>> my base case has the u.s. economy slowing, flirting with the recession. >> we think fed funds it's to 4.75%, 5%. >> we can decelerate and ultimately pause at some point. >> there is no fed number that wants to go down this street as losing the fight of inflation. >> the invasion beginning to

calm down. >> this is "bloomberg surveillance." jonathan: live from new york city, for our audience worldwide, good morning. we kick off a brand-new trading week. alongside lisa abramowicz, i am jonathan ferro. i guess if you want to blame someone, you can blame governor waller. lisa: because they basically said stocks should not fall much more. jonathan: calm down and breathe, coming from a fed official. lisa: saying do not worry about cpi, saying it is not a downward trend with one data point. people so suddenly a downward surprise after so many upward surprises, inflation. have we gotten to some tipping point into disinflationary moments? jonathan: what about the downside last week on cpi? and then there was the gridlock in washington. the third piece was china

reopening. a meeting is happening right now between president biden and president x ati are we looking for anything to come out of that? lisa: i think the answer is no, but there might be signaling, part -- particularly xi jinping 's openness for international businesses to commonly. the story is about big businesses and banks retrenching quietly from china. how much is the political risk and how much is because the economy is not taking off like other economies? jonathan: i will go to the price action for you. s&p 500 coming up the back of the biggest weekly gain since june. nasdaq, biggest weekly gain on the nasdaq 100 since november 2020 at futures down .3% on the s&p. bond market, yields higher. treasuries reopening this morning, eight basis points on

the 10-year, 3.8912. euro strength against the u.s. dollar last week was phenomenal. this morning, euro-dollar 1 .0282. lisa: i will give you the time at the press conference for president biden. i will, but it will be wrong because it will be late. we will get a host of fed speak today, too. perhaps we will hear a similar comment at 11:30 a.m. on bloomberg, or perhaps the new york fed president john williams at 6:30 p.m., similar to what we heard from chris weller, a sickly take a deep breath because one data point does not change the path. does it really matter or will markets go where they're going to go. we will get the kicking off the bloomberg new economy forum tonight. henry kissinger, katherine tai,

u.s. trade representative to china -- i am curious to what she will have to say. the trade aspect might be the most interesting thing that could come from these meetings. less the reopening with respect to covid because they will not make an announcement here at this meeting. they will give a sense that there is some sort of pulling back when it comes to tariffs, and also on the chip side, how that will be curtailed or expanded. jonathan: they have been floating it over the last 12 months. we want to talk about the chips specifically. japan confused by this, europeans confused by this. they are trying to work out what it means for them. lisa: sure, because it has a domestic quality, keeping fencing -- keeping things in the united states. but president biden did not get the big waves some people were expecting. what does he do with that, especially with china?

one bipartisan issue in the united states. jonathan: i keep saying gridlock. lisa: it is not gridlock. jonathan: not at all. lisa: people were rallying around the idea that there would be gridlock. now that there is not, what does that do to markets? jonathan: do you remember the outcome of the election in november 2020? everybody said gridlock, gridlock, gridlock. then we got a blue wave or whatever you want to call it. and the market ripped peerless up this is the thing everyone is talking about, gridlock is good. and we do not see actual gridlock. jonathan: a final word on vice chair bring -- braiard, looking forward to that. we will bring you more later. 11:30 a.m. eastern time, scheduled to take place and typically more and track and on time than leaders in bali at the

g20. pria joins us now. it is the question every strategist fierce right now. how is the 2023 outlook coming along? pria: gosh, every year it is tough, but this year we have the economic outlook, inflation growth, and i think the growth outlook will become more interesting with the fed reaction function. we normally do not have uncertainty on all of the aspects, and we have also had a fairly illiquid market. this is never easy, but i think this year is particularly hard. we should take everything with a pinch of salt or a fistful of salt. we will all be writing it over the next couple of weeks. lisa: do you have any convictions whatsoever? priya: i think liquidity is important. i think making sure that you have enough liquid assets so

you're not forced to sell what you do not want to sell. i think that is a theme we have had this year, and i think that continuous peer the other big conviction i have is that i know the data right now is still strong. we think inflation -- it is less about the peak, it is how it will climb. i think we will look at the base of decline. if that is shadow, which is actually our call here, the fed will stay restrictive for longer. we have these views around sticky inflation, recession, it is timing that, train the -- trading that that will be hard. what happened on thursday can be done a little bit with the move. but some of this is being shunned by investors. i think it will make sense to start to position for duration coming back. the 10-year should not be around 4% if you're heading to recession. lisa: i am not going to let that

go. no idea why it rally 30 basis points on friday -- thursday, rather. friday the bond market was closed. how do you understand these types of moves with position and liquidity? what does it mean when it comes with -- to coming up with trade? priya: as governor wallace said, be calm and breathe, that is good advice. there has been volatility. this is the highest we have seen, including the 1970 costs, and just imagine positioning the importance of flows. understanding that the market is not as the grid, leaders have constrained capacity, i think that is important. that is why you are supposed to keep some cash. keep money in the front end to make sure that if the moves are excessive, you do not have to self. you can potentially put money to work. i think all of this -- we should not see this as a one-off, maybe

positioning was exaggerated. i see it as a structural issue and something we have to get used to, particularly because we have a data-dependent fed. you can expect volatility to stay in low -- i think volatility stays high, but the market focus will shift from inflation to growth. jonathan: how much influence does this fed have on the long end, on the 10-year? priya: i do not know why they do not talk about qt. about 100 billions of measures off the balance sheet every month. there is a lot more supply. mortgages that are long-duration. and the market is looking for that margin. i do think they have control. at some point, i do think qt will end. once they start to ease, we actually have them starting to ease -- i know i talked about sticky inflation, but unemployment reaching 5% or

higher. inflation getting down to 3%, we think the trade-off will start to skew the fed towards rate cuts. i think if the fed starts to cut rates, they will stop qt. people think it is a front entry. if quantity or tightening stops, i think the 10-year has more room to grow. i do think they have control, but they do not talk about that control a lot. jonathan: priya misra of td securities, thank you, as always. what an outlook for 2023. morgan stanley have given an outlook, as well. title, by a whisker. this economy rarely skirting recession in 2023, but landing does not feel soft. it goes on to say the cumulative effect of policy spills over to 2024, resulting in two very weak years. so i guess it is a multi-your for morgan stanley.

3.5%, with the fed having cut the policy rate back to neutral. lisa: it is fair to ask, based on that, people say recession is baked in -- is it even a technical recession or is it just incredibly slow growth or a lost decade or a last five years? how much will people start talking about the duration of what priya is talking about, keeping rates restrictive for longer because of a shallow decline and inflation. that is a different outlook than rapid client and inflation. -- rapid decline and inflation. how do you press this? jonathan: a member of pimco joining us, looking forward to that conversation. news, jeff bezos planning to give away the majority of his $124 billion net worth during his lifetime, says cnn. he will divert the bulk of his wealth to fighting climate

change, unifying immunity among steep social and political divisions. katie martin of the financial times asking a couple questions, bramo ear does that mean huge pay rises for staff, massive tax bills? dot dot dot. question mark. lisa: elaborate public relations on behalf of jeff bezos. jonathan: futures are down .5%. bramo with tons of swag. this is bloomberg. lisa m: keeping you up-to-date with the first word, i am lisa mateo. president biden and xi jinping had the first-ever in-person meeting today. they shook hands before sitting down at a hotel in bali, indonesia, where the group of 20 summit is happening. the president said the two have a responsibility to show that china and the u.s. can prevent

competition from turning into conflict. in turkey, authorities say a kurdish poll taker and its u.s.-backed affiliates in syria were behind a deadly bomb attack in his temple, killing at least six people and wounding 81 in a taurus district. turkey says the suspect has been captured and was identified as a syrian national. in the u.k., chancellor terry hunt is expected to delay much of the 65 billion spending cuts and tax hikes until after the next election. that is to protect the economy and shore up support for the conservative party as the country heads into recession. the bulk of the savings would be delivered in the final years of the five-year forecast. shares of japan softbank plans today, failing to announce why they expect a stock buyback. and a vision fun hosted a $7.2 billion loss in the july through september quarter. valuations of force the world's biggest technology investor to

go into defensive mode and virtually halt investments. 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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>> president biden has been a great president for our country.

he has accomplished so much. over 10 million jobs under his leadership. jonathan: that was nancy pelosi, the house speaker come over the weekend. good morning. here is the state of price action. two hours and 12 minutes away -- equity futures negative on the s&p 500, down .3%. yields higher by eight basis points on the 10-year, 3.8968 euro-dollar -.7%. yields up, dollar strength, and equities lower on the half of the federal reserve comments, telling us to calm down after cpi came below expectations last week. calm down and take a deep breath, basically his words. he does not want to be in the situation we were in in july come over the data and the

market right away and you had the pressure of easing financial conditions here that is not where they want to be purely's upon how much are they going to cap how much stocks will rally? i was listening to nancy pelosi, entity watch the political sunday shows over the weekend? the change in tone from republicans are in former president trump -- how much is he going to really announce tomorrow that he is running for president at a time when a lot of people do not want to see that happen? jonathan: media starting to turn, too. let's get that board back up, stop -- stocks, bonds, fx, commodities and focus on the back of this, crude down by about 1.3%. opec reduces forecast for global demand again. cutbacks keeping markets only balance, playing into the theory that they think the economy is rolling over, why they think we need to cut production.

goes back to about 87.82 for crude. lisa: how does this going to the china story? president biden meeting with xi jinping right now. jonathan: our washington correspondent is on the sidelines in bali. what did you heard about the meeting that tells you something that will happen coming out the other side? >> meeting is ongoing, and what we heard is that it could be a couple of hours. they took a break and now have resumed discussions. we are not expecting any deliverables or big announcements, no joint statement following the meeting. but the president will give a press conference, and that will give us hints about what was discussed. we know some of the biggest issues that will be discussed are putin's invasion of ukraine, where she shaping has not materially helped russia but have not criticized putin, and putin still considers xi jinping a friend on the international

stage. there is the fact that the u.s. has released curbs on semiconductor and advanced technology that china will desperately need. it not just technology space but military space. in the most contentious is what is going on with taiwan and the taiwanese straight. we saw this play out this summer when speaker pelosi made that trip to taiwan. there were military drills by china and the taiwan strait. we saw china revoke some communications with the u.s., whether it was military or climate communication they were working on, and that is why this meeting comes at such an important time. we heard from u.s. officials that even the planning of this meeting started to warm relations a bit. but for the u.s., it is about setting guardrails for the rules of the road, something they have been trying to do since 2021. lisa: does the u.s. and president biden want a warmer relationship right now with g jinping?

annmarie: from the u.s., they want to have competition with china, not conflict. it is an interesting moment because it comes on the heels of the president in cambodia meeting a number of asian allies he sat down with the australian, japanese, and south korea leaders. these countries were a little bit concerned about the provocation in china after speaker pelosi's visit to taiwan, and they want to calm down what is going on in terms of the u.s.-china relations. they want a stable approach, because these countries not only have military bases on their land, so at the u.s. was drawn to conflict, they would also be on the fringes of that conflict, but also other things when it comes to the chips. this is something japan and south korea have not fully backed the u.s. approach. and china says the u.s. is trying to maintain hegemony within the international order. so on these kind of topics, allies want to see the u.s. and

china communicating. the president said he spoke to allies, or his team said he spoke to alice before coming into this meeting. so potentially president biden heard some of their concerns. jonathan: russia is at the epicenter of some of the conversations. can you talk about what has happened over the next 24 hours as there have been conflicting reports? annmarie: there was a report from the ap that sergei lavrov, who is here instead of president putin, who did not go to the g20 and rome and not attending the g 20 in bali, and he is representing the russian delegation. there was a report he is hospitalized. bloomberg news asked the foreign ministry if it was true, then he released a video statement showing himself sink the bloomberg news report is false. he released this statement video. he is working during it. we do not know exactly when this video was taken. no timestamp.

so there have been conflicting reports on the ground in bali, the health of sergei lavrov, a critically important person because he is representing russia. and begs the question of whether or not they will be able to sign up to join communicate, which i know you have been talking about. jonathan: thank you. we will be catching up through the week during the g20. it will be difficult to get 20 countries to agree on absolutely everything. if you have a communique, does it read like fed minutes? one country thinks this, other countries think that. lisa: and how much is there a bigger takeaway? we hear about the regionalized globalization, reassuring, all of that. how much do we see evidence of where the alliances are coming out of this? that might be the biggest take away, more than some sort of global communique, because is there a global goal at this point that all nations can really coalesce around? donath end good advertisement

for the g20, no communique after the east asia summit. sergei lavrov refusing to describe the invasion of ukraine as a war and insisting there is a special military operation. lisa: let's see if china can get behind that. russia has been trained to communicate some sort of lessening in terms of the significance of what is a war, by all measures. jonathan: coming up a little bit later, you should hear from the president of the united states in a news conference on the sidelines of the g20, scheduled to take place at 8:30 a.m. eastern time. on this program, we will catch up with a member of citi next. from new york, this is bloomberg. ♪

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jonathan: typically on a monday morning, i would say what a week coming up. what a week last week was. that was ridiculous. lisa: i think that is fair. jonathan: here is the price action. s&p 500, equity futures negative, down only about .3%.

call it a quarter it feeling constructive peer nasdaq 100 down about .5%. last week, biggest weekly gain since june on the s&p. biggest weekly gain since november 2020 on the nasdaq 100. bond market, down about 33 basis points. the bulk came on thursday, post cpi. the two-year, 4.3761. governor waller pushing back overnight against some euphoria on the bond market, after cpi. vice chair brainard coming up a little later, sitting down with peggy collins in d.c. at 1130 eastern time. foreign exchange, major moves last week across a couple currency pairs. euro one of them, euro-dollar biggest weekend two years. dollar-yen though, a 5% move lower, the biggest weekly move going back to october 2008.

lisa: the widow maker trade trying to shore up what is going on in japan. we have seen that repeatedly. how much of a pause is this and how much more sustainable in terms of dollar weakness? amazon's jeff bezos coming out with a new philanthropic push, talking about giving away the bulk of his money over his tenure. this comes after could a schism about not being overly philanthropic. he has 124 billion dollars of net worth. those shares are down about 43% over the past year. they are poised for possibly the worst yearly loss went back to 2008 and possibly the 2000 that is part of the backdrop. walmart and home depot, most of the earnings have come through from the s&p. walmart and home depot up tomorrow before the opening bell. walmart shares have outperformed dramatically, partly because they have been able to really manage some of the supply chain

constraints and margin compression the other companies had a hard time with, only lower by 3.5% year to date. home depot c-shares down 15.5% year to date. i wonder how much we will see discussion about what mortgage rates at 7%, with the slowdown in housing costs does to home depot. do people invest in their homes and try to stay there? or do they pull back because they do not have new homes to decorate, etc.? that is usually a big part of personal expenditures. jonathan: and fed funds has change the game. you brought up amazon. there was a report in the journal last week that cost-cutting has hit facebook, meta, in a major way. end of 2019 and 2021, amazon hired some 800,000 employees. i had to read that over and over again to make sure i did not get it wrong.

that is a monster number in a small amount of time here lisa: amazon has lost $1 trillion of market value so far this year, the first company to ever lose $1 trillion of market value. until recently, we never had a lot of companies with $1 trillion market values. jonathan: quote of the morning came from stuart kaiser, kim actually yesterday evening. timing is the key word for markets he said, for data, with inflation and growth deteriorating, risks to mandates, for the markets, how long an investable window is there between those two waves of economic risk? stuart kaiser joins us now. it is important, the sequencing of what happens with growth and inflation and what roles over more quickly and what roles of her first. where are we now? stuart: good morning. the challenge is when the fed started hiking, they were hoping inflation would have already quested by now and they would be

able to deal with the growth. housing has started to slow down, an early indicator that growth will slow down in the future. i think what the fed and the markets are hoping is we will get a softer print hopefully in december after last week's, and then inflation will start to come down. unemployment still at 4%, and that is a nice balance for the fed. based on monetary policy, we have not seen the rate hikes really hit the economy. they really want disinflation economy to get under control. jonathan: is that basically the window before growth collapses? stuart: essentially, yeah, the window between inflation looks like it has peaked in the fed can back off on rate hikes, and uh-oh, the unemployment rate is rising and other forms of economic growth are slowing. lisa: how can you time this market? if you look at something that has flip-flopped by 10% in a week? stuart: we dislike you are not

taking victory laps -- that is why you are not taking victory laps. you position as quickly as possible. feels like the market is moving data point today to point at this time, and that is why our people are already asking what payrolls will look like in december and what inflation will look like? market is looking at a 2.8% s&p move on the cpi in the middle of december. so you look at how much risk is priced for that day already, and we are not even to thanksgiving. lisa: is it easier to look longer-term, especially the leadership? we were talking about the leadership in the rally in big tech recently. i guessed said it could be sustainable. do you agree that there is some sort of return, the rise of the big tech behemoth as leaders? stuart: i do not think so yet, either could be or cannot be. impossible to tell. look, tech should work if the cluster for rate seizes a bit.

the challenge for big tech is that it was a valuation discussion, pushing p/e down for the nasdaq. third quarter earnings were not above valuation. those were about actual fundamentals and growth, amazon, facebook. so the question for tech is, if i take that pressure off from rates, do i need a valuation re-rating the people step act to see how the cost-cutting initiative plays out? so tech is a tricky trade for that reason. lisa: i keep going back to this ryan chesky tweet. feels like we were in a nightclub and the lights just turned on. i keep thinking about this. jonathan: i need brian to explain. lisa: you have no idea, clearly. i'm curious, what else is there that will get exposed? jonathan: how big is it? that is what everyone is trying to work out. i saw the comments on twitter

over the weekend. how big is the iceberg? talk about crypto, to what degree have we had widespread institution adoption? how much scope is there from that asset class across traditional asset classes? and for people who never touch crypto, bitcoin, they want to understand, what does it mean for me? what are the risks from these stories? stuart: i think that question relates to, witness the fed going to break? 10 years of easing monetary policy, now hiking massively over a short amount of time. our clients are saying if they're able to hike this much over a short time, not really break any asset classes, that is going to be the accomplishment of a lifetime. there is a beneficiary of easy money that is being pointed to come is that the advance? is it something like yen, easy credit, easy housing? so it is hard to step in and say

i am comfortable owning risk here, because we have not had that moment were the asset class that you did not expect to come with the pressure has. it is a good question. how big is it? you have seen the size of the balance sheet. you have seen negative rates in europe, seen crypto, seen the performance. if there is an iceberg, it is fairly big. an extended period of time. i think that is why a lot of clients have not re-risked and have not fully but in yet. essentially, there is something other that has not worked itself out get. jonathan: we hear from economists about access. but the excess of the last two years of the decade? what do we need to unwind, two years or 10? stuart: i would say it is the last 10. the last two years to me is much more a physical discussion of

how much money the government spent. last 10 years is much more a monetary discussion in terms of easier monetary policy. when you have to unwind all of that -- probably not, but you have to unwind a portion of it. the question for equities, that was about valuation, particularly growth stocks and tech. that got dealt with earlier in the year. but what clients struggle with is who have been the biggest beneficiaries of easing monetary policy and what have they invested in, and seeing what they have invested in rerate itself. real estate is a question people are focused on. we will have to see how this plays out. this is where it is hard to say all clear. once inflation peaks, we're good to go, because monetary policy is summer between a six and 18-month lag. what was the fed doing 12 months ago? it was at zero and buying bonds. while we have hiked a bit, the

real estate market has weakened a bit. there is a case to be made that a small portion of this has hit the markets. jonathan: isn't it a scary thought? stuart: if it wasn't holiday season -- lisa: he's basically coming on here to explain why he can go home and enjoy his holidays. jonathan: just looking at the end of the first quarter back in march. stuart kaiser of citi. great to see you again. what he is saying about, what did we build on top of low interest rates? have we changed certain industries? i would throw in not just low rates, it was not just the flow rates, it was cheap labor. what has changed is the cost of labor has gone up, cost of capital has gone up, and

industries built on top of that, cars, new burke, lyft, great dispersion between these industries. it is great dispersion for all of the above lisa: and consolidation for some of the weaker players, getting blown up because they do not have the cheap money and labor. jonathan: it will be fascinating. futures down .25% on the s&p. live from new york, this is bloomberg. ♪ lisa -- lisa m: president biden in china with xi jinping, calling for reduced tensions between the two largest economies per they met on the sidelines of the group of 20 summit in bali, indonesia. pres. biden: as leaders of our two nations, we share responsibility with you to show that china and the u.s. can manage our differences, prevent competition from becoming

anything near conflict, and find ways to work together on urgent global issues that require our mutual cooperation. lisa m: president biden will hold a news conference later today. opec has reduced its forecast for a global oil demand again, as the cartel implements production cutbacks designed to keep markets in balance. their latest report says the weaker economic act drop and anti-covid measures and anti-covid measures in china are among the reasons demand is dropping. a shooting at the university of virginia in charlottesville sunday night left three people dead, two wounded, and it took place in a parking garage on campus. police are searching for student described as armed and dangerous. london is no longer the biggest stock market in europe. the u.k. capitol has lost its crown to paris. according to an index compiled by bloomberg, the market cap of primary listings in paris overspent that of london. economic growth concerns are weighing on rich's assets.

china's relaxation of covid rules is boosting french luxury sales. 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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>> a lot of people have compared this to lehman. i would compared to enron. the smartest guys in the room, not just financial era but certainly from the reports, whif fs of fraud. jonathan: more than that. that was larry summers, former treasury secretary come over the weekend. your equity market looks like this, s&p 500, equity futures negative through much of the morning. blame someone, anyone, i guess you could pick governor waller. futures down .3%.

yields up by six or seven basis points. in 2022, seven basis points is nothing. euro-dollar 1.03, reclaiming that peer down about .5%. governor waller saying take a deep breath, calm down, after a downside surprise on cpi last week. lisa: the fact shares are not down more tells you how much markets are buying into this. governor waller is not making that big of an impact after last week. jonathan: 11:30 a.m. eastern time, the bloomberg washington dc bureau chief peggy collins having a conversation. when watching the statement and in the news conference, it was looked as if it was not towards vice chair brainard. lisa: her cumulative tightening

stood out, and then the conference said we do not really care. does she push back today with peggy collins? jonathan: what did brian chesky say? feels like we are in a nightclub and the lights just got turned on.guess that is true crypto . let's bring in director of financial technology research at jmp securities. how did we get to zero on valuations, literally in seconds? >> pretty amazing story. first off, we are following the story and it looks a lot like what happened in the financial crisis with the big banks leverage and liabilities. we saw that with crypto companies earlier this year. but it does look like there are some improper activities with investor funds. not only you have leverage, but you are using investor funds for other needs, which is where

things get dangerous. that is where i think -- i heard the comment of having aspects of enron, that is what this is starting to look like, what we saw 12, 15 years ago. lisa: can billion's of dollars a paper valuation disappear without creating any real turbulence in other types of firms, whether it is coin-based or other crypto assets? or have we seen the fallout already? >> hard to say where the contagion is, but i think it is obvious there will be more pain. there are clearly real losses happening throughout the system. some of that is already playing out. you have firms that have futures up in the year, and they have assets in investor money. my sense is that there is more to come here that is normally what happens with these types of crises. you go back to which firms have the best balance sheet and who can weather the storm.

you look at coinbase and they have $6 billion of liquid assets and have customer assets match one for run. i think there could be more pain here before more clarity. what we do not know all the tentacles here of the contagion effects. lisa: we have been talking about the structural changes of adapting to higher interest rates after a period of low interest rates. i wonder whether it -- there is reputational risks, extra premium we have to build into what investors demand for some of these companies going forward. do you think there is a devaluation inherent in the crypto asset space because people realize a risk that did not seem as severe days ago? >> absolutely. people at lk capital will have to think about the risk reward. they will pay more for the risks they are taking.

that will affect how people invest in this space. it will affect getting out of capital. the thing that gets missed here in the conversation is the blockchain technology and where that could drive real-world application. was there maybe overthrew sansom and too much capital chasing opportunities that the space did not make sense -- was there over enthusiasm? those have real long-term value. but the ones that do could be very valuable. i do not think it destroys the industry because i think it is built on a backbone of their being good players trying to build something with real utility. no doubt in the near term, this is a big stain on the industry and will affect how much capital comes in. we do not know yet where the contagious -- contagion is.

because they are regulated in the u.s. and are a public company, you can see their financials. jonathan: we have centuries worth of history for investment banking, so when something happens with something like mf global, the industry survives. the question right now is whether this episode reveals something about bad actors or about the whole asset class? is there something about the majority of the whole asset class, using that loosely, but the fact we do not have decades of history in this asset class were revealing something about bad actors also reveal something about the asset class? >> perhaps. that is the term i would use, immaturity, lack of visibility and regulation. this is happening in traditional finance sectors. these are things that happen in banks and institutions that are traditional finance that are poorly run or are taking too much risk. crypto may not be part of the industry that i would argue is

-- there is a lot of scams and fraud. there is not really a regulatory framework to help you, which is why in the u.s. there is a lot of uncertainty but even more so outside the u.s.. i think that tells us that this will be an industry that is serious, if it wants a future, there needs to be a lot more clarity around the regulation and rules, and that will take out a lot of the bad actors. it would allow good and smart people that are building projects that have real utility to do well and actually bring in the capital they deserve. so we are in an immature phase of the market right now, looks really bad. these are things that happen in traditional finance, not just crypto. there needs to be made clear. jonathan: appreciate it. it will be a much longer conversation in the future. i will not make forecast predictions about this asset class. if it starts going up again, we

will see a lot of people take interest again. near-term, if you have institutional money and you are the decision-maker to take that risk, it is not just about risk reward, it is about reputation. in a pension fund, how do you justify putting money into this asset class right now? right now, it is a monster career risk. lisa: it is a powerful thing, fear is overtaking greed. a lot of these cracks are causing people to perhaps reassess much they want to take that risk and what they will demand for it in terms of valuation. jonathan: getting confirmation that the biden-xi meeting has ended after more than three hours. we will talk about that. from new york, this is bloomberg. ♪

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>> these markets and the way they move, you can tell there is this physician cleansing in the market. >>