>> in the near term, the fed will do what they can to get their credibility back. >> the type of inflation they are trying to control is androgynous. >> food and gas prices are out of control of the fed. >> it is behind the curve in a way it is never been before. >> while the market is not indicating recession, we expect a three year end. announcer: this is "bloomberg surveillance" with tom keene, jonathan ferro and lisa abramowicz. tom: good morning, everyone. jonathan ferro, lisa abramowicz, and tom keene.

forget may. forget the next one. july 27 matters. that will be the fed meeting. jonathan: on june 15, a 75 basis point move. they think another 75 basis point move and they think that comes up to a 50 point basis move. we know the goal of the federal reserve. get back to neutral and get there quickly. what is important is what you do after that. tom: the timeline here is nonlinear and i am suggesting what really matters happens in three meetings. jonathan: we have already seen the peak of cpi potentially. maybe it is in a month, maybe another month. it is around the first or second quarter. from there, you will get lower inflation. that is what most people anticipate. that is one side of the story. the second part is the more

important part. it is how above target inflation will be next year. whether it has a four or a five handle and whether this fed will tolerate that. that is where the division on this fomc is going to grow. there will be some who want to take it above neutral and others who do not want to, some who will be ok targeting above inflation and some who will be uncomfortable. tom: some of them will be looking at the actual news flow and the data. we spoke to adam posen in washington last week and he made it really clear we are not getting back to 2%. lisa: he thinks we will see a more persistent 3% inflationary environment which might be ok for the fed and this is where john's point comes into play. how much does that division, that more tolerant level of this higher inflation rate and that is what i am watching. the fact that avoiding 10 investment management came out

and saying they are concerned about the outlook for bonds because they are concerned about the fed allowing inflation to run a lot hotter and not getting control. tom: it is a raging debate. i want to go to weak sterling but weak in is important into the weekend. chinese yuan, i misspoke. i was thinking in french. i look at chinese yuan and the fact that it is weakening and that is a shock. jonathan: something is happening this week that did not happen last year with the weaker chinese currency. tom: nasdaq is a little green. vix, 23.07. jonathan: futures negative 0.1%. where there has been some drama has been in the bond market. the 10 year yield phase, we give up the gains of this morning but on the front end, we have had quite a move of almost 30 basis points. up five or six today to 274.

tom: speaking to david coston, always a special guest of goldman sachs and he and i were talking about the kids who come out of school two years ago, 10 years ago, whatever, with prodigious dynamic critical thinking skills. nobody is like geoffrey yu. jonathan: geoffrey yu is from another planet and i am lucky he comes down to catch up with us. great to catch up with you. let's get to the heart and that is foreign-exchange. a long week of some weak data in the u.k. i spoke to james foley earlier this morning. what is the lesson we are learning from the u.k.'s experience with the hiking cycle and the uighur data that is starting to come through? geoffrey: stagflation, there are two parts. you have to focus on the stagnation as well as the inflation. as far as the u.k. is concerned,

looking to reach those numbers, absolutely. stagnation is coming to the u.k. household. tom: there are leakages within our servitude. there are things that react and change the story. what are you watching as the metric that will change the story passed july 27? is it dollar dynamics or is it something em developed nation dynamics? geoffrey: we will see change in em. what has been the theme? stagflation. how do you play that? you want to own commodity currencies. every single latin american currency was over held, was well owned in the first quarter but that is starting to change. we are seeing the mexican peso starting to fall back. you look at iran, that is going to come up. our people are looking to go back to asia. tom: what does the dollar do as

one example? geoffrey: you look at where dollar-yen is. telling the ecb, this is the wrong continent. places like taiwan, singapore, thailand. these are areas where every cent offsets any benefit from dollar stronger as well. a weaker yen hurts them more than the u.s. and the euro zone. if thailand continues to open up with places like korea, these two economies really pushing forward right now. lisa: a lot of investors have been tying japan into the u.s. bond market, saying they are the biggest buyers of u.s. treasuries. this dynamic of a weaker yen changes the dynamic dramatically. how much will that influence the

long end and send yields higher? geoffrey: i have not focused on the treasury market but you are right in saying korean investors , it is not the treasury market. it is u.s. high yields. these are the areas where asian investors have been taking up over the last few years. now we are seeing data -- as they begin to exit, to stabilize things to some extent. that is the widening that we are seeing with the fed in the u.s. corporate spreads that will accelerate. lisa: i know you are saying that basically the stronger the dollar gets and the more you see yields continuing to climb and the opposite happening elsewhere, you will see more and more weakness in the credit space that perhaps is not fundamentally driven, but simply a supply-demand dynamic. geoffrey: if i, karina -- if i am a korean or a taiwanese investor, while the dollar is

strong, while i have good total returns, plus my fx is looking pretty good, let me get out here while the fed is pressing the pedal in terms of tightening. for japanese investors, maybe they can take into account the high yields and the same dynamic. they are not getting tightening, but they can top that out with higher yield at the same time. that flow moving out of the u.s., but also corporate higher yields going back to asia while they are taking profit on a very scratchy return trade in the u.s. treasury market -- credit market. jonathan: one thing we have not mentioned is what this means for the u.s. equity story. geoffrey: if i look at the global high yield, i think 6% already. this is the more recent. the two were working in

lockstep. now you are seeing differentiation. now with the tightening of u.s. financial conditions finally moving from equities to corporate spreads, that affords you to drop basically. i would expect corporate credits to underperform equities much more ahead. jonathan: final question from me. do you have a number in mind for the peak of the fund fed rate? do you have a number in mind? geoffrey: you pick a number where, say you wanted three and then you added 150 basis points above that. that is where it is. the fed will be prescriptive to bring down inflation. jonathan: geoffrey yu, thank you as always. tom: the dynamics are so uncertain. what i love and we have heard this twice all morning is you cannot look at these things as a blob.

it is right now a split between commodity haves and have nots. jonathan: on the surface, we have to expeditiously get back to neutral. the real divide of people on wall street, professional investors, is what happens after that, after you get to what the fed thinks is neutral westerners something -- neutral, which is something in the low two's. lisa: frankly, how the rest of the world does because if you get the stronger dollar, and just thinking about what he was talking about, that leads to a less attractive investment thesis for overseas investors that have supported these market. would a strong dollar lead to more weakness within the credit markets? it is counterintuitive but it is something a lot of people are looking at. jonathan: the investment flows

will be fascinating. down 0.1% on the s&p. on the nasdaq, up 0.1 present. yesterday, things were calm. the equity market was tom: we have been remiss. there is so much going on in macro. the individual stock stories whether it is twitter it and musk and all that. the individual stock stories are fascinating. jonathan: i cannot agree more. yields up about one basis point. alongside tom keene and lisa abramowicz, i'm jonathan ferro on this friday morning with equities doing ok. good morning to you all. heard on radio, seen on tv, this is "bloomberg surveillance." ritika: the federal reserve chair jerome powell has outlined his most aggressive approach to taming inflation. he has endorsed two or more half percentage point rate increases.

at the same time, he has described the labor market is overheated. he is taking aim at demand that the central bank wants to calm. kevin mccarthy spent four days after the capitol riot that he urged president trump to resign. the recording was reported by "the new york times." before the audio was broadcast, mccarthy tweeted that it was totally false. olaf scholz pledged to continue shipping weapons to ukraine but he says it could lead to nuclear war and must be avoided at all costs. in an interview, he reinforced his rejection of an eu embargo of russian gas. elon musk, the world's richest person has lined up more than $25 billion of debt financing from morgan stanley and other

financial institutions. he is pledging to country butte $21 billion toward equity financing. twitter says the board will review the proposal. in the first quarter to attract and attend customers. for the first three months of the year, it's sort -- it soared . global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am ritika gupta. this is bloomberg. ♪

>> what russia is doing in ukraine is appalling. there should be no appeasement because we have to deal with economic consequences of what is going on. jonathan: the bank of england with problems abroad and some problems at home. not very good at all, consumer confidence the lowest since 2008 and retail sales uglier than expected. good morning. equity futures unchanged. the nasdaq advancing 0.75%. yields higher by a single basis point. on the 10 year, 292. tom: maybe capturing the foreign-exchange angst as well. alexander vindman has lived the divide of ukraine and russia from his childhood in the

vicinity of neptune avenue. the gentleman of brighton beach with a starlink set of academics, his public service to the nation, and a tour of duty. the lt. col. joins us this morning, the former director of european affairs for the u.s. national security council. thank you so much for joining us this morning. in the media right now, what are we most getting wrong about the new war in ukraine? alexander: i think the comment from the bank of england's right. this is not just a war between russia and ukraine, an unprovoked war against a democratic country. it is a war against the democratic system and the costs will be born by the whole world due to russia's unprovoked attacks. it was unreasonable thinking from the beginning that this would not spill over and this would be limited to the largest country in the world attacking the largest country in europe. we should have all prepared our

populations, our people for the fact that this is going to have significant ramifications, including inflation, including spikes in oil and gas prices and commodity prices and warned them that this is a war between systems. tom: i want to not dive into the white house and look back to the trump administration but i want to talk about what we found on the show, the commonality of obama and trump administration international relations experience who say we are overplaying the worry of a world war iii. do you worry of a world war iii or is that over done by nonmilitary professionals? alexander: it is overdone and it is also overdone by politicians with the intent of casting their limited contributions or limited actions and reactivity under the guise of avoiding world war iii.

it is a convenient way to worn off a public that is not well-versed in what russia's threshold for confrontation are by saying that we could stumble into world war iii. i find it hard to believe for sophisticated actors to think that we are that close to a hot war scenario. we can get there. we can get there over the course of months and maybe years as russia continues to be provocative. but we are nowhere near that kind of scenario because frankly russia has zero interest in confrontation with nato. they look to use as a foil. they point to nato as belligerent and that nato is the way that is tackling. that is why they are something so badly on the battlefield because they are fighting not ukraine, but all of nato. they do not want that direct confrontation because they are much more powerful alliance than what they are facing in ukraine. lisa: what you think that nato should be doing that they are not under the guise of trying to avoid world war iii?

alexander: it should be a full court press. i have written about this extensively. one of the things we should be doing is we should be offering a lend lease program. it has been passed by the senate. it has not been passed by the house and signed into law yet. everything that ukraine needs, we know how to fight wars. nato knows how to find and fight wars. we know the types of equipment that ukraine could use. ukraine could drop on a warehouse as needed. it does not have to go through a bureaucratic requisition process that needs to be evaluated and appropriated and transported. it should be already there for the ukrainians and we should be doing more than what we are doing with replenishing the weapons stocks from seven, eight weeks of war. we should be providing ukraine with more weapons so that they can end the war quickly. fundamentally, if russia is

defeated on the battlefield, if russia runs out of troops, runs out of tanks, runs out of planes, that is how the war end s and we can help ukraine to do that in a short order rather than an law and order where we could see russia replenish personnel losses and equipment. lisa: some people say that there will not be an end until vladimir putin no longer the head of russia, that he will not back down and any defeat will cause him to up the ante in terms of when he attacks on ukraine and the rest of the world. how do you push back against that in terms of army ukraine and saying end this? alexander: that is false. we have stumbled into this confrontation with russia, we as in the western systems, ukraine did not have as much of a role. it is a perceived weakness of

the west. it is because we did too little, not that we did too much. if we had done more, we could have managed to avoid this war, especially over the long history of president putin's tenure. the way this ends is maybe the way it seems to be winding down in mariupol. putin could throw his hands up and cheer on his military. he has taken mariupol even though he has not and say he is moving his horses elsewhere. putin's military is out of combat power. his military tells him he has no place to go and he declares victory and says that he has de -militarized graybeard it could end that way if we help ukraine get there. it does turn into retracting where putin reserves to his comfort zone, looking for vulnerabilities and that is how the u.s. and nato get drawn in

because he has to cross some sort of threshold. if he feels strength, he is not going to reach toward strength. jonathan: absolutely tragic in that country. alexander vindman. an important headline i want to bring your attention to. the market is pricing in 450 basis point rate hikes -- four 50 basis point rate hikes. i know there was a lot of pushback. that is what the market is price for now. tom: i am looking at this geometrically. forget about the calendar. i am talking and we talked to lisa about this, the lengthening of substantial inflation. let me make that up as the lengthening of inflation over 4%. that is the story. jonathan: we will continue this

conversation with glenn hubbard of columbia business school. looking forward to that. perfect timing. futures unchanged on the s&p. the yields must hire -- much higher on the 10 year. this is bloomberg.

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jonathan: good morning on tv and radio. here is the price action for you , coming into the weekend with equity futures unchanged on the s&p 500. on the nasdaq, positive. we saw this movie player yesterday where things were ok in the morning, then in the afternoon, yields picked up. on the 10 year, up about five or six basis point. about 30 basis point on the week. on the 10 year, yields lower by about one basis point. metlife just wrote in on the pricing of fed hike's and said the following, "outside my window we have more famine and plague. people are making great assumptions about normalcy. we will see what they do is equities do not hold up." just one view at the moment.

tom: it speaks to the other perspective and the complete chaos. but the randomness of where we will be on july 27. jonathan: it is the race to neutral. they keep repeating it. they want to get back to neutral and then what? that is the debate. tom: we will start with a student of this nation. the most articulate conservative economist, glenn hubbard joined us from columbia. his service there, dean of the business school. i cannot say enough about his book, "the wall and the bridge," where he leads off where the walls come tumbling down and mr. gorbachev, care down this wall. now we circle around to the chaos of the day. i want to go back to your florida and my western new york long ago and far away in 1978 when milton freeman said what is the right policy now?

the policy showed up one year later in the form of paul volcker. where is today's paul volcker? glenn: the fed has understood that it is behind the curve and needs to step in. i worry that the period from 1975 to 1983 is more instructive than people might think for today. it is naive to think that the fed wants to crush inflation to 200 basis point and the fed funds rate will do that. we will have to see but i think the fed has the courage to act and i do not think the market should take comfort in that. tom: i will not mince words. you are on the short-lived for chairman. -- the short list for chairman. volker had 4% yields. powell has 1%, 2% yields. we cannot do what volker did, can we?

glenn: it is difficult and i will tell you why. fiscal policy, as the fed tightens, the federal deficit gets a lot worse. we shorten the majority of the debt. we have a very large debt today relative to what paul volcker faced. there are issues on how much the fed is willing to tolerate. if the fed wants 2% inflation, i find it hard to believe that a soft landing as possible. lisa: what does that mean? this idea of the fact that there seems to be complacency with certain risk assets. where is that complacency? how disruptive could these tightening cycles before market? glenn: it depends on how far the fed feels it has to go. you mentioned before about the possibility of several 50 basis point hikes. the fed will take a look and see what is happening in the economy. i think we are in an inflationary bloom.

there is a lot of wind at the back. i think the fed will have to take fairly old action, not like paul volcker in a bold. lisa: do you believe you will see a federal funds rate? glenn: i do not think you can rule it out. it is not an event weekend forecast today. but i do think the fed should be prepared to do what it takes and the market believes it will do what it takes to put the genie back in the bottle. tom: moments ago, a world-class economist just came out with a stunning headline which directly addresses the scene. dean hubbard, he says not a period of normalization, but a new policy. is that really what we are talking about as we need to make up a new policy, original economics? glenn: i do not know that it is a new policy as much as going

back to being serious about the factors that cause inflation. we got this inflation because demand was growing too fast relative to supply. it is not that complicated. it is not all vladimir putin. it is not all supply chain. it is more a matter of getting back to basics. tom: what is the hubbard prescription away from the politics of it all to diminish this inflation down to 3% or lower? glenn: we will already see a winding back of some of the fiscal impulse from the national -- from the initial stimulus. the fed has to follow through. it is not sent to underwriting for the stock market every time financial markets have a hiccup. lisa: we are speaking with glenn hubbard of columbia university, talking about the new dynamic and what the fed is looking at with respect to inflation. what about the labor market? the right about economic bridges

at a time when participation rate remains well below where we were pre-pandemic. how does the fed effectively curtail inflation while allowing the participation rate to get back to something that is more representative of a robust economy? glenn: that is a good question. participation is a critical issue. i do not think letting the economy run hot will fix the participation problem. there are things that can. training, education, fiscal interventions that are really not in the fed's toolkit. the labor market as the fed should see it is running quite hot. it would be better if the administration focused more on participation but so far, not. lisa: how much has the fed lost credibility in trying to address issues that are only addressable on the fiscal side? glenn: i think the fed still has credibility with the public. i really do. i think the conversion has helped that. but i think the fed does itself no favors when it tries to widen

its role on issues that are really more fiscal policy. if members of congress and the administration will not do the right thing, that is not an excuse for the fed to step in. tom: we had a debate with claudia out of the michigan academic asset and the rest of them out there and she was really quite heated about the policy gloom of stagflation. is it precisely hubbard economics? no, it is not. but what does the stagflation gloom get wrong? glenn: if we started where we are now, we are in a classic inflationary bloom. we have seen fairly good numbers for output for jobs, potential growth. we are not in stagflation. tom: this is critical. do we underestimate grossly republicans, democrats, economists of all persuasion, do we miscalculate the technological impulse that is

making this so difficult right now, the benefits and the hazards of a technology revolution over decades? glenn: i think we do, tom. technology has been an enormous source for productivity growth. i am very optimistic of that going forward. what makes me worried is not science or economics. it is politics. whether we figure out how to help everybody get involved in the gains from technology. that is really where the political disruption is coming from. tom: i think this is so important, this idea of the political disruption of technology. it is something glenn has written about for years. jonathan: it is wonderful to catch up. thank you, as always. glenn hubbard of columbia. fantastic on the federal reserve and beyond. later this morning, christine lagarde will speak. then the bank of england governor will speak. there are some big questions about how much further the bank of england can go already given

where the data is in the u.k.. lisa: given the fact that they are tightening into weakness. at the same time, it is inflation. if their job is to curtail inflation, what are they doing? how can they maintain a mandate that is to curtail inflation? jonathan: the bank of lincoln facing challenges to the rate hiking cycle. the ecb has not started and we have this big slowdown emerging in china with the lockdowns in shanghai. challenges for those two bankers this morning. how does your communicate tighter monetary policy? tom: i think this is the common ground between paul krugman and glenn hubbard is they will wait and look at the data. they are by definition experts, they can pontificate all they want. they will wait to see the data, including inflation rolling over, which maybe is a consensus presumption. jonathan: the word consensus is interesting. a month ago when the city came

out with that basis point hikes and the fed laughed and now the market is pricing it today. the ecb think they will hike interest rates potentially this year and when you throw that at an investor market participant, the doubts about the ecb's ability to get rates above zero are still humongous. tom: they are and that is very important. the consensus shifts between the time you walk to your next property. jonathan: i am walking there now. tom: it is friday. you have a lot of properties. jonathan: would you like to do one of them? does that take your fancy? would you like to host that show ? you are busy? ok. the vice president of queens college cambridge. you did something really sleep. you suggested that mama got more sleep than you did.

no one lives on is little sleep as you. tom: he is all bransford against the tops. jonathan: you think he is supporting the other side? tom: against the tots? he supports anyone. jonathan: i am looking for to catching up with him. may 12 in the evening if you want to go. are you trying to get tickets? lisa: and a road trip. tom: al from new jersey. jonathan: and get us tickets. we will try and work that out. what are you doing on sunday? tom: i will be watching the election. jonathan: of course. special coverage on sunday with francine lacqua. from new york, this is bloomberg. ritika: the u.s. again is

threatening china with sanctions as it offers support for russia's war in ukraine. the secretary of state says china was not helping the situation in by doing things like amplifying russian misinformation campaigns. there was a promise to help end dependence on russian weapons. demand from oil the most since the early days of the pandemic. demand for fuel is expected to fall 20% from a year ago. china's zero covid policy is a montage of the economy. emmanuel macron winning another term as president. he is running out of time to narrow down gaps between and before the runoff elections take place on sunday. he has a 12 percentage point lead to land a major blow on wednesday night but she failed to do so. an international arrest warrant.

he and four others are sought for allegedly helping him siphon millions from an automaker. it was a daring escape from japan where he faced charges of wrongdoing. coming up, we will talk to him at 1115 time -- 11:15 new york time. he is donating $150 million in california. the co-founder graduated from there in 1966. the money will be used to develop athletic abilities. $60 million in 2012. global news 24 hours a day on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am ritika gupta. this is bloomberg. ritika gupta. this is bloomberg.

>> with the rebuilding costs ultimately in ukraine are going

to be enormous. certainly looking to russia one way or another to help provide some of what is necessary for ukraine to build is something i think we ought to be pursuing. tom: the secretary treasury chair yellen with some important nuance moving forward the story of the united states and the war in ukraine. we have a conversation with janet yellen later today on bloomberg with david westin. right now, this is important because it speaks to the heritage of the nation. if long ago and far away you are an agent and you come into -- you are an asian and you come into california and you are good at mathematics, maybe you go to washington. it is not mr. smith goes to washington. it is mr. singh goes to

washington. daleep singh was the first asian in congress in 1957. he is joining us now from the white house as deputy national security advisor on international economics. your title is baloney. what you really are is the most knowledgeable person about the sanctions we have on this war in ukraine. give us an update this morning. are our sanctions working against mr. putin? daleep: you have oversold me but thank you for that introduction. yes, the sections are working. we have three going into this invasion. we lead the world knowing that this invasion would be a failure, galvanized and unionize the west, and have ukraine emerge as a sovereign nation. the sanctions are having the hit we expected.

the economy will contract by double digits. inflation in russia is 7.5%. you have companies that have fled russia. more than 200,000 of russia's best and brightest have exited. the country is on the cusp of default. the country is becoming isolated into a pariah state. if this is the end game that he wanted, i think it is a big miscalculation. tom: you are front and center for the need for the white house to convince india to hold back from behavior until february 24. what is the biden administration's plan to convince india to support our sanctions to support this effort? daleep: india is a friend and partner. i have deep personal affections for india. this is not about unilateral exercise of american financial force. our conversation with india is we are trying to uphold and defend the core principles that

underpin peace and security for all of us. that is a shared interest for india. as russia becomes china's junior partner and as beijing has more leverage over russia, that will not play to india's benefit so we want to step up for india, help it diversify away from russian defense equipment. we want to help them diversify away from russian energy sources. the amount that india imports from russia is a small percentage of the total, 1% to 2%. we want to be a friend and partner. if we do that and we work together on the spillovers from energy and crude and migration and anchor the economic relationship we have with india, over time, we think it will accrue to our advantage. lisa: this is the same with china -- is this the same story with china? daleep: china has a choice to make. if it is serious about upholding the principles that it espouses, sovereignty and territorial

integrity, this is the moment to show it. europe is watching, the u.s. is watching, the world is watching. are they serious about these principles and do they care about the global spillovers from the war in energy markets, food? they already have a homegrown supply shock from the zero covid policy. doesn't it want to add to that shock? we are watching very closely. we have options in case china actively attempt to undermine our sanctions. lisa: what are those options? daleep: i do not want to specify what those are. i think you know what they are. we have a range of tools including secondary sanctions. we always carry that stick but we do not waive it around. lisa: that is the key. you do not waive it around. you carry that stick. there is this debate on whether to ease chinese sanctions or chinese levees in order to reduce the inflationary pressure on one hand while also threatening sanctions on the other if there is to be more active pushback to what we are seeing in russia. how does that balance get

adjusted? how active are those conversations that the administration is having with china right now? daleep: you are asking about the russian sanctions? lisa: treasury secretary janet yellen talked about the potential for putting restrictions on china should they not come out more actively or undermine the allies efforts. i am wondering how much those are discussions right now. daleep: our first and best option is diplomacy. our efforts the secretary was alluding to is to broaden the coalition of countries that are applying the sanctions. that increases the direct impact and the indirect signal that this is again not just the u.s. effort, this is a shared global desire to impose costs on a country that has brutally invaded 44 million innocent people. she mentioned a range of options at our disposal. if china or any other country attempt to undermine our efforts. i do not want to go any further than that. tom: thank you so much. so much to talk about. we hope to speak to you again

soon. daleep singh is the white house deputy national security advisor. he is arguably the number one person we have on the many nuances of these sanctions. lisa, i am baffled about which sanctions work, which sanctions don't, etc. even with the great effort, it is confusing. lisa: what you mean by work is key because it is a risk reward equation. are they hurting russia's invasion of ukraine more than they are hurting the u.s. and european economies? that risk reward is unclear. it is clear that it is hurting the russian economy but this really is the key argument in why there has not been a full ban on oil and gas imports from russia with respect to germany because they are saying it with her was into recession and the are not willing to do that just yet. tom: you mentioned the partition between gas and oil. i would say part of it is brent

crude 107 and if we get any further lift, and dare i say breakout through in america, aaa unveiled the high-priced couple of weeks ago, that will address the conversation. lisa: we are seeing crude prices come down. maybe this is a technical issue, something with liquidity. maybe this is a realization that they will not necessarily be wholesale bans on russian energy imports because a lot of economies cannot withstand that. tom: it is incredibly fluid, no pun intended. the 10 year real yield, negative 1.3%. that may be a new larger negative number off of that positive moment. lisa: it is an amazing market. it is shortly -- certainly in the short end space. tom: 2.91%. futures -11. the vix was 19 for a moment. with all the individual stock

stories, we back up 23.225 on the vix. stay with us through the morning. at 11:45 this morning, a conversation with the secretary of treasury. this is bloomberg. ♪

jonathan: live from new york city, good morning, good morning. 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, we begin with the big issue. global bonds. >> something in the bond market. >> we saw a tremendous backup in yields. >> demands for bonds is evaporating quickly. >> yields keep going higher. >> not easy out there for bond investors at the moment. >> fed investors -- the fed is coming in with more hawkish talk. >> when you see yields do what they have done so far this year -- >> it has been the worst start to the