>> we are going through an inflection point right now like we saw earlier this summer. >> the economy is rolling over, the data is rolling over, the -- as hawkish as the fed is starting to talk, the market is not listening. >> if the fed slows down their rapid rate of increase, will that allow us to avoid a recession? >> we are going to get a recession at some point, although not right away. >> this is bloomberg surveillance. tom: good morning. we are in holiday mode.

no, we are not. it is a busy tuesday up to the economic onslaught. the data dump we get tomorrow. the data dump this morning is the price of bitcoin dump. disney is there, that story, maybe oil is a story. we will give you full world cup coverage. guess what. lisa: what. tom: bitcoin, front and center. lisa: it is not what we have seen in ftx. we are seeing it in others paired we are seeing the potential for a big grub see that is much more substantial with genesis intentionally filing if they do not raise funds. how much do you end up -- tom: they are in the story, aren't they? to remind people that aren't involved in crypto, winklevoss i've were two twins where women quake and stop in their tracks. these guys are challenged, aren't they? lisa: i'm not going to weigh in.

[laughter] tom: they are challenged this morning with genesis and the rest. lisa: there is a exited chill -- existential question of, is this an asset class coming down and to what? i think the question is, why haven't we seen further fallout as of yet? tom: robin wigglesworth publishing a brilliant some of this, quoting sonali basak. we will have that for you. 15,700 on bitcoin after an ugly overnight. lisa: to me, the real tone is, last week we saw a shift. better-than-expected news out of china, with respect to the energy story in europe. tom: it is not there. lisa: we are seeing worse news out of china with lockdowns affecting potentially a fifth of the entire economy. you are seeing a cold snap and europe testing some of the resolve we have seen in terms of

how much energy they have. we are not necessarily seeing the fallout of markets. there is still resilience. why are we not seeing more? tom: they are looking up the fed and doing the parlor game up until the 15th. let's get the data check. futures up eight, a lift in the market. it is fractional, point 2% including the dow jones industrial average. john from doha emails in and says, go to the dow. vix 22 point 44. yield, well, a story today with yield coming in some of the angst lisa is talking about. dollar turning after a strong dollar yesterday. ian, 141 point 40. oil, all over the proverbial petrol map. 85 point 58 on american oil. up nicely in the news over the two days. i need a tuesday before thanksgiving brief. lisa: it is definitely a tuesday

before thanksgiving brief. we have a slew of earnings, retailers. dick's sporting goods, analog services. i am interested to hear from dollar tree. before market, dollar tree has done well this year, of more than 24%. this is typical, usually the dollar store is the discounters do best in a downturn. i am watching to see what their outlook is given people are downshifting in the face of higher inflation and lower discretionary spending. today, the roster -- tom: dollar tree, go to tra on the bloomberg teller -- bloomberg terminal. dollar tree per your last 10 years, 14.4% per year. no one guessed that. lisa: no. it speaks to the tell -- tale of two americas. tom: i am sorry for interrupting. i'm sorry. i will never do that again. lisa: please note that. he said he would never interrupt again. i will hold up a sign, because

he probably will. fed speak includes cleveland fed president loretta mester, st. louis fed president james bullard. you were talking about how we were hearing the roster of fed speakers moving away from a hawkish stance. i do not know. the interpretation of the rhetoric is the same from before. they are not going to necessarily downshift, but that is not bullish because they are going to go to a lower terminal rate. tom: citigroup comments on bullard tilting to seven percent terminal rate. he has got to recapitulate that today and finesse what he meant i moving markets with a 7% yield. that is a stunning statistic. lisa: he moved for half a second and moved it back down. tom: i missed that. lisa: there is an option. this one is interesting. $35 billion in seven year notes from the u.s. treasury. tom: why is the seven year important? lisa: it is a less liquid

security, tends to be a messier option because there isn't necessarily --i am not talking to you like a dummy. i am telling you why i think it is interesting. i like the seven year option. look at those yields. a lot of people seem to like tom: this area. tom:ok. we will go there. we will give the world cup schedule in a minute. i watched a little yesterday. it was fun. the u.s. game was like, wow. lisa: they should have one bag. tom: darris gareth. we will get the expertise in the coming days. denmark, founder and ceo of -- data. world stops, denmark, tunisia. denmark is percolating with a chance to make noise. >> hopefully, they can do like england did yesterday. [laughter] lisa: tourist comment there. tom: let's get it to the dollar

paid what is the 2023 view on the dollar? there have been big figures moves, there can be big figure moves next year? >> this year has been essentially one of the strongest in the history of the dollar. massive runoff against some of the biggest currencies in the world. you see the yen move and so forth. in the last couple of weeks, we have seen a big reversal within that move. our positioning indicators, we have had some of the most extreme signals. real money investors were -- the trend following investors were really max come along dollars. we have this violent washout. now, everybody has to decide, ok. is this a big change in trend, or is this repositioning in the market?

the repositioning was definitely a big piece of what was going on. we could already see as soon as the news from china, which was actually important to the turn of the dollar overall -- as soon that is less positive, the dollar looks like it wants to go back to the appreciating trend. i think for me, the key is global growth. we can talk about the fed and the fed is important. the most important verbal for the dollar is global growth. if we still have a problematic growth situation in china, if europe does not want to recover, it is hard for me to see there is going to be a strategic turn in the dollar. we could have wiggles. we had a big wiggle the last couple of weeks. a strategic turn requires local growth get better. for me, it is too early to make that call. lisa: you were talking about china. that is giving fuel to this risk appetite, the idea they were tiptoeing from covid zero. it seems the opposite today. the narrative in the market is

not cooperating, you are not seeing the off move in equities, a strengthening dollar. what do you make of the idea that a lot of reasons behind the rally are turning on their head, but the market is not? jens: first thing i would say is, there is optimism around china. the optimism was based on the notion that there was going to be a move away from zero covid policy. what we are seeing in china is that there might be a desire to somehow relax those policies that have had a disastrous impact on the economy. but, isn't really feasible. we now have cases that are skyrocketing. we have a population that has been told covid was scary and something that should be avoided at all costs. this could go on for a long time in the since they only have around call it 20,000 cases a day. go back to when we had a peak in

the united states, which is a smaller country population wise where we had one million a day. we have an early phase of acceleration that could go on for a long time. are they just going to let it run? that would be a pretty strange way for them to go from one extreme to the other. it is going to be a gradual, messy process. i think it is going to be hard for the markets to cope with that. lisa: it seems like they are coping with it right now. into 2023, it seems they consensus is, you might see more dollar strength that will turn into dollar weakness. you will see europe start to outperform, asia start to outperform, the u.s. underperform. where do you push back against the consensus right now? jens: it all comes down to inflation and inflation expectations. what we saw after the cpi print, one cpi print that was better than the trend we had. market rally, enormously. there was after that, the dollar had -- one of its biggest moves

ever in a few days. it comes down to inflation. have we turned the corner, or are we going to have to stick to those prices? i think it is clear goods prices are not standard normalized. the market is hoping services prices will normalize. if that is not the case, it is going to be a big problem for risk assets. it is being priced now worst is over in inflation. if that is not the case, we are going to be back to having risk assets under pressure. tom: thank you, go denmark. he won the beauty contest institutional investor three years in a row in foreign exchange. i think i can say no one has done that. i may stand corrected on that. oecd out with a stunning look. let's remind ourselves --inflation statistics, still 6.8% globally next year on the moves. that is not inflation going

away. lisa: it is the theme of hiking into weakness that they highlight, perhaps not a recession, but pretty darn close, especially in the developing world. tom: should ali bassett on genesis -- sonali next on genesis. ♪ lisa: digital asset brokerage genesis warning potential investors it may have to file for bankruptcy unless it can raise money. bloomberg has learned the firm is struggling to attract funding for its lending unit, which suspended withdrawals after the collapse of ftx. genesis has spent the last few days seeking at least $1 billion in new capital. the oecd says central banks must keep raising rates to fight inflation, even as the global economy sinks into a slowdown. in any report, the organization warned inflation and its impact on real incomes will only get worse if policymakers fail to

act and raised forecasts for inflation at year. in china, an increase in covid cases has led local authorities to reintroducing measures like expanding testing and lockdowns. it is now estimated that a fifth of the country's economy has been affected despite the central governments call for more targeted, less disruptive covid zero measures. disney's returning ceo bob iger has taken his first steps towards reorganizing the entertainment china and -- giant. he has asked his top deputies to rethink corporate structure. he announced the departure of a top manager, the head of media distribution, karine daniel. the richest person in the world has seen his fortune declined by more than $100 billion this year. according to the bloomberg billionaires index, elon musk wealth has fallen to a little less than $170 billion after monday's 8.6 billion dollar loss. his stake in tesla comprised the bulk of musk's fortune. those shares fallen 52% this

year. global news 24 hours a day, on air and on "bloomberg quicktake." powered by more than 2,700 journalists and analysts in more than 120 countries. i am lisa mateo. this is bloomberg. ♪

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>> i think we have one more big lay down and crypto. i think we are going to see selling often bitcoin. one of the thing supportive recently are the fact there are a lot of ways that are invested in keeping it higher. tom: on fire yesterday. we went from katie greifeld on a reporting of ftx, whatever it is called, it was quite good. got picked up by the media. you did the job yesterday. are you any more knowledgeable on bit dog? i am still not. i feel dumb. lisa: the one thing i will say to conflate it coin with the

entire crypto universe is a no-no. you will get hate mail. tom: i do not agree. lisa: ok. tom: i think that is an underline. jon ferro on assignment today. we are going to drive forward in the conversation. lydia you may you'd and sonali put together a important update. as we go into a movable feast of a difficult tuesday for crypto. what are you looking for to happen with genesis this tuesday? sonali: if they file for bankruptcy, how far does that contagion also go? you have genesis lending, which is that lending entity that had been caught up in this liquidity crisis in the bitcoin industry. it is part of the industry run by digital currency group that is very sober, -- baker, a creator of the predecessor to

nasdaq --. tom: i am adamant about this. there is an underline to every transaction. howley is all of the bassett chat? how linked is that to the price of bitcoin? sonali: think about the fanaticism past couple of days. genesis was calling apollo, and a lot of investors were concerned when they looked at it at the end of the day. they said, they are -- there are regulatory concerns. even investors who wanted to get involved in the first place in this era cannot get involved because of the after mentioned problems. lisa: another way to ask wattana's asking, we often look at the price of bitcoin as a reflection of the contagion. is that inaccurate way of gauging out the weakness, or is this haven amid the storm, a more peripheral crypto assets? sonali: people put real money

into to buy bitcoin. the idea there is not an onboarding here is a false conception. that it is not a fake asset flying in the ether. if you pay money to buy bitcoin, you use dollars to buy bitcoin. you put dollars in exchange. let's take coinbase balance sheet. people are worried about the one to one. you have coin base bonds trading $.50 on the dollar. to your point, people are worried about the underlying, but these are still companies that if there are underlying, people are willing to pay for them. lisa: why isn't there more transparency? there was a story today about ftx having more than expected reserves, more than $1 billion of cash that found in people thought, you have money to give to creditors. why are we looking under rocks and in the cushions of a couch to find money for an institution that supposedly israel?

sonali: that is the important part. we are talking about the institutions now, not the underlying bitcoin. when you are talking about ftx or genesis, people are peeling back the curtain and trying to see, what is this entity, who owes who what, and what are they doing with that money? tom: they are going into delaware court today. what are the adults in the room going to say to this unregulated, unaudited, offshore industry? the broader industry, as well as ftx? sonali: they are going to say what they are saying now, how much money do you have, how much assets do you have -- tom: they are going to treat them like adults. are they going to get adult answers? sonali: they're going to try to. ftx had a statement over the weekend, they hired perella lineberger. trying to figure out what assets they could sell, what assets they can recapitalize.

tom: i sense this has a surveillance remote from the bahamas. [laughter] lisa: i think everything says surveillance. i think surveillance in the bahamas is what everything says. i am wondering as you talk, there is a rumor that perhaps certain institutions are so entrenched in this asset class that they have invested interest in not mass selling and in trying to keep things afloat and finding an entry point. how much are you hearing about that, that basically there is enough commitment to keep it going for now until something further breaks? sonali: a lot about that now. you could argue this wasn't started with ftx. you could argue this started months ago when the democrats started forming in the bitcoin industry. -- when the crack's started forming in the bitcoin industry. it was levered up to 60,000. that is the problem.

now what you have is an instance where that leverage came off the system, three arrows blew up, they have lenders, and now you have genesis that dcg had also poured money into two bring out of that hole. now, everybody is feeling the pain from that hangover. lisa: how much surprise among the people you speak to is that there is not more contagion, there has not been greater fallout? sonali: we are in the middle of it. neither genesis nor block five have filed for bankruptcy. we do not know who their creditors are. once we see more bankruptcies come to the surface in the lending industry, and many of my sources say maybe crypto lending is over, you wonder where that floor is when you do not have leverage in the system. maybe at all for many years. tom: is this going to happen today? it is thanksgiving week. everybody is sliding through the week, given a news flow. in that, are you saying today for genesis in connecticut? sonali: they are saying on

record a filing is not imminent. you have to wonder part of the reason for that is they are finding new people to reach out to. have reported finance -- tom: can they reach out to the big banks? lisa: they can try. sonali: exactly. the realities, apollo is one of the -- that have fielded the calls from genesis. everybody is in it. everybody is looking at the books. everybody is thinking about what they can get if they get involved. tom: i am watching the underlying 15,700. a little bit of a bounce in bitcoin. i am not going to pontificate over what i see. congratulations on a story that was top of the pile for global wall street this morning on genesis and phil collins is not involved. lisa: you are not watching bitcoin. [laughter] you are watching argentina. tom: 01 g, argentina is behind.

-- omg, argentina is behind. saudi arabia is beating argentina with 30 minutes to go. lisa: thank you, tom. tom: where is ferro? lisa: saudi arabia is way behind argentina. tom: would you like to comment on this? sonali: i am not watching soccer today. lisa: he is going to mock me. tom: down in flames. team world cup coverage. joins bloomberg surveillance. good morning. ♪

tom: bloomberg surveillance, good morning with futures a lift with fractional moves in the vix, 22 point five in from that 24 level. a better tone to a market turning, waiting for the economic data. 78 statistics tomorrow? lisa: a lot of news.

in particular with fed meeting minutes, i am curious how we get a shape narrative around how much inflation is starting to cool down. tom: i noticed oil with an elevation. ukraine with an argument with a gas problem over natural gas flow. we will have to watch that. west texas $81 up from a 78 level. rent crude, 8863 -- brent crude, 88.63. we keep score at bloomberg. we pay attention to who gets it wrong and ask why. we particularly pay attention to people that absolutely nailed it, oecd in paris, that large group of countries that -- they study. they have nailed the global slowdown and further drive that to a 2.2% statistic for real, global growth next year.

acting chief economist at the oecd with his portuguese economics. i point out your british columbia credit, which tells me it is all econometrics. how good are you at oecd of guessing the statistic? do you have a lot of confidence and degrees in freedom and trying to guesstimate up to 2024? >> well, it is a challenging environment. we feel confident about our forecast. we were warned about the slowdown. right now, we are facing the largest energy crisis since the 1970's. we have a dramatic picture that shows exactly that governments in and around the oecd are spending 18% of gdp justin energy. this is as much as we did in the 1970's and 1980's. a very challenging environment.

we feel comfortable with our forecast. tom: with your gdp growth slowdown from whatever it was in 2021 down to 2.2, how does china play into that vector? alvaro: for china, remember, this year was the lowest growth for china since the 1970's with the exception of the height of the pandemic. we have forecast china next year to rebound to 4.6%. going down duck 4.1% in 2024. there are still risks we think can play this central scenario. it is fairly possible that if the strict covid lockdowns continue and become more pervasive, then growth is going to be a lot less than we are forecasting. second has to do with the real estate market. if the adjustment on the real estate market is less smooth then we would like it to be, it is possible growth will be

negatively affected in china. we are seeing a rebound in china, but risks are certainly fairly high over there. lisa: you pointed out that this is an energy crisis, which isn't necessarily the way everybody else would frame it. they would view it as a free money for tech gains kind of crisis that has come to a head, and inflation crisis or broadly. why do you view it through the lens of energy primarily? alvaro: first of all, the energy crisis is a direct consequence of russia's aggression on ukraine which has led to slow growth and more -- oil prices rising everywhere. we see that even before the war, prices were starting to go up. you are right about that. clearly, inflation became a lot more pervasive, more entrenched and the pressure have intensified after the war.

we have five think an interesting estimation in our forecast, which is trying to see whether this is mostly because of supply shock or -- stock. if it started at supply shock -- as supply shock, many cities, you can see it doesn't matter. it is demand, that supply. some countries like the u.k., demand factors are having more of an impact than the supply factors. right now what we are talking about, very large inflation in many parts of the world, monetary policy has to continue to be decisive. it has to do what monetary policy has to do to get out of this situation. i think we are starting to see positive signs. lisa: you say you think probably china's economy will recover next year, which might increase demand for certain goods including energy. how will this factor into how much developed markets have to hiking rates, be countering that

increase in demand, the increase momentum we see heading over from the east? alvaro: what we highlight as well, this inflation is having a tremendous impact on people's incomes. all across the world, we have a dramatic picture on real wages and all across the world, real wages are going up. that is why we focus on, if you want to ease the pain, if you want a pain to be as short as possible, it is essential that we continue to be determined in this fight against inflation. if the economy starts to recover in the second half of next year, this will give a bit more pressure on prices. i think as long as monetary policy is doing what it is doing and remains steady fast on fighting inflation, we will be able to have no inflation going forward. tom: when bloomberg surveillance visits you in portugal for the

ecb hearing next year, you are modeling out 6% local inflation. every single central banker is going to say that is unacceptable. do you perceive that as a stopping point, or do you have a different statistic where we get to avant to 2% tailor perfection? what do we do when we get inflation down to 6.8 percent or dare i say 5%? alvaro: i think what matters right now is when we are going to have inflation peeking and coming down steadily. the trend is going to be important. a good example, brazil, when they started, they were one of the first countries to face significant deflationary pressures. their central bank decided to hike interest rates decisively for a few months. now, it is starting to pay off. the last reading we had from the united states is positive. what we need to do around the world is exactly assess the

situation. some countries have acted a lot more than others. what matters now is to get the situation, if inflation peaks and starts to come down terribly, it cannot be only one data point. in our forecast, we have forecast that inflation will pivot around mid next year and continue to come down even though it will remain fairly high in some countries at the end of 2023. tom: i do not want to get you in trouble, but i am going to get you in trouble. with your academics, how do you respond to a central banker gaining out a two-year recession as we got from the governor of the bank of england? do you have a confident in establishing a real gdp view out 24 months, or dare i say, 36 months? alvaro: listen, i know this forecast. you know and i know all this forecast, our best scenario, and what do we expect things will evolve. things change.

nobody expected a pandemic three years ago. nobody expected a war a few months ago. thanks change. what i can tell you is, our forecast, given what we know today, what do we see in the data? we are fairly confident about our central forecast right now. risks are rising. so, risks can go wrong. right now, our central scenario is not a scenario. -- is not a recession. sluggish growth, not a recession. tom: thank you for joining us with a really important summary. we gave this great focus, they have been out front on the vector. it is these institutions. i go back to the wto, where you wouldn't expect this analysis. they were really leading on global slowdown, maybe with the pacific rim view. you get the same thing from oecd. lisa: it highlights the

uncertainty around inflation. is it supply driven, demand driven, or both? tom: people take shots at them constantly. the bottom line is, this is a stagflation analysis. you've got nominal gdp of, let's rounded up and be optimistic. 9% nominal gdp a year from now. no, i do not see anybody modeling that out. lisa: what is the counter impulse? do you see fiscal spending, a monetary easing? at what point do we see a easing? tom: well said. the answer is focus lend off deutsche bank in february. i cannot -- two years ago, i cannot remember. in february, full-court's land dell was on the show and said you've got to see fiscal spending because of a war in europe and have we seen that yet, i am not sure we have seen

that fiscal stimulus. lisa: we have seen that in germany. there has been pushed back elsewhere because the concern about inflation, the concern they are not allowing them to spend. i see you distracted. i have to be honest. it is a good game. i was looking at it in the break. tom: she picks up my phone. we go from saudi --saudi upsetting argentina to-one. argentina with huge efforts here. that gets to denmark and tunisia. there is this basic, western layout of denmark layout. lisa: -- scored a goal and the 10th minute. then, the saudi arabian goal. the second was amazing. i am impressed. tom: ferro is probably watching this in a hotel room tearing up. oh my god, lisa with football talk. lisa: he is crying for another reason when i have football

talk. tom: global television for global wall street, two people who are completely unqualified are going at it. we are qualified to give you a data check. futures up two, fixup 22.53. if you are brave, stay with us. ♪ lisa: keeping you up-to-date with news from around the world with the first word i am lisa mateo. u.s. prosecutors have begun in as the best an investigation of ftx months before the crypto exchange collapse. prosecutors in new york had started poking into ftx massive exchange operations. it was part of a sweeping examination of cryptocurrency platforms with u.s. and offshore arms. u.s. defense secretary lloyd austin urging china to avoid what he called destabilizing actions toward taiwan. austin met with his chinese counterpart in cambodia, their first face-to-face meeting since house speaker nancy pelosi's visit to taiwan in august. it is the latest effort to put

the u.s.-china relationship on stable footing. the european union's executive is designing emergency natural gas price cap. it is trying to avoid the kind of record highs seen in august without risking the security of supplies. european commission will discuss the final shape of the so-called market corruption -- correction mechanism today. china supportively -- according to reuters, that would pave the way for the end of a reglet tory overall of the fit tech firm. beijing's crackdown on the private sector included the halt of its massive ipo in 2020. at the world cup, england, argentina and the netherlands won their first matches. the u.s. and wales battled to a 1-1 type. england and u.s. square on friday. global news 24 hours a day, on air and on "bloomberg quicktake." powered by more than 2,700 journalists and analysts in more than 120 countries. i am lisa mateo. this is bloomberg. ♪

♪ we all have a purpose in life - a “why.” maybe it's perfecting that special place that you want to keep in the family or passing down the family business or giving back to the places that inspire you. no matter your purpose, at pnc private bank, we will work with you every step of the way to help you achieve it. so let us focus on the how. just tell us - what's your why?

>> as we work to bring policy to what we call a sufficiently restrictive stance, which in simple terms means the level required to bring inflation down and restore price stability, we will need to be mindful. adjusting to little will leave inflation to high. adjusting too much could lead to an unnecessarily painful downturn. tom: mary daly of san francisco, cannot say enough about it. there were tourist comets about the social consequences about how the fed dances to a simmer 14th and next year. it is the tuesday before thanksgiving, we are not struggling for news flow.

the news flow today is about bitcoin, the weight on genesis. should ali bassett -- sonali was wonderful. today, bitcoin front and center. a turn to the market. bonds yields come in after the quiet of yesterday. oil with a lift, we will get to that. brent crude, 81.59. what i am not struggling with is to understand food. bloss has done a terrific job at bloomberg. the core commodities are not up that much. yet, lisa and i know that when i am preparing to do stuffing in aisle seven at the store that it is really expensive. you did the work on this. lisa: surveillance correction. you are not preparing to make stuffing. you haven't prepared to make stuffing the past two decades.

we will both pretend to cook, i cannot cook either. tom: my stuffing tastes like diesel fuel. lisa: diesel fuel in short supply. stuffing mix year-over-year increased over 69%. if you look at the farm bureau they did a study that shows thanksgiving dinner is up 20% year-over-year, which raises a question of how much further it can go, how sustainable this is and why. kona hack covering all things thanksgiving dinner. i cannot make stuffing. kona, what is behind this incredible lift across the board in food prices, particularly what has to do with wheat? >> i think it does -- to the ukraine invasion. we know the black sea, which is ukraine and russia account for a quarter of re-tech sports globally.

the fact for a long time at the beginning of this year, exports out of this region were locked. that cause absolute havoc. it came at a time where there were dry weather issues, you name it. there was europe, parts of the u.s. we had a shortage and global stocks were at levels we hadn't seen for a long time. which is very and comfortable. seeing that -- across commodities across the food chain have been very tight. the cost of shipping that stuff, the freight, has been extortionate. it is leading to the food basket, which is so much more expensive for the average shopper. lisa: detail and how much is behind this, that speaks to the shipping story. even transporting the food is getting more expensive. are there any signs of disinflation or some sort of relieving of this pressure in the near future, or is it more of the same and even then some?

kona: diesel is critically tight right now. in russia, it is a massive exporter of diesel to europe. this seems to be critically low levels of diesel stocks around the world. going back to food, the united nation's fao food price index peaked in march. yes, it was at record high levels in march of 2023. since then, it has been steadily coming off. that is the absolute futures price level. it takes a time for it to come down to the supply chain and to the retailer. that is going to take a wild to filter through. prices have peaked. one thing about agricultural commodities, farmers are responsive. when you see high wheat prices, farmers will do everything to plant that crop weather permitting, they will plant more as soon as the next harvest. tom: i have been dying to talk to you. if china extricate itself from

its misery and we get a pacific rim restart or dare i say whom, what does that do to the kona hit world? kona: that is the big story. commodities are desperate to look forward to. it really will have an impact. every time when rumors were coming up that shine is about to lift its code zero policy or go towards addressing some of that, it is the one thing that can help things take off. i do not think that is going to happen until q2 of 2023 at the earliest. we see an exponential -- and cases recently causing short-term damage. the hope they will eventually open up, we will see what we saw in europe and america. demand for going out, eating out, restaurants, things you could do in lockdown. we will see a short-term

balance. you have to member one thing about china. structural stories that china is no longer as commodity intensive as it was a decade ago. the drive will not be as extensive. there will be short-term bounce, that will be beneficial but not long-lasting. tom: thank you so much, appreciate that this morning. i want to squeeze one more question in. but we just cannot do it this morning. interesting in food. this is real hardship. i did a whole thing on rice for bloomberg on the economy years ago. it was the cost of food in america. i cannot remember the numbers. 9%, 10%. in cambodia, the cost of food is 60% and 70% of the paycheck. even in america, the percentage of people flat on their backs from this food inflation is arguably bigger than the gallon of gas inflation out there. lisa: you are seeing that in

terms of discretionary spending and consumer sentiment, how much that is deteriorating into the winter months. i wonder when you talk about whether this is supply-side driven or demand driven, inflation, what rate hikes are going to do. if this is the question. if we do not necessarily get some sort of increase in the production of oil, what does rate hikes do other than make it more difficult for people who are at the lowest deciles of their income sphere to be able to afford it? these are some of the things i expect we will keep hearing from fed officials. we heard overnight from ecb members, as well. tom: i like what mary daly said. if you want to see in turkey, what the butterball cost is at the store, i do not know. lisa: i could give you the statistics from farm bureau. turkey is $28 $.96 for a 16 pound turkey. increase of 21% year-over-year. tom: phenomenal, fancy, fancy

turkey stuff. wild turkeys, 90 $5.97 -- $95.95. we spend $90 on a beast, people are looking at 30's. lisa: how many people previously looking at 70 are going to 30, which is perhaps walmart gave share with people migrating lower in terms of the price savings? tom: justin, -- just in, ferro cooking for thanksgiving. lisa: lemon gelato. tom: that would be better than what i am going to do. i'm going to survive bitcoin. this is bloomberg.

>> we are going through an inflection point right now like we saw earlier this summer. >> the economy is rolling over, the data is rolling over, as hawkish as the fed wants to talk, the markets are not sinning to it. >> it depends on what the fed does. if the fed slows down the rapid rate of increase, will that allow us to were void -- avoid a recession? >> this is bloomberg

surveillance with tom keene, jonathan ferro and lisa abramowicz. tom: good morning, everyone. tuesday before thanksgiving. it is quieter, but it is not. in this hour and moment, what do you do for 2023? we will dive into that with a cautious view with wells fargo. jon ferro on assignment right now with argentina stunningly on the edge of losing to saudi arabia. mr. ferro reported on that in our inner messaging system. all the news is comforting to get back with tracie mcmillion back to, what we do to 2023 away from disney blowing up or bitcoin blowing up? lisa: we have to get through it coin blowing up or disney having a huge management shift to get to 2023. no one can game out how that is going to go. the one consensus you are feeling and 2023 is, i love how george sarah bellis put it yesterday, it is unlikely so

many bad things could happen all at once the way it did in 2022. lisa: what is interesting is the rare, optimistic call. there are people looking for a constructive 2023. tom: against oecd this morning, the migration of real gdp growth is bank of england like. the migration of inflation does not get it down to six point 8% global inflation next year. all of a sudden, looking at to 2025. lisa: hiking into weakness, the need to keep hiking to crimp demand and get inflation down. you are talking about bears. i'm going to throw out one that is notable. marco clint beck at jp morgan, almost full capitulation saying the only way to have a sustained rally in asset prices is for the fed to start cutting rates. he does not see that happening in the near term. this is somebody who has been impermeable so much of the cycle basically saying, i am done.

it doesn't look like it is in the cards right now. tom: my reset is, there is mass uncertainty. let's talk about bitcoin, the lead story this morning. genesis is not ftx, right? lisa: it is considered to be more with respect to institutional money, the winklevoss twins. it is a lot of people who thought of this as much more stable. tom: stable coin. lisa: almost like we are on the same page. we can discuss that another time. there is a bigger question, where are we in the following of the crypto turmoil dust? sonali saying we are in the middle of it. how much more do we have to see and how much is this a symptom in terms of the withdrawal of easy money -- easing money? lisa: stay with us throughout the day. tom: we have crypto this afternoon where we dive into this with a complete effort.

we are going to look forward to that. lisa: she says you are correct. tom: she talks to you. she doesn't talk to me. futures up 44, bonds, there is movement today after yesterday's quiet. yields come in 5%. we are looking for the two year yield to get out there, it did not. 4.5% on the two year yield. 3.79%. tuesday and gives me nothing. the real yield, 1.46%. oil with a lift, 88.71 on global brent crude. dollar turning not much of a story. i demand a pre-thanksgiving brief. lisa: if you insist. a slew of earnings, we got some of them including whirling 10 stores, dick's sporting goods, dollar tree is what i am watching. how much do you see an ongoing flight to some of these

discounters because of this feeling that people want to downshift, given the fact dollar tree is up more than 24% this year? this is the winners that tend to emerge during downturns or a soft patch in the economy. today, fed speak includes cleveland fed president, kansas city fed president, st. louis fed president. do we start to hear about concerns about the lag effects? that is something people touched on yesterday. tom: keep this up on television. on radio, we are looking at the three mugs of master, george and bullard. we are down on madison avenue, the country went roque in 1907. in 1912, we started the fed reserve, modernized in 1951. the heart of it is the regional presidents are different and independent. what i love about what you're saying lisa, these are starkly different voices today. lisa: the one consistency is inflation is the first concern and rates are going to go higher before they hold put.

1:00 p.m., we get a auction. these tend to be difficult auctions, they are less liquid than other parts of the curve. yields higher 3.8 9%. what is the demand like? it gives you a sense of where we have been, given the fact we were near zero not so long ago. going up almost four percentage points is shocking. tom: is there tax loss selling in bonds? lisa: not to the same degree as stocks. it is not going to be affected in that manner, it is a huge, international investment. tom: equities, bonds, currencies,, oddities. the -- tracy, let's get out front of your view next year. what do you see for use of cash in 2023? >> good morning.

thank you for having me. for 2023, we are seeing equity markets move higher, but it is going to be of tricky path to get there. the fed is likely to be under three different regimes as we move into 2023. we start the year with them continuing to tighten, then we think we are going to see a pause. we think by the end of the year, they are going to be cutting rates as we move through a moderate recession. i think the market is going to be looking out to 2024 by that point. we see about 10% upside from here. we would cautiously be dollar cost average he into equities. we are also starting to take a little bit of risk in fixed income by moving out in duration. lisa: how concerned are your clients right now? how much fear is there? tracie: there is some fear, but i would say with relation to other downturns, the 2008, 2009

financial crisis even the pandemic, we are not seeing the same level of fear at this point. that doesn't mean we will not see that eventual fear and capitulation that we do tend to see during bear markets. this has been a well telegraphed bear market. this has been orderly so far. we really haven't seen that kind of fear from our clients that we typically see during a bear market. lisa: we are going to hear from a host of fed speakers. later this month, we hear from jay powell on november 30. what are you looking for to understand with the pivot point will be in terms of not just pausing rates, but starting to cut? tracie: what we are looking for is inflation to start to come off the boil. we are starting to see that with the latest inflation data, we are starting to see it in goods

data. maybe not so much, at least from the cpi in terms of services. the services inflation is the hold into this tighter labor market. we are watching the same things the fed is watching. we are watching inflation data and the labor market data. it is going to take both of those cooling before we think the fed will start to cut rates again. tom: thank you so much. greatly appreciate it this morning. the stories for 2023, i'm going to give jon major credit. i think it was three years ago where he coined the idea the outlook for a given year starts in march. there is so much uncertainty. all the confidence is gone. lisa: how much is it reset in march, then june, then again in september? tom: this is pre-pandemic. i cannot remember, we believe.

it is always with his voice. someone with a bow tie. we would suggest. lisa: the market tries to get ahead of everything. so you try to game out the end of the year in the first quarter, have to reset and go to the next year that is jammed into another couple of months. tom: i would suggest we haven't talked enough about, i give our whole team credit for this. your world. when we cavalierly say, bonds are down 15% in price, you can use the word never. we have never seen this. grizzled veterans who remember 1979, that was a walk in the park compared to the rationalizations of 1231, 1232 that are going to made. lisa: it has been the worst year on record for benchmark treasuries. when you take a look at benchmark bond indexes and see them in a bear market, this is unheard of.

this is the reason why sometimes you are skeptical of the incredible optimism people have about bonds next year. they say this is the time to buy, great time for bonds. you are like, really? you just suffered the worst losses in your existence. this is what you say my world. is it possible to have benchmark full faith and credit, safest instrument, get totally blown out and not see anything blowout -- blowup? tom: david goldman wrote a chapter in my book years ago precisely on this. that the mistake is to watch the doom and gloom trenches. -- agreed with mr. goldman, you watch quality out there to see what it does. the quality has pulled back 15%. you see if that recovers. lisa: a lot of people are betting on that. next your is going to be the best year for a long time. tom: exclusive, my bracket has

been blown out. i am so done. we are a day and a half from the world cup. a day and a third. i was all argentina, i am so gone. saudi arabia, stunning argentina. ♪♪good morning. lisa: keeping you up-to-date with news from around the world with the first word. digital asset brokerage genesis warning potential investors it may have to file for bankruptcy unless it can raise money. bloomberg has learned the firm is struggling to attract funding for its lending unit, which suspended withdrawals after you -- after the collapse of -- fdx. genesis has been spending the last few days spending -- seeking at least $1 billion in capital. china increasing covid cases has led authorities to reintroducing measures like lockdowns and testing. it is estimating a fifth of the economy has been effected despite the central government's call for less disrupted covid

zero measures. european union's executive designing an emergency natural gas price cap. trying to avoid the record highs seen in august without asking the security of supplies. european commission will discuss the final shape of the market correction mechanism today. -- paid about 27 million dollars annually to return as the ceo of walt disney. the two-year deal includes a base salary of $1 million and a bonus equal to that amount and stock awards with a target of 25 million each year, the amount is lower than past packages. the former ceo received $2.5 million in fiscal 2021. iger received just over $45 million. the richest person in the world has seen his fortune declined by more than $100 billion this year. according to bloomberg billionaires index, elon musk's wealth has fallen to a little less than 170 billion dollars after monday's 8.6 million loss. his stake in tesla comprises the

bull of his fortune, those chairs have fallen about 52% this year. global news 24 hours a day, on air and on "bloomberg quicktake." powered by more than 2,700 journalists and analysts in more than 120 countries. this is bloomberg.

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>> there could be a growing split between what you might call in american economic pressure to an almost economic warfare in europe led by germany looking to china to compensate for the loss of economic ties with russia. if there weren't a crisis in the u.s. and wanted to introduce sanctions, i could imagine a big transatlantic split. tom: brilliant yesterday on the linkage of our diplomacy, our foreign policy with our domestic policy and the uncertainties moving forward. lisa abramowicz and tom keene with you, jon ferro on assignment. did mark, tanisha coming up. futures up eight, dow futures up

68. futures open, we will see what happens. yields come in, that is the growth lisa: lisa: happening out there. there its concern about how far the fed can go. you keep trolling jon. you keep implying he has ditched us to watch the world cup. we will find out. hopefully he will come back and give us a full report. tom: a more intelligent report then we will ever do. lisa: 100%. tom: my bracket has blown up with argentina losing. sort of like march madness, i am out of it. lisa: immediately. tom: he has been so loyal. into karen joins us now. i have been to china, i have been from the airport in hong kong to the mandarin. maybe some fancy hotel in shanghai. in china right now, it is getting serious.

it is 800 miles from hong kong, one of the four city states of the people's republic of china. tell us about the quality of the covid lockdown we see in inner china this morning. >> it is getting worse by the day. china's covid cases are searching. we had a top health official today, the chinese equivalent of dr. fauci. authorities are trying to thread this needle by not enforcing masks, widespread lockdowns we saw in shanghai earlier in the year. they are trying to do more targeted restrictions on the ground. -- the other epicenter of this outbreak. officials are asking, how are they going to control this outbreak without going under draconian measures? about a fifth of china's output

is being hammered by covid cases. it is heading in the wrong direction for covid zero. tom: over the last 50 years, the city state reality of china is that the mayors, the leaders, the generals of each given city have a voice and are very powerful. have they been quieted by president xi? or, can they give him an urgent response, this is what is happening in our city? enda: there was a recent plan delegating more authority to the local authorities, allowing them to respond to covid as they best see fit. of course, instruction was to not to lie flat and continue to control the virus. our colleagues are reporting, how can they pull that off, how can they allow the economy to breathe while controlling the virus without tree kony and restrictions? this is the dilemma. there is a feeling in china that china is heading into a difficult few weeks.

it is going to be probably the biggest test of covid zero since the pandemic began. also, china's hospital network in time -- in terms of icu beds is not as good as taiwan or japan's. it is a critical few weeks facing china now. lisa: in the u.s., there is a covid wave. there is enough immunity people shrug it off. i wonder as people gathered for thanksgiving meals and prioritize getting together regardless of any health concerns, what the social unrest is like, the social pushback in china amid another round of shutdowns? enda: again, it is hard to be too scientific. social media does suggest there is a lot of fatigue, exhaustion and resentment towards the ongoing covid zero restrictions. we had a panelist on bloomberg tv make a point that people are tired on the ongoing

restrictions, that is understandable. the whole crux of the issue is, how does china navigate away from covid zero without having a fairly serious public health disaster on its hands, that is the challenge? how can they get vaccination rates to wear a should be, chinese vaccines, western made vaccines. how can they keep the economy taking over when you have an exit way from covid zero and other countries in asia getting through covid zero going through a rough time with supply chain issues and everything else. it is not going to be simple for china. a lot of economists were making a point it is going to be a slow, torturous process to navigate out of this. lisa: almost everyone i have read believes china will make its way out of this next year. this is the consensus trade you will see, outperformance in the world's second against economy because of how low things have been this year. they have to start the process. can you connect the dots and all

the things that have to go right to get there to make sense of this consensus call? enda: because expectations have been so low, it is not hard to see how china could recover from here. if they can navigate out of covid zero in a somewhat controlled fashion, the consumer will be ready to go. pent up demand, global sacs think that will happen in the second half of next year. do not forget, real estate slump accounting for almost a quarter of economic activity. as we have said before, economists say there are recent measures to show up in the real estate sector are a game changer. there is a scenario mid next year where china is navigating covid side of things better. maybe the real estate sector has found its feet and china is getting up and running again. thank you for your work each evening. tom: i am going to do a victory

lap for abramowitz. your interview on peter oppenheimer really got major attraction out in the media, people talked about it. ian lyngen in bonds published moments ago, a plethora of unknowns. oppenheimer said the same thing in the equities space. lisa: which is reason why they say meandering performance for a while. the meandering performance ends up leading to something where there are new highs later in the existing stock market, which is not next year. tom: does he participate in the market now, or is goldman sachs london in cash? lisa: participate in the market. this is the consensus. it is, where is the leadership going to go? there are areas that could perform and stockpicking is not necessarily going to be a wholesale, catastrophic moment.

he pushed back against the mike wilson view we could see 3000 on the s&p. he does not see that as being in the cards. tom: we will have to see. i get the feeling they are going to recalibrate. they are not going to be recalibrating on friday. lisa will on friday. attention -- please pay attention to bloomberg surveillance on friday. her guest for the entire surveillance, damian sassower hour, long overdue on emerging markets into next year. the markets, futures up 9%. vicks 22.43%. brent crude moving $1090. 88.58. good morning. ♪

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tom: good morning, everyone. lisa abramowicz and tom keene. sonali is set to be with us in the next hour or so. they are working on an important story on bitcoin. bitcoin, and i'm speaking as an

amateur, and ugly 18 hours, comes back night sleep -- comes back nicely. jonathan ferro is on assignment. i think we are 30 minutes away from another game. lisa: [laughter] i think so. the last one was really good. tom: it was amazing. it went for 101 minutes. they have to play 90 minutes, i think that's the rule. they played out longer. lisa: i think jonathan specifically took off so he did not have to hear us talking about the world cup. he could just focus on the game and people who know better than us. i will give you a sense of what i am watching today, in terms of specific companies in the earnings that have been going on. best buy coming out with better-than-expected earnings. they reinstated a dividend. they talked about operating income, meaning it will be slightly higher than expected for the current fiscal year. shares up more than 7%.

zoom shares down sharply after disappointing earnings yesterday. they reported their slowest sales growth on record. are we post-pandemic and going back to zoom? tom: you follow this more than me. it is highly idiosyncratic. am i right about that or wrong? the retail. the haute -- the hold tech and retail thing. lisa: it's about inventories and what people have done. it's about the mix of customer and the type of product. the one unifying feature is that the discount stores have done well. we have seen that with t.j. maxx. we have also seen online doing well -- not faring well. even walmart, the online sales did not do as well. it is in-store purchases. lisa: do you have that thing in

your living room and you go, "athena, call it jonathan ferro?" lisa: [laughter] it's alexa. yes, i have this. i get it to tell jokes to my kids, so i don't have to. tom: are you serious? i'm coming back to this. lisa: the jokes are actually so bad they are funny. tom: i can just see her in the living room. "alexa, what did the seven year auction do?" they're going to get rid of it all. lisa: that's the rumor. lisa:they are eliminating the staff. dell is slightly lower after cutting revenue. tom: is there other stuff coming out today? everyone is racing toward thanksgiving. lisa: yes, some numbers are

coming out. tom: in the spirit of denmark and tanisha, we now go broader to the baltic sea and east. anders persson, ceo for global fixed income. not in the world cup, but not denmark in a moment. explain to our american audience, particularly those who are not into soccer, italy did not make it, sweden did not make it. is that a big deal? >> it's a big deal, yeah. for any european country, that may be any country outside the u.s.. when your country does not make it to the world cup, it is a big deal. we have to quickly figure out what other country you are going to start cheering for. i am actually of course cheering for the united states. but denmark is my second go-two.

lisa: the ship -- tom: the chicago cubs did not make it for decades. that's important to think of as well. what is your 2023 view? higher bond prices, lower yields? >> we are becoming increasingly more constructive on the bond market as we move into 2023. our view is that the bond market is pricing in more and more uncertainty here. more broadly, volatility and uncertainty, we expected to continue for the rest of the year. in 2023, the fed hopefully starts slowing down hiking, maybe wrapping it up. we do think that is going to be a good time to really start liking and further into the broader fixed income markets. i think it could start a little bit here. we could retest, but yield levels are interesting.

opportunities are very, very real. we are cautious in the near term. we are focused on the income generation of the fixed income. it does not come from capital appreciation, so we can have these entry levels for investment grade corporate's, high yield close to 9%. it is starting to become very interesting and we think it is a bit of a sweet spot from a router asset allocation, compared to equities and other options as well. lisa: a lot of people would agree with you, i want to go broad ahead of thanksgiving dinner and i want to bore my kids with bond existential at. bonds would far beyond what was expected. it did not cause a massive blow up or cascade of default, like so many people fought. we are talking to some people about the best investing experience ahead that they could imagine in bonds.

can you square that? how could the fed raise rates so much and not cause real damage to a corporate debt sphere that blew up in the past two decades? >> i would say we cannot came -- count on that completely. in bond markets and credit markets, they are holding up quite nicely. we still have the uncertainty of a fed policy era. they continued to be aggressive or too aggressive, that could change quite quickly. that is not our base case. we are expecting a mild recession next year and the credit market is going to hold up quite well, as we mentioned. you see a little bit of spread widening potential here, but we are not expecting a total blowout. these are unique times, unprecedented times. i know we keep going back to that. i think that is what the market

is trying to handicap, how different it is this time and how it will play out next year. ultimately, when we take a step back, we are finding the fundamentals are holding up ok. obviously, they are deteriorating, earnings seeing some pressure as you just touched on, but things are not falling off a cliff. that's the comfort we are seeing, that companies are coming into this prepared. they pushed out the maturity wall, they are very focused on making sure they are preparing for tougher times, which is unusual. usually, when you're facing a recession, it comes sort of out of nowhere. it is the unique time we are dealing with. lisa: how much does your bullishness hinge on there being some sort of recession next year? if there's not, the fed is going to keep hiking rates and there will be that much more pressure on the space. how much are you counting on that? >> we are kind of sort of counting on a mild recession next year. we don't think a soft landing, it's not impossible, but in my base case, there's going to be

almost like goldilocks. there will be a mild recession that keeps the fed comfortable, that they have done enough particularly on the inflation side. we need to see the labor market having some cracks, not too much of a crack, but some type of crack. that would be the sort of best case scenario, that we see a little bit of a slowdown, but not a complete fall apart. tom: very quickly here, the heritage of nuveen's municipal bonds. is there value not in municipal bonds versus taxable? >> yeah, we're are finding a lot more opportunities on the municipal side. it has been a very challenging year. flows have been very negative. we take a step back and the risk reward is increasingly interactive. we think municipals are a good

risk reward overall. particularly and a recession next year. we find good value in that space. tom: anders persson, thank you so much. we will get you out here 20 minutes before the people to the west take on tunisia. thank you so much for joining us. lisa, this conversation coming up. we are selfish on this. it is new york, it gets warmer the next couple of days, but nobody has briefed us on new england, new york city, new york harbor hydrocarbons like stephen schork. lisa: and there have been incredibly low inventories of diesel. you've seen diversions between diesel prices and gasoline prices, which will become an issue heading into the winter. tom: it's not about the war in ukraine, russia, saudi arabia, beating argentina. it is about distillates not in my backyard. am i right on that? lisa: a big part of it. did you see the price action

yesterday? plunging in the crude space, brent side following below $85 for the first time since september. opec-plus was considering increasing production, sort of a nod to the biden administration. opec-plus came out and denied it and prices are flying upward. how much is that the swing factor at a moment of real tenuous this about demand and supply? tom: i'm reporting on hong kong, on chong ching. forgive me if i pronounce that room. that has more to do with oil than anything else. how do we deal with that? lisa: people are trying to gain this out and some had of material weight and there is no way. tom: lisa, the family secret is out. we are in a meeting like 18 years ago. tom, we cannot call the show "bloomberg rumors." lisa: [laughter] tom: it was a short list.

this is not "bloomberg rumors and speculation." stephen schork vexed. must listen for your heating bill in february. good morning. ♪ lisa: keeping up-to-date with the first news from around the world. an investigation into fdx months before it collapsed. investigators in new york had been poking into ftx trading. the world health organization warns millions of limes are at risk this winter. -- lives are at risk this winter. in's -- infrastructure has been destroyed and leaving people without power, about one fourth of ukraine's population. china is said to find ant group

more than $1 billion. that would pave the way for an overhaul of the fintech firm. beijing has cracked down on the private sector, including aunt's massive overhaul in 2020. tesla revamps despite fears competition from rivals and ongoing demand. subsidies up to $1100 for new buyers, plus even advertised on a local shopping channel. last month, tesla cut prices in china for the first time in 15 months. billionaire investor carl icahn holds a short position in gamestop. that was around january 2021. shares have lost several one-person -- 71% of their value since then. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am lisa mateo.

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>> we are not so negative about the downsides, we just think there will be more volatility tending toward a low market level. the reason we are not quite so negative is because there are some positives. we do think the u.s. economy will avoid a hard landing. tom: peter oppenheim or with goldman sachs. interviewed by lisa abramowicz yesterday. really interesting on his tentativeness getting into 2023. we are not going to waste time here. denmark, tunisia, jonathan ferro is on assignment. i am sure he will be returning.

lisa and i are here because we don't care. futures up 8%. psycho pipeline was a phenomenal song produce down in new orleans. it is a key oil pipeline along the gulf of mexico. it is the focus now of our next guest. stephen schork, principal of narrowness and acuity on the market. let me summarize for our audience. we are up to our eyeballs in petroleum and the price is going to go down. do i have that right? >> in the near-term, we are certainly risking toward the downside. we have the market that switched , meaning the price this month is cheaper than next month. why are we in this? because to your point, the pipeline, a significant pipeline

that takes oil from west texas that's being produce and takes it to the export market in houston, there is maintenance now that is going to last well into december on that pipeline. your oil flows are lower, but you are still producing oil in west texas. if you can't move it into houston, you have to put it somewhere. it's very important as far as the nymex is concerned, because where that someplace is going to be is up at the nymex complex in oklahoma. we are looking at building supplies at the nymex terminal complex. tom: the surprise to me as an amateur is west texas intermediate breaches $70. had a 69 print on american oil. is that in your realm of possibility? >> yes, now this was one of our more bearish cases. this was at the tail end of our modeling of where it could go. i certainly did not expect a c

-- i certainly expect to see the oil finding a base year, as long as we don't go into a recession. this is oil in the low 70's that the white house has mentioned. if you are sitting there, why would you sell $70 oil when the united states government is going to come in and by 200 million barrels at that price? they are in effect without recession is your floor in the market. lisa: we were talking about a tight market to minutes ago and how oil prices are going to rise beyond $120 per barrel, certainly brent, and close to that on wti. what has changed in the physical market to make that completely an obsolete argument? >> the $130, which is where we were at the second quarter of last year, that is unattainable. we can get back up there, but we cannot see -- we cannot stay

there. that is where we saw demand destruction. that is something catastrophic happening in the supply market. what has changed now of course is the we getting economies around the globe. it is a near-term bearish picture. as we said, the russians are part running -- front running the cap. refineries in europe, fearful of that price cap, have bought all that oil. you are having a hard time selling physical oil. a lot of this physical oil is getting rolled forward into the first quarter, which is going to keep the market supply. the fear now of course is covid, with china. one is that economy finally going to reopen? there is some optimism that it can reopen fully by next summer, but there is still a lot of skepticism in that. without that demand and market, you have this low scenario, the low 70's or low 80's.

this is the bottom of the market, so we are waiting for demand. cap x is challenged. your hurdle rates are not much higher -- are that much higher. you are looking at a market that is not going to bring more oil to the market. your long-term picture is still bullish. it stills -- it's to get to back to the $100 range. but we have to get over short-term hurdles. lisa: can you for see a time where gasoline prices go down and diesel stays high or goes higher? >> that's the new reality. in my hometown of philadelphia, we lost 55% of our refinery capacity. three years ago, we had a refinery in south philly that processed 330,000 barrels of crude oil a day. that was a lot of fuel that went right until our home market. 90 miles of the jersey turnpike,

into new jersey, we no longer have that. that diesel fuel has to come from somewhere. keep in mind that gasoline is your best margin for a refiner, so this is where they maximize. this is where they bring more gasoline to the market, at the expense of diesel fuel. tom: this is so important socially, stephen schork, and you have been so dead on this. if we have a shortage in new england and the greater north east, how do you perceive a government response of this? what is the linkage of "not in my back yard" to government regulation investment incentives to fix this problem? >> the short-term fix for this winter is the northeast heating oil near serve -- oil reserve. we have 10 million barrels sitting up in massachusetts you

also have that for gasoline, two. i'm surprised we haven't seen that yet. here in philadelphia, 45 minutes at the northeast extension, allentown was out of diesel. they closed down one of their gas stations up there because they were out of diesel fuel. we are writing shortages into this market. tom: i don't mean to interrupt. i was in paris, on my way out to cvg. there were lines and lines i have never seen waiting for a gallon of gas. are you predicting that for allentown or albany, new york? >> certainly, that is the risk. i think we will get through this. that is where the price incentive is. but with diesel fuel, we are already running shortages. that was before we even had any sort of heating demand in the markets. we are looking at the northeast, the new england markets that are 70% of the homes or market that heats with heating oil. that is an absolute risk that will continue all through the

cold months. tom: absolutely brilliant here. i cannot say enough about it. yes, i have the males. we protect the copyright of all of our guests. see stephen schork for five pages every day on trucking acuity on the hydrocarbon market. it is like 4:00 in the morning and the lines i saw were different. they were all trucks, all diesel, lined up for miles at gas stations. lisa: and we staved it off now, but could you see that in a couple months time? tom: in short, i guess saying it is possible. it's possible. futures advance up nine points. stay with us. this is bloomberg. ♪

>> stocks can still lag from here. it is not going to express

itself, regardless of what we're doing in tightening and the bond market. >> i think we, like the rest of the market come are looking for a pivot to the next big trend. >> we are going to morph our concerns away from inflation. prices will stabilize. then, we will be thinking more about the recession. >> i think 2023 will be a muted return your, but equities will do better than bonds. announcer: this is bloomberg surveillance with tom keene, lisa abramowicz, and jonathan ferro. lisa: on this day, with a holiday shortened week, it is a quiet week, except that it's not. we've been talking bout this all week. we get the 2023 outlooks. we also have key data coming up tomorrow, including consumer sentiment. tom: it's a data dump. we are squeezing wednesday, thursday, friday into one day. lisa: exactly tomorrow will be the day. especially in light of what we're talking about with 20%

inflation and people going out. how much conversation is not going to be that coin, how do you get rich, but just surviving? tom: let's rip up the script here. michigan is something that gets tossed out. the five-year to 10 year inflation statistic, nobody plays that nobody pays attention to this. 3%. that's not what jerome powell wants. lisa: jerome powell says they pay very close attention to this and care very much about it. we are not there yet. we have seen it fluctuate back and forth. but what if you start to see it go up the? what then? how does the fed respond? what if you see sentiment plunge even more? hold on a second. does that give the fed a little bit of comfort or a sense they can pull back? this might matter quite a bit at a time people are gathering around and resetting. tom: i'm going to reset.

we reset for leftovers on thanksgiving. i'm going to reset with new-home sales tomorrow. what we are really going to do is reset into that reflation -- that inflation report and job's -- and labor report tomorrow. lisa: we haven't seen this yet. you talk about this and i think it's an important point. tech jobs, is that the tip of the iceberg, the idiosyncratic story, or is this something that is a tliv for what's to come? tom: the tech angst is way overdone. amazon is exiting one person, maybe a little more of their employees, and they are hiring in key areas while they lay off people. i have real trouble carrying tech asked -- angst.

lisa: we are seeing movement in china, but it is not feeding into markets. honestly, it is a little bit of a lift. how much is it despite the negativity you heard out of china, despite the fact that there is a bit of cold weather in europe? out there is a sense that people are pushing fast pass these things? tom: i would mention $88.77 on brent crude. $88.78 on brent crude. i hung on every word that stephen short said. --schork said. up to the legitimate angst, i believe he said allentown, pennsylvania with a dearth of diesel feel this morning. lisa: we heard earlier this morning about the energy crisis really feeling a lot of what we have seen in terms of inflation. in the yield space, a very

deeply inverted yield curve. we have not talked about this, but the gap between twos and tens have stayed the same, the most negative since 1981. tom: we are going to recalibrate. lisa: joe quinlan, head of markets tragedy at bank of america and private bank. how do you recalibrate for next year, given the complete lack of clarity? >> it's going to be tough heading into the new year, lisa. we are looking at a recession in the united states. shallow the first half of the year. europe is already in a recession and china is flatlining. it is a choppy market into 2023. we think on the others, second quarter or third quarter of next year, we are going to be buyers of equities, reset in the united states. it is a chop and turn as we go through central bank tightening and energy recession in europe.

lisa: how does that bullish call next year hinge on a quick deterioration in the economy and a quick response from central bankers? >> i think we are seeing the downturn in the economy. i think if the fed just pauses in january and february, you don't necessarily have to cut. that is the green light for the equities to rebuild, put that base in for the next bull market. they don't have to start cutting. think they will be cutting anytime soon. it is just a pause. at the medicine work, see how it is working its way through the economy. a lot of consumers hanging in there. you talk about the labor market maturing. i think we need to pause and build the bottom from the bull market. tom: the pause is there and it hinges on inflation. oh edc came out with a call today with europe at 6.8%. it is lower in america. i think we can do that with bank of america and they would lead

on that. joe quinlan, does inflation actually come down enough next year in america? >> i think it does, tom. you are going to see productivity gains come back, see the economy we can, commodity prices have rolled over. material costs are coming down. i am not in a deflation camp, it is hard landing when it comes to having prices come down hard, but i think we are headed in the right direction. europe is going higher and japan could be an outlook as -- an outlier as well. i think it comes down next year enough that it gives the fed pause in the markets a lift look forward and deeper into 2023 and 2024. tom: we get a pause, then a lift. is it a lift with quality? you have been known for decades with

a comfort and quality ownership. define what that is. is it a free cash flow analysis, persistence of revenue analysis? >> it is going be core competencies, brands, good management. and i think the global breath matters as well. when the fed is done raising rates, the dollar people roll over, so multinationals will have their day again, so to speak. we're looking for second-half recovery in europe. reflation in china and the rest of asia is going to help. we are looking for large-cap quality names to push ahead. it is health-care, technology, financial, financial, industrials in particular. we have a big story out there that we are not ready to talk about, and that is the rebuild of ukraine. it is too early to talk about that, given what is happening there, but that is going to be very important for u.s. industrial [crosstalking] tom: deutsche bank agrees with you as well. i get that for europe and germany, etc.

how does the rebuilding of ukraine assist the viewers here in america. >> remember, investors are more ingrained in europe than here in the united states. they have the plants already over in europe and they will be right there on the front lines to help rebuild. it's not like we are going to be exporting caterpillar machinery. we are going to make it in europe and senate right across the border. u.s. companies are very well positioned to tap into that future demand coming out of europe. lisa: there's a lot of time before then. as we look out to next year, one consensus has been a shallow recession. i know you have been talking about that as well. how do we know a shallow recession is not the new transitory? >> that's a good question and we won't know until afterward. here's what i tell clients. recessions, we have had them before. they not terminal. here in the u.s., recessions typically cleanse. we shoot the zombies. bigger players get stronger.

we don't know if it will get shallow or not. going into the recession, households are in good shape, housing market has rolled over, we know that. this is a recession that is well telegraphed and we are well prepared for. tom: joe quinlan, thank you so much, we appreciate it. we will get all the different views from bank of america here. we make jokes about it, but this is really serious stuff, particularly after this absolutely unique year. how do you recalibrate next year? i get page one and page two. as peter lynch would say, what do you write on page 40? lisa: right now, page one and page two, a couple of themes have emerged. number one, by bonds. number two, we are going to see peak dollars next year. tom: it has been wrong for five

years. lisa: correct, a lot of been wrong for a long time. you could see china being a potential outperformer because of how much bad news has been baked in. a short, shallow recession is also consensus, and that is also a question about whether that is actually achievable. tom: that's always hazardous. i have trouble with that. i say this with a lot of force, corporations will adjust and adapt. what is day two on disney? what, you go to disneyland, go to the magic kingdom, and do a photo shoot? lisa: there's a lot in terms of streaming strategy. tom: disneyland in anaheim is so much better than orlando. do you agree? lisa: i have no idea. i haven't been since i was five years old. i couldn't do the teacups. you like the teacups?

you like spinning around? tom: i did a show once in the teacups. it was great. the teacups are great. futures up 14. good morning. ♪ lisa m: keeping up-to-date with news from around the world. with the first word, i am lisa mateo. genesis is warning potential investors it may have to file for bankruptcy unless it can raise money. we merck has learned the firm is struggling to attract funding for its lending unit after the collapse of ftx. genesis has spent the last two days seeking at least $1 billion in new capital. in china, an increase in covid cases has led authorities to reintroducing measures like expanding testing and locked out. it is now estimated that about 1/5 of the country's economy has been affected. that is despite the central governments call for more targeted, less disruptive covid

zero measures. the european union's executive is designing an emergency natural gas price gap. it is trying to avoid the kind of record highs seen in august, without risking the security of supplies. the european commission will discuss the final shape of the so-called market correction mechanism today. best buy has surprised wall street with an upbeat outlook. consumer electronics retailer raised its profit forecast even as u.s. shoppers cut back on spending on discretionary goods. best buy also said that comparable sales are now expected to fall only 10% this year, slightly better than the previous forecast. the effort is step up in share trading. a french bank has agreed to merge large parts of its equity business with alliancebernstein. the two will unite their cash equities trading and re-emerge under a joint venture. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i am lisa mateo.

this is bloomberg. ♪

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>> i don't see a self-fulfilling or self-perpetuating way to price spiral. if you think we are into recession, as the -- as i think we are going into, not only european and global u.s. recession, that is very negative and all sorts of ways. sadly, people are going to be losing their jobs on the back of that. we know from experience that does bring inflation down. inflation is going to be coming down. tom: david riley, a chief investment strategist. they tea off here, england and the u.s. on friday.

jonathan wants me to come below 59th street. we will see. lisa: i think both of you will enjoy yourselves. tom: maybe you guys could phone in, call in. we could do remote. that would be great. right now, watching denmark and tunisia. don't you think it is going to be a totally different game after what the world just witnessed with the huge upset of argentina? lisa: how much are we going to start to see the underdogs really start to make inroads here? argentina was one of the leaning candidates to win. tom: tom keene and lisa abramowicz evaluating today. lisa: [laughter] why are you asking me? tom: because i'm delaying getting to isaac boltansky. he is in cycle p take on ohio, which i'm told is one of three or four states which really mattered in 2022 through 2024.

he is encyclopedic on the beltway chat. isaac, ohio, how do you want to adjust after what you saw in that senate race? >> i think there are many takeaways from election night, but one of the main ones for me is neither florida nor ohio are purple states anymore. i think that we need to operate under the assessment that both of those are going red. that really changes the electoral map for the next presidential election. tom: i strongly, strongly agree with you. the red got redder and the blue got bluer. what does that mean for the house? how do they prosecute gridlock given the polarity that we learned about the first tuesday of november? >> when we look at the composition of this new congress, i think part of it is due to our primary system. when you look at the house of representatives, what i find interesting is roughly only 15% of those 435 seats were really

competitive, which means that the rest of them were decided in the primaries. frankly, that's not really good for governing. it's good for politics, because both ends skew to the extreme, but it's not good for the actual governance of the country. that means we are going to have to look toward these deadlines. once again, all of us have to focus on deadlines, whether it is spending or the debt ceiling. there is also forcing mechanisms for legislating. lisa: meanwhile, we're looking at ongoing concern for the labor market, not with respect to layoffs, but strikes. i want to bring this to you because i have seen a slew of notes in concern about this. a huge railway strike, as the standoff kind of hardens with the biden administration's outreach to them. how likely do you see some sort of stoppage in the rail system in the united states, given that this is really pervasive and has gone on for months now? >> i will tell you, there is real, palpable concern in policy circles that we are going to have stoppages. i would say this, even. doing my rounds on this, there

is concern and policy circles that you are going to start to see pressures in these marketplaces and ripple effects even before stoppages. you have a lot of folks around the country who are traveling, not to mention the goods and christmas time and everything else that comes out of it. my contacts generally believe congress will be able to act here. there is a law called the railway labor act. that lets congress come in to either impose a resolution, based on what the president's emergency board submitted this past summer, or to basically punt and kick the can down the road, to require operations as is for three months or six months. my guess is you will get some movement closer to the deadline, and part because there is a republican house. that republican house is not going to be nearly as friendly to some of these unions and will most likely call for a reversion back to that plan in the summer,

which was not as accommodating as some of the one-off union agreements we have seen since then. lisa: there is a broader issue. we have talked a lot about the shift in power to labor, the worker, to basically be able to demand higher pay, especially in light of inflation. right now, it is getting harder. we have talked about a loosening, a bit of a slack in the labor market. from your vantage point, politically is there less willingness to allow labor to keep the upper hand, at a time when economic growth and frankly the mix of congress has changed? >> i think a great example and we think about this is the biden administration's independent contractor rule, which came out and spooked some of these folks around the ridesharing acts like uber and doordash. the biden administration a less aggressive stance in that rulemaking than some expected. some of that is due to the

limits paired part of it is also that they don't want to be sponsored over driving up costs even further for the average consumer. tom: very quickly here, running out of time, but i have to go to this. isaac boltansky writing on something i never thought you would write on, which is congress doing something about targeted stablecoin. are we actually going to get regulation to police this industry blowup? >> the simple answer is that we are not getting comprehensive reform anytime soon. the most that congress can be expected to do with crypto is to focus on something they kind of understand, which is stablecoin. it looks a little bit like money market funds, a little bit like deposit accounts. they get that in that is something they can legislate on. the rest of it, i think we are years away from a comprehensive legislative solution. tom: so instead of breaking the buck, he break the bitdog? what is stablecoin? >>

tom: i can't say this with a

straight face. stablecoin. sonali was leaving on the -- leading on the doge. lisa: my kids were, too. it was based on a game they played. you could get that coin. tom: how is that different than what we are going through right now? lisa: it's money they have online in the metaverse. tom: on a tuesday, equities advance, futures up. s&p futures up good or .3% at 14 points. vicks comes in at 22 points. david peterson --dana peterson joins us soon. bloomberg surveillance, good morning. ♪

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tom: bloomberg surveillance. lisa abramowicz and tom keene. jonathan ferro on assignment. we'll is what lisa and are following. $89.10. that is not a small item. lisa: it's amazing how much it has gone from one side to the other. it has been under $85 yesterday,

the first time since september, then you blink and you miss it. tom: an update in the last 60 minutes on stablecoin. sonali joins us now. give us a look into the life of bitcoin. sonali: genesis may seem -- may seek bankruptcy. a very intimate view into what the balance sheet looks like. how do you finance the crypto ecosystem? you are asking about stablecoins. there's a whole other thing happening, where there are dozens of private equity firms looking at ways to on board into private equity funds using stablecoin. i heard you guys talking earlier, it is essentially backed one-to-one to the dollar or other currency. tom: are they looking to save genesis, or not say but assist genesis? big, smart private equity, big, smart hedge funds, and major banks? sonali: it's like anything else

in distress. what do i get for my money? tom: they don't do a warren buffett preferred, do they? sonali: there are plenty of people on the one who want that to happen. they recoup some money, rather than lose it all. you see with ftx, for example, they had nothing, and now they have $1 million. lisa: what's the oxygen between stablecoins and something more established and used for some sort of substitute fiat come -- currency? and bitcoin and the other assets that don't have the same kind of ballast? sonali: on one end of the spectrum, i hear you talk about this a lot with the sec, the war in the united states between tokenization. tom: what? sonali: tokenization. are these listed as coins or

not? then, you have stablecoin, which is essentially one-to-one with certain, safe assets. you see the reserves, a big thing people are really, finally coming to in this industry. we want to know what is backing everson go asset here. it should trade one-to-one with the dollar if it is a u.s. stablecoin. lisa: what is your sense of the next development in contagion? if we are midway through this meltdown, what is the breadth of losses, pain, potential opportunity, given that financial institutions are interested? sonali: we were talking about this yesterday on radio for a bit. when mount cox failed, you had fortress come in and buy bitcoin claims at hundreds of dollars. if bitcoin it flew past $10 million, you are still pretty rich. can you buy assets on the cheap? some of these are purely cash, some are loans, some are tokens.

to your point, without regularity -- regulation clarity, people are concerned. tom: are people trying to buy bitcoin because of the $60,000 value? sonali: there are certainly people who come on this show that are trading on the side, i will tell you that. [laughter] tom: sonali here with us until late tonight. for crypto on bloomberg television as well today. we migrate to something more stable, and that would be economics. dana peterson of wesley and and the university of wisconsin economics at madison. i am thrilled she could join us this morning. oecd came out with a big report. yours is more important. how much have you tweaked your view for next year on gdp? >> we think the economy is probably going to be flat next year, and that incorporates a couple quarters of recession. maybe the first -- the fourth quarter this year is negative, but most of the brunt we think

will be in the first quarter of next year, minus 1.5 percent. second quarter, minus 4/10. then, an increase on the back half of next year, all folding into flat growth for the economy. tom: how do you respond to what the conference board has seen over the many decades of when inflation spikes up, as a general rule, it comes down with quite a plunge, with great repeated? do you buy that we could see that? >> when i look at components of what's driving inflation right now, a lot of it is rent. the other aspects our services, non-housing services. but when you look at rent, they are really sticky. they tend to reflect what has already happened in the housing market. we know that rents are difficult to come off because people being pushed out of the new and existing home sales market, they are going to go into the rental sales market. that means we are probably going to have a period of time where rent will push up inflation. lisa: how much do you buy this

idea of a shallow recession? >> our own forecasts suggest that yes, it will be shallow. indeed, along with that, you might not have a really big hit to the labor market. a lot of that is a function of labor shortages. if you have companies still hiring people with those in-person services and other types of jobs where you have to physically be at work, that is going to support consumption. we not -- we may not have a really deep recession. lisa: that is a bit of a bet on the fact that things will deteriorate quickly enough for the fed to pause, for the lag effects to actually kick in and show us that there is active deceleration in inflation that gives the fed confidence. without that, if there is momentum, how much does that really cast this idea of a shallow recession aside? >> i think the fed is looking at the data. already, the housing market tends to react very quickly to interest rate hikes.

we are also starting to see consumers down back their expectations for how many durable goods they're going to purchase, especially things that need to be financed. the fed is already seeing some of that evidence. but certainly, there are lags. it is not clear how long those lags are. i would see just that the fed still has some way to go in terms of raising interest rates, but that those interest rate hikes are going to be smaller than what we have seen. tom: dana, i am fascinated. this is the heritage of the conference board, which going back to 1947 as always aggregated our economics. are we so polarized as a society, of the haves and have-nots, that you cannot aggregate your macro analysis as the conference board has done for decades? >> the good news is that even though we do have aggregates, we also look at individual income groups, especially with consumer confidence data. tom: what do you see? >> the youngest and oldest

groups are more disgruntled than the folks in the middle. people at the lower end of the income spectrum are being hit harder by inflation. we can look at those details there. tom: please, lisa, pick it up. i am just stunned. lisa: i'm wondering how much this has to do with homeownership. if the younger people are not able to get into homes and seeing rent increase, and it is absolutely prohibitive to go and buy a home for the first time because mortgage rates are 7%, how much does that sting wishing feature breakdown between the haves and have-nots? >> it is certainly a distinction feature. but let's not forget during the pandemic, the biggest increase in homeownership was among younger groups. the millennials, because many of them have children now, they have been able to get jobs and have accumulated some savings. certainly, there were injections of cash from the fiscal stimulus. that help to them at least

during the pandemic, those that got in their early to buy homes. tom: the millennials have their kids investing in doge off their couch, that's how bad it is want to go back to the inflation estimate for december before the fed meeting. is that a mystery to you or do you have some confidence in the conference board pick for what inflation will be before the summer 14? -- december 14? >> we think inflation will begin to ease, we probably reached a pick -- a peek earlier this year. it's really important, in terms of bringing down the aggregate level of inflation, and also things like utilities for all the people who live in homes. certainly, we are concerned about the rents and services prices continuing to rise and place pressure, upward pressure, on inflation. tom: dana peterson, thank you so much. did she tell me i was

disgruntled? i think that's what i heard there. lisa: i was distracted. i could not let my kids put real money into coach coin, but they were really familiar with it because they play a lot of video games. tom: up almost $400 on bitcoin. i don't know what to make of it. on radio, matt miller and paul sweeney will chime in on television this afternoon. lisa: conflating ripped on bitcoin i have learned [crosstalking] [crosstalking] i think it's import to highlight how much love we really do get. we will talk about the road ahead as we try to chart something of a consensus into 2023. very banister, nadia level, brian nick all joining us on the 9:00 a.m. show. i'm curious how much people are looking to china as the poor full deciding factor, to your point earlier. also, global growth. tom: oil up to $89 17 cents,

going up near $90 again. that is the back-and-forth we have seen today. not much else going on. yen with that move yesterday. it comes back a little bit with a stronger yen. i do want to go to the seven year auction. we make jokes about it, folks, but i find the in between seven year option a lot more informative. do we have auctions next week? lisa: i think that's going to be on hold. i'm pretty sure. i think this week is the auction week. one thing i am watching is abercrombie and fitch. they did better than expected, which is surprising, because you think marginal income not go to teenagers. it is interesting that net sales came in ahead of what the expectations were. it just highlights this point. a bifurcated picture of retailer to retailer. tom: over the retail -- over the years, have there been 12 abercrombie & fitches?

what do i know about that world? lisa: i don't know. what's the one where everything is too small? tom: glossy a potential, i think. look at the lines outside sephora. lisa: talk about a racket. but really good stuff. [laughter] tom: we will see. ♪ lisa m: keeping up-to-date with news from around the world. with the first word, and lisa mateo p u.s. prosecutors have begun an investigation into ftx month before it collapsed. prosecutors in new york started poking into ftx massive exchange operations. it was part of a sweeping examination of cryptocurrency platforms with u.s. and offshore arms. the report -- the world warns millions of lives are at risk in ukraine this winter. they cite damaged or destroyed infrastructure that has left 10 million people without power. that's about 25% of ukraine's population. goldman sachs is forecasting the

s&p 500 index and its earnings will see little change next year. the firm expects margins will contract due to upper cost pressure from wages, commodities, goods, and services. they urge investors to own low risk, like health care and consumer staples. china reportedly is set to find ant group $1 million -- $1 billion. that would pave the way for an overhaul of the fintech firm. beijing's crackdown of the private sector included the halt of ant group's massive ipo in 2020. waiting times for apple's most expensive iphones are rising to what analysts say are record levels. that is happening just as the holiday shopping season kicks off. according to apple's website, u.s. customers who order today would get an iphone 14 pro delivered in new york on the summer 30th. the delays threatened to hurt sales and derail a rally in apple stock. global news 24 hours a day, on

air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in over 120 countries. i'm lisa mateo. this is bloomberg. ♪

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>> we are going through an inflection point right now, like we saw earlier this summer appeared we are starting to see that shorter-term signals and longer-term signals are kind of at odds. we, like the rest of the market, are looking for a pivot to the next big trend. tom: catherine kaminski without for simplex. really great feedback yesterday on trading, trend following. she is up 40% this year, down from being up 55% or something like that, doing better than good on the trends this year, even though it has been a tough number of weeks. at any other time, i would pick up on that right away. barry ritholtz, important books

in the wisdom of decades on how not to lose money. of course, this gets huge numbers for bloomberg and the podcast world. barry, we are going to stop now. this is without question my most important conversation of the week. you and i remember executive life is one example that in a 7% money world, they guaranteed 11% or 12%. there is always a yield hog out there. permeating crypto, and i go to crypto.com, which is a sponsor of the world cup. we can get a calculated reward up to 14.5% per year on crypto. we can get rewards, a stablecoin reward, up to 8.5%. it is the same old shell game, too good to be true. >> i have a vivid recollection during the pre-financial crisis,

when the 10-year was yielding 2.5% or 3%, and the securitized subprime mortgage sellers were saying this is just as safe as a riskless treasuries, only it is picking 200 to 300 basis points more. i have a very vivid recollection of saying to someone, either you are going to win a nobel prize in economics or go to jail. there is nothing in between. that very quickly unraveled and proved to be true in the great financial crisis. it is amazing that it is not even 15 years later and only instead of 300 basis points, hey, we are going to give you 1000 basis points more. risk and reward are two sides of the same coin. 15% guaranteed in a 0% world, [crosstalking] tom: even 8%. >> right.

it is outright absurd. tom: a great homage to mark pittman, a fabulous reporter for bloomberg, with that idiocy of 2007 and 2008. there was something called libor or libor lis. i would suggest the price of bitcoin. is this catastrophe we are seeing hinged to the price of bitcoin or hinged to something else? >> it's not the price of get -- of bitcoin, it is the growth. tom: unit growth? >> know, price growth. we can gary you 15%, asterisk, look in the footnote, as long as bitcoin is growing at 20% per year. we know that eventually comes to an end. it always does, always has, always will. they say we are going to give you something guaranteed, but it is dependent on a highly volatile asset that has an asset

-- that has a long history of swinging up and down, going through massive crypto winters from day one. this was deeply flawed, but it appeals to people sense of a magic money machine. tom: one of the magic things here is that i don't manage money. what holtz does. --ritholtz dust. i have a big issue with people who go to billionaires who got in on the ground floor. they are still in profit mode. how do you perceive how much damages out there? how may people have been run over by bitcoin from $20,000 to $16,000, or dare i say it breaks even lower? >> i think of bitcoin and some other crypto as a single large-cap stock. when bitcoin was $3 trillion, it was 1.5 apple?

two amazons? six facebooks? it is not an asset class like fixed income, equities, real estate. it is a pretty narrow group, with a very, very deep narrative that had a lot of very, very strong adherence. the problem is the narratives have all broken down. define turns out -- defi turns out to be a fantasy. when trouble comes, people ask where the regulators are, who is going to protect us? [crosstalking] tom: it's not audited, it's not this, it's not that, and it is foreign, offshore. how do you regulate it? >> the foreign exchange commission can regulate securities. how do you define bitcoin as a security? it is an asset that trades, but arguably, the reason

gensler hasn't wanted this in an etf is that there is no control, no audits, no ability to guarantee the safeguards of a trade the way we can with every single share stock, every single bond out there. it is a very, very different regulatory environment because you have control. the whole purpose of bitcoin or other cryptocurrencies is decentralized, user-controlled, transparent, no need for regulators. that turned out to be a fantasy. tom: let's switch gears here for the last minute. do your shareholders want to do this in 2023 or are they petrified? >> we have done a very good job telling people not to think of weeks and quarters, but years and decades. our clients are much more concerned about 2030, 2035, 2040.

tom: i'm not concerned about 2040, but jonathan ferro is. >> they are concerned about their retirement, fully the p, things like that. they don't matter quarter to quarter, year-to-year, they matter over the arc of time. any given year in the market can be plus 20%, -20%, or worse. but there has never been a 20 year run in u.s. history where equities have been negative. very, very few 15 year runs. we have had a huge decade from 2010 to 2020, then 2020 and 2021 were massive. you look at these gains and you have to just say this is something you have to accept occasionally some drawdowns. the difference between equities and crypto is equities are a future stream of income, it is a discounted cash flow. whereas crypto, you're just

helping the price go higher, and that's very different. tom: hate mail already coming in. barry ritholtz successful again. he really downplays it. i am doing a podcast. what's the major theme? >> he talks about the fed, credit, not understanding where we are in the cycle and how costly of an error for traders that is. tom: in the cost there is a new risk-free rate. we will talk to reynolds about that next time. this afternoon at 1 p.m., after a genesis story this morning, bloomberg crypto. jonathan levin will be with us, jeremy alere as well. they advance. bloomberg surveillance. ♪

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>> right now the s&p is up. the countdown to the open starts right now. >> everything you need to get set for the start of u.s. trading, this is "the open" with jonathan ferro. ♪ lisa: we've been with the big issue, more pain. >> ther