an already well kindled inflation fire. >> the longer it goes on obviously the larger the ramifications are. >> that is putting all of us in a bind, it really the fed. >> they positively have to get off the zero bound. announcer: this is "bloomberg surveillance." jonathan: from new york city, good morning, good morning. this is "bloomberg surveillance." alongside tom keene and lisa abramowicz, i'm jonathan ferro. tk, a big conversation about sanctions. we've got to wait for the reaction from tom k.: russia, haven't we? tom k.:we are getting the reaction somewhat today. the headline that gets my attention is the russians know to the issue, which is employing people. this is something we really haven't talked about. it is out to a jobs report in early april which is, this is

about jobs in europe, in america, in russia. jonathan: this is the headline from the russians. russia may rethink energy commitments after sanctions. what do you think of that? tom k.: i think they're going to come back and we are going to have to see what the new slow is. the ruble out it 1.37., going to call that elevated. the tape is complex. jonathan: we had a headline from russia. they said they will restrict trade and some raw materials. it is the russian response now that i think we have to pay attention to. lisa: it did a little bit feel like, if you're not going to let me into your club then i refuse to be in your club. right now they are basically being banned by everyone, but there is a feeling that uranium is the key element people are looking for. for europe natural gas, still a big question because they cannot eliminate the reliance so quickly. jonathan: futures are up.

going to read the quote we got from the spokes person -- spokesperson from the ministry of russia. they want to say what their goals are. there is no goal to "occupy ukraine, destroyed its statehood, nor to topple its leadership. that is the communication we had from them this morning. lisa: which contradicts some of the rhetoric we heard at the outset of this conflict. ultimately what do we glean from the reliability of any of these statements when there is one person running the show? it is vladimir putin, and it is unclear what his ultimate goals are and how much this is being driven by something personal that predates this era. jonathan: i doubt also the individuals making these statements are the same people who said there were no plans to invade ukraine. here we are. lisa: there you go. jonathan: let's whip through it for you. on the nasdaq we are up 1.9%. look at that in the bond market. 10 year up five basis points.

two-year yields the highest of the year going into cpi tomorrow. jonathan: at the opening of the show what claudia said -- and that was quite an interview yesterday -- how long can a central-bank estate zero bound? you really begin to frame out here not the 25 basis point move, but how do we get to 50 fast over 60 days or whatever? 90 days. two-year yield is leading the way. the market is doing the work of the fed. jonathan: lisa, crude down on the day. lisa: what do you do if you are a federal reserve hiking into weakness? overnight, he expects inflation to rise up to 10%. yet what did they do if you have an economy that could potentially be really hampered by these high commodity prices? at 10:00 a.m. we get a sense of how overheated the labor market is. this is jay powell's own words.

pointing to this very data. nearly 11 million job openings in the united states. we get the latest reading today. how much are we looking at a market with an implied a job right of 0%, a fully employed america at a time when we already have big inflation and the prospect for much more down the line? today i'm really watching this. the crude oil inventory report at 10:00 a.m. we are looking at crude at highs going back to 2008. as well as the usda world agricultural report at noon. arguably or interested in that. what is the supply response? what is the planting response? what is the constraint in feeding the world at a time when commodity prices are rising to record highs? soybean oil, climbing to some of the records when that is one of the main vegetable oils used. 10 year notes, again, interesting to note that the 10 year yield has not as into those highs we have seen like the

two-year. it is rising, still below some of the year-to-date highs. look at the real yields, negative real yields are weighing on what people's sentiment his for longer-term prospects. yes, we are looking and hired 10-year yields. on a nominal basis we are still looking at some of the lowest levels on record. what does that tell us about the long-term perspective for this economy? jonathan: what happened to the bounce? that story has completely unwound. thank you. just getting some news from the president of the united states. we will have an executive later today from the president on planning toward a government agency to take a closer look on issues surrounding crypto from developing a potential digital dollar, to combating illicit finance. we understand the agencies will have from 60 to 180 days to complete their reports. tom k.: we report that janet yellen and her team treasury,

jon, last night, put out a statement on this, and it was taken off the treasury website. to me that is way more important. there is a battle going on here between crypto forward at the u.s. government, and crypto -- wait a minute, what is this stuff used for? those of the two sides. the president has to straddle that debate. jonathan: certainly the situation at the moment has brought that debate into sharper focus? lisa: as you hear some oligarchs potentially using cryptocurrency to exit some of the money they have currently in russia. jonathan: 42,000, up almost 10% on bitcoin this morning. houghton and washington, maria tadeo and brussels. annemarie, let's start with a president banning imports of russian energy, then a report from the wall street journal that he cannot get a whole organized with leaders in the middle east. what is that about? tom m.: this --

annmarie: this is reporting for the wall street journal, but what they are saying is that you have mohammad bin salman of saudi arabia, and the ruler of the uae basically shunning organizational calls to try to set up a call between the white house and these two individuals. this comes at a time in the united states is really different -- desperate to get these two countries, saudi arabia and the uae, to start pumping more oil, because they are taking more russian crude out of the market. whether the u.s. banned those imports, a lot of that will just go to china, but there is going to be disruptions in this market. whether or not it goes to china depends on if a ship is willing to go pick it up and bring it to china. that is the first thing. i would note in the energy market you have dmitry peskov, a long time spokesperson for putin, saying russian may rethink energy commit after sanctions.

this should be a difficult addition for europe. tom k.: i would suggest pest golf does not matter. people want to hear from putin. what did the leaders of europe want to hear from mr. putin right now? maria: well, tom, they probably don't want to hear anything. what they want to see is real action and they want to see a cease-fire and they want to see troops being pulled back. of course, we are here in paris. emmanuel macron will be hosting a meeting of european leaders tomorrow and friday. yesterday when he was on tv he said so far vladimir putin, the way he has handled this, is completely cynical and, "i cannot stand it." what they want to see is real action, particularly on the humanitarian corridors. we know it has been difficult to get people out, and that is a critical humanitarian situation. the pictures coming out of the ukraine are terrible, and the government keeps saying russian -- russia should open up paths

to the west. people do not want to go to russia, that is why there has been no humanitarian quarter happening for the past 48 hours. lisa: how committed are leaders committed to the plan to borrow money to invest in the greenification of the european energy system? maria: today there is no energy system or energy, kind of qualified, system in europe. they all look completely different. there is not a unified position. we talk about european energy policy the reality is that there isn't one. tomorrow we expect a discussion on energy. we expect a big discussion, as you said come on, how do we deal with the fallout of this? all going to see a big fiscal package come through after the crisis in ukraine and the war? and of course there is going to be a debate about ukraine and its membership for the european union. remember, these pledges are very important.

nato, eu, and so on, this has been a point of tension between ukraine and russia. the language around, we want to join the eu, do we want to commit to nato? this could be important in the diplomatic resolution to this. jonathan: can i squeeze this in? i love your interpretation of the comments we got from the foreign ministry in russia today. they said that russia's special operation -- there phrase -- has no goal to occupy ukraine, destroy its statehood, nor topple its leadership. how do you think that will be read in washington? maria: as false. -- annmarie: as false. that is what we see russia trying to do. even before ben-ami pruden invaded ukraine, since the victory of eunuch overage and the fighting we have seen in eastern ukraine, president biden has wanted to put in a puppet -- president putin has wanted to put in a puppet regime in ukraine.

washington will just read that as more russian propaganda. jonathan: thank you. annmarie in washington, rhea taddeo in paris today. can keep up with taddeo. jonathan: i think there's a lot of diplomacy waiting to hear from russia, and as we heard from the two of them, there is an and chancellor gents here. they continue forward. jonathan: two lines from russia this morning from the president spokesperson. russia values its reliable energy supply reputation. we might have to rethink those commitments, though. lisa: they're trying to figure out what leverage they have at a time when they are in a tenuous economic and political situation. jonathan: turn your last week upset down, that is your price action today. crude down 2.5%. from new york, this is bloomberg. ♪ ritika: keep you up-to-date with the first word, and ritika

gupta. russia has agreed to open humanitarian core doors and part of ukraine for 12 hours. that will allow civilians to escape from several cities. the u.s. ones that russian forces are stepping up their bombardment of the ukrainian capital. democrats and republicans in congress have struck a deal on a long-delayed spending bill that funds the u.s. government and includes $13.6 billion for the war in ukraine. the measure will pay for refugee assistance and replace weapons given to ukraine. in the price of oil slipped today had day after president biden said the u.s. would ban import of russian crude. futures have soared almost 35% since the invasion of ukraine. traders are predicting that oil prices could go even higher. building a bond fund manager dessie dunlap warns inflation may approach 10% this year. the ceo said that bonds are now

overvalued, most emerging markets are cheap. u.s. authorities are investigating barry diller's trading in activision blizzard options just before microsoft announced it was buying the company. other trades are being investigated. stiller denies any wrongdoing. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i'm ritika gupta. this is bloomberg. ♪

pres. biden: we are banning all imports of russian oil and gas and energy. that means russian oil will no longer be acceptable at u.s. ports and the american people will deal another blow to putin's war machine. america had rallied to support the ukrainian people and made it clear we will not be part of subsidizing putin's war. jonathan: the war -- the words of the president of the united states. good morning. futures turnaround. of 1.6% on the s&p. crude, lower by 2% to 120.93.

heard from the russian government. russia may rethink its energy commit it's after sanctions. we need to be thinking about, tom, click counter-sanctions, so to speak. reaction from russia. tom: i think we have been waiting for that for 48 hours. we got a little bit out of best golf, that i do agree we need to see some format there. all we can do is look at the markets and consider what the ukrainian and russian forces are doing. i'm going to go, the ruble, 1.46 . jonathan: yields 190. do you know what we are going to get tomorrow? we are going to get a big number. bank of america, 7.9%. hsbc, 7.9%. tom: they're going to look up -- look at the make up of that and form as tentative as they can off the commodity shock i know

mr. green lop is making headlines, but what we have gone away from is the idea of inflation one and done. right now adam parker with trivariate research. from boston university's statistic program, which is a really big deal. this is the one guy we talked to that can take the central limit the room and figure out what to do with a war in ukraine. adam, i want you to model off now some form of the risk distribution of a growth scare, as you call it. i have yet to see a legitimate growth estimate i adults. take a guess. adam: the median analyst estimate right now is about 7.5% earnings growth for this year. that is probably too high. i think it is probably mid-5% is

a good base case. if i'm being intellectually honest i think the risk is more that 2023 earnings might not be above 2022. as we get into the second half of the year we are still dealing with logistics -- transportation, wages, commodities. you could see that pinch. what i am focused on this week -- i spent hours on this -- is, which companies have growth margin estimates that are too high or where we haven't seen anything there? do they really have the pricing power? tom: i want to stop the show here and talk about the great peter bernstein and his magisterial against the gods, and the idea of risk versus uncertainty. the media is throwing around the word uncertainty right now like it is a meant. explain the difference to our audience of risk measurement versus the unmeasurement of uncertainty? adam: there's a lot of stuff you don't know. that is uncertaintry.

i don't building things i can estimate at all. you don't forecast wars when you are making assumptions, but we try to think about it is there is a range of outcomes. try to assign probabilities to those outcomes, look at earnings potential during those outcomes, and make an educated statistical expectation for what is going to occur. i still think the base case is corporate earnings grow. it was a number of companies that have rising power. if earnings grow this year and people believe they can grow next year, the market is going to recover handsomely from these levels. lisa: but not everyone. adam, i was struck by in your research how you were talking about possibly aggressively shorting specific names. why is this a time to start doing that rather than simply staying away from what you don't like? adam: i think you can always make more money if you have the ability to long and short stocks, lisa. i think the peak of when you wanted to do this was almost a year ago when you had the huge short squeeze that heard a lot

of head -- hedge funds. since then the number of stocks that have lacked the market by 20% or more has been way more than the number of stocks were beaten by 20% or more. that is a good environment for shorting. there are plenty of names that have a lot of idiosyncratic risk, and those of the ones you want to short. particularly if they miss margin expectations. when i look across the stock market i look at industrials. a lot of them already have record-high margins. they are forecasted by the analysts somehow to have even higher margins, yet we know they have a lot of input costs that are rising. i don't think they can pass all of that pricing on, so they are the ones that have below average estimate achievability. same with any consumer discretionary, where i think you will start to see some companies miss material in the second half of the year. within equity market positioning is going to be around relative estimate achievability, particularly on margins. i think that is the key debate

when you have inflationary pressures. lisa: and you are still bearish on the stay-at-home stocks, right? adam: i think so. i think we are reopening more and more. we talk about the sample size of one, but my own observations are that even with airline, etc., you are still seeing demand pickup, and i think we will still recover as we start to get warmer in the populous parts of the country. i think you want to belong reopening, generally. jonathan: got to leave it there, buddy. adam parker, trivariate research. to see you. just got a headline from ireland. haven't got the numbers, but the direction of travel is important. ireland to cut tax on gasoline amid price spikes. there is, tom. the island to cut taxes on gasoline. tom: an important note here, going to stuart hoffman the economist at bmc. i'm going to call him economist

emeritus. i think he was there the last time the pittsburgh pirates won in baseball. he says, it is completely doable to give the middle class in america some relief from higher gas prices. that is from a guy who can count the beans. jonathan: lisa, does the white house follow? lisa: how much can actually do? the gas tax is not that high in the united states. if you are dealing with that kind of cushion, it is not very big. they have to start releasing more oil reserves and they have been having talks with people down in the shell patch. we have been reporting on that. jonathan: the ban on russian crude and support for it, just amazing. i saw a headline from reuters, 80% of respondents happy to pay higher gas prices if it means banning russian crude. tom: yeah, this is a really delicate issue. i get the idea, six dollars a gallon gas isn't going to float,

but hole after poll pushing against that. jonathan: futures up on the s&p. crude, still 120 -- 100 $20. have you got used to that yet? we are down about 3% on the day. from new york, this is bloomberg. ♪

jonathan: back from four days of losses on the s&p, we are positive 1.7%. the nasdaq, up 2%. a lot of people talking about sanctions. peak sanctions from the west, what about the reaction from the west, the reaction from russia? we have to wait. tomorrow, cpi in america. look at this in the bond market. two year yields, the highest going back to light 2019. yields up by five basis points. the spread between twos and tens, and between 25 basis points going into a cpi print that could come in close to 8%. tom: the makeup of cpi here is so important. there is x oil, ex housing, and i will be looking at cleveland, which takes out 16% of the cpi. it takes out a percent.

what is fascinating is, what is going to be in the middle? that will be my study. jonathan: we are looking at brent and wti too. brent looks like this, wti looks like this. wti at $120. down on brent by 2.8%. fast forward from here, to the u.s. administration banning russian crude, and then what? according to the wall street journal, can't even get a call scheduled with a leader in the middle east. that is there reporting, not ours, but that is the scene at the moment. what is the crude come from? venezuela, of all places? tom: it is going to be fascinating to see. right now the american response, particularly the american and nato response to what we have seen with her in ukraine. james tribute us -- james stavridis, i wonderful friend of the show with his services in

the navy, was european command her and nato allied supreme commander. author. i cannot tell you how frightening that time the book is my book of the summer, i think it was a year ago. james stavridis, i'm going to talk about in hodges. they have an urgency about urban warfare. give us the same urgency about naval warfare in the black sea. what does ukraine, russia, look like on water? jim: russia dominates the black sea, and really has for centuries. they have been the dominant power there. if you spin around the black cuc romania, bulgaria, turkey, georgia, ukraine, but russia is the monster force there. they will continue to dominate, as turkey has a chokehold on the dardanelles.

the strait that controls access to the black sea. but it is going to be russia's game, because that is where there black sea fleet is located. thank heaven the u.s. navy's seventh fleet inside the black sea. that is the advantage the russians have. jonathan: your impertinent -- tom: your important essay, there were 400,000 americans in service in europe, and that has been whittled down to 100 thousand. what is your timeline to see a rebuild of american military in europe? is it a question of weeks and months or is this going to be long, drawnout, extended process? jim: depends on vladimir putin, and so for he is certainly giving us plenty of reason to think we are going to increase our troop levels in europe. i don't think we are going back to 400,000 we were during the cold war, but look for the u.s. presence to go from around 50,000 to around 70,000, permanently based forward putting continues. and more importantly, tom, we

were seeing the germans and others increasing their defense spending extremely quickly. all of that will move troops to the borders of nato. the nato alliance will keep russia out. lisa: when you say the borders of nato, admiral, are you talking about poland? jim: i think it is poland, but also all around the eastern europe. think, estonia, latvia, let the one year, romania, bulgaria. they have either borders on russia or borders on russia client states, like belarus, or to the conversation tom and i just had, borders on the black sea. there is going to have to be an upgrade in troops forward that alliance realizes is in progress now. lisa: there is a story today on a bloomberg terminal that putin's endgame is starting to look more like simply reducing ukraine to rubble. what do you suggest on the next

steps, since the sanctions have gone almost as far as they can go at this point? the next steps to try to bring a swift end to this conflict? james: first, unfortunately, i agree. when you are the russian military and you have performed as badly as they have, with poor logistics, poor command-and-control, or criminal behavior, at some point your only tool left is a big hammer, and they are starting to swing that thing hard through ukrainian cities. trying to make ukraine look like syria. that is a terrible outcome for everybody, and it is more criminal behavior. what we should do about it is continue the massive sanctions. they will bite. that will take time. on the military front, continue to supply the ukrainians with absolutely everything they need short of our troops going in boots on the ground and fighting. that is a path to world war iii-level confrontation. but that is more material going

into ukraine, and above all let's get these make 29 fighters into the hands of the ukrainians. it is complicated, i get it. that could be a game changer. tom: we have to stop the show here, admiral. admiral's tremendous -- stavri dis. the opera house in odessa. this is not normandy. this is odessa, with sandbags and a bunch of ukrainians. how did we get those jets from poland to odessa to defend against a well-equipped russian navy? james: the poles have said they will fly them into ramstein air force base. i think the next stop would be come put them in lviv. lviv is going to stand for some time. the russians are not on some what's craig. put them in lviv, turn them over

to the ukrainians, let the ukrainians do it they want to do. them create a ukrainian no-fly zone. tom: what does that do to nato being independent? if we going to ukraine, the zeitgeist is this is hugely problematic for the nato you are experienced with. james: the answer is, turn them over to the ukrainians. you not operate them with nato pilots. when they are turned over to the ukrainians, they become ukrainian jets operating out of ukrainian bases in western ukraine. nato can correctly say it is not a belligerent in the combat. is it somewhat risky? absolutely, at this point back to those images you were showing a minute ago about 2 million refugees. we are going to have to take some risks to solve this problem. lisa: on the russian side, how much are they running out of the fuel?

i'm talking about this with parts that are getting stalled out its -- as some of these sanctions bite to repair their planes. talking about the fact that we have not seen the full airpower of the russian army, despite vladimir putin's resolution. james: all of the logistic failures are coming home to roost. russia does not have the kind of 21st century military that nato does, that the united states has. and you see, always -- and this is true in business as it is in war -- logistics each strategy for lunch. feis snow logistics are what drive wars. and so we ought to capitalize on that at the back and, crushing them with sanctions, and at the front office and, if you well, the client-facing end of this, by giving ukrainians the tools to take apart what they can put on the battlefield. jonathan: admiral, a clinic, as always. james stavridis there, thank

you, sir. tom, we have to take risks, the message from the general this money. tom: i talked logistics with ken rogoff 20 years ago. the great harvest -- harvard economist. logistics here, jon, some form of ratio of six people needed to advance one person to the front line the workup i saw a couple of days ago by someone informed was 500,000 people of russia to make this work for russia. there are nowhere near that statistic. jonathan: admiral's tremendous has done a lot as well, did you read the new york times yesterday? the commerce secretary issued a stern warning tuesday to chinese companies that might defy u.s. restrictions against exports into russia, saying the united states would cut them off from american equipment and software that they need. i don't think we have seen is fully play out, tom. tom: oh, no. this is really important.

media -- and we are guilty of this. i think we are working overtime trying to do this -- this is not a game show. day 11, date 12, stay tuned for day 15 of the war. this is not a game show secretary were mondo and others, including admiral's dividends, or working on a timeline different from the media. jonathan: the admiral appreciates we have to wait to see what happens here. there are serious risks still building. we talk about peak sanctions, i don't even know what that means. what does that mean? lisa: especially when the tightening of the screws means eliminating all of the potential loopholes. that goes to some of the comments on china, and yet what kind of conflict do you engender if you start to go after that type of activity? how much do you push russia and china closer together versus further apart? there are so many complexities still in the works, and this is not a game show. there are people suffering, and it is very difficult to know what the outlook should be and

could be with the response. jonathan: this from reuters, china telling refiners to halt april the gasoline and deal exports. that coming from reuters moments ago. to halt april gasoline and diesel exports. tom: it's going to fall onto growth as well, which we touched on with adam parker. we're looking at inflation tomorrow, i get that, but what does this mean for global growth? continental growth of europe? yes, selfishly, what does this mean for american growth? jonathan: futures up 64 advancing 1.5%. yields higher by five basis points. in crude, a break at $120. this is bloomberg. ♪ ritika: keeping up-to-date with news around the world, i'm

ritika gupta. heineken has joined the list of companies that has quit doing business in russia. the dutch bma stopping its exports to russia and halting investments there. the news comes a day after mcdonald's and paypal announced they would -- they were temporarily halting operations in russia as well. the u.k. is ratcheting up sanctions in russia, now banning all russian aircraft from landing and overflowing britain. the u.k. is also prohibiting aviation and space-related exports. that covers insurance and reinsurance products. the former of russia's oil says the comp -- country has moved from an authoritarian regime to a totalitarian. in an exclusive interview he told annmarie hordern that change is coming to moscow. >> the regime will change, no doubt about it. before it might've taken 10 or 20 years from now. now it may happen much faster. ritika: he also said that all of

russia's oligarchs should be targeted by sanctions. in south korea, exit polls in the presidential election shows conservative candidate with a slight lead, less than 1% separates them. he is hawk us and focuses on tighter ties with the u.s.. issues surrounding the fast-growing market, the first attempt at coordinating the government's strategy on digital assets. still it falls short of providing regulation. that is something crypto firms have been calling for. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i'm ritika gupta. this is bloomberg. ♪

>> i continue out of this morning, not a physical shortage

for oil, but there is a very strong perception in the market because of the volume. jonathan: the opec secretary-general. futures this morning, good morning, at 1.4% on the s&p. the nasdaq up 1.8. going into cpi tomorrow looking for something close to 8%. the most 1.90 on it tends. all eyes on crude. $120, and down 2.8%. tom: the massive pullback we have seen in crude this morning -- i am being facetious, of course -- it's us out to 1.8 standard deviations. that is how extended we have been. jonathan: year-to-date, up 60%. it has been quite a move. tom: crude down three dollars right now. rent crude, futures up $61. ellen wald has been kind enough to brief us here, senior fellow

at atlantic council. you are truly expert at saudi. you explain why they won't take the phone call from the president of the united states? ellen: i can't exactly explain why they want take the phone call, what i do think their position on oil production has been quite clear from the beginning, and is in line with the rest of opec-plus. if you look at the trajectory of saudi opec politics over the past couple of years you can see how much closer they have moved to russia and how much russia's participation in the entire opec-plus group really depends on their concept of market management at this point. they are looking beyond the current situation to the future in which they want to keep russia in the fold. they want to keep russia in this group, because russia's production power means that opec actually has a shot at some kind

of market management, whereas before they basically had no way to assess the market other than all-out production. so if they dumped russian now, the results in the future could be disastrous for them. tom: who is they? there is saudi arabia, but what is the relationship around the fractious persian gulf? the relationship travels back decades and decades. is this saudi arabia alone or is there polls and -- is there portion golf unity? ellen: there is saudi arabia and the uae. they have the most spare capacity. in the saudi's have really pushed this relationship with russia from the start. it predates saudi oil minister, mohammad bin salman, it predates him. it was forged, and he spent a

lot of time and effort cultivating this relationship with russia. it goes beyond just opec two, you know, they had a lot of visiting going on. he was to visit russian oil facilities in siberia and he came to saudi arabia. the uae has been a huge proponent of this relationship as well. they are the two that hold the most spare capacity, and could potentially do something about oil. but they are very much set in meaning within the confines of their plans and their deal. they do not want to go outside this opec-plus deal. i think if there is some kind of knee-jerk market dislocation in terms of energy supplies, they could be compelled to discuss it. but at this point it is very difficult. it is not the same as sanctions

on iran or venezuela, who are not the largest oil producers. this is russian we are talking about. jonathan: given everything you have just said, is this cartel there to manage the market or manage the foreign policy goals of the individual members? ellen: well, they will tell you they are there to manage the market, what it is never without foreign policy goals and geopolitics. that is always there and always present. the way that they are spinning this is really, you know, this is not a market issue, this is a political issue, and even if we did increase production, you know, we would still have this geopolitical issue. i think on some level they are right, because they cannot fix the geopolitical issue, on another level more oil on the market would bring down prices. i think eventually we would see the market even out in terms of who is sending oil wear, but

this position is definitely different from what we have seen before during previous global, kind of, issues, the iraq war, for example, the gulf war is another one. but opec-plus is a different group now. they have moved a lot closer to russia and a lot further away from the west at this point. lisa: without a supply response how close are we to demand destruction? are we to the point where oil prices have reached high enough for people to pullback how much they travel and heat their homes? ellen: that is a very good question. i think it depends somewhat on how much inflation is really affecting everything, because if you try to compare gasoline prices now to 2012, when they were also -- the national average is also over four dollars a gallon, it is difficult to make that comparison in absolute terms, because inflation rates are so much higher now.

we are talking 7% inflation compared to 2% inflation. you also have a lot of pent-up demand from the coronavirus pandemic. so i think this summer we will see people making different choices than they might have if oil prices were, you know, national average below four dollars. if we are seeing prices in the six dollars and seven dollars range, i think we will see different choices, and that could affect demand. could see lower gasoline demand across europe, and across the united states. question is, will it just be affecting consumers' acacian habits, or affect the gdp? are we going to see effects in industrial outputs? jonathan: demand destruction. all of the above. ellen: i think we will start to see that pretty soon. i think we will start to see it sooner than people think,

because there are rising costs all across the board. jonathan: ellen, thank you. ellen wald of the atlantic council. that final piece there, lisa, how does this shape discretionary spending? and for that matter, how does it shape credit? credit story in america? do you pullback elsewhere or take on more credit? lisa: frankly we are hearing even from the airlines. they are loath to increase their costs, the cost of airline tickets, because they don't want people to stop their travel. yet they don't have a cushion to absorb those costs. the conocophillips ceo came out and said we are getting to the kind of prices which are encroaching upon the area of demand destruction. he sees it already beginning. jonathan: one had a $20, tom. tom: i'm still not used to it. i'm going to call it a very constructive tape. i do want to note the unraveling of turkish lira. it is ever so gentle, but persistent. jonathan: the airline stocks here today on the s&p, they are

down 17.5%. tom: wow. jonathan: futures up 1.5 on the s&p. yields higher by five basis points. going into cpi tomorrow morning. crude pulling back to $120.17. ♪

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♪ >> situation in ukraine is critical for raw materials. >> it is adding fuel to the already well kindled inflation fire. >> the longer it goes on, the larger the ramifications are. >> it is really putting the fed into a bind. >> they absolutely have to get off the zero bound. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: bouncing back from a four day losing streak. good morning. for our audience worldwide, on tv and radio, alongside tom keene and lisa abramowicz, i'm jonathan ferro. we had the action from the president of the united states. we wait for the reaction from russia. tom: the zeitgeist today is a little more eventful than it was yesterday,