considering her nomination to the supreme court today that roe v. wade is settled law on abortion rights. >> roe and casey are settled law of the supreme court concerning the right to terminate a woman's pregnancy. mark: judge jackson declined to say whether she supports expanding the court. she said her work represented accused terrorists after terrorist attacks. more than one third of covid-19 cases were caused by the omicron v.a.. to subvariant, a notable increase from a week earlier when productions were just under one quarter,. the cdc says more than half of infections in the northeast are now caused by the subvariant and

while covid cases have continued to drop nationally, new york city saw infections rise by 33% over the past week. in new york city, mayor eric adams says he will remove the mask mandate in schools and daycare centers for children ages two through four. mayor adams says "it is time to peel back another later." he says covid cases remain low, the change will take place april 4. new york state dropped its requirements on march 2 and the city followed suit on march 7, making asks optional for school children ages five and over. japan narrowly avoided blackouts in tokyo, but officials are warning consumers must continue to conserve electricity to manage the worst power supply squeeze in over a decade. the government says unplanned outages are probably avoidable today after households and businesses made efforts to lower

the strain on the capital's grid. tokyo electric power warned as many as 3 million buildings were at risk of losing power. 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 mark crumpton. this is bloomberg. >> welcome to bloomberg markets. matt: here are the top stories we are following from around the world. the route and treasury deepens. we will speak with kathy jones on whether a recession may be in the future. plus st. louis fed president

agrees with tightening monetary policy quickly, saying when it comes to hiking, faster is better. we have an exclusive area. prime minister trudeau announces an agreement that could keep his party in power until 20 to any five. we will discuss the economic impact of the deal. all that and more coming up. jon: let's get a quick look at the major averages. we have some green on the equity screen. all firmly in positive territory. we've seen a willingness on the part of investors to keep nibbling on some of those hard-hit technology stocks. oil pulling back a little bit which might be inviting some investors into the marketplace. financials arguing a second look from investors, but worries in the bond market and fears and what that could mean for the economy, that gets us to the what it's worth charting today. the federal reserve and jay powell is pushing ahead with the

idea that there can be higher interest rates in the economy can navigate through that. what we want to show you is a chart that represents something the fed has been watching closely over the last few years which should give you a sense of three-month t-bills today and where they could be in three months. at the end of that screen, you can see there no signs of inversion and there are pockets of red below the yellow line that indicate if you go back 15 years, the up points, when clearly, you saw that kind of concern heading into a recession. comparing it to that to 10 spread where there is a lot of fear, you have to wait to see how these rate moves play out because it is still early in the rate hike cycle. matt: can i just say first of all that i love this chart? i keyed into this answer yesterday when he was asked about the curve, he says we watch the front end, the

three-month to 18 month spread, and their opinion is a better indicator of recession. it shows you the genius of the curve. who else could have protected the pandemic-driven recession we saw at the beginning of 2020, the treasury curve is unbeatable. jon: it is true. it's still early in the game, so we have to see how it plays out but everybody's got an indicator and everybody's got an opinion. let's get to kathy jones from charles schwab. big picture right now, if the fed moves to quick, we have this concern about what happens to the economy. if they don't move fast enough, we continue to have fears around inflation. what is your opinion on all of this? >> i think the fed has been pretty clear that the priority is inflation fighting.

inflation is basically a policy choice by a central bank that is independent that has chosen to fight inflation. they will do it at the expense of the economy if that's what it comes down to. it has been pretty clear from the powell pivot in december, they had congressional testimony where he was asked explicitly if he would be willing to push the economy into recession to get inflation down and he said yes. they're are willing to take a risk and we should be prepared that they are going to move aggressively and will continue to invert in various places and the riskier segments of the market, the more leveraged segments of the market may have to react to that. matt: our chief rates strategist at bloomberg intelligence told us today their strategy, they are going to dampen demand with

rate increases until they can get inflation under control. in the meantime, the supply chain is getting fixed, chips are being produced, and the supply side is going to come back online and inventories will bounce in a big way. it's not about whether or not we are going to have a recession, but what kind of recession we are going to have. do you agree? kathy: i think he's right about that. there's a high probability that the fed will pursue the policy they are talking about to create slack and suppressed demand and just as supply is probably coming back on board, there is a risk we will fall into recession. timing is always difficult on these things and a lot of things can happen. we were not anticipating a war in ukraine and a lot of other things going on. but the goal of the fed, they

cannot control oil prices, they cannot produce more semi conductors, they cannot plant more wheat, but they can reduce demand to meet supply and it looks like what they are doing is they are going to push down demand at a time when supply is coming back on but the timing will be off. risk of recession is definitely there over the next 18 months or so. jon: just to build on that, if we are trying to quantify the recessionary impact, matt and i were flying through the charts there, but do we need to be going back to the 1980's to look at the charts there to analyze what happened in that situation to get back to the story of the balancing act going forward? kathy: this is a lot different than that we still have the spike in inflation. inflation at the time were significantly higher and paul volcker shifted to focusing on money supplies to allow interest rates to go up

and now we have a different methodology. what we need to focus on is the stringing of the balance sheet, the rate hikes and then look at the leading economic indicators in the economy like housing. mortgage rates are moving up rapidly. we want to watch credit spreads to see if activity was getting more constrained for companies. not bad but those would be the leading things i would watch. matt: we are looking at a chart right now -- i have two give a shout out to the producer out of london that put together an amazing package of charts on the fixed income sector that i will forward to you after the show. this illustrates the losses we have seen across sovereigns, across corporate's, across all kinds of fixed income investments in the first

quarter. it turned out to be the worst quarter for the bloomberg treasuries index in my lifetime, since 1973. what does the rest of the year look like for treasuries and fixed income investments? kathy: it probably will look better in the second half. the reason is the yield curve has built-in a lot of the tightening, so barring some major surprise, the market is invested in the idea that the fed is going to hike rates be the neutral rate and that's been flattening for three years out. the market expects the fed funds rate to be higher in two or three years than it is today, which is reasonable. but actually expected to come down longer-term and that should pull down inflation expectation. without a big selloff in the global bond market, a big shift

in the yield curve and levels, it will probably start to level out as the year goes on. matt: thank you so much for joining us. kathy jones from carl schwab -- from charles schwab. a new deal reached in canada that would keep prime minister trudeau in power for at least two years. we will break down the details next. this is bloomberg. ♪

jon: this is bloomberg markets. i'm jon erlichman with matt miller. justin trudeau announcing a power-sharing deal today that could delay other federal election until at least late 25 and reshape the political landscape and impact the economy. let's get some insight from brian platt. you spoke to a veteran poster today that made the case that this could be the most progressive party in power in more than a generation. does this story start with the federal election last year, a calculation justin trudeau made that he could get a majority government and was unsuccessfully doing? brian: when he called the snap

election, it was clear he wanted a majority government and did not quite get there. they fell 11 seats short. these minority parliaments often last one year, two years, maybe three years, so this deal allows him to go the full length of four years and he hasn't had a chance to do a lot of the things he wanted to do in the last two years. he has been in this pandemic crisis mode and this gives him some runway to get things done without having an election hanging over his head. matt: is there any possibility he keeps going beyond 2025? brian: that's a big question and there's a lot of speculation already about that. if this goes all the way to 2025, he will have been prime minister for 10 years. speculation will only grow that he will step down before the next election, but that is not clear. i talked to people around him to

say they genuinely don't know what his plans are. his finance minister, former bank of canada governor was floated as a possible successor, so i think that question will stick around the longer this goes on. matt: thank you so much for joining us. time for our stock of the hour. shares of alibaba surging after the chinese tech company ramped up its buyback program to $25 billion. bloomberg's is in the house. what do you have? kriti: this is the third time they are boosting their buybacks. it went from $6 billion to 10 billion, now $25 billion. but it hasn't stopped the funds coming out of alibaba. some 56%. it speaks to how much is invested in alibaba's stocks and china adrs broadly.

matt: that second index is getting crushed. kriti: it also comes from slowing growth. this is a big deal. think about the chinese middle class -- they are spending less and less. for alibaba, this is the amazon of china. go outside of china and they don't have the same market share. so that's hurting their bottom line. even with the buybacks, investors are not happy with that stock. jon: i had to do a double take because it wasn't that long ago this companies market cap was on the doorstep of 900 billion dollars. i would imagine that ongoing concern about a tech crackdown in china plays a role outside the business itself. does this signal that it is easing? kriti: the stock is up today,

perhaps a vote of confidence in itself. not long ago, we heard from the chinese financial regulatory authority, saying the dialogue into the united states was going along great and would provide clarity into what that regulatory action would be like. chinese adrs were thriving on the back of that and if you compare the pain to what you're seeing in the broader index, there is a ton of market share. alibaba lost $650 billion and that's just the tip of the glacier there. jon: coming up, the st. louis fed president renewing his call for eight quicker rate hike. we will hear from him next. this is bloomberg. ♪

matt: this is bloomberg markets. i matt miller with jon erlichman. the st. louis fed president says

it u.s. monetary policy needs to be tightened quickly to keep inflation under control. he spoke exclusively with bloomberg's mike mckee. >> faster is better in the 1994 tightening cycle or removal of accommodations cycle is the best analogy here. that was quite successful. the fed moved 300 basis points in a single year. they made some adjustments afterwards and the result was we had our 2% inflation target and the economy boomed in the second half of the 1990's. this is a situation like that. we were surprised by inflation but now you have to move the policy rate up discreetly a fair amount, not to be too disruptive. then get to a level we can be neutral and decide if we want to

be restrictive and put further downward pressure. but we are putting upward pressure and it's the wrong place to be. >> the markets, when you look at swaps where futures are pricing in 50. the fed doesn't like to surprise the markets. should we assume that's what you are going to do? >> i'm just one person on the committee. i don't know where the rest of the committee will be and the chair has to manage that process. i thought it was a good speech yesterday that laid out the situation and we will see where we are. >> the economic data have been closely watched, but it doesn't sound like it really matters between now and may. we are too low into the fed funds rate. >> that is a big picture and i think it's right.

we don't need a lot more data here but you never know in this world. you can always get surprised. we've got geopolitical risks out there and my feeling on that is we can't wait for that to get resolved. this could go on for a long time and certainly geopolitical tensions, the tensions would last for a long time. best contribution we can make is to get our house in order and make sure the u.s. economy is doing as well to achieve and that will be the best we can do to contribute to the situation. >> the idea of neutral is a moving target. different people have different levels. it has been summed up as the fed will keep hiking until something

breaks. is that the best way to think about it? >> that's not a good way to think about it. we are going to go to neutral. you don't want to put up with pressure when you have headline cpi close to 80% and more to come. we will probably get to a restrictive policy and putting some downward pressure. history tells us the faster we move to that situation, the better chance we will have moving inflation back to target and getting a boom in the u.s. economy to boot. >> what is neutral to you? >> on the funds rate, i have 2%. i'm willing to go with a zero star, that's closer to other estimates out there. 200 basis points on the funds but i would want to go to 300 this year to get mildly restrictive and that will help

us turn inflation around and hopefully get some moderation from inflation from other sources. jon: context from james bullard, the st. louis fed president speaking exclusively with bloomberg's michael mckee. for matt miller and myself, thanks so much for watching. this is bloomberg. ♪

mark: keeping you up today with news from around the world, i'm

mark crumpton. judge ketanji brown jackson is facing the first of two days of questions from u.s. senators as they consider her nomination to the u.s. supreme court. she defend herself against criticism from republican senators who say she has been too lenient in sentencing child born offenders and has -- and is generally soft on crime. >> you know that there is someone who has written to me and has told me she has developed a agoura phobia. she cannot leave her house because she thinks everyone she meets will have seen her at the most vulnerable time of her life. i tell that story to every child born defendant. mark: judge jackson defended her work representing accused terrorist at guantanamo bay cuba , saying they had a constitutional right to be treated fairly. russian opposition leaner alexei navalny is calling on