is a going to be a harder thing for christine lagarde and the team to reconcile per --. if you are dealing when left standing, will there be data, and will there be an argument in the way?

asked you might get interesting. you might want to. >> were here for the next one. >> i will watch this from. i think it will be very interesting. if you have inflation, we will have a slowing economy, and what will you do? >> it is unheard of over the past two decades. what is the roadmap. at a time when oil prices seemed not to be decided. >> euro as negative. a little more than 1/10 of 1%. the nasdaq 100 as negative as well, little bit more than 1/10. the s&p 500 is -4/10 of 1%. in the bond market, yields are higher by four basis points. 183. premier city, kailey leinz. lisa abramowicz. i'm jonathan ferro. this is bloomberg. >> with headline news, the u.k. government investigation into the parties of force johnson's

office could be stripped of key data's at the request of an investigation that is water down. it would be helpful for johnson. he is trying to persuade his party that the colleagues have new leadership challenge. european union and the u.k. are gearing up to sanction new projects. they say it is an attack on the ukraine. the sanctions will drastically cut back, and technology. china and russia will sign the agreement to the old a research station on the moon. the two countries aimed it complete infrastructure construction on a litter station by 2035. the design has a race to go to the moon, and it is heating up. the united states is scheduling its own programming, and astronauts will be on the moon later this decade. we're going to finish out 2021 as well. the top-selling automaker, again , as it was able to keep production mostly on track despite a year of supply chain

turmoil. it added some's -- some 10 million vehicles, and the market fell 8.9 million. the ceo wants to double swedish retailers. they also won and operate budget of more than 10% within three years. there will be discounts to help lower the buildup. global news, toy for hours a day, and a blooper quick, powered by more than 2700 journals and analysts, and more than 120 countries. i am ritika good to, and this is bloomberg.

>> we still need vaccines for really low income countries and

for places with much less health infrastructure in south africa. there may be another variant, and for another variant to spread here, a country like this must evade the existing immunities that now it's very high. jonathan: from the john hopkins bloomberg school of public health, and from new york city, good morning. with kailey leinz and lisa abramowicz. we are negative on the s&p 500 and very slightly negative on the nasdaq. yields are higher by four basis points, and we keep thinking about and talking about, predicting higher interest rates and the federal reserve. we'll go to five for the are, and up to 25 basis points in hike. a two-year will pick up the story. one of the winners of the year so far, the energy sector. on the s&p 500, more than 19% year to date. one name is disappointing this morning. that name is chevron. it is down 3.6%. kailey: a miss on the bottom

line earnings coming in at 256. a miss on the upstream business. a miss on the downstream business. i'm talking with my sources at chevron later today. we may miss out on an oil boom that we have seen over the last several months. we are not talking about 90 dale's -- $90 a bale -- a barrel of crude. it will be interesting to see. we have a crossing, and at the top end of the three to $5 billion rate, according to ceo. we are trying to maintain this. prioritize returning to capital and shareholders. it is a disappointment today. john: looking forward to that. the stock is lower by 4%. here's the winner of the year. an unexpected story. and hasn't worked out that way, but the banks on the year are negative. just very slightly. down .1%. on the s&p. goldman is now out and lastly for hours. the financials are at neutral, and it said this. the focus is shifting from primarily side benefits of

rising rates to a way more balanced view. we are offsetting factors from higher expenses to further capital market normalization grid that came from goldman, overnight. by the way, the yield curve is ashley flattening. not deepening, as many people thought. how much does that also dictate the action at times? we are facing a talent work, and other costs. frankly, consumers have too much cash to borrow print at levels they don't want to see. jonathan: 121.21. we have a professor and for all just of the john hopkins bloomberg school public health. always good to catch up with you. i understand that you have a sibling, and i'm sure for a lot of people listening, and watching right now, they don't want to hear about this, but we have to talk about this. what is it about? >> just to be clear, i don't like to be the messenger seen their new variance, but the virus is doing its own thing and evolving as we expected.

omicron has a sister virus. it is called, technically, ba two. omicron that we have been struggling with his ba one. it is from the original omicron, so we are a little bit worried about how well immunity will cross-react that virus, and it certainly is starting to spread in the wake of that first omicron, going to the population. all signs point to vaccines working just as well against it, but if it is increasing, we need to monitor the deed -- the disease center, and get an idea of how much impact might have. kailey: where the variance come from, and i asked this meaning where is the level with the lack of immunity, and the level of transmission that would possibly lead to some of these variance? andrew: there are three variants that we call omicron right now. all of which seem to have evolved around the same time in

some part of southern africa and all emerged from the same time. we saw one sweep of the world, we are seeing a second one come through now. use omicron variant's all came up at the same time. what we are seeing is, as expected, as this virus moves through the population, it picks up a mutation, and it makes it a little bit better, and it makes a lot more easy to infect vaccinate people. that virus will become the dominant virus eventually. we are seeing some of that right now. you have to remember, there have been amazingly large numbers of cases, and more cases equals more mutations, equals more variance. we are seeing some of the fallout from that with huge number of cases in terms of new variance emerging is trying to spread. lisa: meanwhile we have controversy of people trying to figure out when they can possibly start easing back on the mask requirement spirit the southwest ceo shifted his stance and said it is still

inappropriate to where -- it is still appropriate to wear masks on planes. if they're going to be a time whether it is a stopped all these month -- mutations, we don't have to wear masks? andrew: the silver lining is that vaccination boosting is protecting against severe disease. it is really a good thing. even the omicron is a very different type of variant from the vaccine, the vaccine is working against that disease. combining with vaccination and a large number of infections that we've had, immunity and the population is going to be quite expensive -- extensive, and it should really make a big impact in terms of severe disease and keeping them under control. then we can start thinking about releasing some of these public health interventions and moving back to some level of normalcy. kailey: we talk about new variance emerging, what is the difference in infection for someone who was infected and has a new rate of infection, but versus someone who did not have

an infection? we still have a significant amount of unvaccinated population. is that mean that you can still see surges of similar sizes? andrew: when it comes to omicron, that is pretty clear. vaccination nation -- vaccination alone does not protect you as well as boosting and vaccination. that really is a combination of boosting or infection and vaccination is really the best immunity. there is new data coming out, saying that if you have been boosted, or infected, you may have an even -- not only a strong immune response, but a broader, meaning that it recognizes a lot of other variance. we are moving to a stage where vaccination has set the stage. it is protecting populations, and now, even if you get infected, you are infected from disease, and you are protected with broader or stronger immune responses. you want to deal with the pandemic. use vaccination to get everyone

protected from severe disease, and then the virus will continue to circulate, and the infection is just going to boost in response, and make us even more protected from future variant. jonathan: thank you. you have to do two interviews. one now and one with our producer during a commercial break. he throws questions that you. thank you. always, at johns hopkins school of public health. amazing how little covid gets talked about. we come to the market conversation. in this is a part of it. in the same way, not anymore. lisa: what happens if they don't actually get some sort of baseline immunity and open up? other than that, we have to move past it. honestly, the cruise liners. they perform earlier in the year, and it is not as many cruises. jonathan: would you say the fed move past it? lisa: how can he trust a weakening in the data? people will say that it is noise from the omicron variant, but

others will say there is something here. perhaps there is a weakening we need to pay attention to. jonathan: i'm jonathan ferro. your equity market is down .5% on the s&p now. we are marginally lower on the nasdaq 100, even with some nice earnings from nasdaq with .2%. this is bloomberg.

♪ >> the hallmark of the fed is they talk a lot tougher than their actions. >> what is clear is powell is very data dependent on the rate path. >> history is missing that ingredient. >> inflation is the number one thing they're aiming at right now. >> they are not going to hike enough to really slow inflation. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: what a week, what a month, what year. for our audience worldwide, good morning. this is "bloomberg surveillance ," live on tv and radio. your equity market is -0.3% on the s&p. just through this morning, starting to fade, negative for just a moment. lisa: raising a question of why earnings don't matter as much as people thought they would. apple having a fantastic forecast, and that has not b