down to consumers. real consumption is strong. >> we are actually looking at possibility as a of oil prices over $150 this summer. >> how far is the fed going to raise rates? >> another inflationary shock that might require more hikes as well from those central banks. >> this is "bloomberg surveillance." jonathan: from new york city, good morning morning, good morning, this is "bloomberg surveillance." alongside lisa abramowicz and kenny lines, i'm jonathan ferro. you choose up .3% on the s&p. the action is in the bond market. lisa: and the stock market is not even noticing. selling off to the highest pace we have seen going out to 1973. how high can yields go before stocks start to notice? jonathan: if pricing in 50 from

a. lisa: the tone has shifted. i would argue there is more momentum behind the 50 basis point hike them before, because yesterday jay powell came out and said, listen, there is nothing holding us back from a 50 basis point rate hike, and the threshold is to see more information showing that the inflation is slowing. you see hints of it or the threshold is to see some deflationary or disinflationary trend, to stop them. jonathan: goldman thinks they will not just to do it once, but twice. kailey leinz, at the june and may meetings, the call from goldman sachs? kailey: i think it is noteworthy that estimate has not changed, so they do think it is going to be this ramped up frontloading. i was talking to christian muller earlier about this idea of whether or not the fed is going to be able to execute a soft landing in that case if it

moves that aggressively with 100 basis points over two meetings. jonathan: lisa, do you think that brings the epic -- the equity market some comfort? lisa: does it? not to be bearish. jonathan: look at the marketplace -- market price. lisa: and avoiding a recession, because we are not seeing a recession priced into credit, we are not seeing a recession priced into many stocks. yes, they are seeing a frontloading, but not necessarily disrupting the trajectory some material to derail the equity story. wondering how this is the case, especially -- even chair powell delighted the harrowing aspect, the harrowing path some sort of soft landing. jonathan: you don't sound bearish. lisa: i'm not making a call. jonathan: of course not.

point -- up .25 on the nasdaq. these moves in the bond market, 234 on tens. crude lower, down a little more than 2%. big move in dollar yen. that currency pair, up by more than 1%. lisa: if you take a look at the bond market, it is the widest going back to 2019. if you look at two year yields versus two-year german yields, today at 8:30 pm jim bullard will be joining bloomberg surveillance. i'm curious to hear how he categorizes what we heard from jay powell yesterday. perhaps we are not seeing a reaction in equity markets. the bond market very much has moved. traders are pricing in eight rate hikes through february of next year. that brings the fed funds rates to 2.4%. there are other fed speakers

throughout the day, including president jon williams, san francisco president mary daly, and please and -- and the cleveland president. we are going to be talking about the rate hiking cycle in may. but also the yield curve. jay powell dismissed it yesterday is not being necessarily something that pretends recession. we are seeing that key spread narrowing to going back to at least 2019. if you take a look at the gap between five-year and 10 year treasury yields it is the widest since 27 -- 2007, a year it would not be happy to compare this winter. this is also day one of the bloomberg quality summit. i'm curious to hear how they address the current situation in russia. how do you deal with a fast-moving ethical backdrop? what does it mean to have ethics roped into investment he sees at a time when commodity sector is left for dead or left for

ethical dead are now booming. jon, it is a conundrum to get performance for a lot of the same foundations, and frankly retirement accounts, at a time in the concept of ethics is changing. thank you. looking for to your coverage of that through the day on bloomberg. right now top --, team coverage with jon matthew and maria tadeo. maria, the italian parliament at the moment, what is the asked today? -- ask today? maria: you see this tour continues in which the ukrainian president is trying to quickly address european leaders before president biden gets here on thursday. of course he wants to see weapons being delivered to ukraine. i think a lot of ukrainian sources argue the west really needs to come to this understanding that ukraine is not going to surrender and this fight will continue. saw yesterday when the ukrainian government refused to surrender

mary opal, which is been 80% destroyed. the other issue will be sanctions to increase pressure on the russians. today we see the russian federation is able to pay coupons. they continue to sell oil and gas to the european union. that conversation -- conversation will dominate when it comes in particular to those imports of oil and gas. now, are we going to get anything that looks like a full band by the end of the week? i have sources that tell me that is not going to happen. we need 27 countries to agree. evan said that, the debate is all -- is back on the table. lisa: there is the report there is a potential for chemical or biological weapons used on ukraine. what are the red lines among european leaders as far as what will provoke a greater action and more discussion of actions beyond sanctions? maria: it is those two.

it is biological and chemical weapons used on the civilian population of ukraine. unfortunately we have seen repeatedly that russia does target sites where there is civilians. it is not military sites when you see a school that gets bombs, and hospital, theater tickets completely obliterated by very heavy artillery. europeans, they say that would be a real redline. that is the case and you see a repeat of what the syrian forces did in the syrian war, and many europeans will tell me in a flight that is two hours away from where i am sitting, you cannot have an aleppo 2.0. that would be unacceptable. that would trigger what is seen as the nuclear option, for lack of a better word would it be the energy sector. kailey: it is not just chemical, it is not just nuclear, you also have cyber attacks, potentially. that is something president

biden warned about yesterday. ukrainian companies here in the u.s., potentially, those cyber attacks on the rise in. what would be the administration's response to that if it comes to u.s. shores? joe: it is a great question, and have not answered it. we do not know how that would be interpreted by the white house. if there was a cyberattack on not ukraine, but the u.s. -- this is why the federal government has been briefing dozens of companies -- about 100 according to our reporting -- to get them to harden their defenses for what they believe is a potential attack. evolving intelligence is the phrase used to last evening. the president spoke to the business roundtable about this reflate. it is interesting, when you look at this some of these companies have quite primitive defenses. we are talking about double authentication, we are talking about in cryptic sensitive data, and some of these companies have not done that.

without suggesting this would be interpreted as an act of war. that remains unclear this money. jonathan: thank you, sir, from bloomberg, alongside maria tadeo as well. yields higher on tens by five basis points. on tuesday, up to 218. lisa, massive moves. lisa: i was looking at the cycle for the 10 year yield. it was .5%. we have quintupled over the period in terms of where we are. just to give you a sense of how quick this move has been and the amazing ability for credit and credit spreads to absorb this, has shocked me. we are not pressing in recession, and yet can we avoid some sort of economic slowdown or downturn if the fed is that trained on getting rid of inflation? jonathan: just to go through this, the three year yield, five year yield, seven-year guilt, 10 year yield, and move on threes yesterday, and of the biggest

moves we have seen going back to 2009. lisa: more than a decade. you have these durations starting to see these curves inverting. we still have the two year yield, call it 16 basis points that. powell's commentary, when asked about this yesterday, he is not so much worried about the vanilla curve. he pointed to the 18th month curve -- 18 month curve. jonathan: do you think it will shape risk appetite? so far it doesn't seem to be doing that. kailey: we haven't gotten to that point. i wonder if curve and poison -- inversion would be different for this equity market, the equity market has by and large been able to look through that for reasons kind of unknown. jonathan: has anyone pushed back against this, lisa? bostick, not willing to move only at 25? very open to half-point moves. that was barking. they are all lining up to say if

we need to we will, and it looks like they need to and they will. lisa: which is a lot more conviction than we had going into this previous meeting in terms of rate hike. what i'm curious about is the balance sheet. do they start to target a more rapid wind down because they are concerned about that yield curve, or do they hinge the loop -- their views on what we heard from jay powell yesterday which is, typically that inversion signals a downturn because the fed's hiking rates at the cycle. so it is just a correlation not causation? jonathan: do you think this time around it will not be like watching paint dry? lisa: i'm going to have a view. jonathan: take the view. lisa: i don't think it is going to be like watching paint dry. jonathan: good morning. this is bloomberg. ♪ ritika: keeping you up-to-date with news from around the world,

and ritika gupta. russia is focusing its military campaign on the east and what may become a narrower set of goals for vladimir putin. one of the primary targets, every paul, the bombardment of the city has continued and russian deadline for surrender expired. the intensity is striking. president joe biden is warning the private sector against cyber. the president says the kremlin may be plotting cyberattacks to retaliate for sanctions. the white house room -- provided few details about the nature of the threat. the federal reserve is now using a more aggressive tone toward curbing inflation than just a few days ago. powell said the fred is prepared to raise interest rates by half a percentage point at its next meeting if needed. last week policymakers increase the right by a quarter point. justin trudeau reporting a deal that will keep his literal --

liberal party in power until 2025. judo's government is discussing an agreement with the new democratic party. if there is a deal it would reshape canada's political landscape. alibaba has ramped up its share buyback to 25 william dollars. china's e-commerce giant is reacting to a $470 billion loss of value during beijing's internet crackdown. government has pledged to support the economy and finish a clamp down the tech sector as soon as possible. that triggered a rally. 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. ♪

>> based on evolving intelligence russia may be planning a cyber against us. it is a patriotic obligation to invest as much as you can in making sure it will help in anyway that you build up your technological capacity to deal with cyber attacks. jonathan: a warning from the president of the united states. from new york city this morning, good morning. futures higher by .3% on the s&p. a lot to talk about. yields higher by six basis points.

before we get there, some headlines. kailey: the spokesman for the kremlin says that ukraine talks are slower and less substantive than hoped. kind of reiterating the messaging we have been getting from russia about the slow progress of those negotiations. goes to show you there is not necessarily going to be a quick resolution to this conflict, especially when you have president zelenskyy saying any agreement that is reached in -- the operative word being if -- will also have to face a referendum and be voted on by the ukrainian people. this is going to be a drawn out process. jonathan: the kremlin not even talking up talks anymore. lisa: in the market doesn't care. that is what i find interesting. right now people are dismissing all headlines and acting as though you can look at this conflict as a set of parameter of risk rather than something that could percolate into something larger or longer. jonathan: will the market care

about this? this from goldman. we now for cased 50 point hikes above the june and may meetings. joining us now is george gonclaves. did we overreact yesterday? george: i think the markets are starting to play catch up to the fact that there is a big moment of truth in the bond markets. are these longer-term factors that have been guiding bond investors, are they really about to go unhinged? this new world concerned about inflation, supply disruptions, and a new inflation regime upon us that the flu fed -- that the fed and central banks have to preserve the sanctity of their credibility, otherwise bond investors are going to look the other way. that is the big concern for the bond market right now. lisa: george, you have a radical call for only three or four rate hikes this fall, we are pricing

in seven or eight rate hikes. why do you think it is only going to be three or four? jonathan: did we lose george there? we want to reestablish that, george. george gonclaves us of mufg. lisa, looking at the spread, lowest since 2007. it seems pretty clear over the last few weeks this curve is flatter and pockets of it converting. we have been on top of that over the last several days. lisa: if you take a look at george's assertion that the bond market has to have faith the fed can control inflation and get longer-term inflation down to a more normal pace, then why not by the long bond if it is above 2%, right? it sort of is a self fulfilling prophecy unless you think the fed is unable to bring down inflation or unwilling to do so. how much of people betting on that then in the near term expecting a lot of rate hikes needed? jonathan: george's back with us.

george gonclaves as of mufg. let's pick up on some of the issues we have been talking about over the last several weeks. let's start with pricing in this bond market. what are we pricing now? george: we are pricing now -- and by the way, thank you for putting me back online -- i thought you cut me off because i have an unconventional view on the bond market. in all seriousness, we are pricing in is a bond market that is pricing in liquidity, we have a complete curve -- i think i lost you guys again. jonathan: george, if we have lost you, we are going to come back to you soon, not because you have an unconventional view, just because there is a technical situation. george gonclaves there of mufg. what we pricing at the moment, lisa? if we are pricing in an inverted yield curve, if the whole curve inverts by the time we get to may, we are not pricing in a

soft landing, are we? lisa: that is what people are thinking. fed says we have seen such an unconventional bond market over the past couple of years that perhaps you cannot take the same signals from it. and yet it doesn't seem like it is getting more difficult to get to a soft landing. honestly we have heard that from a number of strategists, saying i the day the chances of a soft landing are deteriorating. jonathan: why do you think this market shook some of this off last wednesday? it is a mystery. have you drawn any conclusions on that over the last few days? what happened last week, when chairman powell essentially repeated what he said yesterday? lisa: i think a lot of people were wondering, if you are so hawkish, why not go 50 basis then? why not take a dramatic move? why wait? what are you waiting for? and what we heard from him yesterday is, frankly, they are not waiting for anything and perhaps the ukraine war was the main factor in why they didn't go 50 basis points. but it's not going to stop them

going forward and they are assessing the risks, it also higher input costs, and he talked about how inflation is not just going to come back down. he is no longer in team transitory and i think that has been a big shift. jonathan: governor wallace said as much last week. talked about the process of 50 and said the reason we didn't go is not because of the data, it is because of the geopolitics. even what is happening with financial conditions, yesterday, wednesday, thursday, friday the equity market was almost -- was up almost 5%. you and i were talking about how chairman powell might respond to that. i think he probably wasn't surprised, based on what he communicated wednesday. on top of that the balance sheet discussion is barely featured at the moment. is that going to be passive this time around or do they understand the effect it will have on financial conditions and considerate? -- consider it some form of tightening? lisa: they have not been shy about their views. what will it take?

this is where the soft landing discussion becomes somewhat difficult. if they need to crimp demand in order to effectuate lower inflation, then they have to do more, which means they have to dampen demand, which means they have to engage with some sort of slowdown. they have to manufacture a slowdown. that is not being priced into equities because they still think it is transitory or they think it is not going to be that big of a deal. jonathan: staying on top of two issues this morning. the price action we are seeing in the bond market, but also president zelenskyy addressing the italian parliament. an kailey leinz saying the pope playing a mediating role would be appreciated. kailey: looking for help anyway he can, including the vatican. this is the latest in a series of please resident zelenskyy has made to world leaders. he was in the u.s. just last week. he is now speaking in italy. we know what he wants. he wants eight, he wants

weapons, and theory he would like a no-fly zone. as war continues to rage and kremlin -- the kremlin says talks are making slow progress. jonathan: from new york city this morning, good morning. good to have kailey leinz in the seat. tk as a way. this is bloomberg. ♪

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jonathan: live from new york city, i'm -- here is the price action in this equity market. the s&p up .3%. the nasdaq up .25 percent. in the equity market all is calm. the bond market, anything but. twos, fives, and tens. your five year yield is above your 10 year yield. this pocket of inversion and decompression we are starting to see through the curve. twos, tends look like this. 17 basis points between them now. the tightest between these two we have seen going back to march 2020. lisa: it seems like the bond

market is pricing in near-term we are going to avoid a recession. but over the next four years it seems inevitable. that is what you are seeing increasingly recognized by bonds. jonathan: one stock to watch, they keep delivering, nike. bouncing back by almost 6%. jeffrey saying third-quarter underscoring strength of nike's brand as demand continues to exceed supply. that last line came from the nike cfo as well. demand continues to significantly exceed inventory. that is the situation still. kailey: still working through some of those supply-side challenges. the production has gotten a little bit better because you have started to see covid restrictions acting in the regions in which they produce. in addition to working through some of those supply chain issues, weakness in china is starting to improve. cap yes, you still had china sales down. jonathan: that is the story for

nike. the talk about this commodity market. crude has been all over the place, and nickel has been its own story. it's good to francisco blanch, the head of derivatives research at bank of america research. how much crimp -- how much credibility has lme lost? francisco: it has been a messy process, that is for sure. one of the advantages of having multiple exchanges around the world is we continue to see a live price for nickel in shanghai. even though we have had some disruption for several days, i think at least there has been a reference out there that people could track. and that has been a positive impaired to private crisis. lisa: how much more do we have to see if these clearinghouses getting disrupted, or even the consequence of them increasing the margin requirements in order to avoid some sort of disruption leading to lower liquidity? francisco: since the financial

crisis we have been concentrating a lot of the risk on the exchanges. and obviously that is partly creating some problems, but also remember commodity markets are at unprecedented levels. it is hard bringing up those margin calls or margins in the commodities people play, because the risk is higher. have seen that with nickel, we have seen that with oil commodity markets. some of the week as we saw in oil was related to the liquidation of long positions linked to increased margin calls. as you know, open interest has fallen in oil, despite the incredible risks we are running here with the war in ukraine still unfolding and still at a crucial point, i would say. lisa: she thinks that brent

could get up to 150 dollars. i think you agree that by june we could see brent get up to $150, but then quickly fall back down. do you still believe it will quickly fall back down based on the fact that a lot of people expect a prolonged conflict and prolonged consequences in the commodity markets? francisco: our scenario since october of last year was a spike to $120 a barrel by the summer. we had that view based on a post-covid demand recovery are limits to how much shale is likely to respond, and inventories, which are low. with -- what the ukraine crisis has done is lift the entire expectation by $25 to $30 a barrel. we do have a $50 -- a $150 a barrel target. it could still get worse, right? i don't want to sugarcoat this. it is a very bad situation and europe could still opt to

restrict russian oil purchases, in which case we would see meaningfuly higher prices. that is what we call our ugly scenario. russia actually supplies about eight to the global markets. so, things are not great, and it could still get a lot worse. and, actually, if you look at petroleum markets we have seen diesel prices already surpassing the high points that we saw back in 2008. so it is not just crude oil itself, it is pictorial -- petroleum products. crude oil is the basis of the economy, everything we do from harvesting to industry. and diesel is connected to jet fuel. so the back point -- the backbone of the economy is being affected by these exceptionally higher prices.

it is the new agriculture, aerospace, it is also nuclear and renewables, and gold and critical metals. so it is all of that that has come back to the fore with the crisis. kailey: you mentioned an ugly scenario. does not equate to in terms of a dollar figure on a barrel of crude? how is that different from your base case by $150 by summer? francisco: our ugly scenario is $200 a barrel-plus. the way we get there is a simple. if you think about every $1 million a barrel of day in disruptions from russia equates to $25 a barrel on the prize. so if we get to, you know, one million-plus two -- to 4 million, have to add $60 to $70 a barrel to our scenario. as i said, i think what has been

so difficult to impose restrictions on russian exports, because at the end of the day when you sanction a commodity of a very large producer, you are alternately going to end up paying a higher price as a large imported. of course, the european union is one of the world's largest importers, together with china. so, restricting the supplies of energy from your largest supplier, which, again, russia supplies one third of europe's oil and 40% of europe's gas. essentially it would elevate energy prices, which are already at record levels. i think that is why there has been debate there. kailey: let's talk about other sources of supply. what assumptions are you making about potentially more capacity coming online from opec-plus or the shale patch? francisco: from opec-plus, obviously i think the big potential supply additions could come from saudi arabia or from

the emirates. we have also seen some progress being made on the iran nuclear deal, which could also provide some relief. if you put together all of those that could be up to 3 million barrels a day of incremental supply. i'm talking about iran, saudi arabia, and emirates trying to max out production. the issue is with the very low inventory levels we have if we max out production then there is really no room for error. your keeping our fingers crossed that no missiles from human end up impacting saudi exports. or that the situation in libya does not worsen, or god forbid we see another string of supply disruptions elsewhere around the world. so that is where the challenge is. member, energy security has taken pretty much the headlines here and i think, when you look at esg versus energy security we have seen a much bigger focus on

energy security, because security is like oxygen. provides oxygen to the economy in the same way that national security is oxygen to all of us, because you don't think about it much, but once he don't have it that is the only thing you can think about. and that is really at the heart of all of the baits we are seeing in the political sphere and i think all of the warnings that have come from people like me, the analyst saying, there is pros and cons. if you end up pushing too hard on the restriction side could also end up with a very bad economic outcome. jonathan: let me pick up on that, finally, because the policy change we could see from this energy transition, there was almost a disregard for fossil fuels, particularly at the beginning of this administration. do you think it will change things on the policy front over the next several years? francisco: i've been making the case that the u.s. would go from energy independence to energy

dominance. and energy independence, we made the case 10 years ago when shale started to emerge as a new infeasible technology and we thought the u.s. was going to become independent. now we think it is going to become dominant. in terms of policy, remember markets in the u.s. are powerful forces. with these kind of prices we are going to see a lot more liquid natural gas exports out of the u.s.. even former secretary kerry has agreed that natural gas is critical to energy transition. we are going to see more petroleum exports, we are going to see more chemical exports. the u.s. is going to really grow dramatically its energy production base as the rest of the world is facing these shortages. remember, the u.s. natural gas price is under five dollars per btu. that is about $30 a barrel

equivalent. so the u.s. not only has the cheapest energy, but the safest. i think that that is two very good reasons to up investments in the energy space in the u.s.. even president biden mentioned that there is a lot of leases out there to drill. i think we will see a turn as a solution between russia and the ukraine becomes more entrenched. and u.s. sanctions, u.k. sanctions could be there for years. potentially degrading, as well, the profile of commodity production for russia, which is the world's number one commodity producer on many fronts. jonathan: in a big way. we have learned that the hard way. francisco blanch of bank of america. lisa, some massive numbers.

$150. they are not backing away from there. lisa: they are doubling down and saying that is the base case. jonathan: futures picking up here. up .4%. from new york, this is bloomberg. ♪ ritika: keeping you up-to-date with news with the first word, i'm ritika gupta. ukraine's president says he is ready to discuss a deal with russia. he told ukrainian tv he would discuss a commitment from ukraine not to seek nato membership. in return zielinski wants a cease-fire. the withdrawal of russian troops. and a guarantee of ukraine's security. investigators are trying to figure out why a boeing 737 suddenly fell from the sky. the crash in the southwestern part of the country is believed to have killed all 132 people on board. crash experts are baffled by the plane's nose dive from 29,000

feet. meanwhile china grounded its feet of -- fleet of those planes. nickel is once again training then the london exchanges daily limits since the sashes for the first time since reopening last week. the market is starting to stabilize. >> there have been some well-publicized glitches which i do not think made a difference to the fact that we went down ea day, but clearly they have been embarrassing to the lme. that is what happens when you have to deliver these things at speed to reopen the market. ritika: the lme was criticized after allowing nickel prices to store more than $100,000 a ton. global news 24 hours a day, on air and on quicktake by bloomberg, -- i'm ritika gupta. this is bloomberg. ♪

>> we likely will see an uptick in cases, as we have seen in the

european countries, particularly u.k.. hopefully we will not see a surge. i do not think we will. the easiest way to prevent that is to continue to get people vaccinated. and for those who have been vaccinated, to get them boosted. jonathan: dr. fauci on abc over the weekend. from new york, good morning. futures, positive .4%. the nasdaq, up .3%. staying on top of the bond market yields higher. on the pandemic, joining us now is dr. amesh adalja. might sound like the former president, so forgive me. i will point you said cases are high because we are testing loads. i wonder, should we still be testing as much as we are? dr. adalja: i do think we need to be testing a lot, because now we have antiviral splint to being diagnosed within five days of symptom onset. we still need to have a robust

testing, because if we are going to use those tools to make it more like other respiratory viruses, we have to diagnose people. i don't know what the exact number of tests needs to be done to be sufficient, but we want to have robust testing so people can get linked to treatment. lisa: we are watching the wave in europe intensify, particularly with germany with record cases. people are wondering, when is the latest variant going to hit the u.s.? what is that going to look like in terms of cases? dr. adalja: it has already hit the united states. maybe about one in four cases. this is something already spreading and it likely will become dominant in the united states in terms of the type of covid-19 circulating. cases are going to go up. how high remains to be seen, because we have a lot of immunity from the omicron wave that may limit its ability to spread. i don't think it is going to

translate into hospitalizations going to a crisis level. we are increasingly decoupling cases from hospitalizations. we need to keep emphasizing the fact that yes, there is going to be cases, there is going to be hotspots, but the goal is to shift those cases to the outpatient world. cases that don't even require a call to the doctor because they are so mild forgive quickly linked to antiviral treatment or monoclonal antibodies. all of that is going to be what is key as we move through this wave. lisa: a lot of people in the market have moved on. they think the pandemic is over and they are waiting for revenge travel or the resurgence of people going out and doing things. people are not wearing masks. are we going to refer back to what we saw over the past two years, was that -- or is this what we are going to experience because people will treat this like the flu now? dr. adalja: the vast majority of people, i think they will treat it like the flu. they will treat it like a toy

virus they are protected of -- protected against, but not something that occupies the same amount of time in their mind or risk calculation as it once did. there are going to be immunocompromised people that are going to have to be much more vigilant, especially when they are in high risk situations. for the vast majority of people, because of all that we have been through, i think it will be something that is more of a mild illness. when everybody it's to that point is a little unclear, but that is the trajectory. i think airplane ticket sales are surpassing 2019 levels now, so people are going back to the normal life. kailey: can we do without a fourth shot or second booster? dr. adalja: i think it depends on who you are. if you are a healthy person, a fourth vaccine is going to have diminishing returns. high-risk people, people that have other medical conditions, for those it may make sense, but

we shouldn't be in the process of thinking that boosting is the way to get out of this pandemic. it is still first and second dose is that matter the most, then immunocompromised individuals. those people are going to need protection, but we do need different vaccines and second-generation vaccines if we are going to start to think about cases versus severity of infection. you think about the vaccine, the major function is to prevent severe infection. that is why i think boosters should be targeted to high-risk individuals, not universal. it makes sense only to protect people at high risk for hospitalization. jonathan: in the commercial break, back in the day lisa would turn to me and say, when is this over? i would say, who you waiting for to tell you it is over? does someone come on tv and say it is done? from your perspective, how do you define the end of this? dr. adalja: it is going to be different for each person. to me i think it is when you do

not see hospitals worrying about capacity. largely in the united states that has already happened. i have to go to work after this show and it is not going to be something where i'm seeing a lot of covid patients. for me in that sense it is over. yes, there is going to be cases, but it is not going to be anything like the caliber we saw in the early days of the pandemic. jonathan: dr. amesh adalja, thank you very much, sir. lisa, sometimes you are asking about the end of the show and not the pandemic. [laughter] lisa: i love your question to him is, are you going to ring the bell and say it is over? jonathan: i wonder what people are waiting for? does someone go on tv? president did that last year and it didn't work out, did it? lisa: i think a lot of people are treating it like it is over. we are hearing about the resurgence of cases in europe, and you raised the question to start with -- does it matter? should we even be tracking the

cases the way we are? would it be that sensational to see the rise and fall of various illness? if we are not seeing the hospitalizations and deaths it doesn't have the same application for socialization and economy. jonathan: the older measurement of whether this is older or not is the health care system, hospitals. are they overwhelmed? in the doctors opinion, no. lisa: hopefully they stay that way and ba.2 doesn't start to cause problems given most americans are vaccinated. i think what was telling to me and for the market specifically is that covid-19 was not even really mentioned as a risk by the fed last week after two years of consistency. that being an uncertainty, that federal reserve officials have to consider, the only time it was mentioned is in inflationary measures. jonathan: in september something didn't happen what they wanted to happen.

he would always talk about september it was back-to-school and people get back to work. we would start to see a supply-side response toward the end of the year. that is what they were betting on. that is what they were betting on happening, and they were hoping inflation after that would trend lower. that hasn't happened. lisa: we had the omicron variant. what we heard from jay powell, as soon as the pandemic was over this new crisis has led to supply chain disruptions that do not lead them to expect supply chain disruptions fix themselves. that was a shift in tone. he is saying, we have to see real progress instead of assuming things will roll over and we will get back to some base effect. the base effect is not in their favor because this new crisis is even more disruptive when it comes to supply change. jonathan: i know it is only one story, but nike speaks for a lot of what is happening in the corporate world. demand continues to significantly exceed inventory. that has been the story of the last couple of years, hasn't it? lisa: it has been about

production and getting it the stores, but honestly what else have people been able to do besides go out and shop? jonathan: futures, another left. from new york this morning, good morning. this is bloomberg. ♪

>> i am still a big believer about the physical global economy continues to mow the lawn. >> it really does come down to consumers. real consumption is still very strong. >> you're looking at possibilities of oil prices over $150 this summer. >> how far is the fed going to raise rates? >> there is kind of another inflationary shock that may require more hikes from those central banks. >> this is "bloomberg surveillance." jonathan: some big calls for a big move in may of this federal reserve. from new york city this morning, good morning morning, good morning. this is "bloomberg surveillance." alongside lisa abramowicz and kailey leinz. the price action once again and the bond market. lisa: