hi inflation on income will start to be a drag. >> we will raise rates aggressively. >> that expectations all year long. >> we have to be very careful. although cyclical dynamics are pretty much unprecedented. >> this is bloomberg surveillance. jonathan: live from new york city for our audience world wide, good morning, this is bloomberg surveillance on tv and radio. equity futures on the s&p are up 2/10 of 1%. tom: a big day for big tech. it's a big day and microsoft, we love to talk about apple and twitter and google. do we talk enough about microsoft? jonathan: and it's a heavy

weight on that particular index. tom: no question about it with the cash filled up in the transfer from the original management to the new management stuff it's been a giant success story. they will separate the stable haves. jonathan: twitter will report earnings later this week. i wonder what those earnings actually look like whether that's a factor in accepting the offer from elon musk. tom: john kessler will be with us in a little bit. maybe the conference call will happen this afternoon. jonathan: we've got an agreement about price of $54 billion. can we close this transaction? lisa: shareholders have to sign off on this. you on musk will have the equity

position but will he share it? he wants external investors, will he get them and how does he finance this? jonathan: cost of the debt as well. a lot of people have said moral crusade may be moving company away from for-profit to something else. i'm wondering whether he can do that. lisa: when you have a leveraged buyout, you have real investors, people who want to see the money. any deliver at a time when he needs to do this in real terms? jonathan: we have earnings from alphabet and those names are 17% of the nasdaq 100. we are down two/10 of 1%. we have got to talk about this

one reflate, a 106 angle on euro-dollar, that's a big one. tom: this is the true back story this morning step we will have a brilliant call on dollar euro. when you talk to the adults of global wall street, this is what they are focused on. they are focused on a weaker yen. would you say 105 is the emotional point for the euro? jonathan: this seems to be the objective. lisa: it's up problem as we get the potential threat of a recession and it's not just the conflict in ukraine. it has to do with what's going on with china and they are trying to stimulate their economy but can they do enough when so much of their economy is pretty much locked down. the u.s. secretary general is visiting moscow.

he's visiting with serge lavrov and he will have an audience with vladimir putin. the threat of nuclear war has been floated and we will hear from the u.s. secretary general. we can focus on a whole number of economic data but i want to talk about what we get at 9:00 a.m. we get housing prices at a time when we are still seeing prices near record highs. how much will we see that continue at a time where we are looking at anywhere where we want a sense of tightening conditions? today is tech earnings across the board, microsoft and alphabet. the haves and the have-nots, that partition and the cloud is the haves. but what about advertising? how much do we get the sense of

where the emphasis is at a time when the consumer is in question? jonathan: looking forward to that earnings later. we have earnings from pepsico. they are still -- they are seeing full year organic revenue at 6% step tom: the frito-lay corporation, this is a different story than coca-cola. i think that a percent is important and speaks to the nominal gtb just didi gdp. the view forward is important. those are big organic revenue numbers. jonathan: two percentage points fx registration and we might see more of that. tom: i've always played it down, because it's a media darling but maybe this time around, fx really matters. lisa: we saw a similar type of calculation with coca-cola. so much of their revenue comes

from overseas. has this become the canary in a coal mine? it's an excuse at the time of perhaps other potential headwinds? jonathan: down about /10 of 1%. they have agreed to a price for twitter, can they close this transaction? >> i think a lot of people are expecting this deal will close. they talked about within six months. that seems somewhat arbitrary. it seems like the perception is that they will close this transaction. you on has filed documentation related to the elements of the financing. i think morgan stanley is

involved in that process. will others come in? that remains to be seen but conventional wisdom is that the -- is that this deal will be consummated. tom: do the back of the envelope work where the tesla price generates the margin of all calls. the bottom line is, if tesla goes down, how much is mr. musk at risk? >> i haven't done that math. i can tell you that that would seem to be a risk. if you look at the source of his wealth and some of the financing, it is directly related to his holdings in tesla.

it would seem that would be a vulnerability. he is potentially hedged but i don't have any direct knowledge of that. tom: i'm going to call elon musk right now. >> tweet him directly. jonathan: have you got that number? lisa: we will work on that. i wonder how much twitter is actually worth? how much is elon musk overpaying when the board took this deal and ran because it was probably the best deal they could've gotten. >> that's a topic that hasn't been talked about as much. it's important to understand when this process began, a lot of people just assumed elon musk is looking to buy twitter and that's interesting. my take was this is the

beginning of a process. twitter's board is now obligated to engage with advisors and reach out to third parties about their potential interest. what's noteworthy is that it doesn't seem there was much other activity around participating in a buyout of twitter separate from what elon musk is doing. what he indicated is that the initial offer was 420. i think that strongly suggests that this was by far not only the most compelling offer but perhaps the only one. jonathan: thank you as always. interesting question, did the chinese government gain leverage over the town square? i think it will be fascinating

given tesla's dependence on the chinese market. we will see how that plays out when it comes to twitter. lisa: especially as we talk about the new town square being a public company and our private company with less oversight. how much pressure will there be on the company and on elon musk for this to make it easier? how much will we talk about what the meaning of free speech is and how much he represents that? jonathan: we talked about how this just how this could invite some scrutiny of his other company. tom: i think the autopsy we will see is the massive squandered opportunity to make a revenue making income statement, profit-making company. twitter did not succeed in that in some people would suggest

that this is the price. jonathan: you and i talked re-flee about the prospect of this going pipe -- private and then becoming public later on. tom: here's the headlines coming out right now with that commitment letter, amended equity commitment letter. jonathan: we will go through some of those details in a moment step is a day for tech and we kickoff tech earnings with google and microsoft. i still can't call it alphabet. tom: facebook, alphabet, google. jonathan: this is bloomberg. ♪ ritika: keeping you up-to-date

with nusra around the world. call it musk 21 billion-dollar mystery. where will he get the cash to buy twitter. he has agreed to buy the social networking site and he's out lying -- he personally guarantee the 21 billion dollars. the russia's foreign minister warns about the serious danger of conflict. he's is the risk cannot be underestimated. many in russia believe that ukraine's position is tied to the u.s. and other western countries. in china, china is worried about lock downs.

it promised a quick resolution of the ongoing crackdown on technology firms. prime minister boris johnson is trying to come up with innovative solutions to the rising cost of living. politicians have accused his government doing as little as possible on soaring inflation. this is bloomberg. ♪

>> it's very important to support countries around the world. from food to energy to finance. these are very deep interests that we have at the present moment to do everything possible to end the war as soon as possible. jonathan: that was the u.n. secretary general. i'm new york city this morning, good morning. we are down lower on the s&p one -- the s&p 500. big tech is reporting after the close. in the bond market, yields had south by three basis points.

euro-dollar is $1.06. talking about twitter on twitter -- this is dangerous for our democracy. elon musk is playing by a different set of rules than everyone else. we need strong rules to hold big tech accountable. a loss for words. tom: i am lost for words because i like what you said 19 minutes ago. can we assume this deal is done? i'm not sure we can do that. jonathan: we can assume he's secured a deal with the board. tom: everyone knows that the price of tesla would go down. right now, joe matthews joins us

for a washington brief this morning. he will always be the general, the secretary of defense, mr. austin. he is indicating a change in town by the. color that tone for us this morning. joe: the town of ukraine winning which is a fascinating shift over the past couple of days. this so-called clandestine visit , they got in and got out and the message is russia is doing worse than you ought. by looking at the hardware on the side of the road, the human laws here, austin is suggesting that russia is down and we need to keep them down with this new shipment of weapons and a big conversation and it will have a lot to do with the way this ends. we are waiting for the number that the biden administration is expecting from congress.

austin is holding a meeting with military leaders from 40 countries. the chairman of the joint cheese will be there following their conversation directly with president zelenskyy to find out what you need. what are the actual pieces of hardware? tom: what is the difference of a kid out of west point whose first assignment out of west point is the third division, third infantry division of the united states army? how much critical mass does he have with a bunch of politicians more worried about the emmanuel macron victory? joe: they are worried about getting this right in the biden administration seems to want to give deference to the pentagon much like it has with his lemat or. instead of having the president -- much like it has with its diplomatic corps. should we be using artillery in the battlefield? that's the conversation going on now. we understand from john kirby and the pentagon, they have

finished up howitzer training. there are some 70 howitzers that can shoot longer than the russian artillery. we sent their trainers back into ukraine to spread the word and an interesting thought to have the secretary of defense, someone who is experienced, that conversation today and germany will come back to the united states and the politicians will do their work to put together a spending plan on capitol hill. lisa: will there be a meeting between vladimir putin and joe biden? joe: with the secretary general of the u.n. going to moscow, there is not a lot of love coming from ukraine. they don't like vladimir putin sitting down with people in front of cameras and to think that joe biden could meet virtually with vladimir putin seems like a long shot. lisa: sergey lavrov was talking about how it looks more

it doesn't seem like that's the case on the administration side. how can we interpret that but also the comments about the nuclear threat coming out of the kremlin? joe: you can interpret that as a successful visit with secretary blinken. russia knows it's not going terribly well. they say it might become a nuclear conflict just to poke officials. the fact of the matter is, vladimir putin himself is -- reached a dead-end weeks ago. mr. lavrov might be having a conversation with himself right now. jonathan: the ultimate boomer stock, ge.

tom: it's a jumble. the stereo type is that this is a boomer stock is a massive restructuring. that got a $3 billion buyback offer. what i want to know is what they are doing with aviation. i think that is the silver chalice. they say demand remains strong. jonathan: monitoring china and the aviation business is managing china and covid. lisa: it's a huge question because china was a huge source of demand for a lot of aircraft. jonathan: health care strong and monitoring china and aviation. macro headwinds, this is mixed. tom: it has a little bit of

weight to it. it's ambivalent maybe to the downside a little bit. stocks are giving me an indication it was 90 and change. those are the old days. there was a romance and a guy from welch was over pittsfield and that was another time and place. jonathan: futures down 1/3 of 1%. jonathan: is that the ultimate boomer index? tom: fidelity announced they want to bitcoin in retirement plans. jonathan: how do you feel about that? tom: don't get me going. jonathan: three basis points on the 10 year. euro-dollar at $1.06.

from new york, for our audience worldwide, and on radio and tv, this is bloomberg surveillance. ♪

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jonathan: a big week for big tech. it starts off at the close a little bit later with microsoft reporting and futures going negative by 1/3 of 1%. let's talk about the performance month to date. in the premarket, down about 4/10 on microsoft. this month of april has been tough for some of the big names. everyone is talking how important earnings are through the week. tuesday and wednesday facebook then amazon and apple. euro dollar has a one dollar six

and handle. in 2016, we had a $1.03 handle and i argue that would be an objective for a weaker euro. it could become a problem given where inflation currently is and the ecb taking things more slowly. tom: i agree with that strongly that this is a radically different point for the euro and for everything else out there. 6.55 on the u.n. and the correlation between euro-in, low wall street has it tattooed to its brain. jonathan: i don't know where this is going. euro-dollar could be breaking down to charity.

tom: that's part of it. jonathan: can the ecb set out this rate hike? tom: my experiences they get overcome by them. the real issue is you get a 104 euro and the story suddenly changes. let's continue on the american economy. we are in a fed quiet period. what are they studying in their quiet period? what >> they prepare to accelerate the pace of tightening and what is neutral, what is potentially

how far they will have to go in the other question is what effect does the balance sheet tightening have on the economy? that's something that will become very important. tom: on a calendar basis, how far are they from neutral? is it a late 22 event or do you stagger out to 2023 to move from accommodation to some sort of fed neutrality? >> i think the latest neutral is at the end of this year. but we've seen in terms of data, the fact that the labor market continues to tighten rapidly, inflation has not receded quite yet. the fed rhetoric would potentially be at neutral approaching faster than that. we're looking for a few basis points here followed by another 50 basis point hike in june. the market is pricing in additional basis for july so you

could get there by the third quarter of this year. lisa: we see people talking about how the rate scare will turn into a growth scare especially given what we see in ukraine and now in china. how much do you think that will accelerate the growth scare aspect and maybe slow the rate hikes? >> i think we are looking at a case where there is still quite a bit of turbulence in the u.s. economy. the growth scare is more of a story for 2023 despite some of the negative real income news. there is still a lot of wind in the sales for spending. when you think of the overall strength of household finances and the financial obligation ratios are at the lowest going back to the 1980's and the sheer penta demand we have for

services. i think there is still a lot of growth here in the near term. when does growth get below trend and when do we see that squeeze? i think we will see that more in the back half of 2023. there is more to be seen in the economic data. lisa: talking about china and not necessarily the ukrainian war because a lot of that has been brought forward by the commodity shock. how are you looking at these potential lockdowns in china of having an effect in the u.s.? >> i think this is one of the biggest risks. we are talking about the potential for peak inflation having been reached in march but i think the big risk of that in addition to sheer volatility is the oil prices and those are the lockdowns in china.

in terms of inflation receding, we need inflation to come down. core goods are still up about 12% over the past year. this is coming from the past two decades where it has been the average in europe step to bring inflation down, we need to see inflation receipt and that will be difficult if we don't get further improvement on the supply front which these lockdowns in china are throwing into question. tom: when is the party over? >> you're already beginning to see this. we have seen this come down in the middle of the last year? we've seen it in the earnings to date.

margins have come down. it's been particularly hard for your smaller businesses as well. if you look at the small business survey sentiment, optimism has rolled over in a big part of that is a decline in profits even if sales are hanging in there but it reflects that margin squeeze. people are starting to get more discerning in their purchases. lisa: we get economic aid from the u.s. government and companies as the report earnings. which data point will be most crucial for determining the path for the fed going forward? >> i think it will come down to friday's data. not so much the pci report but the fed data will determine how much pressures are still in the system. we see some signs of early data.

compensation plans among small businesses have started to come down. there are some signs of wage pressure and i think pci is the one that the fed hangs its hat on so whether it moderates will have important implications about sustainable inflation pressures in the u.s. jonathan: looking forward to the data friday, thank you. pimco put out piece on elon musk and i thought this was interesting. the house gop leadership said the following if i'm a democrat, i would pray that elon musk puts trump back on twitter. it would validate trump's opinions and would put republican candidates not having to answer to that. a view in politico, what -- if

the former president we get back on that platform. tom: you mentioned the timeout chair yesterday. i will avoid that but it's immediately politically important. jonathan: going into the midterms later this year. lisa: it's a tricky point and we've had a lot of discussion about over sensation on these and -- over sensationalizing can distort the polarization. what is the remedy to it and is the remedy worse than the actuality? this is the hot button issue and how elon musk will elvin to this effectively and avoid the scrutiny on his other properties will be interesting. i think this will be an ongoing conversation about free speech. jonathan: here's another quotation -- several top gop insiders said they hope the former president stays the hell away from

twitter. lisa: they had to answer to a lot of the antics that are controversial on both sides of the aisle. jonathan: you would think the republicans want to focus on other issues like inflation and not on the former president. tom: i guess there are two republicans. i will leave that to the political experts. get out the calendar. it's april and this really hires up after the fourth of july. jonathan: for the price action, slightly negative on the s&p 500 and the nasdaq as well. we are down another three basis points this morning. we haven't talked much about china.

they are pledging economic support and every time the market gets into trouble, that's what you can expect. lisa: they really eased some of the fx holdings in order to facilitate some of the trade and create less of a weakening. what can they do and that can they do enough when their economies shut down? jonathan: how much will that affect the moving treasuries? lisa: what else can you point to? jonathan: coming up, the editor at foreign affairs magazine. from new york, this is bloomberg. ♪ ritika: keeping you up-to-date with news from around the world, it would be one of the biggest leveraged buyouts. the elon musk deal goodbye

twitter for $54 billion. there are likely to be numerous changes. it has caused doubt on the advertising model. a military aid package may be passed through congress. there is growing bipartisan support for providing as much is $5 million in aid. joe manchin is exploring the energy and climate question. a bipartisan energy package could undercut the democratic agenda. he says one area of common ground would be the federal oil and gas leasing process. coronavirus testing is part of a scheme to quell the omicron

spread. nearly 20 million people will undergird -- undergo three rounds of testing. gary gensler has an idea at parity. he says disclosures have generally failed to keep up with technology. this is bloomberg. ♪

>> i don't think this is poised for ending any time soon. if it goes badly, mr. putin one

-- won't want to stop and if it goes well, he wants to press his advantage. i don't see a successful negotiation anytime soon. it would be wise to prepare for very long war. jonathan: that was the president of the council on our in relations. good morning, equity futures on the s&p 500 and the neck -- and the nasdaq are negative by 1/3 of 1%. we talked about the fx market, a $1.06 handle. crude is essentially unchanged at 98.59. here is a very uncomfortable number. as many as eight .3 million refugees are expected to flee ukraine by the end of this year according to the you and refugee agency. tom: it's a humanitarian issue and its front and center for too many.

thank february 21 and i stopped and read robert kagan in the washington post, what we can expect after vladimir putin's conquest of ukraine. it was mesmerizing at the time as we were in shock of a new war. the editor of foreign affairs magazine has put together an absolute tour de force, get the hard copy. this is the single best issue in years. maybe since the last time there was a war to write about. he speaks with eloquence about the endurance of the american experiment. how enduring are we right now? >> this challenging piece looked at ukraine and the way it it -- it changes the debate about american power. we spent two decades focusing on

forever wars in iraq and afghanistan. ukraine has thrown into sharp relief is that we are in a different world. this is not kind of war we were focused on for years. that puts the question of how america should use its power in a different light. bob kagan would like to seen expansion of u.s. power. tom: some say the cold war never ended. was is it look like for the new regime as they read this issue foreign affairs? >> one of the great historians of russia steps back from the

focus that this has on vladimir putin and ukraine and looks at the must larger question of russian power. he sees patterns that extend and don't change fundamentally. they extend across these decades. this is going to be this longer-term challenge even of russia is defeated in ukraine but it doesn't change the basic way that russia fits into this and there really hard questions and how the european capitals will have to wrestle with this. they could still go on for some time. lisa: how will history judge the western response to russia's landgrab in ukraine? >> i think we are still in early days. it's already been a long war and it's been terrible for

ukrainians especially for russian soldiers and ukrainian troops. we are in a new phase now. we will be dealing with the long term and that will be more challenging. a lot of us have not wrapped our heads around this. the west surprised everyone and the ukrainians -- surprise everyone with the force of its response. there has been quite a bit of military assistance coming in from european powers. the question is how long are these populations going to sustain this kind of pressure in this kind of focus especially the economic toll. you have people who are going to go with higher energy prices and start to get scared. there is the ongoing told of the

economic effect. it will be a long struggle and keeping up that kind of pressure and keeping the international coalition will be challenging economically and politically. lisa: are there particular countries you have pinpointed as particularly vulnerable if russia gets away with grabbing land in ukraine? >> certainly, if you are a small power in the shadow of china or russia or the regional powers, you are watching closely to see whether the world stands by this norm at the center of global politics for decades or centuries. there is a great piece by a political scientist called the return of conquest. what happens to the small countries looking at chinese or

russian power if we don't uphold this norm in ukraine? if you are sitting in south east asia were in central asia or elsewhere or eastern your, it's a portland to see this norm upheld that conquest is not art of global politics anymore because the reality of power changes fundamentally depending on what happens in ukraine. jonathan: wonderful to catch up, thank you. something to look out for. we are waiting for notification from the u.n. secretary general stuff he will meet with the russian foreign minister. tom: you can see it in market coverage. i would mention the heart of the language of this war is this calibration of a greater

conflict and it could be eastern europe to finland but that speaks to the delicacy that folds into the market barometer. jonathan: any headlines we will bring them to you. 25 basis points last month and now they are at 5% and that's extreme price pressure. lisa: how much is the fed pressuring acceleration and making a move ahead of this of the currency? this is one of the big questions. the fed is going to have to pair back some of its moves and response to emerging market disruption. jonathan: it's very global in a way it wasn't the last time the fed was hiking interest rates.

the ecb is set to get into the mix as well. futures are negative 1/3 of 1%. from new york, this is bloomberg. ♪

>> i sought nothing organic in the economy that would bring down inflation that means the fed to fight inflation. >> it will start to be more difficult. >> the fed will be able to continue to raise rates. >> calibrating fed expectations all year long. >> we have to be very careful. all the cyclical to nymex we are seeing are on -- all the cyclical dynamics we are seeing are unprecedented stop > this is bloomberg surveillance. jonathan: live from new york city for audience worldwide, good morning, this is number surveillance on tv and radio step futures are down 4/10 on the s&p 500. a big week for big tech. tom: the big document the just drops the schedule 13e for twitter.