>> if inflation does continue to build and wages respond to it, the question will be due central banks play catch up. >> inflation is starting to rise more precipitously. that is not a healthy consumer. >> a soft landing would be if you start to see these inflationary pressures come down . >> the fed needs to move quickly. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: jonathan ferro, lisa

abramowicz, and tom keene. 24 hours to the cpi report. the jumble here, one day away from the inflation report, it is unusual. jonathan: the estimate, 7.2%. we are backing away from the highs we have seen on a 10-year treasury yield. on the two-year treasury yield, going into a really important print tomorrow morning. tom: into a successful three-year auction, there's other tea leaves here. we will get on to some normality. we see it in the equity markets, the nasdaq on a tear. jonathan: the mask mandates slowly getting chipped away, then all at once. tom: the kids, no masks in a week or so. lisa: perhaps. we have not actually heard.

we are looking at the post-pandemic economy, and is it marked by a new kind of growth in inflation, or are we back to a new normal? it seems like the market is betting on a new normal that is better than the old. tom: i don't know if we made it up for the prime minister, living was covid. that is what we are going to do. jonathan: it is some to beep prime minister has been pushing for a number of months. at least, that is the direction of travel. sweden doing the same. even australia is opening up back to tourists, double vaccinated. that is the direction of travel. but china and hong kong are not playing ball. they are doing something very different. when we think about the global economy and supply chains, you cannot forget that china is doing the 2020 one-story. tom: i don't have a 19 vix, but

two or three or four days in a row. jonathan: we are down a couple a basis to 1.33%. we are backing away from the recent highs, but tomorrow is the big one. how much do things change with a six in front of inflation after people were just getting comfortable with seven? tom: bridgewater earlier modeling out 5% inflation for the year. with amy wu silverman, really quite good on the dynamics of the market at the royal bank of canada. thank you so much for joining this morning. i want to cut to the chase. you go cross asset in your to relative and assess -- in your

derivative analysis and the credit market. explain that in english. amy: it always makes options people a little nervous when you see a flurry of credit hedging, so people buying downside protection in hyg, the high-yield bond proxy etf. we have seen a lot of that. even though we are getting that fixed number going back to sub 20 levels, the dynamic between the cross asset credit hedging not abating is a bit of a divergence from what we are seeing inequities right now. jonathan: facebook just having a monster move on a single day. that surprised a lot of people. but you take some signal from what happened about the consumer at the lower end of the waste spectrum. i throw in small business confidence as well. you got the median numbers, the average come of the top end numbers which seem to blur the

average. there is something going on at the lower end that i think we've got to pay attention to. what are you looking at? amy: we have been quite fixated on this because something our economist tom porcelli has highlighted is the bottom quintile of folks are at a point where there liquid assets are lower than prepend them at levels. whether or not that lead through has really been priced into options, the short answer is it hasn't. so like dollar tree, dollar general, all of these cohorts where it is very leveraged to the low-end consumer, you are not seeing that concern yet and the options pricing. the second thing i will say is this earnings season, options have really paid off. even with those high numbers, options were probably implying relatively average implied moves, and we have beat them by two or three times across the

board. that is very unusual and we think that continues for names leveraged to the low-end consumer. lisa: what are you seeing that is going against the common narrative, that the lower income individuals are doing better than these proportionate wage increases and they still have cash left over from the fiscal impulse last year? amy: i think what is interesting is some of the readthrough we have gotten from the recent reports would say that is not necessarily true, and you are starting to see other companies where that weakness is. that demand for hedging number this week and was trading at average, and now today has spiked to an all-time high, so that is that downside skew number, so this week and last week we are seeing that priced in, but now the options market is starting to flagged that to the downside, and these again are all the names where they are

particularly more leveraged to the low-end consumer than they would be to your middle income or high income consumer. lisa: this is a specific idiosyncratic trade. companies are leveraged these consumers. however, is there a broader readthrough to the other equity parts that have perhaps seemed invulnerable so far? amy: i think that always goes back to how the meat is made. if you are looking at a broader readthrough, that is going to be more tech heavy come over your i w ends -- your iwm's are less so. overall, on an etf index level, option prices have still been relatively ok. they have not shown that concern even though we have seen a lot of demand for downside coming into the credit etf's. we ran basically a cycle of what happens to s&p versus something

like high-yield during different rate cycles, and they remain highly correlated. we are talking 80% plus correlation in different rates cycles, which tells me one way or the other, someone is wrong. jonathan: looking at the junk bond etf, how would you play that at the moment? amy: something releasable is just to own hyg puts. the reason i say that even though we have seen that lift up and demand is you can kind of pull hyg back to its full history, which includes 2015 to 2017 rate hikes. skew levels are still in the bottom quartile even though they look expensive now, if you look on a pandemic basis. one wrinkle i think you guys will remember is hyg was one of the names the fed was buying at their facility last year, so i think to some degree, those numbers are very skewed because other etf's are being purchased by the fed in the facility and

around this time, which is how most people look at their windows. that skew number is still relatively expensive. jonathan: thank you, as always. the brilliant amy wu silverman of rbc. that relationship between credit and equities. lisa: fascinating what she was saying, you're not seeing the same kind of complacency in the credit space as you are the equity space. a lot of people look at credit spreads remain contained, but how much has this been a massive distortion? people are saying bonds have been a less safe place to be than stocks. it is a very confusing moment. jonathan: are we talking about sovereign debt, the risk-free asset, or are we talking about corporate credit? lisa: has the fed muddied the two? have they muddied the signals? i? think that perhaps is the question underlying that diffidence -- i think that perhaps is the question underlying the dissidents.

-- the dissonance. it is hard to say, given the fact that a lot of companies have fortress balance sheets, they don't have near-term maturities, and you don't have huge credit risk even as you have the fed pulling back. it just creates a very complicated scenario. tom: speaking of balance sheets, the balance sheet at the fed is going to be reduced this year. the size of the balance sheet reduction, we still haven't quite got clear guidance from this federal reserve. they are talking about paint drying. will it be? tom: these are separate glide paths. you've got at a dependency for rate dynamics and data dependency for balance sheet dynamics. what i am certain is none of that is in the textbooks. they are going to make it up as they go, and i'm going to go to tomorrow's inflation report, on to march 11 in place and after that. jonathan: do you think it is market dependent or data dependent? tom: both.

the answer is absolutely both, and what it is really dependent on is for second derivative dynamics. if they can do this in a controlled manner, they will. if they fail, they will stop. jonathan: i would suggest the data is already in and they feel like they are late. lisa: the key will be how much inflation comes down over the next few months. the pace of it, the direction of it. if it does not normalize, they might back off a little more. jonathan: futures up 1% on the s&p. on the nasdaq, up by 1.4%. michael nathanson, the founding partner at senior research analyst of moffett nathanson joining us very shortly. looking forward to the conversation. yields in three basis points at 1.93%. this is bloomberg. ♪ ritika: with the first word news, ritika gupta.

the u.s. congress is split over imposing sanctions on russia. senate majority leader mitch mcconnell -- senate minority leader mitch mcconnell says the nord stream 2 pipeline should be blocked now and that president biden already has the authority to enact sanctions. russia has denied it has any plans to attack ukraine. qualcomm posted a record -- emergency services are said to be overwhelmed. in new york, the state reported it will drop its stringent indoor mask mandate, according to "the new york times." the mandate requires businesses to ask customers for full proof of vaccination or require mass wearing. protesters blocking traffic between canada and detroit are further stretching an office supply chain that has already worn thin -- an auto supply chain that has already worn thin. the demonstrators are showing

their opposition to vaccine rules. media mogul byron allen is preparing an offer that would make in the first black majority owner of a national football league team. allen says he will be making a bid for the denver broncos. the investor group led by alan could pay as much as $4 billion for the team. at a time when inflation is running high, your coffee is about to cost more. coffee futures have climbed to the highest in more than 10 years. in new york, the cost of beans has more than doubled over the past year because of dry weather in brazil, supply chain problems, and freight costs. 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 ritika gupta. this is bloomberg. ♪

♪ >> let's face it, the u.s. consumer powered by stimulus has been the hero of this economy over the last year and a half, so looking forward, inflation has a real threat to slowly take the wind out of that sale. jonathan: is that already happening? the call from the fs investments chief u.s. economist. your equity market positive 1% on the s&p. on the nasdaq, up 1.4%. yields backing away from recent highs on tens. the high yesterday, 1.96 86%. right now, yields lower three basis points to 1.93%. crude down 0.75% to $88.65.

we are down about five dollars and have come back in. tom: right now we are going to digress to revenue and profit. we do that with michael nathanson. we could have a two hour conversation this morning on the olympics come on what we are going to see sunday at the super bowl. on disney, i want to go back to michael nathanson of moffett nathanson to november of 2019, when everyone said another worn out star wars franchise, and out disney+ came with "the mandalorian," which was a huge success. are we going to see another blow out disney moment this afternoon? michael: i'm not sure because i think what is happening here is that they have pulled forward a ton of demand from their core fans. what we see with disney+ in the u.s. is gross is stalling. we want to hear more about the expansion of their content, to

move to maybe not other verticals, but to be broader as a service. they have done a great job delivering for people who love pixar, star wars, marvel. they need to broaden it out. we think that is going to be the focus on the call. how can they accelerate growth in the second half of this year? tom: if you were to write right now a famous moffett nathanson 15 page history on the linkage of revenue to profit in your world, but would you write -- what would you write? michael: the world we came from was incredibly profitable. in this world, streaming, you have to spend to advance revenue growth. it is like you are looking into a chasm of spending, and you hope you can start driving revenues after you invest. they have to basically believe

there's a revenue model there that comes after the spending. lisa: how much are we seeing the spending from disney plus get downplayed in the parks really taking over in a new way as experiences come back online. michael: here's the challenge in the streaming world. parks numbers are going to be really strong. but people turn to their press release and look at disney plus subs. so the entire organization is keen on one number, which i think is flawed, but that is how the market has treated these things. the parks are going to show in credible strength this quarter. pricing is up. the park will be the story on the earnings front. the drive of the stock is going to be the disney+ takeaway. jonathan: does that make it a more volatile stock?

getting some clarity, some visibility on them, instrument asleep difficult. stocks all over the place, is that the new disney? michael: without a doubt. we thought that all of the earnings drivers would be hit by covid, which was true, but because of the take-up of disney+, the stock went from $100 to $180 very quickly. it is all on that data point, and the volatility is insane. it does not really matter, the economics in the near-term, but it is just sentiment on is this a netflix growth story or not. jonathan: can we talk about just the number of apps on rtv's now? it has got ridiculous -- on our tv's now? it has got ridiculous. i'm think about how much can i spend. i am talking about five dollars on paramount, peacock. i am losing count at the moment of how much i'm spending on

monthly apps. tom: that's the way it is as well. there's been some good work on that as well. while we've got you here, on the olympics come on nbc's ratings, is the olympics done as a tv enterprise? michael: we talked about this before from the summer. i thing the olympics are done in asia-pacific for the u.s. as a ratings driver. i think once you get back to european time zone, a u.s. time zone, it will be a different story. it is not their fault, but you go to bed at night and it is happening when you are sleeping. jonathan: you are being too kind. let's talk about the summer. it was a mess. i did not know where to find it. that's my biggest problem now. i got hulu to watch the premier league on the weekend. is that there? is it on peacock, espn+, paramount? it is a mess.

michael: you are yet. nbc did a terrible job. we agree. but i think it is harder because of the time zone. that said, the nfl and premier league, they are going to have to come up with a model where you find all of this stuff in one place. because they want peacock to be the next netflix or disney+, they are pushing everyone to peacock, but i am not sure everyone wants that. that is a separate discussion, but we will see what happens when it is back in a normal time zone. i think they will learn their mistakes. jonathan: can i just slip this in ahead of the super bowl this sunday? i am streaming sports, and there might be someone next-door watching the same thing, and i hear them before it happens. lisa: this is so specific. jonathan: the value is in the fact it is live. michael: how about if you are

betting on it? all of the sudden the odds change. it speaks to why may be the streaming of sports is not as good as the live delivery over the air or through cable. it is ironic. it really is. but i find the same frustration. jonathan: michael nathanson, thank you, sir. lisa, you often take the opportunities talk about things you are frustrated about. sports fans worldwide are trying to watch the game. lisa: the next time you accuse me of asking our johns hopkins guests about personal pet peeves, i will turn to you and be like, how about those neighbors watching? jonathan: just now and again, just a couple of minutes. tom: one of our interns noted, the 'bramo shrug was noted. jonathan: i don't miss a single look. [laughter] disney ceo bob chapek coming up a little later. looking for to that. tom: peacock+ is $10 a month.

you got to became a. jonathan: peacock drives me insane. futures are up 0.9%. from new york, this is bloomberg. ♪

jonathan: no more rants, i promise. bramo told me off. on the s&p up 42, up .9%. tends, 1.9325. cpi tomorrow. the estimate come in a little bit, 7.2%. the bank of england chief economist speaking now, the prospect of more hikes, the perspective path for rates is uncertain. do not want to find this. there is a case for a measured approach to decisions. a feeling we frontload some of this and then we pause. tom: we recalibrate tomorrow at 8:30.

we will get that important inflation report. this is a joy because deutsche bank has dropped a wonderful essay on the dynamics of productivity, the multiple ratios of productivity, in particular how wage dynamics and in this case rising wages folds into a better america through better productivity. matthew luzzetti joins us, the chief u.s. economist at deutsche bank. what a tour de force. there has been this raging debate about productivity. give us the moderate leakage of rising wages into this good thing, better productivity? matthew: thanks so much for having me. the way we typically think about productivity and wages from a macro perspective is all wrong. the typical leakage we have is

you need to see productivity gains for them to feed into real wage growth. if you are seeing wages outstripping productivity, there is concerns about margins from a corporate perspective. empirically the causation runs the opposite way and you tend to see wage gains leading productivity. it is a robust relationship over the past three or four decades. we have seen high productivity growth. that is really an upside from the current environment where we are seeing the employment cost index hitting the highest since the mid-1980's. it is suggestive we will see a productivity boon over the next two years. the logic is if it is difficult to find labor and expensive to find labor, what you see firms do is invest and optimize their inputs. tom: we will put the cart before the horse with this modern wage theory. that is fine. does the advantages dispersed across a broad section of american labor or is this again

the have take all of the gains? matthew: what we have seen historically is that it takes time for those gains to disperse. to see the record long expansion we had last time over 10 years. the early part of the cycle and where we are at the moment, it is not as widely dispersed as it can be. if we take a step back and neck -- and ask what does this mean for the federal reserve, it means they have to be hawkish today, they have to tighten monetary policy to combat the upside risk to inflation and hopefully bring inflation pressures down, but they also have a difficult task ahead of them, which is clinically economy which we think will show 7.2% headline inflation tomorrow in a soft landing to make sure this recovery continues and we see broader spread gains across the labor market. lisa:ngdovetail your idea with what we heard

from rebecca patterson and what we heard from amy wu silverman. rebecca patterson expecting a 5% inflation rate 12 months from now. amy wu silverman saying she is seeing weakness among consumers that is perhaps not priced into the market yet. can you square these opinions with the matthew luzzetti call? matthew: the way i'm thinking about the inflation side of things, and we have 3% core pce inflation through the end of the year, both driven by the supply side and the demand side and the strength we have seen. we have recent evidence on the goods demand side that is beginning to dissipate, which is somewhat of a welcome event or realization from an inflation perspective. we have also seen inventories begin to build which is helpful to bring inflation down. on the consumer front, there is so much focus on the aggregate

consumer which looks great from an aggregate perspective, debt to income ratios have come down, debt service ratios are at record low levels. we should be cognizant that consumers are facing headwinds today. real wage growth is negative. gas prices are increasing substantially. that is a big hit to income. we have seen successive waves of covid. one data point i would highlight is our favorite cyclical indicator for the consumer, it takes the gap between the present conditions in the city of michigan and conference board, it is near a record low level. it is suggested the curve should be inverted and also suggested there is a 50% recession risk over the next year. this is a difficult task for the fed where we are seeing some fragility on the consumer but also very high inflation rates. lisa: can you sit on this idea of the inflation risk being

priced into this rather obscure metric you look at? why is it such an important one to you? matthew: it is no doubt rather obscure. the value in it comes from how highly correlated it is -- there has been some concern about the metrics, where they take the difference between the 10 year yield in the two year yield and being distorted by things like qe. we have been looking for alternative metrics not distorted by these types of flow arguments that are equally effective been big able to predict recessions. that is why this metric is so important. as everything else today, there are distortions. we are coming out of an unprecedented pandemic. my own view is you're likely to see the yield curve flattening come at the same time you will see the consumer sentiment indicator improve as we get further past covid and we will see convergence. it will suggest recession risks are more limited. taking a step back, there is at

least some caution about the strength of the consumer going forward. michael: tread lightly -- tom: tread lightly, but are the days of negative interest rates over? matthew: what we are seeing in europe, the european yield curve, the ecb is incredibly important for not just europe but also u.s. interest rates. what we have seen from a global perspective is other interest rates have been an anchor for the u.s. yield curve, and there i would highlight if you look at the gap between 10 german yields and tenure u.s. yields there has been a good indicator for the 10 year term premium in the u.s. over the past 35 years. it tells you you cannot see an un anchoring of the u.s. yield curve unless you see europe move higher. we expect the ecb to raise rates twice this year beginning in september. i think that is an important

dynamic for the u.s. yield curve. it does mean we can move higher. jonathan: it is counterintuitive for people to think about interest rates as something that slows down growth. you think that might benefit growth in the euro zone? matthew: there are all of these nonlinearities as we get around the zero lower bound not only of monetary policy but also an interest rates, and there is a lot of work done about what it means for the banking sector. i think also there is a sentiment channel. we have been stuck in a world of low interest rates, negative interest rates in europe. the idea we could be raising rates does give animal spirit and can help to lift growth. banks are dealing with a difficult environment. landing this perfectly will be a difficult task. there may be positive sentiment channels from the idea we can normalize monetary policy. jonathan: interesting to see how

this works out in the next 12 months. matthew luzzetti, thank you for all of the hard work at deutsche bank. lisa, if we could go to positive territory we can prove what people have been saying a blast eight years, the negative rates have hurt the economy. if we can prove, maybe will not go back there ever again. lisa: i keep wondering about matthew luzzetti's point about the recession risk in the next 12 months. how does the fed combat that? do they get rates high up and then drop them back down and what kind of impulse that have on markets and of already been drug -- already been distorted by policies? if they do not go negative what tools do they have? jonathan: what are they more uncomfortable with, inflation climbing or employment picking up. tom: those of the dynamics. what is important is to look at the history of what central banks do. they will not be proactive and try to help market the market. they will wait to see what the data show, not so much financial

data but economic data front and center. jonathan: that was 12 months ago. tom: i think it is 12 months from now. jonathan: the story of last year. they waited and now they are late. don't they have to adjust based on what happened? tom: that is the story. to me they signal some sort of rate regime op and say they will stop and monitor. jonathan: that plays into the standard chartered argument they have to frontload. i keep going back to the calendar, at some point the base effect kicking in the opposite direction. lisa: that is certainly what a number of people are betting on. to give you perspective with the negative pull yield debt, it is now the lowest level since 2015 at $4.5 trillion worth of this stuff, down from more than $14 trillion at the end of december to give you size and scope. it has dropped by two thirds.

the fact you've not seen more market disruption people are saying is a green light, we can dissolve this stuff and still managed to keep things moving along. jonathan: so much of that takes a marginal move of the front end in europe, italy, in germany. what you need to get that to happen is 15 basis points? slightly negative to slightly positive and you get a massive move. i am with you. the move in europe has been massive. it is a big change to go from a negative state to a positive one. lisa: and the impact on the united states market has not been fully priced in. jonathan: down two or three basis points on 10 to 1.9379. on the equity market, positive .9%. the global chief economist at citigroup will be joining us in the 9:00 hour. from new york, this is bloomberg. ritika: a new york judge has

granted bail for two people charged with trying to launder billions of dollars worth of bitcoin. the cryptocurrency was stolen in a 2016 hack. they were arrested yesterday. the government says it seized about $3.6 billion of cryptocurrency from the couple. the biggest digital lobby says that u.s. should negotiate a digital trade deal. the u.s. chamber of commerce says -- including the movement of data across borders. it estimates the u.s. digital economy is growing almost three times as fast of the broader economy. prime minister boris johnson is trying to shore up support within the conservative party. it was part of a mini shuffle of ministers in an attempt by boris johnson to write out the political storm from a series of scandals.

china came up short in its commitment for purchase of goods in the trade deal with the u.s.. bloomberg analyzed u.s. government data and found china bob 63% of the extra goods it has promised. the biden administration has said it will hold china accountable. cbs posted results that beat wall street expectations, driven in part by high demand for virus tests and vaccines. the bike -- the jane -- the chain trimmed its outlook for cash flow. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am ritika gupta. this is bloomberg. ♪

>> this is not an overheating economy. we are still growing below

potential. the idea is these are inflation dynamics, very unpleasant, but they are driven by supply constraints, not an overheated economy. that will lead to a more muted cycle. until we get there we will see a lot of volatility. tom: one of my favorite people, extremely competent and the vice chairman of blackrock on the moment at hand. what we will do is continue, the equity market looking up. what we will do is dive into our conversation on the great unspoken. we could do that going back to the giant david ricardo of the early 19th century who changed our language about how the haves gain advantage. joseph stiglitz is the columbia university professor who joins us this morning. at the bottom of your wonderful essay on inflation, you talk about monopoly rents.

i would expand that -- i would extend that even more to monop solispic rents. how much did the haves gain off of this pandemic? joseph: an enormous amount. it has gotten a lot of attention that will so many americans were living hand to mouth and the money that was going to them just enable them to get by, the people at the top were making billions and billions of dollars. one of the things in the article you mentioned that i advocate is we are going through a very tough time. prices are going up, it is hard for people at the bottom in the middle. why don't we have an excess profits tax on those companies that have done very well in the

pandemic and use the revenue for that to help those who are struggling? a one time tax, you might call it a pandemic inflation adjustment. tom: in a lockian america that has moved on to of the individual, let's eat cannot get through an excess profits tax -- let's say you cannot get through an excess profits tax. what is the next best thing to do? joseph: i could tell you the best thing not to do. it is not a good idea to raise interest rates to kill the economy in order to beat what is still moderate inflation. if you look at those inflation numbers, they are all distorted by a huge increase in the energy price. that will not continue. the price of oil one from below

normal nobles -- pull normal levels because of the pandemic, they will not go to try to stop it -- just -- they will not go to stratospheric levels. we know how to make cars but there is a shortage of chips. why kill the economy? lisa: there is an important distinction within what you are saying, which is as you look toward the fed and the way they should handle policy, they should continue to rely on fiscal policy makers to try to help the lower class, but their policies are more helpful for lower income individuals than they are harmful in terms of widening the gap, fueling market gains that have led to a bigger dispersion between the wealthy and the poor. can you explain that? a lot of people view the fed as the instrument of widening this wealth disparity. joseph: the fed tries to pretend

it is absolutely neutral, but what it does has big distributional effects. when it lowered the interest rate as it did at the beginning of the great recession in 2008, the big gators were those in equity markets. the losers included those elderly people who put their money in t-bills, the return they got on their t-bills went to zero. they were the people who lost and the owners of the equity, overwhelmingly those in the upper 1%, they did very well. at the current juncture, if you raise interest rates, it will slow down the economy in the first-order impact is going to be on unemployment. people who might otherwise have gotten jobs will not get those jobs. lisa: how can you say that is a

risk of raising rates 50 or even 100 basis points at a time they are near zero and you have a labor market that is so tight to have vastly more job openings than you do people to fill them? joseph: the numbers in the unemployment rate do not give a full picture of what is going on in the labor market. we are millions short of the number of jobs that we would have had had we continued the pace of job creation -- response to a population -- tom: we will leave it there. i think with the technology we have lost professor stiglitz. to me the great debate is what the liberals or the progressive

student at coming off a presumed house gop and maybe even a senate gop in the election? what is the next page for liberal america? i do not know what it is. lisa: we have some people saying this is a chance to spend and invest in programs that help narrow the gap in wealth and then you have other people saying why would you spend more money if we have inflation where it is? the camps are getting wider and wider as we see disparate views on the economic trajectory. tom: i give columbia immense credit. the divide between glenn hubbard , and exceptionally intelligent -- not supply-sider, but -- and joseph stiglitz looking for an out light -- for an outright tax on the haves. lisa: it is important to have

these discussions because people look at the vet to stave off inflation which is hurting the lowest income bracket, and then you have other people saying that the fed will help the lowest income bracket by allowing employment to continue to beat a very robust tool in the economy. tom: we touched on this earlier. i will take issue on a decile basis, a 10th of the economy with a focus on the lower income. pre-pandemic they were statistically doing better. to me it is the broad middle class, however republicans and defined that -- however republicans and democrats to find that, i would suggest off matthew luzzetti's productivity and wages story, that the middle class ex-taxes will get crushed. lisa: that is why tomorrow morning for the cpi print i am looking at how that factors into real hourly average earnings, real weekly wages. tom: it will be like jobs day.

this report tomorrow at 8:30 is something. a great set of guests lined up tomorrow. we do that through the day on radio and television. looking at price change in an inflation heated america. stay with us on radio and television. this is bloomberg. ♪

jonathan: yields down, stocks higher. good morning, good morning. your equity market pushing up and away.

"the countdown to the open" starts right now. >> everything you need to get set for the start of u.s. trading. this is "bloomberg: the open" with jonathan ferro. jonathan: live from new york city, we begin with the big issue. moving on from omicron. >> the economy is shaking off this pandemic. >> you're starting to see people come into the labor force. >> jobs report. >> you do not see the expected omicron impact. >> the economy is strong, the consumer is strong. >> the environment is one of tightening. >> rates are going up and the economy can support it. >> from pandemic to endemic. >>