kriti: no votes of confidence from the bake, 100 right -- 100 base hikes from the fed, calls for them are getting louder. this is "bloomberg markets." the markets are lower. the s&p 500 at one point, session those down almost 2% and now you see some losses repaired. losses are broad across sectors but take a look at this, as you see stocks lower, the dollar is higher. much of the dollar strength is getting in the way of foreign

investors hopping into the stock market. that will be a major theme as we talk about inflation calls and just how far the federal reserve is willing to go. speaking of the fed, it is the hawkish tilt, potentially 100 basis point on the table putting a lot of pressure on the bond market. the two stents curve remains inverted, down 15 basis points. it dropped to 27 basis points earlier. something we will keep an eye on in terms of what recession signal is it really giving. growth is coming with recession. brent crude under $100 per barrel. much of that is pulling back on inflation fears and how much is that recession signal? amid that noise, we also got bank earnings which added to all of the market jitters i'll eight out as the bank prepares for a potential economic slowdown. jamie dimon, a massive vote of confidence or has been in the past for the american consumer released this earlier on the conference call. >> there is a range of potential

outcomes from a soft to a hard landing, driven by how much rates go up, effective quantitative tightening, the effective volatile markets. it is not going to change how we run the company. we have managed through recession before and i am comfortable we will do it again quite well. kriti: for more on earnings including morgan stanley, let's bring in sonali basak. she has been covering it all day long. let's talk -- start with what a lot of these banks are telling us. you can look at it different lenses. the asset management businesses, trading revenue, investment banking business we talk about deal volumes falling off of a cliff. what is the biggest signal we should pay attention to? sonali: the numbers. there were misses on so many businesses an anticlines and d -- anticlines on asset management. and trading, even though there were gains, -- and declines on asset management. and it trading's, even though there were gains.

what does that farewell for goldman sachs and city group -- citigroup? fixed income was in the debt side of things, rates kind of things, and commodities, and that is where you expect the bulk of the commodities. if it is muted, how much longer can these elevated numbers be sustained for and you are seeing pressure now on jp morgan's a stock because the worry is really about what is going to offset some pressures in investment banking and now even you have to worry about lending as a consumer faces more pain. kriti: a lot of these big banks are market makers, they have to be. you are going into a more earnings tomorrow as well. we are also talking about liquidity in the market and economy. tie all of those for us. sonali: i think that's an important question. you heard jamie dimon talk about it a few times, the banks don't serve the same place in the market that they used to. that's paired with quantitative tightening, you have a lot of

liquidity issues and that is from everything from stocks to bonds and new issuance. remember, it is not just the fact liquidity conditions are tightening. you also have sides the banks are burned on some of the riskier borrowers. jp morgan has a couple hundred thousand dollars lost because of buyout loans essentially. they are not even the worst of what is to come. there is a real worry more banks have taken on too much risk when it comes to their big private equity clients, riskier corporate by -- corporate borrowers. you see the charge, still see discretionary keep up, and you also see panes on the corporate side and that is what is troubling as well. kriti: lot to digest. stick with us because you will be a part of this conversation. we will bring in stephen biggar, the director at argus research. he has a buy rating on jp morgan and morgan stanley. thank you for joining us. let start with the liquidity question, how worried are you about to the bank's role in

terms of making the market? stephen: look, i agree with most of what you have been saying. clearly the banks have passed the capital levels, they went through terrific stress tests and all past. some of the stressed capital buffers increased and that is tripping up a few banks, jp morgan included. they did rise up late last year and they went from 3.2 to 4% buffer. that is kinda behind what we are seeing but liquidity is still good. i think the banks and conference calls confirm this this morning that they are ready, willing, and able to lend. they are not overly concerned about credit quality at the moment, they do see things on the horizon that are worrisome, particularly may be at the lower income levels where consumers are bit strained, but the loss provision for all the other things that did go haywire was in line with consensus at $1.1

billion. sonali: i'm curious about you mentioned those regulatory constraints. i wonder where the fed ends and jp morgan begins. you heard 70 concerns from jamie dimon about the regulatory environment, about those constraints, about the idea that regulations are being tightened and capital buffers are being tightened at a time where ranks should be stepping in to help these, -- the economy. sonali: that's true. -- stephen: that's true. jamie dimon made it clear he is not overly happy with some of the oversight i guess in the increase stress levels they have , the buffer requirements. this is a time where you want to lend and you do not want to crimp the economy. that is exactly what the fed is doing who agreeably has competing priorities with safety and soundness and wants to maintain those high requirements. the banks are even to the pandemic except for loss

provisions skated through with good profitability. they can witness pretty severe downturns and the housing crisis of 2008 and 2009 was the most recent large one, but all of those regulations in place i think have improved capital levels to the point they do have that flex ability today. kriti: let's talk about those two, tens and versions. they have major applications for how much profit these banks can make on the loans but it is also the market a major recessionary signal. we are looking at a -15 basis point rate on the two stents curve in terms of its inversion. -- twos tens curve in terms of its inversion. how much do you put into that? stephen: not too much. there have been inversions. i joke about the market at large, the s&p 500, has probably signaled 10 of the last two recessions. you don't always have recession

after an inversion in the yield curve. banks will continue to make good money as long as the short end rises. there's a lot of lending tied to the prime rate which improves immediately when the fed rate goes up. they do not make quite as much on the spread. they would be happy making loans but they will not make loans unprofitable either. i think they are more -- banks should be worried more about the overall economy, the pace of low growth and show that pullback -- sonali: beyond loan growth, you look at how the big trading firms have traded over the last months and the decline has not been as drastic as the first three months this year. at the same time, goldman sachs has now fallen below $100 billion in market value. it is trading at 92% of book value. do think that is warranted? stephen: no. i think -- and not just goldman

which we happen to have a hold on -- but many other banks and because of the capital market sensitivity relative to others, they do not have the offset set jp morgan or bank of america has a typically when you get to these levels, these sub one times book value, when you have these 3.5 to 4.2 yields like morgan stanley does today, you're closer to the bottom then the top. i think valuations are compelling here on a price-to-book and yield basis. again, i think the move today is overdone. they did miss the quarter by 4%. sonali: morgan stanley is essentially flat on the day. it is kind of up now. do you think they are immune to these recession fears that jp morgan is seeing its stock so hit because of this? stephen: a lot of the concerns today are around credit loss and link would seize and what will happen. morgan stanley is not a huge

lender, does not have that as a big risk item. i think that is what the market is telling us that it is worried about the liquid sees down the road and morgan stanley is much more immune to that phenomenon. kriti: stephen biggar and jane castor --stephen biggar and sonali basak, thank you. mark: in israel today, president biden committed to extending any agreement that provides billions for the israeli military. he signed a joint declaration with israeli prime minister -- the israeli prime minister. the two countries will also never allow iran to acquire a nuclear bomb, the document claims. in japan, the prime minister's asked for as many as nine nuclear reactors to be on this winter deal with -- to deal with an expected power crunch. this is following the fukushima nuclear disaster in 2011. 10 of the 33 have been

restarted, though some are off-line for maintenance. in tokyo, the government raised the covid-19 infection alert to its highest level, almost 17,000 infections reported in the city wednesday. that's compared with 3500 july 1. so far, the number of severe infections remains low. italy's prime minister, mario draghi, says he will tender his resignation today according to a statement from his office. this comes after the five-star movement boycotted a confidence vote on an aid bill in the senate. five-star senators were absent from the vote, saying they would not participate. 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 mark crumpton. this is bloomberg. ♪

kriti: this is "bloomberg markets." i'm creta give debt. breaking news moments ago, mario draghi said he will resign after the five-star movement boycotted a confidence vote. joining us is -- thank you for joining us. a developing situation. we put this into context and this comes after the five-star movement led by giuseppe conte about boycotting the confidence vote. now mario draghi is set to

resign. i believe tonight. walk us through the options here for the italian government. >> it looks like italy could be soon back into the famous political instability. mario draghi is doing what he threatened to do if the supply side boycotted a confidence vote. he said he would resign and he will resign tonight in the hands of [speaking warning which] he says the condition -- speaking foreign language] he says the majority does not exist. he will meet with the president later tonight. the president could try to see if mario draghi could form a new government or to say as a caretaker prime minister for the time being. we are hearing that one

representative speaking to parliament in next week. it is difficult to predict the outcome. the fact mario draghi will resign as a fact. kriti: at the core of this, it feels like if european instability broadly, that is becoming a bigger question, especially in light of simply the gas prices and energy crisis the economy is facing broadly -- and as we speak off of this news, you see italian stock futures dropping, you see yields higher. that spread is becoming such a focal point in the ecb's policy. talk to us about what this means from a market perspective. tommaso: for the market reaction, it looks quite clear since this morning, since last night when they cleared be a they won't vote for draghi today because mario draghi was essentially a prime minister which granted the country some stability and obviously is well respected by the market. he is a former ecb president,

known for being the man who saved the euro. so he gave italy the stability the country essentially never had for decades. so obviously investors are worried by the fact he won't run the country anymore and you see what has happened on the bond market come on the stock market. italy stock market today was the worst-performing in europe with a spread for italian bonds and german ones widened this afternoon and it will most likely tomorrow now that the resignation is official. kriti: this is a fairly recent appointment to have mario draghi become the italian prime minister peer i believe it was a little over year ago, early 2021. what is next for mario draghi in terms of politics of italy? tommaso: that is a good question. he has been in the office one year and a half and obviously italy is facing a difficult moment like all around europe

there is the russian invasion of ukraine, inflation, energy crisis, so it is not a quiet moment to have a government crisis and take into consideration italy is to pass the new budget law in the fall and we never had election in the fall in italy is because [indiscernible] if we go, this'll be the first time ever seeing italy -- since italy became a republic 70 years ago. kriti: let me ask you a quick follow-up, 30 seconds. what is going to be on that election ballot? what are people going to be voting for? tommaso: that's a good question. if they won't change the center-right, the center-right parties leading polls, but in italy, and election, you can never forecast which would be the outcome. 2018, the populace won the

popular vote and they changed three government to stay in place. we will see a little bit too early to protect what will happen and even if there will be election or not. ebhardt joining us from italy. thank you as always. breaking news we will keep our eyes on. we will have more on the draghi news and we will be talking about that throughout the day. we will also be talking about sri lanka's president also resigning arriving in singapore following mass antigovernment protests. we have the details for sri lanka and the emerging markets broadly. this is bloomberg. ♪

as a main street bank, pnc has helped over 7 million kids develop their passion for learning. and now we're providing 88 billion dollars to support underserved communities... ...helping us all move forward financially.

pnc bank: see how we can make a difference for you. kriti: this is "bloomberg markets." i'm creta grouped -- k riti gupta. this is surpassing the peak from even 2020, adding pressures to em currencies, really emerging comp likes broadly. joining us now is the bloomberg

editor and em reporter. i should say the head of rights coverage, christine aquino. let's start with you on the dollar story. this affects story gets scarier and scarier for a lot of these emerging-market countries dealing with fuel inflation, food inflation. having the stronger dollar does not help your how much worse cannick at four emerging-market companies -- countries? >> a lot worse because we are not even at the end of this fed rate hike cycle which is really the major driver behind this dollar strength. we all know that when the fed is hiking, that really means trouble for a lot of emerging markets for a number of reasons. where we are looking at this idea, the pole of higher treasury yields will reverberate across emerging markets which will of course increase the cost of their financing at a time when we are already seeing a cascade of potential defaults or defaults on a reality for a number of these countries. then of course this idea of the

rate to parental story because that is the appeal of emerging markets broadly, that they offer that extra yield on top of what you would get in developed markets. not anymore. if the fed will go the route is being pushed to go, hi potentially that hike potentially 75 basis points or 100 basis points in one go, that spells trouble for emerging-market assets, in terms of attractiveness but also the effective costs of their financing. kriti: that carry trade disappearing innocence is crucial talking about what the imf director had said in the spring meeting. she made it clear he might have a sovereign debt crisis on our hands, not for europe, not for china, not for the u.s., but for emerging markets. that will be crucial. speaking of the currency story and trade that is disappearing, let's talk about she lay -- chi le. there currency actually fell. explain that. kristine:chile is in a tough

situation because they started raising for brazil early in the cycle and that was an attractive aspect of the currency. then they started to see inflation getting under control and they said they would ease the pace of tightening and that is something investors usually do not like to hear from a traitor and now the things that happened is currencies are on because of current prices and the market expect the central bank to come to the rescue. the swap rates market something around 100 basis points or 75 was a disappointment. so this is like a very strong market reaction and sort of expected and we are all waiting to see if the central bank will come may selling dollars. that is probably the next thing to watch. kriti: that comes as currency intervention was taken off of the table by the chilean central

bank. it is fascinating while we talk about the currency trade or currency trade -- or carrion trade is worth a, let's go back to you because we see political tension. sri lanka is a key one. we saw dispersing -- disparaging images over the weekend. this seems to be a theme coming across the world. we were warned about this when it came to food inflation in the last time it was this high in 2011, it contributed to the rise of the arab spring. talk to us about the geopolitics and what other tension points, what other pressure points there are in the em world. kristine: the geopolitics is really quite worrying. just looking at what we see out of sri lanka. this is only the latest in a string of hot geopolitical stories across em. we had russia and ukraine starting the year with giving a lot of volatility to markets across the emerging world but before that we also had a

situation in turkey and the fourth quarter of last year. it almost is kind of like we are seeing this situation now where you have a constant stream of hotspots and emerging markets cropping up and a lot of it has to do with initially financial market volatility and instability, but as we saw from a lot of these countries, and their situations, that could easily and quickly lead into other kinds of instability as well. i think this is in fact what is quite worrying, that all of the gyrations we are seeing in emerging markets at the moment, given there is already a precarious economic and geopolitical domestic geopolitical situation, that could very easily deteriorate into something more. again, i think sri lanka is a good example of bailouts are not always good for emerging markets. kriti: it is something we will keep an eye on.

we thank you both as always. a fascinating time to talk about emerging markets, simply the effects of food pressures. we will talk about all of that in the coming hours and days, especially as we see ppi prices get higher and higher. this is bloomberg. ♪

hi, my name's steve. i lost 138 pounds on golo and i kept it off. so with other diets, you just feel like you're muscling your way through it. the reason why i like golo is plain and simple, it was easy. i didn't have to grit my teeth and do a diet. golo's a lifestyle change and you make the change and it stays off. golo's changed my life in so many ways. i sleep better, i eat better. took my shirt off for the first time in 25 years. it's golo. it's all golo. it's smarter, it's better, it will change your life forever.

>> mark: sri lankan president rather -- president roger boxer has sent his resignation to the parliament, reportedly, soon after landing in singapore today. there have been months of protests in sri lanka over soaring inflation and shortages of food, fuel, and medicine. on bastille day in france president emmanuel macron is pushing forward with his ambition to reform the country's labor market. he wants to lower the unemployment rate. in an interview after the annual bastille day parade, mccrone said -- emmanuel macron set a

law is needed to get unemployment laws more strict and there is strong opposition in parliament. donald trump is looking at announcing in september he will run for president again according to the washington post that says allies are telling mr. trump that announcing before the november midterms will drive turnout to help republicans take over congress. negotiations on wednesday over unlocking millions of tons of ukrainian great exports were constructive according to ukraine, turkey, russia, and the u.n.. the sides agreed on setting up a monitoring unit in istanbul and are expected to meet again next week accorded -- according to a statement from the turkish defense minister. global news 24 hours a day on air and bloombergquint take powered more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg.

♪ jonathon lewinsohn --jon: i'm jon erlichman. kriti: i'm pretty cooped up. -- kriti gupta. the stock market down 1% on the day. we talk about inflation, possibly, 100 basis points in the works from the federal reserve in two weeks. you are seeing this show up in the 210 inversion that is deeper through the session. now -15 basis points. at one point earlier it was down 27 basis points. brent crude is perhaps also serving as of recession signal. it is muted below $100 per barrel.

jon: as we look at individual movers in this session it's been hard to ignore the banks, the financial services sector under pressure. takeaways from jp morgan and morgan stanley left investors feeling unsettled. those names continue to be down. crude is back at levels we saw before russia's invasion of ukraine. eog resources are a good example of a name losing resources. energy has led the s&p lower over the month. take by comparison has held in better over the past few days. meanwhile, conagra is a good earnings example of a company that has powerful brands, but, seems to now be running into struggles when it comes to pricing power. consumers are starting to balk at higher prices. k that is something that has been driving the market for a while. driving volatility as well. some of that, to bit today when

federal reserve governor christopher waller laid out his perspective on the fed rate path. >> i support another 75 basis point increase, however, my base case for july depends on incoming data. we have important data releases on retail sales, housing, inflation expectations coming in before the next meeting. if those data come in materially stronger than expected, that would make me lean towards a larger hike at the july meeting. kriti: joining us is bloomberg's mike mckee who just interviewed waller. sankey was always for joining us. 100 basis points is being priced into some parts of the market. christopher waller says 75 is a way to go. your take? mike: i think waller will be influential. he was one of the most out front when they would to 75. he has been one of the more hawkish members of the board of

governors. he made a good point that esther george made in her dissent last time that you don't want to go too far, especially if the chances of recession or a significant slowdown are growing, because, you could find yourself in a slowdown or contraction. then, the monetary policy you did a couple months ago makes things worse. so, we will see what the data show. but, waller at this point, i think, is most likely to try to lead people to 75. jon: it's been a big conversation this week, mike, with the bank of canada making 100 basis points of the new 75. speaking of canada, the bank of canada governor's feeling some heat from the markets on whether or not this country can't navigate a so-called soft landing. you got into those details specifically with waller talking about the current state of the job market. maybe, you can elaborate on that front? his perspective there? mike: well, he is looking at even just headline numbers like

this 3.6 percent unemployment rate and said it is inconceivable that you could be in a recession with that low of unemployment. he didn't think that because of inflation and the said reaction to it and raising interest rates that the economy would slow. but, he says it's most likely to slow below potential, which, the fed puts around 1.9% or 2% for a couple years, then, get back to the potential growth level after that. so, he is not forecasting recession. he thinks they can avoid it, though, he admits there is a possibility. kriti: in the last hour we got breaking news that mario draghi, the keeper of the euro, the bringer of stability to europe and italy, he is resigning. talk about the implications on what this means for policy in europe broadly. mike: well, it may or may not be meaningful. i mean, he resigned because the populist five-star movement that was part of his coalition refused to vote on a measure of confidence in the government.

but, he won the government mandate anyway. so, there is a strong possibility that the president of italy sergio bought develop will just ask him to form a new government without the five-star movement in the coalition. if he steps down that to be a big problem for italy. that is something italy does not need at a time where it is trying to stick together over ukraine policy and deal with the issues on russia dialing back on energy supply to the continental. it's a potential big problem. or it could be another chapter in the long-running drama they called italian politics. jon: we always appreciate your insight mike mckee. the insight and analysis on the road ahead for the federal reserve, let's get back to that subject. joining us now is their house, senior economist at wells fargo corporate and investment bank. sarah, i will start because

everybody is wondering about the fed's next move. christopher waller seems to be in the 75 basis point cap. where do you find yourself thinking now about where the next fed action is sub being? sarah: it's really close call. i give the slight edge to maybe the jumbo 100 basis point move and that's because we have seen the fed be firmly focused on inflation and yesterday what we saw with the cpi print is core inflation continues to gather speed. we have actually seen it accelerate in recent months. to waller's point, a lot of this will hang on the data in the next couple weeks. while growth has downshifted, the overall real economy is still hanging in there. i would give the slight edge to the 100 basis point move. but again, it's a close call. kriti: let's talk about other economic data this morning. producer prices now with an 11 handle after 9% handle on cpi yesterday. can you talk to us about the

differences here in where inflation is showing up? we know it is broad. where is it getting worse? where are they getting better? sarah: a big reason for the upside of cpi traces back to energy. that was largely anticipated. if you drill down into the components of the producer price index we got good news with moderation in other areas. slowing food inflation. services inflation. back a little bit. notably we saw the first drop in transportation and warehousing for goods since may 2020. i think there's a little relief on the horizon. but, broadly speaking, we need to step back and look at the overall pace. we are still seeing remarkably strong inflation whether you are looking at final prices by consumers from the cpi or what domestic services are selling goods and services for. jon: you raise an excellent point. change is on the margins. but, it feels like the markets

have been paying on every new inflation report. for additional context, how many reports will we have to watch, wait, and see before we really start to change the perspective of the said on inflation starting to cool in a more meaningful way? sarah: right. you have seen the said say they want to see a series of slowing inflation prints. again, if you look at the core index, you have not even started and see that when it comes to consumer prices. so, you would need to see three or so months worse. that clock has not even started taking yet. i think that will set the tone of how quickly the fed raises rates. but, in order for them to really back off and maybe feel like they have tightened enough, we need to see inflation come down or two bleak -- noticeably further, core pce somewhere thousand 3% at least on an annualized basis. i think we are still far from that. kriti: how worried should we be about the labor market and housing market as contributors?

which is worse? sarah: i think overall right now we have seen much more weakness out of the housing market. that's more interest-rate sensitive. that has responded to the massive jump we have seen in mortgage rates. at the end of the day when you look at the u.s. economy, residential investment is a relatively small part. it's only around 4% 5% of gdp. when you look at the more sustainable path of consumer spending, implement is key. what we -- employment is key. what we have seen given the strength in limit growth over the first half of the year and even through june, that is putting a floor under how much consumer spending can weekend if you continue to have hundreds of thousands more workers getting a paycheck each month. i think that should give the fed some resolve and convert that the u.s. economy can withstand noticeably higher rates in the effort to bring down inflation before we really see the economy retrench on a broad-based basis consensus -- consistent with a

recession. kriti: sarah house of wells fargo always a pleasure to have you. an important day when it comes to inflation. coming up, we talked to mark gam see the digital bridge ceo as he makes a deal with deutsche telekom. details next. this is bloomberg.

jon: this is bloomberg markets. i'm jon erlichman with kriti group for. digital bridge manages digital infrastructure assets including wireless towers and data centers. it announced today is teaming up with brookfield to acquire dutch telecoms towers units in a deal

that $17.5 billion. let's bring in marc gamzi the digital bridge ceo. this is a sizable transaction. like everything in the markets now, there are a number of twists and turns getting to the finish line. tell us about the finish line and what that was like. neil: -- marc: at the end of the process it was about partnership at the end of the day. you heard tim umoja's warning about the importance of finding strategic -- a strategic partner that understood where long-term evolution was going. our experience in cell towers going back to the early 90's was a key attribute to why we were the favorite dinner at the end of the day. at the end of the day our operational dna and ability to bring, most importantly, some things to the partnership others could not bring, with a key differentiator a, at the end of the day. kriti: walk us through your

plans to look at other competitors, business in europe like vodafone or orange's totem for example. marc: that's a good opportunity for us. one of the good things about having a partner like brookfield at the table is they have a lot of capital and understand how to bet big on infrastructure. this is one of the moments where you need to lead in -- lean in. we see a lot of opportunity to consolidate the sector in europe. we have the right partner in deutsche telekom and brookfield to do that. there is a window in european digital infrastructure to consolidate and focus on the networks of the future. the macro data is tough, it's not getting easier. local carriers in europe are having a difficult time growing and there is a significant dinner bell for 5g. having a strong partner that can help customers like vodafone, orange.

this is the right moment to do that and we are poised to take advantage. jon: explain from your vantage point, for all of those companies dealing with things like debt load, a near-term reality that seems to create opportunity in your case. why is it that these businesses have always been so attractive to you? marc: look, it's a great moment in time for digital infrastructure. this transaction in particular, is anchored by a 30 year commitment from deutsche telekom with an annual escalation link to cpi. our investors are long-term investors at digital bridge. the largest sovereign wealth funds in the world, the largest pensions. what are they looking for today from an asset allocation perspective? risk off. nothing is better than mobile towers. if you go back to the history of other challenging moments in our economy, 2001, 2008, both times i was in the cell tower space

and we profited greatly from having long-term vision and focus. investors like the predictable cash flow. the fact we can put a second tenant on most towers and organically double over the next five years. that's unprecedented. the business deutsche telekom has built is incredible, over 5000 new towers in the last three years. that is a fantastic platform. it's poised for growth. most important a we will go help other characters alleviate the pressure on their balance sheet and put our balance sheet work for them. kriti: mark, let's talk about the financing. how is deutsche telekom getting a $10.5 billion in cash given they are buying 51% at about $17.5 billion. ? can you walk us through the math ? marc: brookfield and us are putting up $2.5 billion in equity.

then $5 billion of debt capacity on the business. it was not easy. it was challenging the last 30 days keeping the financing together. but we have great bank relationships. brookfield and digital bridge are two of the most from your infrastructure investors in the world. i have invested through challenging times in 2001 and 2008 where banks showed up for me and having the three decade reputation was really helpful. they know we will build great businesses. honestly, this is not that overleveraged when you think historically what kinds of leverage these businesses can take. so went to conservative capital structure. you get cash back to dt and we are poised to do more. jon: you've been busy and it sounds like you will stay busy. thank you very much, marc ganz i the ceo of digital bridge. president biden is heading to saudi arabia friday to meet with crown prince mohammad bin salman. stay with us.

we will have those details. this is bloomberg.

kriti: breaking news. the latest out of italy. the italian president has rejected nejra -- mario draghi's resignation offer after the five-star movement went ahead with threats to boycott a confidence vote on the government. the italian president did not have to accept the offer. he has other options. he could ask for mario draghi to create a new government, perhaps, one without the coalition. asking for support from other allies. also perhaps what this means in terms of elections in the fall. remember, a collapse of the coalition does not really serve anyone in the italian political space. we will keep you apprised of the market reaction.

we know that on headlines of mario submitting the resignation, yields are getting higher. a key sticking point in europe at the moment. a key sticking point in the middle east comes down to the energy picture. that's where president biden is visiting now. with that update is bloomberg's annmarie hordern. give us the latest. annmarie: today in israel the focus was on israel and making sure the president stood firm. he said that the u.s. has an ironclad commitment to israel's security and for israelis that means making sure they stand with israel in the face of their enemy, iran. the president said there is a deal on the table and the iranians can take it but he will not wait forever. the president doesn't think that being in the jcpoa -- does think that being in the jcpoa would make sure they can control

iran's nuclear ambition. you mentioned energy. when the president becomes the first u.s. president to leave israel and fly directly to saudi arabia tomorrow it will be all about energy. there may be not specific setting terms of willingness to discuss energy in the outlook, but it's obvious that the trip is so much due to the fact that the president is dealing with poll after poll, higher inflation, higher gasoline prices, and a country that can really help ease pain in terms of the oil market would be the kingdom. jon: as we tie it back to the headlines krit was just telling us about out of italy, turmoil in that country again in the face of economic uncertainty tied to the road ahead for energy. it's this uncertainty on where the energy market goes that is creating a lot of complications, whether for the president or clearly, across europe right now. annmarie: having covered a

number of italian elections i am not surprised. these are roller coaster events. i was just at bavaria at the g7 two weeks ago now. you had boris johnson there, mario draghi there, leaders claiming they want to make sure they continue support for your crane and continue the pain towards president putin. boris johnson is now leaving the u.k.. we have potentially a new government on the way with a fresh election possibly in italy. so, you see these countries coalescing over make sure they are supporting ukraine well now potentially be driven by new leaders. when it comes to energy, next week will be a big question on nord stream one. whether vladimir putin starts playing more politics with gas. that would affect germany and italy as well. kriti: fascinating stuff.

geopolitical tensions around the world from boris johnson to shinzo abe to the sri lankan president and now mario draghi as well. we will keep you apprised of all of this. this is bloomberg.

and it's easier than ever to■ get your projects done right. inside, outside, big or small, angi helps you find the right so for whatever you need done. with angi, you can connect with and see ratings and reviews. just search or scroll to see upf on hundreds of projects. and when you book and pay throug you're covered by our happiness

it's easy to make your home an a check out angi.com today. angi... and done. marc: keeping you up-to-date with news from around the world, i'm mark crumpton. president biden and the israeli prime minister signed a declaration that commits the u.s. to providing billions for the israeli military. the agreement addressed i rounds -- iran's nuclear vision. president biden: we will not allow iran to acquire a nuclear weapon. we have laid out for the people, for the leadership of iran what we are willing to accept in order to get back into the jcpoa. we are waiting for their response. when that will come, i am not certain. we won't wait forever.