>> more than halfway through the trading day in new york, stocks are not doing, treasuries are rallying. this is "bloomberg markets." here is your check on the markets. it makes no sense to me. headlines at a vladimir putin talking about nuclear war. china potentially reopening. more monetary stimulus coming out of the pboc. stocks could much doing nothing, bloomberg dollar index is down, there is a safe haven in the treasury market, 30 year yield

below 3.5%, crude you would think it would be a boost. it is down again almost 3%. we will try to work all this out . when it comes to the s&p bank of america has a target that is 50 points shy of where we are. we spoke with someone earlier about where the opportunities in equities like. -- lay. >> do not index, outdex. the megacap stocks are value cap -- traps. by the rest of the s&p, i think not having exposure to stocks and sticking all your money in bonds and cash is a mistake at this point. >> joining us to see where the s&p sits on a technical level is bloomberg's just.

i always go to the technical levels we are below the 200 day moving average and below the 100 day. where are we? >> stocks are stabilizing a bit today the s&p 500 is below its october. it has broken away from the uptrend, it makes it tricky to see where this. it is below the downtrend since january, breaking above that briefly last week. because of the losses from the last few sessions it is below the october low where we saw the uptrend go higher. maybe the bears are a bit more in control. when i talked to someone they said it was an update that could change the course, even if it breaks above the 200 day moving average that currently is a low bid over 3050. they are looking for more conviction. if you are looking for safety, august 15 intraday high, the

current rally of the summer did peak. they are looking for the s&p 500 to move about that to have more conviction for the balls. -- bulls. >> are the individual stocks seeing the overall pressure as the indexes? >> it is above 50%, but over at oppenheimer he has flagged, looking at more extremes. 20% for the broader s&p 500, rather than closer to the 70%, closer to that 70% threshold that is where stocks exhaust that. there is a lot of improvement, even when you see what is happening with the 10 year yield, that could potentially bode well for equities. that is something jonathan, who covers technicals, says that potentially bode well for the balls -- bulls with treasury yields. >> let's go over what we know

with how rallies act and what happens after. we typically get the bear market rallies that trigger a boatload of short covering. than the shorts accelerate and drag the index back down. it keeps going in a circle, is there anything breaking the circle? >> i was looking at a client from bank of america yesterday, institutions were buying up shares last week and they work a riskier part of the market. technology, and shying away and selling more defensive network -- sectors health care. retail selling on the flow data, could be a contrarian indicator. bank of america was flagging over the next two weeks, is historically a strong time for those flows. in december the first part of december is weaker for the broader equity market. typically obviously except in the latter half of the mark -- month.

it will be interesting to see how the flow data looks like when you are looking at what is happening with shorts, coverings, and how exactly institutions are positioning themselves right now. >> absolutely right, love it. let's get more insights, i am joined by kelly cox, u.s. investment analyst. we talked about the technical set up, positioning, institutional. investors what is the take away? it does not feel like anything new fundamentally. guest: i think a disease is say the 200 day is an important level. technicals a side there is not much that has changed here. we had some good services data, that the market did not like because of inflation. we still see encouragingly strong economic data considering where interest rates are. we tell our customers to focus on that even the panic and fear is settling back into the markets. >> on the fundamentals, the fundamentals, this bring me back to china.

if we had talked about fundamentally china reopening a few months ago that would have been a huge upside for the market and potential growth. we finally get that news along with monetary stimulus and commodities do nothing. what leads what? guest: people change their minds quickly come he had to understand how far we have come and how quickly the market changes is mightier. i think -- mind here. people have encouraged about the economy and the globe and have walked past the china reopening thing. that is why you see industrials rally, global companies expose rally, since the october close, we have moved -- past that. >> it is a buy the rumor, sell the news sort of theme. next week when it is central bank super bowl, what have you priced in in the market? >> central banks are in focus,

40,000 people are watching powell on youtube, breaking down all of his words, you have services have come out, cpi next week and then the fed announcement. people will be picking apart, we have priced in the rate hike slowing with the 50 basis point move. this is a shift, not a pivot, rates will stay high for a while. that change the game we think about the markets and what you are investing in. >> how should i change? guest: think about this, we might be in an early bull market if he did not could not cannot to the lows. it is a tough in -- operating environment for the companies. investors will favor cash flows and profits. it is not a sign to pile back into risk. this is more purgatory. this is not bad, it is a point we have to be selective and look at quality risk with emphasis on the quality. >> that sets us up for next

year. it feels like consensus emerging is that the first half be heavy in the second half will be better. at little bit of growth, the recession, then we get better. if that is it, then we are worried, we are positioned for the same consensus, strong cash flow, dividend payers, strong margins, how do we avoid that trap? >> fear is good for stocks, when we are fearful we hedge, taking chips off the table. if things come out better than expected, that they have throughout this year, investors are more apt to jump back in. they will buy back in because there is so much cash on the sidelines. i will not say things get better from here, i have no idea, i am a cop half full -- cup half-full kind of person. they underestimate the fed's chance of landing this. >> what do people do with their

money? spent in a recession, or save it because of they are scared of what is to come? >> right now they are spending it, they seem to love spending money more than most economists think. we are not seen inclinations of financial caution because the job market has been so strong. that is what i am watching, what -- job market leading indicators, job openings, to understand how healthy the consumer is. it is tough, to understand. it without damaging the job market too much -- we think the fed can land it without damaging the markets too much. >> i think so, it has been a crazy year, 2023 can be just as crazy. >> kelly cox, thank you very

much. tom now for -- time now for bloomberg's word news with john hyland. >> vladimir putin calls russia's nuclear arsenal a deterrent factor in war and he stopped short of promising not to be the first used one. he says the threat of nuclear war in the world is rising, he says russia will defend itself and its allies all the means that is necessary. in germany, law enforcement officials conducted raids breaking up a coup attempt, they detained 25 linked to a far right terrorist group wanting to overthrow the government. is the biggest ever german rates to target extremists. beijing will now allow for some people to quarantine at home instead of in centralized camps. they ours wrapping virus test to

enter public venues. covid zero left people stuck in a cycle of outbreaks and lockdowns. it -- u.k. home prices fell the sharpest rates in 14 years things to rising mortgage rates, it fell 2.3 percent, the third straight decline, typical property in the u.k. cost a little more than $360,000. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am john hyland, this is bloomberg. ♪

- i just got the new job! - oh my god, i'm so excited for you! - [narrator] if you're ready to advance your career, southern new hampshire university can help you get there. - [speaker] southern new hampshire university has changed my life tremendously. i went from thinking college wasn't for me to graduating, to getting the job. - [narrator] with over 200 career focus programs, snhu can help move your career forward. - [speaker] i have my degree and it's something that no one can ever take away from me. - [narrator] reach your career goals at snhu.edu. alex: this is bloomberg markets, i am alex. peru's president pedro, has

announced a disillusionment of congress, calling for a new constitution. this is hours before an impeachment debate. this escalates a political crisis and puts peru's democracy under threat. the dollar peruvian soul, off by 1%. we will keep you updated on the story. it has been a dismal year for u.s. corporate credit. they are reporting a $70 million loss on debt. you have the bank of america, j.p. morgan and kkr betting on a strong comeback for the better debt market next year. joining us now, cochair of debt markets over at kkr, also joining us is chanelle bassett.

>> i think we see the economy with fundamentals declining. we are seeing with -- a lot of interesting opportunities with credit. if i have to pick one, it is hard to pick one, there is one area where we have to tell people you need to start striking today. that his deployment into private credit. it can take all types of forms and structures. we think having leadership there and leaning in with the traditional capital markets shut for a while. >> you see what is happening with credit over at blackstone there is nervousness in the market. wisest the bigest conviction play when were -- investors are worried about next year? guest: if you think about it, there is a lot of private equity dollars raised in 2021.

it will get spent as m&a picks up. without a lot of leadership in the public markets and new issuance, stepping into new transactions you can be a real leader. it is a lender market. you get real pricing, oid, structure. you are also getting call protection. extending that higher income for longer. that is where the real opportunity to make multiple money is through that extension of call production. >> your talk about private markets, but what about public markets? there are real names that see dramatic selloff in the last couple of months. do you think the mark has thrown out the baby with the bathwater? are there names you can look at the snap up? guest: absolutely, what we try to do in the public markets is to be that liquidity when others look for that liquidity. the 50,000 foot level, the

market is not for sale. there are a lot of interesting opportunities in situations that are for sale. taking advantage of where people need liquidity, motivated sellers, motivated need for capital. that can be funds, mismatch assets and liabilities like we saw the u.k. pension during the ldi volatility. it could be refinancing is coming up and people need to step in and provide new issuance within the public markets. alex: is it in investment grade versus junk bonds? high yield versus leveraged loans? where do you find the upside? guest: idiosyncratic situations. company by company. subsector by subsector. waiting for opportunities where people need liquidity rather than necessarily broad-based data. >> i've heard you and your colleagues talk about the idea

of timing the bottom before you start to get into the market. beyond that, do you have a sense of what the bottom is? where the spreads need to go from here? what high yields look like at the bottom of next year? guest: timing the bottom is superhard. the market is so fragile right now that weighting can be a dangerous game. starting to strike now the way should be thinking about credit. if we are a higher resting heart rate for rates at a long period of time, valuations will be lower. credit seems attractive relative to equities. the market is essentially set up most like a tinderbox ready to explode. when there is consensus, conviction there, a lot of caches on the sideline that will step in and there is not a lot -- cash is on the sideline that will step in. >> banks are feeling burned,

j.p. morgan of them multimillion dollar gets, the pain really is the leveraged loan market. how much propensity do you have to two by home loans at scale? guest: it is out there, people know it is a pricing exercise on some, a credit decision and binary on others. that is one area of the trade where you can show some leadership and step in. there is a lot of other idiosyncratic situations. people making decisions on certain subsectors. daily liquidity flows that look for liquidity that is equity linked. it is not necessarily the home loan trade. there is a lot of refinancing coming up. new issue come a lot of product from the syndicated home market to the high yield loan market. a lot of product go from the syndicated home market to the high-yield credit market.

even more opportunistic the spoke structures. alex: i hear you on the idiosyncratic part of all the different areas of the market. do you feel there are sectors that have the best bang for their buck? even regions. is there a place that is attractive? guest: it is contrarian, we like cccs. you look at the structure of the market, there is not a lot of incentive to take risk in the public market. a lot of the market is restricted on how much ccc it can by. 50% of the high-yield market is double be. -- double b. this is ccc at time of issuance. this is not necessarily deteriorating credit risk. you do not need to reach for risk or stress to get really interesting double-digit returns. >> it is clear you want to be

diving in more. it is clear you want to take on some riskier. what is -- risk here. what is the pace of deployment? when will you reach your peak? how many billions are talking about in a couple months span? guest: credit as a whole you should be read increasing your asset allocation. if you talk about deployment that can take years. it takes time for the new issue machines to pick up and make an allocation make sense today. history tells us the markets bottom before the fundamentals. fundamentals are still going down. being prudent, making asset allocations and private situations make sense. it is not an all in situation, is not the beta trade. >> what are you avoiding? guest: businesses that are price

takers instead of price makers. when you look at management teams and we talked to management teams a lot a lot of businesses are doing really well fundamentally. they are taking price early. they are taking markets leading businesses, secular tailwinds. where they can take price and pass it on to the consumer are the things we can focus on, keep it simple. alex: we appreciate it, chris sheldon, head of credit for kkr. one update you on the breaking news from a few moments ago. peru's president, announcing a temporary dissolution of congress a few hours before impeachment debate. assets are falling, equities are finding a bottom, you are still seeing the peruvian soul still off, we are off the highs of the session. we are looking at live pictures

in peru as congress starts a impeachment session on pedro and he temporarily dissolves congress. we will keep you updated on the headlines as a cross. this is bloomberg. ♪

alex: this is "bloomberg markets ," i am alex, this is something that caught my eye i'm taking a look at carvana come a lot happening with the company the stock totally decimated on wednesday. wall street pessimism spread, spread, spread a big decline on big volume. the largest creditor signed a deal in active negotiations with the company, you have analyst slashing the 12 month forecast by 89%. all the way down to one dollar.

that is a really intense price forecast/. that comes -- slash. that comes after friday where they prevented creditor fights to have complicated debt restructuring in recent years. they are trying to divert a disaster in the credit market while the stock goes lower and lower as you see that downgrade by 89%. this was a pandemic darling, and hundred people bought their cars during the pandemic from carvana. when you had a supply issue with cars it is a different story. that is one thing i'm watching, coming up the bank of canada raising interest rates by 50 basis points. we are breaking it down with avery, i had a meeting on air with guy johnson, was today hawkish move or a dovish move? you have bonds in canada selling off, yields are higher in the u.s., you see the opposite as well. we are also watching in the

dollar cad there with the dollar moving higher. you're looking at the dow jones up by .1%, the s&p goes nowhere, the nasdaq is just down by .2%. this is bloomberg. ♪

>> i am john, welcome to bloomberg markets. alix: i am alex, let's get a quick check on the markets. what i am checking is a lack of action in the equity market. s&p going nowhere fast, flat, having a hard time with coming up with direction. the bond market is a different story the dollar is trading heavy and you have a bid coming into the bond markets. i cannot make heads or tails of it. it does not feel like risk on and it does not feel like safety. you are looking at the 30 year yield below 3.5% and we have not

seen that since december. one thing to point out, i am an oil geek, you have a crude -- you have crude at 72, 73. >> we see the deterioration in once hot energy stocks. we continue to track that, in movers, we have our eye on car vana, trading is resuming out of those circuit breakers. investors are nervous with 35% drop. you have the story of different outlooks, campbell soup pleasing the street with its performance up 5.5%, state street with a commitment to buy back stock. a crowdpleaser. you see the potentially recession proof play in brown foreman, though shares are down

7%. alix: let's talk about a main mover in the market, the bank of canada raising rates for the sixth straight time. investors are focusing on the language that leaves the door open for may pausing its hiking cycle. >> they will pause, without a doubt they will pause. that is why the second q2 will be difficult. once it plateaus, if interest rate is 4.25 and inflation is high, that is easing, that is more inflation. they have to catch up. we still see interest rate at 6% at the end of next year. john: a lot to watch on the interest rate front, let's get another perspective on the bank of canada. avery is the chief economist with cibc capital markets. it is miracle day, raising money for a children's charity. he has a t-shirt on, you have the economist brain working overtime after the bank of canada decision. what is your reaction?

>> the phrase you use, it is a may be pause. is a 50 basis point, it is not a small move. they are still concerned about inflation. they are signaling it might be high enough, they are not committing to. that by any means. they are considering if they need to raise rates further. we see signs of slowing of an economy. disagrees that is coming on as renew mortgages, and canada you do not have a 30 year mortgage come your mortgage comes to every 3, 4, five years you have to reset it at a higher rate. that will squeeze the household spending. the bank of canada is thinking maybe these rates are high enough to do the job. alix: this is bring up the easy hikes, that earl davis was talking about, is done. does that mean the recession part of the scale is tipping higher than the inflation part?

recession growth fears are more important than inflation? guest: the bank of canada wants to cause economic pain, they are cheering on these signs of stall in the economy. they will not be as quick as financial markets are thinking to provide any interest rate relief. to me, the big interest -- mystery, the curve is inverted after five years. we spend a briefing flirted -- a brief earlier tatian with rates at these -- brief flirtation with rates at these levels. to get that stall the need to keep rates at this level for the entire 2023. i think the bond market in both canada and the u.s. is counting on relief coming from the central banks as soon there is a bad number here or there in the economy. i do not think that is where we are at all. john: speaking of the u.s. tieback to the fed as we await

next week's decision by the u.s. central bank. if we see a smaller hike by the bank of canada, there would be a bigger narrative around the widening divergence between canada central bank in the u.s. federal reserve. given how the markets anticipate a further move higher in u.s. rates. is this decision a nod to the fact that canada cannot be too far out of line with the fed? >> they have a made in canada policy, consistent with past cycles where the fed went 75 basis points above where the bank of canada went. that reflects a less interest sensitivity in america. the fact that they have locked in 30 year interest rates in america. the fed has a 50 basis point hike this month and another 50 basis point hike in the first quarter. that is where you see the two central banks diverge.

the bank of canada staying on hold in the first quarter. the fed, caring on. alix: there is a narrative in the u.s. of the markets are not listening to the fed to the fed, they have made it clear that they will keep it higher for longer. and the third quarter we see it priced into the market, our markets listening to the bank of canada better? guest: i think they are better attuned to the bank of canada, but in both cases they are getting too much solace in one sawfish core cpi --softish core cpi number and say inflation is gone. if we do not have enough economic slack with the few quarters of slow economic growth it could heat up again. they miss the point that central banks not only want to see inflation come down. sure, lower gasoline prices and better supply chains will help that. they want to see inflation stay down. for that to happen you need a

rise in the unappointed rate in both u.s. and canada. if you do not have a full-blown recession will take a few quarters of we growth to get there. the markets are out of sync a little bit with how interest rates will stay at these levels of not higher. john: before we let you go we saw the canadian dollar strengthened against the greenback on this news. there is a dominant story this year about a strong u.s. dollar and how that cap the case central bank policy for a lot of markets around the world, certainly, canada as well. >> the canadian dollar's a little bit on the weak side. nothing compared to what happened to the yen, euro, sterling. we have been the lower volatility currency. it has not forced the bank of canada's hand one way or another. the bank is comfortable with the current level of the exchange rate. when it was weaker they did start to point out some of the inflationary consequences of that. right now they are benefiting from the fact that the u.s.

dollar is not on a steamroller gain on other major currencies. the market's right to suspect we are nearing the point, probably in 2023 with fed says is is done. the u.s. dollar gives us some of its gains. the canadian dollar will benefit a little bit from that. alix: avery, thank you very much, chief economist for c abc. peru president pedro castillo announced the resolution of -- dissolution of congress. they describe the move as a coup , the situations fasten. right now. what happened? >> we have seen political turmoil so often in peru since the election of pedro castillo. i thought, another at pete -- impeachment debate. this is a country where it is

easy to remove the head of state through impeachment. we have seen one already removed from office. we have seen so much volatility in peru. this election of pedro castillo was very contested. 18 months ago he went against the daughter of the former president who went ahead and did a self coup in 1992. this was the last time we saw such a state for peru. now we are seeing more of the efforts by pedro castillo to get his way this time around. we do not know if the armed forces will back the president. the political turmoil is getting worse and the president taking a further step in that direction. john: clearly have been watching the market reaction as well. probably one of the obvious ways to look is what is happening with the currency world. in general, the market interpretation of what is going on right now what is your

observation? >> the parole -- peru sol has been tumbling since the latest announcement by the president. today we get the monetary policy decision from the peru central bank where they are expected to hike rates for a 17th consecutive time. they are dealing with inflation, not only an issue or peru, but for the broader region. an interesting day to have such political developments. it will not help the broader economic picture when you have currency depreciation, inflationary pressures hurting the peruvian public, and on top of that more political turmoil. alix: does peru have an actual democracy? >> that is a key question for many latin american economies. there was a proper election, runoff, and he did get the vote for the presidential election.

we were expecting this attempted to have an. congress would have needed 80 out of 130 lawmakers to make it happened. it did not happen, if it goes ahead with a disillusionment of congress and they rewrite the constitution there are big questions about the legality of it all. john: i want to switch gears and focus on china, and other global story that the markets have been tracking today on many fronts. on one hand the reopening plan is something through market has reacted to in recent days. now we need -- seem to have gnomic broad strokes from the government in terms of what they want to achieve next year. there are cup locations in the near-term. we saw that in the -- complications in the near-term. we saw that in the near term. >> when i saw the chinese officials debating the 5% economic growth target for 2023.

i thought it was ambitious considering they were only going 3.2% this year. far removed from the 5 -- 5% they were targeting. you talk about the covid restrictions being eased and there is a definitive shift away from covid zero. not only because we get 10 new measures from the health commission on how to ease away from covid zero. also we had the bureau statement, we did not hear anything about that dynamic zero covid approach that has been mentioned throughout the last two years. perhaps right now the idea from beijing, all this reopening will lead to revenge spending, and travel that will support the economy. you mention the trade numbers, when global economic demand is slowing, the november export numbers contracted the most since he sparred desha start of the pandemic. it -- since the start of the

pandemic. it raises big questions. we will see it in the national congress in march. john: thank you for the thoughts on congress and the raking developments in peru. they are calling on people to remain calm, will track the story. coming out raphael warnock defeating republican herschel walker in the run-up for the georgia senate seat. what does it mean for democrats? we will get the latest details. this is bloomberg. ♪

some things are good to know. like, where to find the cheapest gas in town. and which supermarket gives you the most bang for your buck. something else that's good to know? if you have medicare and medicaid, you may be able to get more healthcare benefits through a humana medicare advantage dual eligible special needs plan. call now and speak to a licensed humana sales agent to see if you qualify. depending on the plan you choose, you could have your doctor, hospital, and prescription drug coverage in one convenient plan. from humana, a company with over sixty years of experience in the healthcare industry. you'll have lots of doctors and specialists to choose from. and, if you have medicare and medicaid, a humana plan may give you other important benefits. depending

on where you live, they could include coverage for dental, with two free cleanings a year. plus, dentures, fillings, crowns and more. vision, including eye exams and eyeglasses. and hearing coverage, including hearing tests and hearing aids. you may also get rides to plan-approved locations, home-delivered meals after an in-patient hospital stay, an allowance of up to $3,300 dollars a year to help pay for essentials like groceries, rent and utilities. even an allowance for health and wellness items. plus, if you qualify, you could pay nothing for covered prescriptions all year long, even the brand name ones. and zero dollars for routine vaccines, including shingles, at in-network retail pharmacies. so, if you want more from medicare, call now to speak with a licensed humana sales agent. learn about humana plans that could give you more healthcare benefits, including coverage for prescription drugs, dental care, eye exams and glasses, hearing aids, and more. a

licensed humana sales agent will walk you through your options. answer any questions you have. and, if you're eligible, help you enroll over the phone. call today and we'll also send this free guide. humana. a more human way to healthcare. alix: this is bloomberg markets i am alix with john.

raphael warnock has won the senate seat a highly contested runoff. it gives the democrats a 51 seat majority in the senate. with all eyes on 2024, he joins us in georgia. what were the key topics? guest: you could list quite a few. it is not quite as simple as picking out issues and topics in what was a pretty complex contest that had to do with personality. coattails. had to do with donald trump. it is difficult to replicate this anywhere else in the world. senator jeff -- raphael warnock did succeed -- he talked about -- we need to talk about the fact that this is years in the making. the apparatus that stacey abrams put together in georgia. the get out the vote machine

that rivals anything democrats have another states is what lifted him to victory. although she lost her raised for governor she left her figure prince on the race for senate. john: considering that democrats fared quite well and states that were key for the presidential election going back a couple years ago, you have to wonder what message this sends as you move towards the next presidential cycle. guest: they are talking about georgia as a swing state now. that is pretty remarkable. it is not very purple, republicans won every other statewide race in georgia a month ago when elections were held. joe biden has a. different relationship with georgia. if he is running against donald trump that could be a democratic when in the state -- win in the state. donald trump has a challenged relationship with republicans. it gets worse, a lot of people are angry that he hand selected

herschel walker and brought a candidate that could not bring it over the finish line. >> what to democrats in up republicans -- and republicans learn about the infrastructures on the ground? guest: we learned as this race, as we expected, was it decided in the suburbs. cities like atlanta. the suburban vote at the last moment went to senator raphael warnock. 200,000 republicans and independents voted for the republican governor brian kemp and did not vote for herschel walker the first time around. herschel walker did a great job, as it turned out, getting conservatives out in rule areas. it was not enough to make up for a powerful early vote. a big part of the democratic strategy. and a ground game in urban areas that is very effective. john: wonderful context, a lot to continue to get on that

front, joe, every weekday on his radio program talks all things politics five eastern on bloomberg radio. coming up we will talk about the rise and fall of canadian e-commerce company shopify. this is bloomberg. ♪ t retirement. his personalized plan is backed by the team at fidelity. his ira is professionally managed, and he gets one-on-one coaching when he needs it. so ben is feeling pretty zen. that's the planning effect from fidelity what if you were a global bank who wanted to supercharge your audit system? so you tap ibm to un-silo your data. and start crunching a year's worth of transactions against thousands of compliance controls with the help of ai. now you're making smarter decisions faster. operating costs are lower. and everyone from your auditors to your bankers feels like a million bucks. let's create smarter ways of putting your data to work. ibm. let's create

alix: an update on the breaking news around peru. peru's congress improves -- approves impeaching the president pedro castillo. pedro castillo wound up dissolving congress. congress has approved impeaching him. this is a mess. it will take a while to sort out. sherry says this is happened many times and it is a favorite way to get the president out of the top seat.

it seems that the congress has improved -- approved impeachment of pedro castillo. john: 72% of the data point today, how much canadian tech player shopify stock has declined this year. making it the worst performer in the technology center. -- a sector. analyst are not expecting a turnaround. she is a -- he is a technology analyst with the bloomberg television. have you been surprised by how dramatic a drop we have seen in the stock this year? >> one would wonder, if a stock is trading 20 times revenue a year ago, where technology valuations are this year this is not surprising. one of the did a is 72%. one of the things i would say is look at the stock over a 10 year timeframe.

is not what the let -- happen in the last year or so. it is because the pandemic gave a massive booster companies like shopify. valuations of shopify and some other companies went out of whack. alix: i spoke with, along with guy johnson, the president of shopify a few weeks ago. they had some stellar numbers for cyber weekend, black friday, cyber monday. he had strong numbers. i am wondering if overall consumer demand and everyone still spending is enough to offset idiosyncratic weakness in shopify. guest: some very good points when you break out the spending on shopify. when you look at it as an independent entity has some of the best products. the growth rate of the company a few years ago no one was expecting them to grow at 30%, 40%. when it comes to the pandemic

they grew 86%, and another quarter was higher than that. we look at growth rates that high, -- this year you're looking at that comparison and it is weak. john: in terms of the business model, where growth points for shopify was going after small businesses, the oil's have those larger businesses in their pocket as well, as the economy cools, where does the focus go? >> a lot of the pockets they sell for small and medium-size merchants they help them to be far more efficient in terms of delivery times, shipping. all those things are far more important if you can do it in one platform. the next phase of growth from shopify will come from larger merchants who want to sell their products on instagram, or through chat channels. they will have to upgrade

software packages and move on to a much stronger platform like shopify. alix: i love that we're talking about shopify with a senior tech analyst. that says it all at the end of the day. i am wondering what they have that others do not when it comes to technology, how good or how bad is it? >> one thing they did very well, they made it easier, if you are a small merchant or a big one to go live and multiply. is a cloud-based program. the product was cheap. it is of superior quality. they charge on payment. if your payment volume increases they take a piece of it. they got to a large chunk of the change, when a merchants platform grows with them. that is the big story for shopify. is not because of consumer spending, but small businesses

grow bigger. john: thank you very much, of the bloomberg tech team with the latest on shopify, suck -- i am john, this is bloomberg. ♪ it's official, america. xfinity mobile is the fastest mobile service.

and gives you unmatched savings with the best price for two lines of unlimited. only $30 a line per month. that means you could save hundreds a year over t-mobile, at&t and verizon. the fastest mobile service and major savings? can't argue with the facts. no wonder xfinity mobile is one of the fastest growing mobile services, now with over 5 million customers and counting. get in on the savings and switch today.

>> keep you up-to-date with news from around the world this is the first word. you are looking a live shot of peru after congress approved to impeach president pedro castillo shortly after he announced to the disillusionment of congress. they call for a new concentration our debt showers before a -- hours before an impeachment till it -- debate. they declare he is no longer in charge of the country congress improve -- approved to impeach him with 101 votes. beijing is moving