jon: welcome to the bien bloomberg and bloomberg markets. >> i'm alix steel in for matt miller. latest headline as negotiators leave the white house with no agreement. the markets taking all of it in stride. the s&p down .7 percent. the services pmi data did come in really strong earlier today. the underlying economy still holding up. energy outperforming. the nasdaq 100 a little softer. you do have yields pushing

higher. the two-year option did to cover , superstrong but the high yield was four point 3%, so the government can sell the dead but they have to pay up for it. all that suggests the jitters from the debt ceiling debacle. jon: we are continuing to trap what is happening in the -- to track what is happening. let's start with a tech theme today. we got a reminder that some businesses are arguably cautious with their spending right now. zoom shares under pressure to the tune of about 7%, the worry being they are not getting as much enterprise sales business on the larger scale as they would like. yelp shares by comparison are higher. the stock getting a lift after that and nisha wall street journal report on possible activist pressure to look for options like a sale. also watching the retail front, getting back to your commentary about the economy.

it does still feel like there is some cautious commentary coming out of players. shares of lows are up. but it could be a challenge for consumers. that same kind of message from home depot last week. on the club side, with a businesslike bj's wholesale down, telling us the consumer picture could be cooling as we move through the year. alix: from the micro to the macro -- that debt ceiling talks is one of the major themes. here's some of the highlights from some of the guests at the event. >> both sides know their needs to be a bipartisan deal. it will be a compromise and we will get the debt ceiling race. >> no deal gets done until everyone walks away from the table at least once, so we are doing that in a global environment with a lot of media but sooner or later, the debt ceiling will be yesterday's news. >> of course we are worried about the debt ceiling.

i heard the comments from president biden and speaker mccarthy yesterday. i have to think these guys know what they are playing with, so i am ok with that. >> like the other four times we were in the situation in my lifetime, i hope we stop playing games -- i'm not saying we are but i do believe there's a solution and the longer we take to get to it, the worse it is going to be. jon: some hopeful views there but let's get some perspective from megan scully who has been covering each detail. thing today not necessarily leading to anything meaningful for now. it does seem like there's a debate as to the significance of june 1 itself? >> there are some republicans questioning june 1 and whether that is the actual x data and whether there is some additional time. this would allow them extra time to get a deal through the house and ultimately through the senate. but the treasury department has

said again and again, we saw it yesterday that june 1 remains a very real risk of the u.s. starting to run out of cash. >> at the same time, the procedure to how they vote makes that essentially even closer than we think. it seems like the house wants 72 hours to vote on it. does that mean the data is over the weekend? >> it also has to go through the senate which also takes time. 72 hours is not a hard and fast rule within the house. that could be waived but speaker mccarthy did promise conservatives in his very lengthy campaign for the speakership in january he would abide by this to give lawmakers time to review legislation. that is three days and then a vote. but the senate is a whole other beast where one senator can tie up a vote for as long as 30 hours.

that pushes us ever closer to the june 1 state. jon: we had those hopeful comments from business leaders, but you and the team have been exploring how prepared world markets can be for an event we don't have a lot of familiarity with even if banks are doing their part to try to get ready for the unknown. megan: we are hearing war rooms at banks and other financial institutions, but this is uncharted territory should we ever default. the u.s. has never done that and we are getting closer and closer to the brink. probably the closest we've been in the situation with the most doubt wasn't 2011 when the u.s. suffered a credit downgrade but never actually defaulted. alix: and even then, you saw the s&p go down 7%, but then it rallied. the birds megan scully joining

us there. outside the debt ceiling, oil is the true topic of the qatar forum. there were warnings were short-sellers and oil. >> you would think in any market, they are there to stay. i keep advising them they will be ouching and they did ouch. alix: so he said oil speculators are on notice. that is on nothing new but it it forces the idea that saudi's are active managers and do not want short players in the market and do want a floor on the oil price. jon: this comes ahead of a key opec-plus gathering as we move into next month but look at what has happened with oil prices recently and the fact we already saw that initial spike back in

april. we have not been above $80 for a while and you have to wonder if this is more story about sentiment as opposed to the shorts themselves. there have been a sea of stories -- china demand may be not being as strong as some had thought and it has generally been a challenge to men -- two mention around the trend being lower. alix: yet i still go back to the supply issue in that russia has not delivered the cuts it has said and iran is able to move oil and may be that trails off and it comes to russia and that has to be the turning point when it comes to the oil market, not necessarily relying on china demand coming back. . talk about full steam ahead? coming up the mercedes-benz ceo and maibach debuting today. looking to go all electric by

2030, so maybe not. ahead. this is bloomberg. ♪ fabulous surroundings... but everyone's looking at their phones for financial insights from merrill. is he hailing a ride to the concert hall? no. he's making sure his portfolio and retirement plans work in harmony. they want to adopt a child and build a new home.

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jon: this is bloomberg markets. i'm jon erlichman with alix steel. i'm for our stock of the hour. mercedes-benz unveiling its latest may bock brand as part of the companies push to build a fully electric fleet by the end of the decade. for more perspective, let's bring in the ceo of mercedes-benz usa. thank you for being with us. you are a couple of years into this journey and commitment to be fully electric by 2030. at the higher end, the luxury and where you specialize, what

would you say about demand for electric vehicles? >> i would say the demand is picking up. we have a good lineup of products, both on the combustion side and electric vehicle side, therefore satisfying customer demands. beautiful products with good equipment, so demand is there. alix: what are you unveiling next? everybody wants to be the luxury tv. get a ticket, get a big ticket item, what's the difference here? dimitris: we started by launching our first electric vehicle in the u.s. and in 18 months, we have launched another four products. we now have five full electric products in the market. at the end of this year, we bring into the market the suv which is the pinnacle of luxury of the electric vehicle segment.

alix: in terms of the demand side, is there enough room for all the luxury ev's we have out there? are you are interested in pricing power or demand? dimitris: i would say we are looking to give to the customer more individualization. if the market exists coming have to cap trip. we have an electric vehicle, and suv and it is coming out in layouts in different equipment. today, what we are launching in new york is the top end suv of the nine series special. jon: when it comes to north america in particular, the love affair with the suv, is that one of the differences in the north american market versus china which is a very important market as well? dimitris: i would say we are producing the suvs in america.

we have our factory in alabama. our products are made in the u.s. for the u.s. market. of course the products are exported from the u.s. to the rest of the world. jon: maybe you can update us and this is a story that connects to canada -- the need for a large charging network has been a big focus area for you. you had some updates at the beginning of the year. that is a process that will take some time but can you give us an update on how things are going so far? dimitris: we are working on our end to offer top customers a 300 succeed agree solution, not only offering our products but offering our products to be connected to the customer's life, at the same time offering a charging solution. we have enough for the end of the year, proprietary charging

network that will offer convenience, priority for our customers and it is connected to the vehicle and they customer. this is the ultimate convenience, luxury and convenience. alix: ford announced some lithium agreements to secure the supply we need to build all the ev's. how do you'll look at managing that problem? dimitris: we are also looking at growing our base. we have a battery factory in alabama supplying batteries for electric vehicles and we look forward to strengthening in the u.s. we are looking more and more to capturing the markets in the u.s. with a strong footprint. alix: we are looking forward to the new unveiling. the ceo of mercedes-benz usa. thank you very much. coming up, we will take you to the goldman sachs finance conference with an exclusive interview with the head of debt

capital markets at kkr. this is bloomberg. ♪

jon: this is bloomberg markets. i'm jon erlichman with alix steel. let's take you to the goldman sachs leverage financing credit conference. sonali basak standing by with an exclusive interview with kate thompson, head of u.s. debt capital markets at kkr. sonali: thank you and kate, thank you for joining us. it's funny because on one hand, kkr is a client of coleman and you are strongly competing with them when it comes to the debt capital markets, providing large-scale buyouts. are you friends or enemies, arch enemies?

>> good morning and thank you for having me. as we have continued to grow and evolve as a firm and within the industry is welcome we've added increasing numbers of strategies. at times those have a higher rate of intersection, but what we have found is we've had a long and lasting relationship with someone like coleman to partner together rather than to compete seriously outweigh competitive aspects. sonali: if you look at the first quarter alone, you have pitch book data that shows 94% of new deals in the first quarter were done near private credit. what does that normalized level look like? banks are starting to come back into the market but to the end private credit can fill some serious space deals, what does it look like? cade: private credit is a financial alternative. it nothing new. the coexistence between private credit and the syndicated marketplace is nothing new. i think a clear validation of that if you look at kkr and

through our platform, we had those products on our platform for quite some time and find it to be very advantageous working with third-party clients to able to provide holistic solutions in the form of private credit, in the form of syndicated credit and capital markets through the balance sheet which funds that part of business. sonali: this scale has certainly gotten bigger. some of the biggest deals we've seen when it comes to private credit alone. are we going to see more of those this year? cade: the disruption in this syndicated side of the market has allowed for bigger revenue, including us to use the private credit marketplace. when we whiteboard a new deal, whatever the case may be, we are always examining as a fiduciary all of our terms available to us. that includes direct channels through the junior portion of the cabinet structure as well as the syndicated marketplace. what comes out of that is some combination of the two but over the last 12 to 15 months, 18 months as markets have been

disrupted, there has been significant flow redirected to the private credit channel. sonali: but how big? do we see more deals of the size we are seeing? you think more of those are coming? cade: i think you will see more of those. there was a widely bantered deal in the market that did not get done. we were around that deal in every regard. had principal appetite and agency appetite. i think you will consider -- continue to see that thematic as we see the disruption in the pozner syndicated side of the market we are experiencing. sonali: when do you think the market starts to open back up? there could be a delay for many months of top you hear both sides of the story. cade: it is important to note that while markets are more challenged, they are functioning. what you see through the syndicated side is the lower level, bigger equity checks being met with great fanfare.

having said all that, we are seeing other assets find homes in the syndicated marketplace. if you look at our portfolio and what we've done in the syndicated side of the marketplace, we have refinanced nearly $10 billion of debt through the portfolio. heartland dental, where we had to use a combination of the syndicated bank and bond market. octave, which is a cybersecurity portfolio. as recently as a week and a half ago, and incremental loan -- to tap on opted for a second, this is a good representation of the themes we are seeing in our marketplace stop it was an existing term loan which we had to extend. 12 or 15 months ago, that would have been a straightforward exercise. perhaps extend the maturity and move on with life. it is not that straightforward in the current environment and

that's ok. it's causing us to be more creative around how we create these solutions. sonali: thoughtful and creative signals caution to some degree. for people worried about recession, what does not get done in the next six to 12 months? what are the deals you saw in this environment that are not going to happen now that rates are higher? cade: if you take a few factors that are widely bantered about, with how quickly rates have moved, the fastest in the 35 years the fed has moved, the general macro uncertainty where do we go from here and the valuation gap, the difference between buyers and sellers expectations, throw that into the pot and what comes out is this pause in broader m&a activity as you think about not having a robust pipeline. that's what we are not seeing. having said all of that, we are finding new opportunities and ones that will allow us to

deploy our full model in terms of principle and agency capital, direct syndicated capital and our advisory capabilities. when we work with third-party clients, we don't care what solution they elect. as long as we are part of the solution, we are agnostic. sonali: you don't seem to love the word cautious. is kkr ready to get aggressive? cade: we feel over the last 15 to 18 months that we've managed our risk in a prudent fashion. as a result, our capital basis with regards to the principal and agency side of our businesses are in very good shape and the opportunities we are seeing, senior down to junior opportunities are very interesting, so, yes. when you put that together we feel we are nimble and and and opportunistic position. sonali: how much of this is waiting for a fed pause waiting for stability in the rates?

cade: it's probably some of that but also some's debate -- some sustained -- we know what the big factors are weighing on this marketplace. what we are trying to be thoughtful around is what is it we are not seeing? what is around the corner? the banking crisis and all that ensued after that -- i'd don't think we saw that coming and it's causing further uncertainty . it hit the pause with what i referred to earlier with pipeline activity and that kind of backdrop is going to leave us in the position we are in now. sonali: thank you so much for your time. hope to talk to you about this again as the market opens up. alix: great stuff. thanks to cade thompson over at kkr. it is interesting to have a capital markets conference when you have the debt ceiling overhang, not that things will magically change themselves if

we get a debt ceiling. but what will the liquidity situation be like if they are able to issue a lot of money will be quite interesting. jon: we were talking earlier this half-hour about how there was additional debate as to june 1 -- is that the ex state or not. the closer we get to june 1, i imagine that is something we have to discuss more because we saw the s&p 500 trending toward its lowest levels as we got those headlines out of d.c.. the market is waiting for more signs of progress on that front. alix: and you are looking at it. the s&p down, of tiny bid in the back end of the bond market. the 30 year yield above 4% for a moment but since you saw that, some buying coming in and that dollar stronger and crude eating a nice little boost. the saudi oil minister talking about how the oil shorts are on notice. and still on notice for the debt

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romaine: treading water -- investors waiting for answers on what the u.s. government will do to avert debt default. romaine bostick here in new york kicking you off to the close on this tuesday afternoon. a quick check on the markets. a potential target breakout we saw giving way to a potential downward slide here on this tuesday afternoon. the s&p attempt to crack that 4200 level hitting a key resistant point once again. three stocks down for every to higher. the biggest rags are