>> there was just a lot more momentum in the u.s. economy. >> there is no obligation for the fed. >> the fed is focused on the lag effect between policy tightening and actual economic impact. >> for economies fighting inflation, a weak currency is a problem. >> it is confusing not only for the markets but generally, globally for central banks. announcer: this is "bloomberg surveillance" with jonathan

ferro, tom keene and lisa abramowicz. >> good. this is "bloomberg surveillance" on tv and radio alongside tom keene and lisa abramowicz, i am jonathan ferro. futures up 0.7 s&p. >> this is a serious report. we come off a fed meeting of shock. a bank of england meeting that i thought was even more shocking. it is now we come to this jobs report of tech austerity. >> on the back of an equity market that has been absolutely hammered. and a curve that now sits at -60 basis points. twos compared to tens. >> and people are responding as they should. how much is this going to continue and when does that take and the fomenting out of some

other areas of the economy so you start to see the pain the fed is looking for? >> that is my favorite note of the week. chris rallying today. brent crude up 3% to 9750. wti with a 91 handle. the china reopen the rumor mill gives some fuel. >> it is cascading. every day there seems to be another blurb. you wonder where this stuff comes from. it has to come from the government. moments ago, the 10-year yield round up to 1.75%. that is remarkable. >> can we live with that? that is the question. >> i would say this is incredibly rich today. i looked back, 10 percent unemployment in 2009. it is different now because unemployment is so low but the tension is genuine. >> and inflation was not at 8%

then. that is slightly problematic to. s&p 500 of 0.8%. the 10 year yield at 4.1563. there is quite a move on the two-year yield to see it at 4.70. >> in the election, can we say wednesday morning or tuesday morning when we are in washington, can joe biden enjoy a $100 rent? it is feasible. >> i do not think he wants that number going into the midterm. bravo wti, $91.13. >> today is all about jobs as we have been talking about. we get the u.s. change in about 90 minutes time.

will it matter what the number is if it is 200, 190. or is it going to be the wage picture? this might matter more simply because it gives you more of a sense of where the pressure is and what companies have to do to lure in employees in which employees do they actually want? we are also going to be hearing from labor secretary marty walsh at 9:30 am how to they pitted to a constructive message ahead of the u.s. election giving -- given they set unemployment needs to rise to get inflation down. today we are talking about the twitter layoffs. about half the company workforce the longer has jobs. this is an elon musk issue as he comes in and tries to cut jobs. how much is this a tech issue or a broader issue? is this just an isolated case

because this is the area that has benefited the most the past 10 years or is this a predecessor to some job cuts we are going to see but not yet. at 10:00 a.m. we hear from boston fed president susan collins at the brookins institute event. how much that she talked about the terminal rate? i was shocked at this. i was looking at the fed futures. a higher rate for pretty much the entirety of 2023. have we priced in this especially at a time when we have this yield inversion version that will only get steeper? >> fascinating to see the fed speak over the last couple days. do we seem split or are they all on the same page? >> to be have a cumulative? >> it will be fascinating for the next couple of days. the queen of rates, head of

global rate strategy at td securities. great to catch up. the 2/10s very close to -60%. >> i think it all depends on inflation. if inflation remains high, we can absolutely flaccid -- absolutely flaccid further. at some point, the front curve will give the most amount of yields. the labor market is strong, i think we will move to the front end. the fed also doing qt. i do think there is a limit to the inversion because there is a lot of supply coming in. the five year-two-year part of the curve. i think we stand out here but we can flatten. if inflation remains high, broad-based, i think there is room for the flattening. >> i will say that if you get

the priya world, does the short end of the curve began to move out? do we go from a one-year study to a two-your study and than a three-year study? do we ebb out? >> it is hard to call in years that i think you are supposed to start to look further out in the curve. look at the mortgage rate rates. i think what is being missed, you guys keep fighting it, but the market is missing that those rates are at 1.75%. they are getting close to 2%. i would arguectually longer andg down and a higher rate will put pressure on the economy. you are supposed to start laying into the duration. is that now or early next year

when we start to see the delay? i think just keeping money in the front and is not going to be a great heads. i think they will lead to start cut rates. i think, about 4% is cheap, given all of the tightening and financial conditions we have seen. >> we talk about real rates which is basically how restrictive the fed will remain. and the question of how the work it will remain restrictive or demand a higher premium. the market is not understanding interleaved 2% rate. >> i would say the u.s. government or any government. for them, vigor rates are not an issue because they can print out of this. it is the corporate sector and the housing market.

the u.s. has these long dated mortgages that are fixed. you may not see that in household leverage which is lower. i do worry about the corporate sector. the longer we stay at high-yield rates, you are going to see credit contraction. that takes a while to see this in the economy. you will start to see investment so down and banks start to pull back. ultimately that shows up in a weak economy. these things just take a wild. i think the market is looking at there is no buyer of fixed income right now. i think that is why you have seen this move in the valley of the government -- the valley of the government rate >> i am curious if there is something that you can point to in terms of what you think will eventually get priced in? >> i think in 2024 or 2025.

companies have brought down debt because rates were low but if earnings start disappoint, the companies will start thinking about their debt burdens then. we are going to start to see job losses pick up. more in the second half of next year. i think what the market is underpricing is fed easing in 2024. i think they are going to stay resolute and what inflation lower. you think we get close to 3.75 next year which will allow the fed to then focus on unemployment. those are the eases in 2024 but i do not think they will give us forward guidance. as we look out, the high rates have to factor into the higher investment decision so we will see more of that through next year. >> fantastic and great call on the yield curve a number of months ago.

can you imagine if the fed had an open conversation about what priya just talked about witches rate cuts in 2024? that we are going to do this but the lead against it later. >> i think there is money to be made and money lost with the subject -- with the legitimate trading thing. do not think the fed is going to sit and figure out the magnitude of the pivot. >> we are seeing the rates priced into the markets already and still be -- is firmer. >> can you imagine if the fed said this? the market is pricing this in an expecting it. it does not matter what the fed is going to say because this is what we are trading. >> that is what he is leaning against. >> can we say good morning to scotland? is it "cel-tic" or "kel-tic"

daca --? he said the celtics is the best crowd. is it the same as english football? >> it is a different leak and a different standard but the atmosphere is better. [laughter] >> they both have an end zone. this is bloomberg. ♪ >> keeping you up-to-date with news from around the world crammed with the first word, i am lisa mateo. the jobs report is out today and the question is whether the labor market is cooling enough for the fed. bloomberg says companies added 195,000 jobs in uber. sober growth and unemployment and wages would help.

donald trump has sent the strongest signal yet that he plans to run again in 2020 at a rally the president said he wouldn't -- the former president he would "very, very, very probably" run again. workers are suing twitter over elon musk's plan to lay off 3700 employees at the platform. they claim the layoffs are taking place without getting enough -- giving enough warning. president xi jinping met with chancellor olaf scholz this morning and used to the engagement to send a message with vladimir putin. he said he opposes the use of nuclear force in europe which were his most direct remarks on keeping the war in ukraine from escalating. global news, 24 hours a day, on-air and on "bloomberg quicktake", powered by more than 2700 different journalists and analysts in over 120 countries.

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>> uncertainty is the enemy. in terms of the markets and what is causing that uncertainty, clearly the fed is way ahead of

the midterm elections. if you look at the effect of the midterm elections on the markets, the last 16 midterm elections have been followed by up stock markets six months and 12 months. >> that is the market history there. let us get straight into this price section. equity futures up 0.8%. the payroll report coming in about one hour 12 minutes. crude is higher from the china reopening news. the euro-dollar up about 0.6%. the 10 year around 4.16. if you look at the two-year, caught it 4.70 six. up for basis points. they're looking for 190 5000. let's talk about jobs.

in the overhaul of the last week, tech companies announced plans announcing to about 2700. denise indicating just months and are that credit suisse is planning a fresh round of job cuts starting next week. >> on top of the 2700? >> that is what they syndicate. >> that were pushed into 5.2%. some people say this is the end of a year adjustment at love wall street firms but that is not what this is. >> this act -- this adds to investments that have already started. the credit suisse spokesperson reached out and reiterated their plan to cut 2700 roles and declined to comment further. the idea that the job cuts are spreading. >> in the spreading, warner bros. discovered they do not need to do this right now but they made it clear they are speeding up rapidly.

they had synergies move from 3 billion to 3.5 billion as they move, move, move into entertainment. >> it is never easy but this is not an easy moment to do this and. >> are you liking the heat wave in new york? >> it is warmer in london too. >> washington will be 90's -- 87 degrees. annmarie hordern joins us. the weather is unusual. i want to open this up as we begin with you for our election coverage. this midterm is unusual when it comes to turnout. do you have any sense of the -- sense if the turnout will be greater than the stunning number of 2018? >> the direction of travel is we are seeing bro must turn, not just in early voting but polls are showing it could match or

surpass 2018. i was reading through the details of this this morning from an analyst group that the record amounts of money has ever been spent that we are seeing in this midterm election. there is a lots of money and a lot of people getting out the vote. we talked about this yesterday when you look at suburban women who really came out in droves to flip a lots of house seats to democrats in 2018. they are now very upset with the price and cost of things going up and inflation rates. this is their number one concern now. this is starting to shift and the polls are showing more than 50% want to get out and vote and they plan to. it is also warm weather so it does look like it is setting up for this to be a very high number of turnout of americans. >> the consensus right now is if the is that the -- right now is the democrats will lose the

house. what about the senate? >> it depends on what poll you look at. many say it is still a tossup. if you look at 538, some are saying it looks like they can win this and make it 59-41 democrats. right now, democrats are in control but by a laser the majority. this is going to be something everyone will be focused on because pretty much everyone agrees the republicans are poised to win the house. even have some democratic senators coming out to see what they should do in the lame-duck session because they think republicans will win the house. >> how worried are they at the moment that new york might be republican? >> they are incredibly worried. to be have there yesterday? the vice president kamala harris

and presidential democrat nominee hillary clinton, going to new york to campaign for current governor hochul. this is something you would not really see days out from a midterm election. they are in deep blue new york. this would be something that is quite shocking if she was to lose this race but kathy hochul recently said she felt like she was the underdog in an interview. she retracted and said she feels that way because she wants to make for every campaign she is connecting with rotors. at the same time, what you have from the other candidate is starting to resonate with new yorkers who feel like crime is going up in new york city. subway crime has gone of 30%. this is resonating at the moment in new york on top of the fact it is more expensive to live there. >> if that does not speak to the weakness of this party right now, i do not know what does.

if you are fighting in new york than you have a problem. >> there is an upstate and downstate tradition. this is not hugh carey who was an iconic governor of new york with a whole sense of new york city. you think of elder motto of long island as a republican but this is kathy hochul from buffalo. i really wonder growing up in western new york as i did, ms. hogle was weaned on jenny crimo. jenny crimo is not booze but a beverage of your choice. >> is it a light beer? >> it is not like coors 32. the problem is the governor but is from buffalo. she is not really explaining

this from the media right now. >> do you remember the lieutenant governor used to come on this program with us? now she has stopped speaking. >> speaking of beverages, this is great. on radio you cannot see this but i have been trying this. it is tang zero. [laughter] >> you are surely sick. you avoid these chats. he sent me the new drink. i said are you serious? >> you actually have a container of tang when her counter at home? >> i do. ♪ we all have a purpose in life - a “why.”

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jonathan: for day losing streak, trying to rally up .7%. on the s&p 500 down -4%. potentially, it will be the worst week going all the way back to january of this year. let's see the story, the pain in the bond market.

the two's, tens and 30's the yields look like this. the two year is four. the difference between two and 10 the negative since the 1980's. -60 basis points. tom: this is all moving very quickly. that would be my statement over these chaotic three days. jonathan: we always wondered if he could enter a step down from the interest rate hikes and easing the financial conditions. if that was the question going into the news conference, he can. that terminal rate will be higher we can talk about that. if you pull up the commodity screen, if you have access you will see a ton of green. copper, bread, absolutely surging but why? there was a conversation this

week about china reopening. there was a rumor earlier this week that the government had put together a committee to assess dropping covid zero. a confirmation of that. we start to get to reports from bloomberg and reuters. bloomberg saying it is opening travel a bit. another from reuters about shortening the quarantine and that fuels the rumor mill. it has fueled the commodity market this morning. tom: i have brent crude up 3.4%. we have a major fall spot. let's get this straight, to get jonathan ferro on the straight and narrow, you have to understand there is two ways to quote copper and we do that. jonathan: i am well aware on how

to quote copper. tom: we have $3.58, that is chicago. jonathan: this is been the third time in 24 hours. thus the price action. lisa: i will follow up on the story that you were talking about with china and some of the rumors that have fueled some of the rally. i want to talk about earnings. what have we seen this earnings season? if you disappoint, you get penalized heavily. if you disappoint on the forecast even more so. the examples are paypal, down 6.6% ahead of market trading after coming out with disappointing outlooks. twilio down 26% after their disappointment and credo's

defense and securities, which is not the tech sector is down more than 10% after talking about supply chain issues. these are all different assets of the same story we keep telling. software, hardware, tech getting hammered. how much is that a broader story? the areas affected by labor shortages and supply chain disruption still feeling that pain. how much is that a broader story it -- and how much of that as a supply chain issue. in china, we ceased a massive rally of chinese companies. alibaba surging 9.45%. jd.com is up nine point 3%. yum china up 6.8%. how can we buy into these rumors as chinese authorities are trying to push back. there is absolutely no change in i wonder what the signal is.

gmp is being more outward looking, is meeting with foreign leaders. tom: we will have to say, remember sunday evening look for a fruit -- asian coverage. look at paypal, you talk about the tech is down 70% from the moonshot. lisa: we talk about the bubble in the bursting and is their broader ramification or is this an isolated incident. tom: let's speak with tom porcelli from rbc capital markets llc give me the wage dynamic with you right now at rbc? tom: the moment you say things

are slowing down, people start saying collapse, i don't think that is where we are. i am looking at certain nuances and the nuances are that wages are slowing. i've said this many times, i prefer average weekly earnings. i think it's a better measure of wage dynamics. if you want to look at that on the six months exchange basis, year and year is very lumpy right now. the six-month change, it has slowed down. you are running at 11.5% pace. the rage dynamic is slowing down but i think this will be a slow grind to this weak labor market. something we've been saying for a long time now. tom: how does jerome powell adjust to the slow grind that you predict? >> it's a great question because

there are two ways or two boss -- two boxes they need to check. they need to see inflation slowed down he was asked what he's wanted to say and he was fake. by the time we get to the march meeting, i think inflation will have slow down enough to put this hiking cycle on pause. the next box that needs to be checked and this is for the people who are so desperate for the pivot. i hate this word, i've grown to hate the word pivot. to get to the real pivot where he is reversing course the next box you need to check us labor and more specifically to or near job losses. i think that is one thing waiting for us in the middle of the year you check that box off and that's when the fed reverses

course. lisa: what are you getting wrong, inflationary rise has been priced to the upside. tom r: what can happen, what could go wrong between now and the next six months? if i knew, i would not make the call. the consumer is sitting on -- in the aggregate, they are sitting on cash. some people are sitting others are tapped out. if the consumer continues to go down that path, you can certainly see a dynamic where that mitigates many of these problems.

again, you are asking me to think about things that could go wrong. i have said this for a while, if you look at, i like to look at net value add for corporate businesses. think of it is so a for profits. when you look at that measure, this net value add corporations the first half of the year it was running around 11%, 12% in the first half of the year. in real terms, it was down 2% or -2%. think about what that means. the only reason you saw net value as a proxy for profits and positive territory because companies were able to inflate their way to profits. lisa: i get the point. tom r: let me just finish the

whole idea. what that means is that their volume of stuff is down. when you look at real profits that were in negative territory, the volume of stuff was down. what has happened this far in the second half of the year. volume continues to be down. what do companies do to defend profits? a common way is to go after labor. i don't think it has to get pernicious. sorry lisa, you were going to say. lisa: the fed has been very clear that the balance of risk is inflation getting entrenched and it still has to do that. in 30 seconds, why do you disagree? tom r: this will not become entrenched? lisa: lisa: that's not the main risk we are facing. tom r: there is lots of

disinflation in the pipeline. i think the fed has to say this because the moment they don't say that is the moment they let financial conditions ease and thus last thing they want to do. jay powell is the last to acknowledge that labor has terms. that is at odds and what we see in the pipeline. jonathan: hey tom, we have to go. tom porcelli is there. this is different from what the fed is signaling and what it thinks. when you look at the labor market right now, we see prices all over the place and we don't see it in the data. when we look at the inflation stuff, you can see it in commodities, have not seen it and headline inflation. tom: i will defend richard clarendon, they are fixated as is joe biden on one thing,

inflation. jonathan: some people have a big problem with that. tom: that $98 brent is not going away. 8:15 eastern time, we are 15 minutes away from a payroll report in america. this is bloomberg. lisa: oprah winfrey has thrown her endorsement to john fetterman and the pennsylvania u.s. senate race. he is trying to win a tight contest against amendment's, the republican he was one of oprah's protege. he is a doctor who began as a frequent quest on oprah's talkshow and leaders hosted his own successful program. a warning from christine lagarde she says that interest rates may need to be raised to restrictive levels to get inflation down to 2%.

it has raised borrowing costs by 2% in the past few months. it may have to take into a point where they act as a brake on the economy. apple could be shifting from its reliance on china. it's taiwanese contractor has begun assembling the latest i-4 14 in india. that would make it the second apple supplier in the country. this comes after apples manufacturing hub was placed on covid lot by authorities. billionaire jeff mosys may take an offer from the national football league's washington commanders. the owners of the team say they are exploring options including a sale. the snyders are facing increasing pressure to step down. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700

journalists and analysts in more than 120 countries. i am lisa mateo, this is bloomberg. ♪ ♪

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>> the fed is saying that we have been getting this so wrong for so long. we have to see the numbers we can't anticipate the numbers. global growth is slowing, you have to buy the dollar. jonathan: that was head of research at fcc. yields are higher about a basis point on a 10 year. on the front end on the two-year, yield is up for basis points. for 75.

we were at 12 basis points 12 months ago. tom: messy and to love, gravity is back in physics. that's what he's talking about the two-year move. brent, 97. brent crude of more than 3% on the session. china getting some real fuel. tom: nice pond right there. this is something all of you care about including those towards a midterm election. well, is it feasible that brent 98, we get $100 a barrel by election day tuesday. are we moving that fast?

will: it would take another headline out of china to get us there. it is clear that a hundred dollars is in the sides of the market and as john said, this is being driven by china. the one source of weakness that has been consistent is china where locke downs have kept mobility under control. that means less driving and flying. it will tighten the market considerably. tom: an apology on the part of survivors. we quoted chicago copper instead of emily --mle, jonathan threw a tantrum. is copper in the commodity lift, is it linked with brent and china to $100 a barrel? will: it's all part of the same

picture. most of the market comes from china. everyone always says that china recovery would be very good for copper prices. that said, it is more input into their industrial economy which has not been as affected by lockdowns as the movement of people around china. lisa: it is november, we are tracking the weather. the weather has been warm. it still a long winter ahead. how much with china reopening take energy away from europe? away from the u.s. at times where the prices are at most concerned? >> one of the reasons they have been able to fill it stockpiles, one of the recent gas prices have fallen back is because china's demand has been subdued. a stronger chinese economy could change the quite quickly. it's definitely something for

people to watch on the gas side as well as the oil side. they could feed through towards the energy complex. it would only take a cold spell of whether before the narrative on gas prices change. we got another dreadful set of figures from france on how constrained its nuclear production will be and missing earlier targets. that said gas prices higher today. for all the good news we have had on gas, the winter is a lot warmer but we are nowhere out of the woods yet. lisa: it's a confusing picture in europe, it's hard to understand where different countries get their energy sources. natural gas, and france nuclear power plant. are there overlaps and sources of natural gas in china, germany? >> one of the problems that

germany is hot in this gas crunch did not have the power to import more energy. we are seeing the emergence of a global energy market. more energy is traded on a small basis in terms of long-term contracts. you see cargoes arbitrage between europe and asia. that is a world that is changing in a world where energy invents in one part of the world can have an impact on the cost of energy in japan and china. tom: an unfair question, it is unfair friday. do you and your team model that if you come back to some gdp as of 5%, do we represent a 100 brent crude? >> there is a vague bullish mix.

the other thing we need to talk about cosby impact of russia's price cap. in early december, the eu will stop buying russian crude and that russian crude needs to find a home somewhere else. it has been sending oil to india and china but it's a real question whether those markets can absorb all that crude and whether the logistical and financials can happen or whether there will be snarl ups and some of that russian crude gets strangled in russia. you put that with resilient demand and the rest of the world and you get a bullish mix. one other thing i would say on demand, people talk about a recession of what it would do to oil. it takes a deep recession to cut the demand for oil. most recessions just see demand

grow at a slower rate. i don't think people should assume that if we get an economic slowdown outside of china. translates into demand. it could prove a bullish winter of these things come together. jonathan: wonderful coverage, will kennedy there. 91. five brent crude right now, close to 98, 97.90. every single line of thought commodity market this morning, every single line is rallying. tom: copper is 79 13 and chicago 360.25. you have to quote both numbers. my expertise is if you are in the dorchester hotel at the mining conference with your

single executive executive producer and she asked for an umbrella in the cocktail, that's what you do with the conference. lme week was very cool. jonathan: is not a cool as it used to be. you can't drink as much. payroll study is four minutes away, this is bloomberg. ♪ ♪ no matter your purpose, at pnc private bank, we will work with you every step of the way to help you achieve it.

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>> i would not read too much into what the central banks are saying right now. >> some doubts or creeping in. this is different from where the fed's now. >> the fed is sg