>> stocks and bonds are rallying. bloomberg markets starts right now. green on the screen like it said. the s&p 500 off 1.5%. take a look at this yield move. how much of that is a fed story?

we will dive into that. the dollar continues to weaken. perhaps really encouraged. the result of that is commodities. it is about what is happening in the u.k.. absolutely driving the trader earlier. >> the bank of england find self in this situation. some other measure to contain financial risk, and these things are in conflict. we discovered that this is more

complicated. >> joining me to discuss all of this, we also have joseph, the former chairman and the administration really kicking off the show with an all-star panel. we want to talk about the bank of england. are we handling this right? is it the right solution? >> i think they made some steaks. a tepid statement on monday. what they did today, their hand was probably force. it could have been something that they needed to do. they have worse options than a week ago because the real unforced error is fiscal policy. >> terry, it is fiscal policy

that is the problem. does that mean that in two weeks, you see the bank of england intervening? >> it could very well fall back into freefall. they may feel guilty. they will stay high because of the misdirected policy. they may need to step in more than once. >> how low does it go? >> remember it is not just what they are doing. it is all the other things that

are happening in the next few weeks. the start of winter, energy bills, the fact that we will see the cost squeezing profit and diving further into a recession. >> ultimately colliding. jason, your thoughts on the poster child for markets around the world when monetary school policy is supposed to be independent? is this a warning to the biden administration? >> i think it is. i hope that warning is being heated. we took a lot of other steps last year for infrastructure, chips, veterans, student loans, all of which added to the

deficit. the u.s. has much more room for error. no one can take financial stability for granted. we really need fiscal policy moving in the same direction, not moving against it at a time like this. i think we will, but it will depend on voices being made in washington. >> i think that the key part in this effort that we have yet to see, could we see a step in the plaza court? >> the idea that you will coordinate, it is worth having

that conversation. i would not set high expectations. they are economies with very different dynamics. they will not be able to fully coordinate their way out of this. >> that has to do more with the euro and the losses and pain there. do you think there will be a repeat? >> it will be supported at the fundamental level. there are semi things bearing on them. it is impeding their ability to adjust policy. it will be very difficult to get it to work. because of that, the last thing a policymaker is wanting to do is take it worse of action and failed.

if you believe it will have an effect, we see that perhaps with the numbers that come out in a few weeks. we took some action, keeping with the increase that you are projecting to fiscal policy makers. >> jason come up really you the final word here. do you think the biden administration should be worried about what they are seeing across the atlantic? >> the only contagion would be if we followed what they are doing in terms of policy.

i do not think you automatically get contagion. i think you have the opposite. we just want to make sure they do not -- we do not follow their policy. >> i've been told i am a gracious producer. you can have the final word. i'm saieh. you are going to have to come back. the market is dropping. we are looking at 413 on the yield. >> a large fiscal deficit adding up. you tend to find those in the emerging-market. between 8% --

no, i did not. i said it was emerging-market. i'm very careful with my words. it might be an attack on those with that characteristic. intractable problems with adjustment. >> i wish i could talk to you for much longer. global currencies and interest rates. the former chairman -- a very fascinating kickoff to the show. mark: officials are urging those in its path. the hurricane has rapidly gained strength. it is approaching florida's

coast. it is expected to be one of the costliest storms to ever hit the u.s. speaking in brussels today, calling russia's quotes and illegal attempt to grab land. >> the threat to use nuclear weapons, a further threat. we do not accept this referendum. we had determined to make them pay for this further escalation.

>> the eu will propose a sweeping new band that will cost moscow nearly $7 billion in revenue. in brazil, polls released show that the momentum continues in the final days of its campaign. they are pushing hard for a first round we -- win. voters go to the polls on sunday. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton and this is bloomberg. ♪

>> apple is backing off on plans for production of the iphone 14 after a surge in demand. a real treat to have him on the show. how worried should we be that these iphone sales may be flat?

>> it is far more dangerous today than it was 12 months ago. look at what is happening to the euro. people in those countries -- it has gone down. do you think they have the time to go out and upgrade right now? it is good. it is very good. >> they were trying to come out with something more accessible. they do not look at apple when it comes to mobile phones. >> it does not care. it does not leave you.

there is a leadership position. it really needs to cell phones and give them gross profit. i'm not concerned about them coming up with this. >> what are the apple bears getting wrong? it is one of the fastest-growing companies in s&p 500. what are the sellers getting wrong? >> one has to argue that at any given time, right now is the time where those market will be under compression. it is really driven by interest rates and the fear of interest rates going higher. it is a lot less severe. everything has to do with where

we think the 10-year is going to be. if inflation keeps going up and valuations keep going down, as soon as we get the first word of inflation cooling-off, it will be an issue at that time. >> still ahead, hurricane ian is rapidly gaining strength. wendy does at around 135 miles per hour as it approaches florida. this is bloomberg. ♪

>> this is bloomberg markets. hurricane ian is barreling towards florida. urging people to brace for

deadly win's for what may be one of the costliest storms that will hit the u.s. alix steel, i think this is your first time on the show with me. i think florida is the fourth-largest economy in the u.s. >> it is relatively minor, about 11% of oil. the real problem will be demand. a storm with this much severity, that will be a huge demand drop-off when it comes to gasoline. when i think -- >> is a pretty painful drop. please walk us through it. >> they uprooted trees, for example.

these particular commodities, this is all pretty typical. the short-term for traders. 90% would be terrible. >> we have seen this happen a couple of times. please put this into perspective. >> irma hit pretty hard as well. it will have broader indications for the fertilizer industry. the mosaics factory is in the middle of the storm. they also have a plant that produces fertilizer. they say they have done adequate protection for that, but the problem is, if you have to shut down production, fertilizer

prices are already through the moves -- through the roof. fans have been shutting down production. you cannot buy the fertilizer for your crop. that has long-lasting ramifications. >> the stock itself was moving. >> that had been demand issues as well. people cannot actually buy it. it has trickled through into the likes of mosaic. that area is where traders are focusing on. this could be a huge issue for the industry. >> thank you for walking us through the wider implications. let's bring in justin french

with some great reporting. walk us through what you are seeing on the ground right now. >> we are seeing a worsening of conditions with the wind and rain picking up. we found out it was in-line with the eye wall of hurricane ian. you might recall that it quickly changed yesterday. perhaps in some areas they reach as high as 18 feet. >> one of the ways we have been warned about this is just how much physical damage is happening. justin, walk us through the numbers.

>> i think a lot of people saw what happened down in cuba, knocking out power across. now that it is making its way here, this storm has the potential to not only be strong with windows as high as 155 miles per hour, but when this storm slows down over the tampa bay area, where 70 people work and live, it has the potential to lift up all of that water into these communities. people were asked to evacuate high-risk areas where that storm surge would be an issue. as it tracks northeast, imagine, even when it slows down, losing some of that steam, it has a lot of force where so many people

are living at this time. it is going towards orlando but within a days time, we found out that area is at high risk of this storm. . we have about a minute here. walk us through. he talked about how much they might lose. it has gone from a category one to a category five very quickly. >> we are seeing a change. that is the real concern here. should it come ashore, we are talking about a storm that would reach record territory, the fifth hurricane in u.s. history

to do so. the last to do that was michael. as we know, over the years, as the storms grow larger and more powerful, the economic impact becomes more deep -- more difficult as well. the potential of tens of billions of dollars of damage. ron desantis saying that he anticipates that there will be years of cleanup and restoration ahead just from the 36 hours of this storm and its major impact at those high levels. >> think check of the markets. the hurricane take a look at what the bond market is doing. the 10 year yield, 370 three,

dropping 21 basis points in one session. back into the commodity space where you are seeing green across the board. stick with us. this is bloomberg. ♪ millions have made the switch from the big three

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mark: i'm mark crumpton with first word news. president biden has a warning for oil and gas companies, do not write couch because of the hurricane barreling toward florida. the president also had a message for florida residents. >> the danger is real and when the storm passes, we will be there to help you pick up. we will help you clean up and rebuild and get florida moving again and we will be there every step of the way. that is my commitment to people in florida. mark: mr. biden spoke from the

white house during a conference on hunger. united states and germany remain -- remain stuck on details to send battle tax -- battle tanks to ukraine. u.s. state department says providing model -- modern battle tanks would require training and support the effort now is to supply ukraine with weapons they can use quickly and effectively. some scientists are calling gas leak from the nord stream pipeline an unprecedented climate disaster. three near ruptures have not been confirmed but german and u.s. officials say the incident looked like sabotage. 380 tons of methane leak as a result. north korea fired two short

range ballistic missiles into waters off their coast and the move ramps up tensions. vice president kamala harris is set to visit demilitarized zone. the north korean leader has ignored u.s. calls to return to stalled nuclear disarmament talks. global news, 24 hours a day and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. ♪ jon: welcome to bloomberg markets. kriti: we are seeing a bond

market rally as well as a stock market rally. as we see going into the gilt, the u.s. market is not are behind. a 21 basis point drop in the 10 year yield. you see the dollar falling in addition to a return to pound sterling. the dollar weakness shows the entire commodity complex is the green. jon: we will piece the puzzle together. all sectors and subgroups in the green at this hour on the s&p 500. you mentioned the pullback in the u.s. dollar and gold has been moving higher so it's helping some stocks. this has brought investors back to homebuilding stocks.

tech is having a favorable day but not apple based on the reporting about their iphone sales expectations going forward. that stock is down 3% but you also have stocks like biogen which is gaining based on the exciting news of the company tied to an alzheimer's drug. kriti: joining us now on these markets, to tiana. there is volatility in the u.k. gilt market but also in the u.s. market to walk us through this. >> the rally in yield has translated into a similar rally in the u.s. with treasury yields down double digits across the board. that is giving a boost to stocks. what is happening underneath is the move from the boe's parking hopes that the fed might scale

back or pullback on its aggressive tightening plans here. we've been here before so let's not forget the idea of an early pivot that has sparked a bear market rally this summer and that ended with new lows earlier this week. we have to see where they are going but if you look at the bloomberg, you can see the terminal rate expectations of now come down to 4.4% which is lower than last week's peak and definitely below the fed's plot for 2023. jon: i was looking at some great perspective on what happens with the equity market when you see a 10 session slide of more than 10% because of the magnitude of selling. sometimes investors come into

the market but it feels like the broader question now is how much recession risk is priced in. when you talk to the experts, what are you hearing? >> it depends, we had jp morgan earlier saying their models were showing that stocks were showing a 92% recession probability. if you look across assets like treasuries, maybe with the rally and yields going higher, that doesn't jibe with the recession story. if you look at credit, the spreads have remain contained even compared to past slowdowns. so far, the price action has been unpleasant, six days off relentless selling but it's far from a crisis. kriti: we thank you as always.

volatility is facing traders now. the deutsche bank ceos talked about the state of the market as it pertains to europe. >> volatility will continue. if you look at the inflation numbers in europe and the interest rates going up, i cannot see the volatility goes away over the next 12 months. jon: we have the head of equity derivative strategies with us. what are you focused in on right now? >> when you talk about volatility, you have to ask about what market you are talking about. we are seeing unprecedented volatility and it's not just u.k. assets, we are seeing dollar strengthening across the majors. the vix around 30 is still relatively concerned -- contained.

i think a lot of people are looking at cross asset volatility and asking how sustainable it can be. kriti: what is the contagion effect? connect the dots. >> this is been going on for a couple of months. i can point to many factors but one of the main ones is we are seeing the diversions in it sustaining itself or longer. what drives equity is not macro uncertainty. it's liquidity events and liquidity shocks. sometimes these things can overlap step what we are seeing in the equity market now is people deleveraging

significantly since the start of the year. never say never but if you look at the risk profile within the equity market, hedge fund leverage is near the lows and asset managers and other institutional investors have allocated away from equities into cash. my expect tatian is equity markets can sell off further as we go into recession but equity volatility will take more than that to get that pop in the vix. jon: i was looking at some work that the bloomberg intelligence team was looking at the call ratio and saying we are now getting to levels that in the eyes of some are based on historical charts and would suggest we are at a bear market bottom. there are a lot of reasons why investors are feeling uncertain now but will you be watching more of the market indicators to determine whether or not the

selling pressure, whether the negative tone in the market sets a separate possible bounce? >> in the equity markets, you are seeing more risk priced in and more demand. we are seeing a classic rift -- risk off sign but the levels are still fairly benign. if you are looking for panic and signs of capitulation, you're not getting it yet. kriti: for a lot of money managers and traders, that's where you make the money step i'm curious about the players. what do you think it will take for them to hop egg into the market? >> i think it will take more

clarity on the macro picture. the volatility is very much-deserved. we are seeing such uncertainty regarding the inflation out look. people wilshire away from equities. jon: about the global story, we haven't talked about what's happening in the u.k. with the volatility picture measure through the pound. what are your latest observations on that front? >> just to put it in perspective, last friday's increase in sterling volatility was a greater one-day move that posted since 2016. that's a signal of how much credibility has been locked.

when you have developed markets were surging fund yields come at the same time as collapsing currency, we don't usually see that. bank of england is behind the curve and has a lot of work to do. kriti: we will be watching that but thank you as always. coming up, more? it's embracing alternatives. the cfo of a tech company, this is bloomberg. ♪ at fidelity, your dedicated advisor will work with you on a comprehensive wealth plan across your full financial picture.

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jon: this is bloomberg markets. companies in every country are

navigating economic uncertainty including in canada. one of the themes of the bloomberg conference, there is a company on a good read of consumers not to mention currency and crypto. nice to have you with us. a lot of touch points, give us a general sense of what you are seeing in your business. >> we are seeing a tremendous uptick across the board. we provide solutions that help businesses that how we serve them. we are seeing tremendous growth across tech and commerce in general. kriti: on a day like today, you see a lot of fx volatility -- volatility.

walk us through the impact the dollar falling has as far as impact on yours. >> our merchants are cross-border. we facilitate cross border transactions of volatility as in acted many ourselves included but from a global perspective, we try to make error solutions available to more customers. we do it in a way that allows them to select currencies, over 150 different currencies. that's how we've been successful to date. jon: what about on the crypto side? a year ago, there is a lot of excitement and possibility and where that would play within the industry. what does it mean for you?

you have made a long-term commitment there as well. >> crypto currency is another way individuals to pay. we made an acquisition last year. blockchain technology is not going away so we want to make sure we are there, providing them with alternatives all staff kriti: i want to talk about sports betting because this is a relatively new space, specifically in the younger generation. talk about how your company caters to that. >> we started serving that industry online several years ago. it's one of the most complex verticals.

the sophistication and size of the operators as well as the regulatory environment that surrounds this. it requires technology that can handle anything. think of the super bowl. transactions is important and whether the environment is in the u.s. or around the world, understanding and being able to navigate the regulatory environment, we understand it well and customers appreciate that. it's highly complex but it adds other verticals for us. it's more than just online gaming. it involves online retail and

marketplaces. having our team in that area allows us to build other verticals. jon: the other change in market tone we have seen, you think about the metaverse. there are questions about payments in a world that is built by the likes of meta and others. we just got the results of the latest bloomberg poll survey with there was a lot of market skepticism on how are it will take us over the next couple of years. where do you weigh in on the uptick of the metaverse role? >> the metaverse is an interesting opportunity for providers like us and others. payment is a big part of success in the metaverse to shop in that environment but there lots of other exciting things happening.

there is open banking and meta-finance, those are all there with the metaverse and from our perspective, it's all innovative and we have a strong product that is developing globally so we have our sites and innovation and we are spending time thinking about stabilizing that. jon: thank you for your time to day. we take a quick break and coming up, the biogen stock is soaring after investors learned of a trial concerned about fighting alzheimer's, details next. this is bloomberg. ♪

kriti: this is bloomberg markets

with jon erlichman. shares are surging today after experimental alzheimer's drug from biogen shows signs of slowing debilitating brain disease. let's talk a little bit about the story. we saw shares under quite a bit of pressure so walk us through the change here? >> biogen was trying multiple drugs and when they started the collaboration in 2021, medicare decided not to cover that drug. they were searching for a new ceo and what happened yesterday

is a similar drug was unveiled in terms of a trial. that trial made its primary goal. there is a 27% slowing of the rate of decline but people are not going downhill as fast. this allowed them to apply for fda approval. there is a lot of excitement in the market about it today. jon: what can you tell us about the history of these companies collaborating together? >>eisai led this trial and were in charge of this trial. they got kudos for managing the trial well.

they presented one of the first approved alzheimer's drug many years ago. ever since then, they've been trying to promote a better drug and now they might finally have done that. we will have to await more details on this trial. they haven't presented any details just yet or what they will do in november. kriti: something we will keep an eye on. the shares are up just shy of 38%. we thank you as always a let's get a quick check of the markets. biogen is not the only stock in the green with the s&p 500 up 1.5%. volatility is 31 on the vix and you see a rally in 10 year yield

dropping 21%. this reflects what's happening across the atlantic with the dollar weaker. and 89 handle on brent crude. stick with us, this is bloomberg. ♪

mark: now keeping you up-to-date here is the first word. president biden is warning oil and gas companies not to price gouge as hurricane ian bears down on florida. pres. biden: my experts informed me of 100 90,000 -- 190,000 barrels will be impacted and that is only less than 2% impacted. this small temporary interruption provides no excuse for price increases at the pump. ma