ritika: welcome. president biden in kentucky to show federal support for the recovery from historic flooding. the president and first lady joined kentucky governor andy beshear to visit families in the eastern region of the state. it was one of the worst hit areas with rainstorms in late july at which left at least 37 people dead. president biden passed drug bill will help democrats in the midterm. house expected to pass the measure on friday.

pres. biden: do i expected to help? yes. help seniors with medicare and supporting $2000 for drugs, and metal what the cost are. that is a good deal. ritika: the bill is a slimmed down version of the $10 million plan suggested a year ago. a potential 2020 gop presidential campaign, saying they are opening rallies featuring governor desantis. he is running for reelection for a second term in florida but has been making fundraising trips and campaigning for candidates in other states and a potential for a 2024 white house bid.

new york city subways, cash crisis. the transportation authority that runs the subways and rail lines is projecting a $2.6 billion budget deficit in 2025 p returned 30 officials scrambled to find more funding and cost of doing. ridership is at 60% of pre-pandemic levels with many office workers working from home. global news 24 hours a day, online and at quicktake on bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i'm ritika gupta. this is bloomberg. ♪ john: welcome to bloomberg markets. caroline: let's check on the market.

nvidia pulling back over revenue expectations putting a blunt on the market. lower on the s&p 500, calling it flat but the daunting nature of those numbers with the 10 year yield back off of the selloff. we are going for the into negative yield curve territory. i'm looking at the bloomberg. index, pulling back a bit, very much focused on the fed reaction. john: you talked about nvidia, deep into earnings season. the fact that we are getting earnings or update that are worrisome, rattling a few groups of investors today. outside of nvidia, waiting on that stop, inflation realities

tyson booed off 7%. a lot of takeaways from the outlooks and earnings. tesla moving on the reaction to the big climate development of the washington. caroline: as we start the week, a lot of attention will be paid to the cpi report. you also have china, brazil, argentina. this is mindful and festers are paying attention. >> inflation. >> inflation. >> inflation is going to stay. >> we see peak inflation coming sometime in the second half. we have some double-digit inflationary costs trade -- costs. >> it might stagnate or go into a recession area -- recession. >> was a potentially eight

recession, a modest recession. >> we are watching central banks ' reaction to the inflation. >> it is a mix of inflation and labor market issues. >> turbulent times as you have been saying all morning. john: let's bring in bloomberg news reporter for more on the inflation story. if we added music, that would be quite the video. people are saying the word inflation more than ever. set the environment. >> on wednesday, a very closely watched inflation metric which is the consumer price index. the overall measure expected to come a bit off of highs and large part because we saw a pullback in gasoline prices from the mid june at record highs. you are going to see some

pockets of moderation, but it will not be the broad-based, significant moderation the federal reserve is hoping for. if you look at the core measure them you will see another robust print coming in the month of july. caroline: talk about what we learned on friday, because is it a worry that inflation would be a -- will be more sticky? >> only got the jobs it was the overall number of jobs added that was double over what was expected we saw the unemployment rate fall and another rate of solid gains. we show that would wages and salaries are rising in the private sector. thinking about the picture that

we got on friday, you have seen several comment -- several areas increase expectations produce jp morgan increase expectations to 75 basis points as the fed ties to tackle this sense of inflation. one thing i will point out that was a sign of good news for inflation expectations, we got a survey today that showed expectations for one year ahead and three years ahead has actually come down a bit, while there are still quite high it does show this idea of entrenched inflation expectations, those concerns are abating a bit. john: outside of the market reaction to the jobs report last week and the signs we saw there on hoping keep the economy chugging along, on the consumer

report, what can you tell us about that? reade: you saw a surge in consumer credit last friday. this is essentially looking at how much americans are borrowing , whether credit cards or student loans and car loans, and you saw another substantial month of a big pickup in credit. what this shows us is you have a consumer that continues to spend, even in the face of the high inflation, but the high inflation is leading a lot of folks to have to lean on credit cards to paying their necessities. there was a survey that showed that about four in 10 american are having difficulties paying their household bills. it shows a broader picture of those things happening at the same time. caroline: thank you for taking the time.

joining us for more market analysis on the inflation debate is our chief market analysts. what are you looking at? matt: i think it is still concentrating on the inflation issue you have been talking about. the one thing that concerns me is that even though we have reached peak inflation, what does that really tell us? is it going to fall to the 2% that the fed is looking for? i find that hard to achieve given it is the longest we have had since the 1970's. this is having with the issue of the sanctions on russia with the war in ukraine. if those things are going to remain high and even if they come down, that leaves inflation out there as a problem or an extended period and means the

fed will continue to hike rates. john: let's put that in context of the equity market. had recently seen a decent rally in u.s. equities, 16% from the all-time highs for the s&p 500. to get out of a bear market, presumably you need to move 20% off of the lows and all bills for a substantial period of time. what is your sense on where we are right now? matt: i think it is more of a bear market rally. in the last, since the great financial crisis, every time the market is finally bottomed and bounced back in a pullback or deep correction or bear market, there has been a major change in policy. we saw that in 2009, what

happened was the market ruling that allowed the liquidity it was providing to take hold. in 2011, it happened when we had the european crisis, the european union bailing out the european banks. in 2018, we had a major change. and then in 2020. i don't see that major change taking place. caroline: what do you make of animal spirits at the moment? i am looking at amc. what does that signal? matt: signals that even a month and a half ago how bearish sentiment was and that did signal a bottom. the fact that we were able to get these meme stocks shows the complacency is still out there in the bearishness we saw in

june is not what we usually see in a row bear market. john: good to get your perspective as always. matt maley joining us with a busy week. when we come back, we talked about the uncertainty to the selloff of nvidia. we will talk about the reasons why. this is bloomberg. ♪

caroline: this is bloomberg markets. let's get back to the s&p 500. nvidia surprising wall street with lower projections by more than a billion. are these being lakes -- linked to the gaming sector? >> we knew coming in that intel had guided down and the consumer vice was the weak spot in terms of the shipment and overall over there. i think what nvidia has told us that not only has gaming reached

margins and down 20%, that could be more structural because because no they don't have as much volume as they thought they would have and maybe the growth margins continue to be down for a while and even though the chip demand may come back in a couple of quarters, it could be more structural here. john: you take with the outlook for crypto activity, the downturn have seen. they have leaned heavily on that space. the other side of his is that data centers has been a tremendous area of growth for years now. and the company itself acknowledge that while they would have preferred better performance it was standout performance. mandeep: every cloud company right now is still acting big on ai and machine learning infrastructure, and that is a

tailwind. the key question is -- went to the cloud companies actually do their own chips in terms of customization. apple has done it on the smartphone side. that could be a big risk. we don't see anything in the numbers to suggest that data center will slow down. that is a big tailwind. the stock would have been down morehead it not been for the data centers -- down more had it not been for the data centers. caroline: companies willing to do r&d at the moment? mandeep: i think overall the sentiment is still you need more processing capability. you need to go beyond the years and gp use is what -- beyond the cpus. there is a lot going on in terms of just semiconductors and what kind of processing you can

achieve with a combination of cpus and gpus and every company is going about it. >> thanks so much. we will continue to track the story of nvidia. moving to clean energy stocks which are getting a boost after the u.s. senate passed the landmark tax, climate and health care bill. ed ludlow covers electric cars and joins us now. in a year where there has been so much focus on the white house on getting more access to oil around the world, this is a reminder of the longer-term story of renewable sources and certainly the electric vehicle market. ed: the white house did have a hand in getting this over the line, taking a year of negotiation and a lot of

concessions from where we started on the bill. it is interesting you see the biggest points mover on the nasdaq 100 and the market in electric vehicles and many other names also higher pair the automakers got what they wanted, a tax credit for both used and new vehicles that they hope will be a demand boost for electric vehicles across not just higher earnings but lower middle income earners as well. caroline: are we expecting the more luxurious ones to be subsidized? ed: the gap is 55,000 u.s. dollars on cars and $80,000 for suv's. i just went on tesla's website and the base model rear wheel drive model three is just below that $55,000 mark. it is around $46,000.

there is good reporting on the bloomberg terminal that it has been higher income households that bought ev's with the supply chain crunch, they use the lever of demand to raise prices what will times and are expensive. the average price for an ev is higher. even though there is a $4000 credit to use ev's for middle and lower income families, there aren't that many secondhand ones to buy anyway. there is a limited impact this will have. i -- >> many of the traditional automakers and you have reported on it are spending massive amounts of money getting ready for an ev future, in many cases restructuring their businesses.

there lobbyists are busy reacting to the news out of washington as well. ed: they are. it is not uncommon. we know that gm and ford have clear views. elon musk has a somewhat fractures relationship with the administration. they are playing what is missing as opposed to what is achieved and there is still a question around the structure. you the charging structures to become more commonplace to get along the psychological barrier to ownership. a lot of the models coming to the market are getting over that but there is to be done in going to the administration and congress and saying, where are we going with infrastructure. that doesn't just relate to chargers, but what i am being told is where is the plan for the concrete and steel needed to build supportive infrastructure for this industry.

caroline: always great to catch up with you. coming up, we focus in on an unmover. this is bloomberg. ♪ - [narrator] ready to go back to school, but worried about the cost? southern new hampshire university offers some of the lowest online tuition rates in the nation. - i ended up spending less money my entire time at snhu than i did in just one year at my other university. - [narrator] visit snhu.edu.

>> this is bloomberg markets. time for what it is worth. a number tied to earnings, $.24 doesn't seem like a lot but on an adjusted earnings, topping expectations. it continues a trend under the leadership of mark bristol, the cer of barrick gold. part of it -- ceo of barrick gold. part of it is tied to the inflationary environment.

here is more from an interview. >> it is a convenient excuse to use inflation as the answer to all of our problems. the fact of the matter is we are in a business with the costs go up and down. the way to protect one's business and ensure sustainable profitability is to put the quality of your assets at a point where you can survive the cycles. caroline: it has been great catching up with you today. we will be together all week. from new york, this is bloomberg. ♪

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in his first trip after covid, president biden and jill biden joined andy beshear to visit families in one of the worst hit areas in a days long stretch of severe rainstorms in july. >> we have suffered the consequences of [inaudible] undertakings [inaudible] [inaudible]