>> the data supports things are weakening i think they will pause. >> when you get up fed funds hike cycle, equities will sell off. >> they will send more hawkish than expected. >> this is a fed that doesn't like to surprise. >> this is bloomberg surveillance with tom keene, and lisa abramowicz. jonathan: cpi tuesday, live from new york city this morning, good morning, good morning or our audience worldwide, this is bloomberg surveillance. your equity market is positive

by little more than 0.1 percent on the s&p 500. we are 2.5 hours away from important economic data in america. tom: the market is getting out fronted this. there seem to be a celebration of a tilt to a better core statistic. maybe more than ever, it's not cpi tuesday, it's core cpi tuesday. the town is constructed. jonathan: china stimulus tuesday as well and excellent reporting from the team at bloomberg, considering a broad package of stimulus measures as the pressure builds on the chinese government. lisa: here's my issue with this story, are they trying to stimulate or support from some sort of significant deceleration. i don't have a sense of that. we are seeing that 5% target. tom: we tried to be out front

and sometimes we get it wrong. ian shepherdson with this yesterday mike talked about his colleagues work on china. it's been brilliant and they nailed it. they say this is not a major stimulus. this is a limited, narrow effort to salvage some hard growth. jonathan: let's get the reporting and then let's get opinion. a dozen measures are being proposed in china to support areas like real estate and domestic demand and they include the potential for interest rate reductions. here is an opinion for you -- jp morgan said yesterday -- any stump -- any china stimulus is unlikely to be meaningful. we heard from j.p. morgan yesterday saying something similar. they say any hope that china will outperform tom: do it 2008. jonathan: they are pushing back.

tom: i would suggest this is where you get rates down there on subpar growth and you ask will we bring the disinflation in china to add to inflation worries in the west? jonathan: we had to talk politics this morning as well. we will talk about the prospect of china stimulus but we have to talk about the presidency. tom: extraordinary, i don't know what to make of it. this is so original. two average rep -- to our international audience, people are trying to part -- pontificate about where this goes in american history. it's an original moment for the nation. jonathan: kailey leinz is on the ground in miami and we will catch up with her. look out for those conversations through the morning. 2.5 hours away from the economic data. the stage is set going into that information later this morning.

equity futures are posited by 0.1%, barely changed. the euro is a touch stronger. just to finish with crude oil, yesterday in the last couple of weeks it's trying to get up off the mat. it's trying to bounce by 1%, $68 at the moment. lisa: you categorize that correctly. 8:30 a.m. eastern is that u.s. cpi print for the month of may. cpi really is the key metric that supposed to come into about 5.2% year-over-year from 5.5%. this is driven by rent. rents are declining in certain areas of the nation over all and decelerating at the fastest pace going back years. how much does it support the feeling that a pause could happen and be protracted. 10 :00 a.m., janet yellen

testifies in front of the house financial services committee will talk about why the u.s. should support the imf and world bank to counter the chinese belt and road initiative. at 3 p.m., donald trump is expected in miami federal court. it's interesting to see the public response to this and the security what kind of drama there will be. in the courtroom, it's an initial salvo of a long, protracted process. jonathan: what a moment for this country, plenty of coverage of that just around the corner. jonathan stubbs joins us now. we are having this broader conversation over the last couple of weeks as to whether this equity market rally year to date can broaden. do you still like small caps and why? >> if you follow signals and valuations, u.s. small caps on the s&p 500 trades under 12 times on a medium stock basis.

we've only seen that gap twice before. there are buying opportunities for small caps. the signals we've seen of the last 25 years tells us to buy small caps that's pretty contrarian given the market over this year. if you think valuation is important to support returns, we've got a valuation signal. it's an indication of the softening of the economy ahead. tom: it's way too early to do the math but 60/40 is typical. you gotta 40/20/40 and 40% based

on liquidity. is that played done now? the vix is coming in with the drama we have seen so what's the new allocation? >> when i started here in 2020, i wrote 60/40 was not a way to hedge the post-covid inflation risk. it went to in asset allocation front which had a long tail exposure to relapse to alternative assets. it also went to a liquidity heads to find combination assets to provide investors with some protection against world risks. there is bitcoin which is controversial to many.

there is cash and i also have gold and i think that still relevant. you're talking about political history being made in the u.s. we got politics being explicitly weaponized. that must bring into question the risk premium investors globally and how it affects u.s. assets. running asset allocation with eyes closed is not an option. adding legitimate protection is the way to go. lisa: what does it mean to have your eyes open if you underperform the assets you have and haven't delivered and haven't delivered in the rest of the universe has fundamental reasons for why they should sell off and continues to outperform and even add to that? what do you do? >> it depends what you are trying to do with capital.

you want to protect capital in real terms. it's the best performing asset class to deliver that. we recommend a 40% weight in equity and we recommend strategies such as defensive growth or quality at a reasonable price, fiscal alignment which is owning industries or companies that align with very strong narratives from the government like cyber and defense industries. we want a balanced package that presents a good opportunity to deliver real returns. tom: spx 4400 is what futures said. give me your spx by year end? >> if you go top down first, get the signals coming from the

yield curve, a year out, we may be at level slightly higher but it suggests that we are going significantly lower between now and then. you have to scrap everything we learned. we are living in a time of capital -- captured markets were fiscal under pins everything. we are going into a world where authorities effectively remove premarket and you can construct very reasonable full case threat on that basis. you have to assume we are not living in an environment of free markets. tom: did we get an answer from him? i need 4600. >> we are selling rallies and buying dips. we think we are sitting for the top end of a strong rally which

is good for the market. the technical set up is not to add aggressively at this point. sentiment now is not telling you to do that. that's the warning sign. jonathan: jonathan stubbs, good to see you as always. yesterday evening, some of the moves we have seen of the last couple of weeks, bank of america year end price target 4300. evercore 4150, goldman going into the weekend no 4500 and it was 4000. 4000 was the center of gravity but as we get further away, more will come through. tom: this is the bloomberg terminal adxdmi and it's a lot

of fancy calculus but it's really magical. this is not about people buying. it's asymmetric. this rally is about a dearth of sellers. there is a difference. it's not about i've got to own apple, it's i'm not selling apple, there is a difference. jonathan: i think we need to pile into these names over the last few weeks. lisa: we are hearing this more and more that it has legs and it's sustainable, here we are. jonathan: a toxic brew of optimism. i remember i headline you wrote a long time ago, most hated bull market ever. all these rallies are despised. tom: it is criminal how the public has missed the greater bull market. jonathan: that goes back a long time.

tom: the fed is very articulate. jonathan: equity futures on the s&p 500 are posited by 0.1%. these are the days. more info a few hours away. lisa: keeping up-to-date with news from around the world with the first word -- there are more signs that china is increasingly concerned about a slowing economy. beijing is considering a broad package of stimulus measures. china's central bank has unexpectedly lowered the key short-term interest rate. the latest u.s. inflation figures come out today and bloomberg economics says data are likely to give the federal reserve officials the permission to put their inflation measures on pause. in miami, police say as many as 50,000 people could turn up when former president trump appears

in federal court today. he is expected to plead not guilty to charges involving the mishandling of classified documents. trump loyalists have promised to show force. the french president says he hopes ukraine's counteroffensive is successful and lead to negotiations. he and the leaders of germany and poland met in paris and discussed coordinating military assistance to ukraine and the upcoming nato summit. global news powered by more than 2700 journalists and analysts in over 120 countries, this is bloomberg. ♪ good night! hey corporate types. would you stop calling each other rock stars?

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>> i always want to make sure we have a fair process. it really seems like one side justice is being weaponized. >> was that a good look for the president to have boxes in a bathroom? >> is it a good picture to have boxes in a garage that or -- that opens up all the time? a bathroom door locks. sonali: bramo is not jonathan: too impressed with that exchange.

going into cpi later today with equity futures up by 0.1% and yields unchanged. let's go straight to apple, closing at a record high yesterday session. a touch softer today, ubs making a move, moving to neutral, cutting the outlook for apple. they say softer iphone and services growth and apple trades at 29 times near term eps estimates, above the next 12 months estimates above the 1, 3 and five year average. tom: they had their developers concert and there is concerns about this or that box but the answer is life goes on for apple. as they approached $3 trillion market cap since the october lows, you have to say apple will just continue to grind out what they do.

mr. cook says to build the ecosystem, the number of people involved each and every day. jonathan: all-time highs, 30 or 40% year to date? tom: 191 is $3 trillion and we are above that. jonathan: that's quite a run. tom: it's less than nvidia. this is important. we have to get to work on the former president but this is important. apple is under owned by institutions. it's an unloved stock. people don't want to buy because of the size of its impact on the market. jonathan: these names got battered last year, big tech had difficult time. tom: do you near -- do you need airpods to go to camp? jonathan: do you can't?

tom: you have to go to summer camp. i'm not camping. i am writing the check. right now in miami, reading in this historic moment for the nation. we go to kaylee not -- kailey leinz in miami. what will you observe today of the judge at this arraignment? kayley: we won't actually see the judge or president trump inside the courthouse because cameras will not be allowed. we may not even see the former president walking to the courthouse through the lobby. he's expected to enter through an underground tunnel. once he is inside, he will be arrested and then process like anyone else. is facing federal criminal charges and his mugshot will be

taken and will go up to the floor and appear before that judge and we expect him to these 37 counts of different criminal charges and that's what makes this moment historic. no other former president has been charged with a federal crime but he's been indicted formerly. after all the proceedings in miami today, he's getting back on the plane and going back up to new jersey and his golf club and will address supporters at 8:15 p.m. in the fund raising of his campaign 24 where he expects to raise $2 million. tom: we will see how it goes tonight with the president speaking in new jersey. wendy shall is joins us now from brown university. let's cut to the chase. it is truly an original moment. this is not in your classic textbook. how will you place a new to

chapter in your textbook? >> this is a development for the democracy something. some say it's telephone -- terrible and political witchhunt but should presidents be shielded from behavior if it's criminal? they should be held accountable. this is an evolution of where we are. we don't want to be like latin american even europe, the former leader of scotland has been held accountable. democracies have to have a rule of law and you can -- and if you let the most powerful operator in the democracy break the law, they will probably do that and that's not something we want to do. i'm not as disturbed by this. i don't think it's a political witchhunt. i am concerned that when democrats get out of office, the same thing will happen but there is a rule of law and if you break the law, you need to be

held accountable. lisa: there is the response publicly where people were for the former president are still for him and believe this is some sort of undermining of the institution. when you teach political history classes at brown, what is your take away? >> political loyalty has turned into fierce support and sometimes violence. that is not new. we will see what happens today. people will go to a rally and it will be hot in miami today. is that the same as committing violence and trying to upend the system to save this one person? it's a larger problem for the republican party going down the line. mccarthy's answer was quite weak. does a bathroom lock? this is the espionage act, these are military secrets. can this man be trusted with national security and that becomes the larger issue for the republican party and other

people running for office in 2024. lisa: putting aside kevin mccarthy's response, there is an issue of at what point republican nominees or potential nominees start to push back against with former president trump is facing and starts to put more credence in the judicial system? will that be the case or will they need to import backing the former president and sticking with that line? >> that's the important question. in the polling, they got to win the primary. these are the most devoted republican voters but a lot of independents in some states with open registration vote in a republican primary. they have left him in majority numbers in the last couple of years but will they go to the republican primaries? if they vote in the republican primary, they will not want this guy. how do you balance that?

in the general election, we know they will not vote for this guy. that's the big question for the other people running. you don't want to alienate trump supporters but other people vote in primaries, too, but they will get sick of this if there is a january 6 indictment as well. this guy becomes too much of a liability and you risk a turnout for 2024 among that base for republicans. jonathan: what kind of legal representation does the former president have today? >> i think they were scrambling as of yesterday so i'm not quite sure. at what point does he lose the capability of getting the best minds in the country to defend him? this judge got in trouble for the way she handled this case earlier in its proceedings, what does she do now and does she continue on that path or does she perform with her standards? jonathan: that's wendy schiller

and that's the question today. tom: i didn't bring it up earlier but it's the most important question, having nothing to do with politics. any individual in court, particularly should be entitled to the best legal representation but that's clearly not the case this morning for the former president of the united states. jonathan: it appears he struggling to find it. tom: it's not for me to judge bids than outrage we are having this conversation. jonathan: equities are just about positive on the s&p 500. this is bloomberg. ♪

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jonathan: a three day winning streak on the s&p 500, can we make it for? the s&p 500 futures look like this -- posited by 0.1% on the s&p and the nasdaq has been outperforming all year. the nasdaq 100 is up year to date 35%. tom: we talked about the fancy technical mumbo-jumbo, nobody is selling. yesterday the nasdaq was up and then pulled back and hung out for an hour and then pulled back

in a nice pop at the end. jonathan: that's a nice description of the session. tom: it's very telling. the first thing i see when i walk in today on the spx is 4400. i couldn't have framed that for weeks ago let alone four months ago? jonathan: sentiments change. no doubt things can change as quickly in either direction. not much has changed at all in the bond market. the two year on the year is up by something like 15 or 16 basis points with tons of volatility in between as high as 5.08%. we're talking about hard landing in credit crunch and then we get further further and wait for that test from that and we think about a fed that could pause and hike once more. in the fx market, are we about

to get whipsawed by china stimulus? we have reclaimed $1.08 on the euro. china might be considering stimulus. tom: china stimulus equals lower interest rates which means a weaker you one. i believe standard charter framed out seven point 30, a weaker you one. jonathan: we had a scare in europe and there are reasons to buy this story. now you're looking for a new engine of growth in this market, where does it come from? we are halfway through the year and we're talking about stimulus in china when we should have been talking about this at the start of 2023. we thought we would be talking about china booming. we are talking rate cuts and

measure to support the housing market, the government under pressure? that's a real change to what we expected six months ago? tom: as john says, we are halfway through the year and the year is like 14 months long. lisa: it's been a continual whipsaw and a lack of uncertainty and in specific regions, there are bifurcated recoveries and within the u.s., certain states are doing better in certain states are not. it's hard to get a handle on the overhead top level view of the economic picture. tom: let's solve that now with janet henry. at hsbc. let's blend together the derby that is upon us here with the china moves. the hong kong and shanghai banking has this ability and if we see a disappointing china, will we import their challenges?

will we import their disinflation? >> not immediately. relative to the consensus view earlier in the year when there was a huge amount of optimism regarding china and the reopening and some people looked very excited about the idea of unsynchronized growth, that china would lift europe in the u.s. went to the inevitable hard landing. the u.s. has already been more resilient. china has not had the explosion on reopening and this was the second reopening and it's now clear that the stimulus -- more stimulus will be required to continue the recovery. we are not getting the say -- the same trade channels. trade is already week. there is not the same deflationary influence.

when while we have seen commodity prices be a little bit weaker than many anticipated, they are probably half their peak levels. they are still higher than they were back in 2019. i don't think it's as clear cut that suddenly china being weak poses deflationary influence its of the global economy. tom: i just looked up that the united states department of agriculture and their guesstimate for inflation of food this year in the united states is 5-8% and it's much worse for many parts of europe area are you beginning to see on this core cpi tuesday, a lessening of food inflation from these central banks? >> you are but so far it's interesting, where you see the biggest drop in headline inflation is actually more the emerging markets. we've seen energy inflation come down and bigger reduction in

food price inflation but it's been more in emerging economies. part of that is because they buy more fresh fruit. people in the west by packaging and that involves labor costs. all get to see some easing of inflation but is still running a close to 20%. we still have volatility on inflation. we hear about resilient of bad harvest like in australia. it's the volatility of inflation and for producers, they don't move with every monthly change in prices. lisa: we are about two hours out from the key cpi print in the u.s. and we're looking at a lot of central banks including the australian central bank, including the canadian central bank and potentially the bank of england after that surprisingly hot labor print we got earlier this morning.

what is to say the u.s. is not facing the same inflation dynamic that the u.k. is or australia or canada? >> where some of the key differences are so far on the u.s. versus the others and be tickly the u.k. is clearly on labor market. when you get wage prints around the 7% level in the u.k., this is an economy that doesn't -- that hasn't grown for the last year. the labor market is still surprisingly strong and the wage workers are clawing back on pay rises. chair powell has been telling us the last couple of months there were certain elements of the u.k. and u.s. economy that so far are different. it doesn't mean they will continue but it's unusual you say things slow from just under 6% to below 4.5%. not consistent with inflation

but to move down without any rising wage growth means the inflationary pressures are different in the u.s. than the u.k. they have more rigid wage setting procedures. the u.s. has inflation challenge . i think they will probably raise rates again but clearly not in june. they told us that. i think the fed is not done and i don't think it will cut rates quickly. it will be 2024 beasts -- before we see a rate cut from the fed. lisa: this is confusing because you mentioned where wage growth has come down. how much is that because some of the people getting wage gains are the -- are in the lower income sphere? how much is this a compositional story more than anything else that makes it difficult to look at the overarching numbers? >> very good point -- if you

look at the lowest paid sector in the u.s., it is hospitality and for a time, that's where you have the strongest wage growth. it's about the only sector the didn't see a will rate -- wage screeds -- wage squeeze. in the u.s., wage growth has grown but you have seen a recession in other sectors and you've seen the most jobs lost. got divergencies and other economies as well in the u.k. had the strongest growth in real estate. also finance, not the jobs. tom: you went right where i want to go. it's real simple, what is the brexit effect on inflation and growth in the united kingdom? i don't see anybody addressing

that. thumbs up or thumbs down? >> i think it's fair to say that the brexit impact on the u.k. economy has contributed to lower growth and higher inflation. a lot depends on where we go from here but so far, it's been on supply-side of that you -- of the u.k. economy we found the impact of brexit there. that's as much as you can say at this point. jonathan: very diplomatic. thank you. we've had double digit cpi in the u.k.. the wage growth story this morning in the united kingdom is punchy. we are talking about seven handles, six handles on looking at the projections for the bank of england now we have this

conversation about the prospect of a six on the fed funds. that is the conversation for the city of london this morning, the prospect of maybe getting near six. lisa: we are talking more of a stagflation environment. is still better than expected. how the you understand this? is it structural change to labor market in the u.k. or is it global? we are seeing it in other european nations and the aging workforce. it's tough to get a handle on this. tom: we aggregate central banks in every nation and economy is different. i defer to you on this, the polarity in the united kingdom from a prosperous server sector dynamism of london, versus the united kingdom flat on their back i would suggest it's different but as stark or starker than the united states. jonathan: i'm the worst person to ask that question two because

i have a bias on the city of london. i hear people come over and say the u.k. is bad. but i love london and it's doing great. it reminds me of switzerland. you go over to zürich and you see what these blacked out luxury vehicles and everyone is living large and the central bank is like negative rates, -75 basis points and we a problem with inflation. tom: that continues to surprise. jonathan: in london, they wouldn't swap it for the world, the people who work there. tom: should team surveillance move to london? what do you think? kids could acquire british accent. jonathan: $68 per barrel.

coming up in the next hour, the former u.s. treasury secretary coming up in about 60 minutes from now, from new york, this is bloomberg. lisa: keeping you up-to-date with nusra around the world -- former president donald trump will appear in a miami court today to face criminal charges. the miami police chief said they have prepare for crowds of up to 50,000 people. trump is expected to enter a plea to a 37 count indictment accusing him of mishandling classified documents. goldman sachs has rethought it prime brokerage relationship with odey asset management. they remove their founder after sexual assault allegations. we spoke with the ceo of goldman sachs international. >> we hold ourselves to extremely high standards. we expect the same of our client base and that's how we work together. when new information comes to

light in any situation, we review it and review it quickly and take the appropriate action. >> did use ever ties or are you still contemplating what happens next? >> we are in the process of moving away from that business. lisa: the allegations have been denied. global news powered by more than 2700 journalists and analysts in over 120 countries, this is bloomberg. ♪

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weakening. if they want to land this thing, the want to try a soft landing. we think yields will move lower from here but we don't think they will return to the 1% or 2% level. jonathan: this is what i love about wall street, i've known drew a long time. there is someone just a sharpened intelligent who has a completely different view. more information about 1.5 hours away. equity futures are just about firmer. the s&p at the close yesterday, three-day winning streak. let's look at the bond market quickly. when i on europe all morning. china is considering a georgia

-- a broader package of stimulus to support the property market. it might be broader than that and the euro is stronger. we are getting whipsawed in one direction and another. tom: we will talk about two questions and they will turn to the reach from a country called the brookline to a place in los angeles where it is a new golf world for a u.s. open tournament. two questions on china and we will go to the sport blowing up in america. how scared is beijing with these actions. when you look atem pricing, what does it signal to beijing? >> dollar-you on at $7.15 is

likely. if we get to seven dollars 20, they have lost their confidence and i think that's a real risk. you will see themtlf declined by another couple of basis points this week. if you look at u.s.-china 10-year gilts rates which of collapsed at 81 or back to -112. i never would've thought we had -- we would have been widening to those levels. tom: i will ask one more question on china -- what is the adjacency effect here? chapter 42 of every emerging market book is watch out for adjacency effect.

>> you basically have a euro rally when you see china grove and with the stimulus you will see a growth there as well. you will basically see commodity prices rally. we've seen that overnight. you will see stuff like that. the reaction amongst global asset prices is there. we are talking about adding 10 dips? tom: it's like so what? >> with the unexpected policy activity in china over the last 10 years, household and corporate's don't trust what they are saying and i don't see it really working. jonathan: do we have to talk about golf so quickly says br amo? lisa: china has been trying to chart its path in the global

emerging sphere with belt and road, etc. so how much can they continue do the do that when they struggled to support their own economy when they have a situation where they're not -- where they are not necessarily bolstering growth. >> we have activity coming up this week. maybe it was a bad month. you have the resurgence of covid in shanghai so it's weighing on industrial production and retail sales and fixed investment. it will be weaker on a sequential basis. tom: so the golf courses is the number one golf course. that's our segway. jonathan: geopolitics, tension captured by one group teeing off thursday.

talk to me about the significance of rory mcelroy and brooks kappa being in the same group for the u.s. open on thursday. >> did you see the press room? the poor guy had questions at the press conference. he wonders who is working for, he wants clarity on who we work for and that's where the rubber meets the road. are you working for the saudi's or the pga? the commissioner of the pga says we are the majority shareholder year. we have control over what will happen next. i don't know. jonathan: what is the importance of saudi arabia being involved in american sports? it said that headlines and were aware of it but if you think

about the significance of saudi arabia in the u.s. economy, it's already massive. they are the biggest refiner in this country. why don't we focus on those things. shouldn't that be a bigger concern? >> with technology, the saudi approach to sports is just is -- is to disrupt the test the existing infrastructure. think about major league baseball and college sports. then -- they can create a dream team if they get behind a u.s. university tom: should the non- liv people be compensated? should they get a one-off payment to equate to what theliv people got? >> that question was asked and the commissioner refused to answer. politely. it will be difficult to give

them any compensation for not moving. we are talking hundreds of millions of dollars here. we don't know what was paid out to the liv golfers yet. how much could they get and is the old contract still valid in this environment? jonathan: the bigger story is getting a slice of the tv rights. if you think about what's behindliv golf, these guys turn up and they know they are a draw and they know that's why people are watching. i watch for rory and i watch for the rest of them. if they don't win, they don't get paid. the guys who went to liv golf say we want a slice of the money. if we are going to turn up and give you four days of work, we are the draw and people watch for us. i think it's interesting to see

them say i know i am the content and i know you make money for me, not just from selling jerseys but also the tv rights, they want a slice of that and it's interesting to see the golfers say that. i wonder how that materializes the next few years. the next time we get the big tv deal with golf, they may step up and say i might not win on sunday but people are watching me. >> what's to stop them from starting their own league? you mentioned that wonderful the u.k. is in i would rather get the -- i would rather be in miami. jonathan: the tax cat you might get coming from paris to miami should be interesting -- the tax cut you might get coming from paris to miami should be

interesting. maybe his wife has something to do with this. lisa: this is brought to you by the florida chamber of commerce. jonathan: fantastic, thank you. the bloomberg business of sports podcast -- it will be so interesting for a long time. tom: what's so important, could derek jeter have gotten an equity interest in this? i'm still humbled by betting on anything in the seventh-inning of baseball. it's not outlandish. jonathan: welly of blackrock coming up. equities are just about positive and we are 94 minutes away from economic data in u.s. with a read on inflation. the fed's decision is coming up

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♪ >> it is extremely difficult for the central banks to get a handle on where it goes from here. >> when you have a fed funds hike cycle there could be a selloff. >> this is a fed that does not like to surprise. >> this is bloomberg surveillance with tom keene jonathan ferro, and lisa abramowicz.

jonathan: that cpi data 90 minutes away. good morning to our audience worldwide. this is bloomberg surveillance on tv and radio. we did -- the market did good to keep up with the trading yesterday. we are in cpi data. a read on u.s. inflation. and we go into the fed reserve tomorrow. tom: we will have complete coverage for you tomorrow afternoon with a great lineup to be had. i think will be really on top of the story. we have george at -- saying cpi and all of them have a reality. with inflation. jonathan: you can break this down for me later.

at citi they say the fed practices and extreme data point. and this could be the difference between a hike and a skip on the fomc tomorrow. lisa: is the fed practicing extreme data dependence? and if so, what of a looking at? will a small percentage point determine one way or the other if way -- if they will skip? i think some are on the -- our guest is on the side of hiking. jonathan: he is stuck with the call. looking for 25 and then maybe another 25. a lot of people are capitulating on their views. you see it from b of a.

evercore got a 450. goldman joins the party over the weekend new year in price target 4500 and the previous was 4000. we had a big move in the market that was meant to be the other way around. in 2023 we were meant to dip then rip and markets just ripped. tom: the idea that the inflation target cell on the news will that be the target this morning? i do not hear a lot of people talking about that. the vix has come back from 14 but i wonder if it is that kind of tuesday. jonathan: january soft landing, february no landing, march hard landing. april credit crunch. it is mega cap tech and then jewell -- june it is a bull market. month to month it has been a real. lisa: [laughter]

i saw that on twitter yesterday and i laughed out loud. it is so true. it has been a whipsaw feeling. in which narrative will rule the day? right now i very little conviction to remain bearish. and when people do remain bearish, i want to know how much people come out and say you've been like this forever why won't you capitulate? jonathan: there is no winning. james athey of aberdeen said there are ping-pong narratives. back and forth. tom: just for the record he would never -- jonathan: we will get to whaley in a moment. equity futures right now on the s&p with a positive .1% with the lift going in to getting the cpi data. lisa: i'll be interested to see how much rent is driving the cpi

print lower as people push back a little bit. 10:00 a.m. u.s. secretary janet yellen testifying on capitol hill. and trying to adjust china's grip -- discuss china's grip on this. and we will catch up with kailey leinz throughout the day. jonathan: thank you, and we have wei li joining us from blackrock the chief investment strategist. >> at the beginning of the year we called for a recession and persistent inflation. we will see evidence of that very soon and it is likely going to happen. the consensus is .4% call cpi's is going to a -- cpi

sequentially. inflation is proving persistent. the rent component is driving it down, but we are still looking at the end of the year four or three somewhere in between. but somewhere above the target. when it comes to growth, we have a recession coming at the beginning of the year. when you look at the gdi and gdp there are two different ways of measuring the economic activity in the country. if you average them, we've already seen two quarters of consecutive contraction. at last week we had the highest european gdp and germany is already in a recession. recession is coming, but may be already here. but there are investment opportunities to be made and identified in the context of growth slowing down. tom: let's get out front to the

investment opportunities. in your research, there is a phrase of economic damage. we see that in china on a relative basis. we have enough blackrock economic damage that it could cause global disinflation? wei: in china we have seen inflation surprising on the downside. that is also why they cut rates which is a surprise at this point. they cut rates 10 basis points is very little compared with the inflation rise. we have more rate cuts coming. the bottom line is, the chinese restart. momentum is not as powerful as a halt. that is putting our previous expectation for china growth to come up to about 6% this year and bringing it down to

marginally below 6% which is our current expectation. they have policies based bear, but they may be very reluctant to use that in a aggressive way. lisa: do you think the pile and training into european equities is overdone? wei: we've seen a lot of european equities not doing -- doing well so far this year thanks to china restart excitement and the fed energy crises did not materialize next to energy. and a mild winter as well. europe is facing a similar comply strain challenge. facing recession on the one hand and persistent inflation on the other. the wages they invested in europe would be in a selective way through quality values. on the one hand, the water is

underway but on the other hand we see a tilt into quality. and quality indexes the biggest name in the index. lisa: that is a redefinition of a lot of different characterizations. people say apple is defensive. as you are talking you say recession might be here but it does not feel that bad. if that is the case, how are you resetting your midyear outlooks? how much are you adjusting upward and your risk tolerance and willingness to pile into the names you have liked? wei: yes we will have our outline released in two weeks. i look forward to coming back and talking about it. the macro environment is taking shape. and it is priced into markets. but in addition to the cyclical macro assessment, whether we have a recession or not, this is

very debatable. there is also the structural forces that come out with the cyclical considerations. so far this year we've talked a lot about this in the program, the narrowness of the u.s. market. there is not a macro story so far, that is a force ai story. i think bobby and selective weekend -- week -- we can overcome. tom: -- jonathan: the stock is up by 176%. and to hear you call equality, can we tease that out a little bit. you can go specifically to nvidia or whatever. but why are they quality stocks? wei: when using about quality

characteristics. that is what the quality index selects names on we are talking about price and power. cash and the ability to generate free cash flow. the ability to grow margin. these characteristics we want. we are in an environment where it slows down. and as we think about being selective, we end up with names that also happen to be the sort of names that markets favored. jonathan: like nvidia with the backdrop. you said it, not me. you should be -- tom: rick rieder is at the shop right now saying why in god's name is she talking about nvidia? lisa: it's a great advertisement. it talks about the screening model and what it does. wei: [indiscernible]

jonathan: i trust you. tom: we have energy and fixed income and equities, we forget it until we see a grab for representation the loneliness of equities and -- tech equities is the one big thing. jonathan: the one big theme into june. can it broaden now? the regional bank so far to date up about .1%. we have a big conversation on wall street as whether the narrow rally can move into year-end. equity futures positive. inflation data for the u.s. coming up in one hour 20 minutes. >> keeping up-to-date with news from around the world with the first word i am lisa mateo. in florida, around 50,000 people

to show up when he federal -- former is appearing in court today. trompe l'oeil is have promised to show force. inflation figures come out today and bloomberg economic say the data will likely give support to officials wanting tightening campaign on paul's this week. it is estimated for inflation rose .3%. macron says that he hopes ukraine counteroffensive is successful. with the leaders of germany and poland they met in paris to discuss coordinating military assistance to ukraine and the upcoming nato summit. transition in the act business bunge is buying the terra --viterra. the deal will create a trading giant that will compete with the world's biggest layers.

and the denver nuggets have won their first nba championship. they beat the miami heat 94-89. they had the best in for series 4-1. they had 16 rebounds, and he was the series most valuable player. global news 24-hours a day on air and on bloomberg originals, powered by more than 2700 journalists and analysts in over 120 countries. i'm lisa mateo. this is bloomberg. ♪ this is ge aerospace, advancing flight for future generations. ♪ welcome to a new era of flight.

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>> it is a very tight and detailed indictment. this has run amok. he has going to put this country through this. he saying i'm worth more than this country. these are my papers. did somebody remind him he's not the president anymore? you don't need these anymore. jonathan: chris christie not holding back on cnn yesterday. some comments for those running for presidency.

diplomatically he's trying to walk a fine line. he understands what his role will be in the primaries. tom: that's a way it is. everybody is playing apart right now. the clichés -- whoever takes the trophy. the shock at the town hall is so different from what got -- out of the door. it was something different. jonathan: a different character. former governor of new jersey conducts the conversation in a different way to the former president. tom: that was chris christie voicing his concerns for the historic day for the nation. we have a chief correspondent in washington. we report in the nation's capital with kailey leinz in miami. and anne-marie let me start with you. kaylee is down there in the

granular of the moment. what happens wednesday? everybody is wondering what happens next year with this process. anne-marie: we know that the president is trying to make this his campaign event. he will fly back to new jersey and give a speech and in the campaign will come out. he wants to raise $2 million following this arraignment. the next few days and weeks and months in the trump world, with the reporting is overnight, the guardian or the washington post that he is scrabbling -- scrambling to find lawyers. that is part of the process and this story will continue. it is not like it will wrap up soon. there was a press conference friday where jack smith said they want a treaty -- speedy trial at the press will try to slow this down. this will go through the rest of

2033 -- 2023 and no into 2024. tom: does donald trump have representation and be arraignment today? annmarie: we have lawyers here trying to add someone to his legal team and those efforts were unsuccessful. he will have to be represented by his existing attorney that is after two of his attorneys resigned friday. immediately after the indictment. the representation is a question. we know this is not unusual for a former president. he has had a revolving door of lawyers over the last several years. as he faces federal criminal charges for the first time, it does not see that his legal team is fully filled out. lisa: why is the current legal team sufficient?

what was he looking to find in his interviews? annmarie: someone to represent him here in florida for the arraignment today. but -- one of them is technically from florida. i think this is an issue of someone who was to take on the case for the former president as we talk about 37 pounds of separate different criminal charges on indictment that was unsealed friday. it revealed a narrative of what happened with the documents and how they were stored in the shower, the bathroom, the conversations he was having with staff with the ability of whether they can classify them. he was saying wouldn't it be better if the documents didn't exist at all? it is definitely a different -- difficult case for the defense to fight. that is why he is having a difficulty finding someone to take that challenge on. lisa: we saw her early this

morning comments on why it is worse to keep records in a garage rather than a bathroom because the bathroom door locks. what is the response in washington dc to the rhetoric around the trump case. kailey: it depends on who you are to. there's been mixed results on the republican side of how they want to socialize and communicate about the case. speaker mccarthy wanted to deflect and point the finger at the fact that there is a pending case against current president joe biden with the documents he had to the difference between biden and pants and trump is once they found these documents, they immediately contacted authorities. they did not want anything to do with them. the current president still has this pending case. this speaker is trying to deflect saying bathroom doors have that are locks. i think a lot of people were laughing about it.

that was his answer. you have the likes of senator romney who say these are highly classified documents and this is absolutely inappropriate. what is more interesting to me is what the challengers to the former president on the campaign trail have to say. nikki haley yesterday in a fox interview -- he was a former president u.n. ambassador she has amped up her rhetoric against him. she pointed to the fact that her husband serving in the military is about to be deployed. she said this puts all of our military men and women in danger. she called it reckless. some of them, we heard from chris christie last night and we knew what his rhetoric was going to be, but there are others moving closer to making sure they are on the record talking about how dangerous this indictment was and how dangerous the former president acted.

jonathan: we heard from governor christie. we know over he stands and where he is going with this. we heard from nikki haley. what has governor ron desantis said about this? annmarie: he took an interesting town on friday. he said when he was in the military if he did something like this he would be ousted in a new york minute. he made the case that he knew what the consequences were but at the same time he was to show and ostracize the base of the republican party of what we've already seen and this week shows how strong of a whole former president has on the base. he did talk about the fact that the department of justice -- the democrats have weaponize the department of justice. it was interesting him saying that he would never do such a thing because he knew how strong

the consequences were. jonathan: and just remind us again when all this kicks off this afternoon. kailey: 3 p.m. this afternoon. but before that we will pay attention to how many protesters show up. miami police pricing for anywhere from 5000 to 50,000. president as ask is reporters -- supporters to show up today. jonathan: over there so many times with regard to the former president donald trump, in the last eight years he has desensitized you to what is playing out this afternoon at 3 p.m. eastern time. tom: i mentioned the math yesterday with the republicans being asked percent of the public. it is amazing as the problem unfolds. we see thousands of people with kailey leinz in miami today.

what ocean of the american public is that? i know what the guesstimate is, but is it 5% or 10% or 15% dare i say 20%? jonathan: annmarie talked about the poll over the weekend. he has weathered out storm with the base. does that help you win and places like georgia? it is become really tight more recently. tom: and further litigation in georgia coming up as well. jonathan: precisely. equity futures positive about one hour away from inflation data and america. -- in america.

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jonathan: three-day winning streak on the s&p 500. 60 minutes away from inflation data. one day away from the fed reserve decision. the numbers look like this on the s&p 500 futures are positive up by .1% on the nasdaq. -- up by .1%. on the nasdaq, up by .3%. tom: and it will be worth watching this cpi report at

8:30. it will be an important drive with the skyhigh short-term yield. and the less top duration here. but it is good to position short-term dynamics with the long-duration dynamics. jonathan: let's do that right now. we have the two-year end of the 30 year. the yield hire by almost one basis point. 3.87. for the 30 year. as we start to think about price cuts, and pricing in hikes, we will see if the conversation changes in 60 minutes when we get the inflation data. i can tell you the u.k. changed this morning. 2 p.m. eastern time 7:00 p.m. local time -- 12569 is the pound

against the u.s. dollar positive by about .5%. in a similar story with the euro. positive by .4%. there is dollar weakness out there encouraged by the stories we have from our colleague in china. and they are considering not just a package to support the economy but a broader package that could have interest rate reductions as well. lisa: i'm old enough to remember the discussion on both of those currencies. with starling it is an interesting turn of events with the whipsaw. it is time for the artificial intelligence report. we look at oracle with earnings yesterday beating expectations and an increase in the growth expectation. cloud growth is going to be fueled by artificial intelligence. the shares are up 5% ahead of

the open with an all-time high. manufacturing in the ai game shares up 1.6%. apple not really feeding into this because they already have so much this year. all the names are up more than 40% this year so far. to give you a sense of the boom we have seen. manchester united i think you would want to touch on this because well they follow man city when it comes to their backing? the shares are up almost 15%. well they are wont they be sold to cutter? jonathan: i'll try to give you the guide to all of this. the buying process has been going on forever. tom: this is a blip in the

family have -- of this. jonathan: we are in a situation where we see the billionaire in the united kingdom conversation taking a smaller stake as this retains a small stake not just in the united the hopes and dreams of shareholders getting a big offer from seeing the changes go -- and you and i can spend money in manchester city. we've been spending a lot of money anyway. let's be clear about that. i have not seen any clarity or come back from officials but the stock is up in the premarket in a big way. tom: we have bloomberg surveillance team to manchester to speak. the futures are up for. it is coursing tuesday. jonathan: it is data just around

the corner. an hour away from u.s. inflation. they say cpi may bolster the appearance of sticky service inflation. that said, we doubt that cpi will surprise sufficiently to counter the signal that is already being delivered for this meeting. out there trying to reinforce this message from chairman powell. tom: he manages money and joining us now with federated ms rj gallo joins us now. i like how you say they will have to change the tune of what we will see in one hour. you are backed in long-duration. your optimistic about a disinflationary outcome. to find what you look for at

8:30 to lean on duration? . rj: this cpi releases for the last 12 or 18 months have been exceptional with the inflation we experience. we look at the trend it is hard to focus on anyone number. the army of economist at the fed and on the street have had a tough time calling it inflation. a surprise to the upside with disinflation that began that -- last year which has plateaued in the very near term. when you look at the data there are portions of see guy -- and they have more reasonable statistics. the fed has made significant and rode in the battle against inflation. we have been leading long-duration, not counting the table, but leaving for a number among -- of months.

we are past peak inflation, and peak growth. we are getting close to the time where if you do not have moderation you might miss out. the bond market will have a really good day. after the courts. -- after the report. tom: how do you link the bond world to the persistent cash flow -- cash flow shift. how do you link the two worlds together? rj: we are more linked than you realize. on the macroeconomic committee, our users are not too far apart. our view on the fixed income sign -- side we were using more traditional phrasing.

but a mild recession could look a lot like what we saw in the turn of the most recent century. many have occurred traction -- contraction of gdp, but the consumer never contracted. they did not have a negative growth rate. but others did. i think something like that may be in later this year. it underpins idea that adding duration to your portfolio and buying bonds is where we think from an asset allocation standpoint it would make sense. we are not leaning max long-duration, but long-duration is good. lisa: what do you think would be a bigger shock to the market a significant -- significant

upside surprise or downside surprise with the cpi print? rj: that's a great question. when you look at the surveys most expect a soft report. the conventional wisdom would be if we get a stronger will -- stronger report we may be shocked. that said, the policymakers on constitution avenue are all ringing our hands. the bigger shock despite the survey is that you get a soft number. you might open the door to many people moving the direction i described. the market would replace -- reprice -- lisa: i saw consumer savings data. i saw yesterday that savings are still considerably elevated from where they were pre-pandemic. at one point -- what point does

the tailwind get used up? rj: it's been extraordinary. you think is about the monetary and fiscal response to the pandemic and we are dealing with that years later. they still persist. the unemployment rate has ticked up, but it is three times of a percent off of a 50 year low. the household in america are in good shape. you may have savings left over in the fiscal policy money. you probably have a job. most people that want a job have one. and wages are growing at a reasonable clip. these are all reasons to suggest to bear is no recession. but this right-hand side of the balance sheet, the asset devaluation and the commercial real estate values that is about 50% occupied on any given day.

there are potential ramifications of this economy and the 500 basis points of bad economy that we think will continue to slow the economy even if the consumer fill has savings and a job. the markets will ultimately soften up but we could have ever session for the consumer. the other segments are. jonathan: very interesting. 10% rally in the bull market. rj gallo at federated hermes. he mentioned office occupancy which reminded me of this story. new york city office occupancy across the 50% threshold last week for the first time since the covid-19 pandemic outbreak. there's two ways of looking at this, great news people are back in the office and other is that it is just 50% that just got back there that is amazing. tom: it is game changing.

this is the biggest conundrum. i do not have a belief and i do not know where we are a year, two-year, five years from now on this national issue. this is a huge -- to borrow from the great historian bernard bailey -- it is the deepening of cities. jonathan: it is up four percentage points from the week before. let's see if it moves that direction through the rest of the summer. s&p futures up positive. coming up next a conversation you do not want to miss with the inflation data. coming out about 50 minutes away. lisa: now keeping you up-to-date with news from around the world. here is the first word. i'm lisa mateo. former president donald trump will appear in miami court to paste criminal charges. the police chief say they are prepared for crowds of up to 50,000 people.

trump has been accused of mishandling classified documents. there are more signs china is concerned about a slowing bonhomie. bloomberg has learned that beijing is considering a broad package of stimulus specials. and they are lower in the short-term interest rate. keir starmer is taking shots at prime minister rishi sunak conservative party with a fight between sunak and boris johnson. he spoke at london tech we. >> most people are not worried about the cost of living they are worried about how they will pay the bills. i think it is a very serious situation. lisa: recent polls show labor ahead of conservatives. the next election is likely in

2024. shares at oracle are at a record high. the competing business will continue its growth in the coming year. it gained 54 percent in the fiscal fourth order. global news 24-hours a day on air and on bloomberg originals, powered by more than 2700 journalists and analysts in over 120 countries. i'm lisa mateo. this is bloomberg. ♪

what do you get from the morgan stanley client experience? listening more than talking, and a personalized plan ♪ to guide you through a changing world. ♪ conventional thinking delivers conventional results. at allspring, we break away with purpose.

harnessing data-driven insights and boundless curiosity. we dissect the market from every angle. helping to build portfolios that redefine what's possible. ♪ because investing isn't one size fits all. ♪ allspring. purposefully divergent. >> i am hopeful the fed has done enough. if they keep hiking they will have done more than enough and the recession will be deeper and

longer than it needs to be. the fed does not like to surprise. unless the cpi numbers are wild they will not hike this week. jonathan: let's see if we get absolutely wild numbers coming up. we will discuss those and then is onward to the fed discussion tomorrow. equities pushing a little higher on the s&p 500. positive by .06%. a weak dollar out there now 3.10 against the euro and pound as well. it is at 1.0794. tom: we have clear inflation data and it is good to speak with secretary janet yellen is occupied so we will do better the former u.s. treasury

secretary joins us. thank you for joining us for bloomberg surveillance. i cut to the chase. your -- the great tip o'neill understood that technology drove things forward. he was a big believer in the system and vision. we come out of the pandemic, we have skyhigh inflation, the dynamic is changing. is this normal inflation? should we fear this or could it lead to a better disinflationary trend? better productivity and growth? jacob: good to be with you. i think it is fair to say there is nothing normal about coming out of covid. it was an extraordinary period that required policies that no one had ever had to think about it our lifetimes before. i do not think there is a surprise that coming out of it is a somewhat bumpy bath with

somewhat unpredictable duration in terms of where we are headed. i think it is clear that there's been a trend down in inflation. a lot of the inflation was supposed to slowly roll off. what is left behind as the higher inflation rate family like. but we do not know is when all of the measures kick in. all the higher interest rates, all the defective: failures combo where will we be? i think a cautious approach is still the right one. we've groomed the economy for some tightening. unemployment is low. we still have a stronger economy but we are headed toward a gap. the question is will it or will it become a technical recession? the data matters. i am sure today's news will be the last word.

tom: jon ferro mentioned this on london and the united kingdom in the last hour but there seems to be a separation in america with an advantaged technology front group that does not care about inflation and another group of america flat on its back. how separate are these two groups economically? rj: that is a good question and there's -- jacob: that is a good point there's a lot of data to show that it is a problem. you talk about savings rates and what are the residual pandemic support and overspending when people go out. it is different when you are at the top or the bottom. at the bottom, the savings have been gone for a while. it has a lot to do with what people can buy -- those things.

we have to ask how different parts of the economy fair. lisa: i wonder how much the fiscal policy will be severely constrained. do you think people appreciate how much for debt ceiling negotiations will constrain for fiscal spending or do you think it was a band-aid over something that did not change the narrative in any way? jacob: i think there will be lower spending on the appropriate time. it will have an impact on things that are important in terms of getting services to the american people. i would not say it does not have a fiscal impact, but the debate is over a small slice of the budget. it was not over revenues. i do not think we should confuse the size of the deal with the order of $75 million -- $75

billion with a true package of fiscal consolidation. i think the question going forward is will there be continued stability with the government not creating that for the society. part of the agreement was a technical legislative provision to put pressure on congress to pass all the appropriation bills separately. they have not done that. if that happens, everything will go smoothly. if it does not, you face a prospect of shutdown, cuts in fed spending. employees coming out of washington the last few days suggest to me that we are not done with problems in our capital. lisa: i do think people are expecting more in terms of the drama.

at the same time am you talk about instilling confidence in the c-suite. i wonder euros vase to future vanke failures at a time where a lot of people are saying there is a backstop for those depositors promised by the treasury department and interference promised by the fed. jacob: i think regulators in treasury made clear they will do what they have two to prevent systemic crisis from occurring they have not made it clear of if that is in every case. they continue to be -- normal workouts of troubled banks. not everything is under the case of the regulators stepping in. but i do not think we are done seeing the impact of higher interest rates on pressure of five a financial institution. you add to that, the pressure

that comes from commercial real estate values being below where they were just a short period ago. there's going to be some stress in the system. what ought to happen is that there needs to be more careful oversight of midsized financial institutions. so that we do not have as many surprises in the future. i don't know what shape that will take but that is a very important discussion and rolling back the oversight a few years ago i thought was a mistake at the time. i am glad to hear that ethic has changed. jonathan: one final comment. i have to say happy anniversary. it was almost a decade ago when he unveiled the new signature. can you believe that was 10 years ago? jacob: it is hard to believe.

jonathan: isn't it amazing? tom: it is original. jonathan: it has changed. jacob: i still get them when i go to the money machine. lisa: [laughter] jonathan: they never got the new signature on that? tom: is there a review of this possible? lisa: cannot say -- my children would love that they are often trying to develop a signature. they would say we can be great at this. jonathan: thank you, jack for being -- being a good sport as well. 10 years since he unveiled a new signature. that is unreal. tom: 30 minutes away from his inflation report. this goes back to how time is leading onto to where we were.

this morning it takes is to an interest rates juncture back to one percentage of our audience on radio and tv does not understand the traditional rate structure of before. and that is time marching on. lisa: do you have a good signature? tom: yeah. jonathan: is not embarrassing. d have the one with all the long circles? lisa: yeah. jonathan: dear remember the information with jack lose new signature -- jack lew's new signature. tom: to use a disney cliché. it is a whole new world after all. lisa: no one talks about that in the more. jonathan: equity futures right

now positive and inflation data is 34 minutes away.

>> there is a lot of faith being put on the consumer which means is being put on the labor market. >> wage pressure is diminishing but is still elevated. >> if you're wondering what a

price spiral looks like i'm i think you're looking at it. >> i don't know that we will see this strength persist. >> things have changed so much that there's clearly been a shift in the inflation cycle. >> this is bloomberg surveillance with tom keene, jonathan ferro and lisa abramowicz. tom: good morning, inflation of america, we will see that in 30 minutes time. we've got a great lineup scheduled. abby joseph cohen will be with us after the cpi inflation report we just heard from a former treasury secretary jack lew and those two are great and worthy of america. they see disinflation. jonathan: what a difference 20 basis points can make because the estimate is for inflation to come down to 4.1%. can you imagine if we had a three handle on inflation? we are looking for something like 5.2% year-over-year but

month-to-month -- month over month is 0.4%. a lot of people would conclude that still too hot. tom: which way does it tilt? i don't have a feel on the whisper number. asymmetric cpi inflation with deutsche bank and i don't have a sense of its .4. .4ish is.3 ish more of a big deal? jonathan: what would generate a bigger market deal? lisa: what we heard was potentially a downside surprise. people are girding for rates being high for a long time. the difficulty in understanding the trajectory is if you look under the hood, rents are decelerating on an overall basis at the fastest pace on record. inflation is coming down at a rapid pace but is this backward looking?

is this concentrated in only a couple of cities? these vagaries is what's making it difficult. what's important is the to america's we talked to jack lew about. there was a great si this -- essay this morning, this inflation report for fancy people, i don't think it's a big deal. let's move on with our savings we have and the pandemic. there is a hunk of america that are still flat on their back, crushed by short-term rates. jonathan: let's attempt to put some numbers on it. the spending on big-ticket items is huge. the bottom line is consumers have rotated their major purchases from goods to services instead of falling back on spending altogether. in their view, this is a style of consumer health because it tends to be cyclical.

big on big-ticket items is still happening in a big way. tom: supreme capital was out with a summary as well and i guess there is some good optimism in it but anecdotally, we see a lot of pain out there with three-month t-bills where they are. lisa: the optimism number came out early is morning and came in better than expected. there is not complete optimism of the difficulty is everyone is waiting for the savings to get used up and they are not. they are still higher than where we were pre-pandemic. it's the tail effect of the stimulus. when does it get used up? we are still looking at a pretty significant pile of cash. tom: west texas intermediate is 67.7. yesterday 68 point 50, that's cheap oil. jonathan: going for the rental

stats, rents are coming down? really? lisa: how specific is that? new york and san francisco is a different story. jonathan: your equity market is just about positive on the s&p 500 and the data is about 35 minutes away. yields are coming in about one sink is -- one single basis points. tom: joining us now is brian levitt, global market strategist at invesco. we are 25 minutes away from a key inflation report. how are you adjusting midyear to a nascent perhaps disinflationary trend? >> is still an environment where investors should be looking for quality. we are not at the beginning of a new cycle yet. we are not at this big pickup and economic activity that will drive cyclical performance higher. you seen the larger cap stocks

do well because investors are focusing on polity and what will still be a slowing economic environment. the fed is still raising rates. that's the roadmap for now. we will be looking for signs that market sentiment and leading indicators are shifting toward a more cyclical variance but we are not there yet. tom: are we in a bull market? >> we are for a handful of names. if you look at the broad indices, it's a bull market but it's a very narrow concentration. the top 10 names are driving a lot of that performance. this is how these things play out. we are still well off the peaks from where we were prior to this inflation battle. we are grinding higher and yeah, over the next couple of years, markets should do well. if you look historically after

inflation has peaked and after the fed has done tightening markets, they have done well over the next at least two years. lisa: we were mentioning some of the upward revisions we've got from a number of different shops as they reassess the landscape heading into year end. how much have you changed your view and upgraded your expectation for stock returns? >> we were positive coming into the year. the reason being is that inflation peaked last june. if you look after inflation peaked and stocks tend to do well so we are a year out now and pretty true to form, the equity market has performed well. a lot of this has been driven by higher-quality names. early in the year, it was all about the soft landing names and lately, it's been more tightening and some struggles in the economy. ultimately, we will move through the old high and what we are looking for are signs that the

composition of that is shifting. what you would like to see is broader market participation. the narrow concentration says maybe you have some potential near-term challenges but ultimately, the next couple of years are likely to be good for equities. lisa: what would give you a sense that something is real here in terms of the bid into regional banks and financials in general and consumer cyclicals? >> you would like to see some normalization of the yield curve. you would like to see more participation from emerging markets, the deepest rally names, you'd like to see stocks meaningfully outperform. we've seen some signs of it but certainly, not an all clear. what we have to remember is monetary policy is a leg. the fed funds rate was 1% a year ago and this is a market that knows the lag effects are still

coming in with got an economic slowdown coming. that likely precludes a new market cycle immediately with early cyclicals taking leadership. tom: let's go to 8:30 a.m. and it's just one number and you will tell me you never look at a smooth moving average. what are you going to look at within the festivities here? what's the single thing that matters to you? >> the first thing i want to see in the year-over-year. we want to see how much it has come down and there are some pretty good base affects we are working on. could we see a year-over-year that's in the low 4's or below? that would be interesting. this has been a progression. we see commodity prices fall and we've seen a collapse in the money supply. we've seen retailers rebuild inventory.

we are starting to see rents come down. it's all a process. there is still some parts that are hot. all of us at her home for three years and we are still spending money and hotels and airlines and that's because we have a low unemployment rate but that will start to shift ultimately. i'm pretty convinced this inflation story is in the rearview mirror. i'm convinced that investors should be looking toward an economic slow down, the end of tightening an ultimate beginning of a new cycle rather than being so focused on the inflation numbers. jonathan: tell that to the airlines. thank you. i was looking at some of the numbers, united airlines, the ceo looking at the potential of a pilot deal adding $8 billion in costs. fedex yesterday, the union approving a tentative package of 30% pay rises for pilots over at fedex. we are still talking about this.

certainly sectors of this economy are affected but these are big pay rises. tom: it was not a small business, a larger business but not united airlines and the head of it said every single marginal revenue dollar is going to labor compensation. he said every penny of it audited by their accounting staff. jonathan: that's coming at a time when the airline service is booming. lisa: what's their incentive to go forward when they charged with a charge? business travel has been going up but a lot of business travelers are being forced to use economy who previously would use business because of how much the prices have gone up. people are putting up with the discomfort of it because there aren't alternatives right now. tom: i burst out laughing how

expensive an international trip is. they were numbers that were unimaginable three years ago. jonathan: they are not coming down. tom: the demand is there. that's exciting for the airlines. i thought they had of ryanair was interesting yesterday. i will stand up. jonathan: you are going to stand up for six hours on a redeye? tom: i would. jonathan: you think you would be standing up. that's different. in the next 30 minutes, the lineup looks like this. inflation data about 20 minutes from now, michael mckee will break it down but we will catch up with will kennedy of our famed commodities team to break down what is in wasn't isn't happening with fruit after that, abby joseph cohen cohen, professor at the columbia business school will catch up with us in about 18 minutes. tom: she is the toughest greater

there. -- grader there. she is tough as nails. jonathan: from new york, this is bloomberg. lisa: keeping you up-to-date with news from around the world with the first words -- less than 20 minutes from now, the latest u.s. inflation figures come out and bloomberg economics says the data are likely to give support to federal reserve officials wanting to put their tightening campaign on pause this week. it's estimated core inflation rose 0.3% last month, a slowdown from the april increase. in miami, police say as many as 50,000 people could turn up when former president trump appears in federal court today. he is expected to plead not guilty to charges involving the mishandling of classified documents. trompe l'oeil is have promised to show in force. the french president emmanuel macron says he hopes ukraine's

counteroffensive is successful. he says it will lead to negotiations and ian leaders of germany and poland met in paris and discussed core knitting military assistance to ukraine and the upcoming nato summit. shares of oracle are at a record high. the company projects its cloud computing business will continue its rapid growth in the coming fiscal year. the cloud sales gain 54% in the fiscal fourth-quarter. global news powered by more than 2700 journalists and analysts in over 120 countries, this is bloomberg. ♪ it can happen to the people who teach us

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>> i don't think we are done seeing the impact of higher interest rates on pressure on financial institutions. you add to that the pressure that comes from commercial real estate values being below where they were p just a shorteriod ago so there will be stress in the system. jonathan: some of the fed officials want to wait. you can see the impact of the cumulative tightening regardless of the inflation data. we will go through the data coming out in 30 minutes time.

we are just about unchanged on the session. session highs number of hours ago just about unchanged on the equity market. the opening bell is one hour and 30 minutes away. yields are a little bit lower. one theme in this market we need to talk about his crude oil, lower for the week, $66.80 with wti and we are off those lows. we saw 66 monday. it's been difficult despite what opec-plus is trying to achieve. tom: maybe it's a gallon of gas and will kennedy is in london. it's a gallon of gas in london of $5.40. here it's $3.60. it's a disinflation of a gallon of gas in america of 28%.

i guess that's good news for all. what is the level of panic above opec producers right now and u.s. producers? what is the sweat we are reporting in this price decline? >> i think there is still a lot of confidence among opec producers that this weakness while unwelcome will be temporary and actually they still expect a significant upswing in prices in the second half of the year. opec just relates monthly report that forecast big differences in the second half of the year. in july, when saudi arabia will introduce it voluntary one day cut, they see a cut of 2.7 million dollars per day. that leaves significant gaps for the second half of the year so there is some optimism and surprising that they have not

reported the optimism that these are lows and we will see things go up from here. tom: you been a student of this over the years. we say energy doesn't matter like it used to but i've never bought that argument. can you suggest that energy is part of our inflation pie and disinflation is not as important as it used to be? >> i don't think global gdp depends as much. each unit of global gdp seems to mean less oil and that means oil prices don't have quite the economic impact they used to. therefore, it seems gas prices don't quite feed into people's overall baskets like they used to. one interesting question going forward his will that relationship continue to change? will the global economy become less dependent on oil than it was?

if you look at the number of electric cars on the streets of china, they were overwhelmed by the number of electric vehicles on the streets of the chinese capital. that tells you the relationship between gdp growth in oil demand growth may be changing on a structural basis and that something we need to understand better as we assess oil prices over the coming months and years. lisa: we heard this from a number of people -- are you saying because of china's shift to electric vehicles, they are not necessarily going to generate the same kind of demand for oil that they have in the past and that's the reason you haven't seen a rebound? >> i'm not saying demand will wane in china but the growth in china may not produce the uplift you saw in the past and some people expect to see in the future. the relationship to economic growth in countries like china and elsewhere is changing and perhaps becoming weaker.

i think it's something people want to understand better. as electrification rolls out across the world, whatever pace it goes, it will change the relationship between oil demand and global economic growth. jonathan: will it change the relationship with commodities more broadly? >> yes, i think it's fair to say that copper demand, the economy will become more copper intensive and people expect that being that we need huge numbers of electric cars would use copper but the power grids huge -- use huge amounts of copper. yes, the world may become a little less oil intensive but will become more copper intensive. these are fairly marginal. i do see these relationships

starting to change. jonathan: thank you so much. we need to talk about this global growth and the potential for stimulus. michael mckee is with us and i know we will talk about cpi in a moment but we see the headlines from the chinese central bank. there are different interest rates that they adjust, sometimes i can't keep up. what have they done and what are they doing now? mike: it seems that they are cutting rates that would influence banks to lend to consumers. they want to build domestic generated growth as opposed to growth from fixed asset investment you get maybe by cutting borrowing rates for borrowers by cutting the overnight rate in china. they have had a slow recovery from covid in terms of domestic demand. these rates basically free up additional money to be lent at

lower rates. lisa: there is a different backdrop in china where there has been falling inflation at a more significant pace. not the same kind of problem central banks in the u.s. and europe have been fighting. how much does that signal what others can do? is this very much a china specific story driven by the disinflation? mike: for the moment, it's a china specific story because they have low inflation and demand is low which is the opposite of what we see in more developed countries of the west. one year medium-term lending facility is their main rate which they haven't adjusted in a while. there is a thought they would do that this week but then we have this story about a number of different stimulus ideas they are considering so that might put off an announcement of the medium-term rate cut.

tom: i know you will get the first question in the press conference with jerome powell tomorrow. we are fixated on the cpi report. are they looking at the labor market for inflation? mike: they are looking at inflation. the labor market as an input to inflation but they met their mandate. it still below probably with a think for employment is so it's all about inflation. we will talk about this obviously bit of the numbers come in hi, you will have wall street start betting that maybe they will change their mind. the question of the day for wall street is what happens at the wall street journal reporter is in the shower and this is the call? lisa: there is a story out that told is nothing. tom: there was a story about

recession being part of america. colby smith says inflation is cracking. is it? mike: that might be going a little far. it's starting to decline but we are in that part where you pick the low hanging fruit. it will be harder to get rid of something to some of the embedded inflation out there. things will still go down slowly but after three, it gets tougher. jonathan: be kind to our friends at the financial times. michael keaton -- michael mckee with inflation data. from new york, this is bloomberg. ♪

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tom: and inflation report for america in 20 seconds. the bloomberg terminal says a little bit of lift to equities and for more further curve steepening in the last number of seconds. lisa abramowicz and tom keene and jonathan ferro preparing for our next eventful hour. we will have a careful study of the cpi report. we need to go to michael mckee of the shock and all of the moment. mike: i need to start downloading the numbers because

we are a little bit slow this morning which sometimes happens when everybody starts hitting the numbers. cpi comes in up 11/0, down from 4/10 and the core comes in the same. that puts the year-over-year at 4% for the headline. the core is at 5.3% which is down from last month's 5.5 but it take higher than 5.2% that had been forecast. in other words, this is a status quo report, almost exactly as forecast so what you are looking at is a fed that doesn't have any reason to change whatever view it has decided if it has decided as of today. tom: this the status quo is a lift to the equity market and you see that with the nasdaq up 016 percent. up 3% earlier.

the vix was 15 and out some more optimistic 14. the movie and yields is tangible and its lower. lisa: if you look at the core year-over-year, it actually surprised to the upside. people are looking at the headline and that's interesting because many people thought the core would be more important people want to see some's art of deceleration and are willing to take that view. tom: i like the mix we see among four or five or six data points. lisa: i think what the market is saying which can change, they are basically saying this takes up the need for the fed to come out and surprise markets with a rate hike. they are ok holding because there wasn't a significant upside surprise. this is a global tom: growth statement.

equities lift and lift nicely in the s&p is well over 4400. even oil is on the bid with west texas intermediate up slightly. give us further data on the status quo of 4000 lines of bls. mike: the big news as energy, gasoline prices went down 5.6%. we have to see if that goes into june -- july as well. energy services down 1.4% overall. apparel prices down 0.2%. cars and trucks have had a drop at the wholesale level. some analysts have been saying watch the numbers in july when

we get the june report and they say it will go down that will put extra pressure on the markets. tom: what are rents doing? mike: rent is up 0.5% which is a tick down from the prior month but seen is not a major drop. it shows some movement. also 0.5%. you were talking about airfares earlier. airfares are down 2.6% which is a fairly large drop. we are seeing some downward pressure. does this change your questioning to jerome powell tomorrow? mike: not really, if they don't move tomorrow, what is it that will move you to raise in july? does it have to be a turnaround

in inflation? we are seeing inflation sort of on the path they have laid out. tom: the federal reserve reports tomorrow we will have special coverage tomorrow afternoon. abby joseph cohen darkens the door of our studio. she is not with goldman sachs. there is a new world after being a goldman sachs partner, a professor at columbia business school enjoins us. wonderful to have you in the studio. once again, it's a market and you have to believe in optimism on the american economic experiment and within the caution and gloom equities will rise. is this a bull market off the october lows and it is it a better time for the stock market? >> there are quite a few questions embedded in their.

i am delighted to darken your door. thank you for the invitation. i believe what we are seeing our in -- i see investors thinking differently than the talking heads. the people who are required to make daily comments about what is happening over reacted in some way to daily data or monthly data. they forgot to look at things in context. michael did a great job of saying here's where inflation is now let's put that in the context of where it was a year ago. we basically see that inflation is coming down and it takes pressure off the fed to continue to raise interest rates. the other think we are seeing in the data, not necessarily every week or month is that there is ongoing economic growth in the united states. it has been surprisingly good but not relative to consensus expectations.

not really a surprise when you think about the strength of the consumer. when the fed began to raise interest rates more aggressively a year ago, the household balance sheet was in the best condition we have ever seen. credit wasn't very good shape relative to income levels we also know the employment situation has been good and is not really shown any deterioration. in our u.s. economy, that really is the base for economic growth. lisa: on the heels of the cpi report the cayman status quo, i wonder if we are seeing disinflation and we are still seeing the dynamism with wells fargo saying they are seeing an increase in card spending and strength there. but those two together and now do you buy into the immaculate disinflation, the idea you could get a new bull market and disinflation even if growth slows? >> i have been consistently in

the camp that we would see slowing in growth with no recession. and we could see inflation come down. part of that is because i've had confidence in the fed. they would pay careful attention to the data. when we think about what they may or may not do tomorrow, i think they have the option to i don't know if we call it skip or pause but people assigned something to that but the thing i learned as an economist at the fed is we don't know how long it takes for monetary policy changes to actually affect the economy. i think they have already done so much and we already have an inverted yield curve. if i were voting which i'm not, but if i was a voting member of the fomc, i would vote for wait and watch. lisa: that seems to be the consensus as far as what people are expecting. as you advise the boards of

public investment firms to understand how to position, would you say is time to lean in and bet on a broadening of the rally and it's time to understand that perhaps we will go back to something that's a lower yield reality? >> i know we are focused on the fact that we are no back to where we were. i think the time to a really good decision was late last year or this year. everyone was so disturbed by what might happen and what i considered to be a low probability scenario, that was the opportunity. as i take a look at things now, i say equity valuations are not as appealing to me as they were in november and december because the pe has risen off the overall market. what i am advising is balance. we have an opportunity for the first time in ages to fixed income and i would go with high-quality.

high-quality corporate scum at treasuries and so on, you can get four or 5% return on treasury which is not bad. in the equity market, i would be looking at some of the sectors that haven't performed well. 40% of the s&p 500 roughly is i.t. and communications. these are the two sectors that have done so much better than the rest. if you are concerned about relative valuation, there is great opportunities and -- in some of the more cyclical areas and if people believe there will not be a recession, that's where you start to look for opportunity. lisa: do you think the whole ai hype has been overplayed? >> i have been speaking to computer science professors and experts -- tom: you never did that a goldman sachs. >> i have an undergraduate degree at computer sciences as strange that might be. they are saying they are kind of

nervous about how ai proceeds. there is the sense that if you put good data in, you will get good results out. what the scientists are saying is it's not true. the processes that are being used are not really being properly regulated. they are advising pilot projects we can see what happens. this congress has not yet figured out how to regulate the internet. we may be pretty far behind in terms of whether there should be some controls over ai. i'm not talking about anything for conine, just guardrails and our congress is not yet figured out what to do. tom: i've got eight ways to go in 40 seconds. i want you to tell me what the second leg of a bull market

looks like. the first leg is easy money, what happens now? >> i've been at that 4500 level since last december. i'm not surprised in terms of what we see. when i take a look at david's forecast, he is talking about an increase to around 4700. i think that's reasonable when we look at the profit outlook and what might happen to pe's. tom: does columbia know your view? >> i'm not placing trades. i'm doing that at home. tom: abby joseph cohen on a day of inflation and michael mckee says it's status quo. lisa: keeping you up-to-date with nusra around the world -- former president donald trump will appear in a miami court today to face criminal charges.

the miami police chief say they are prepared for crowds of up to 15,000 people. trump is expected to enter a plea to a 37 count indictment, accusing him a mishandling classified documents. there are more signs that china is increasingly concerned about a slowing economy. beijing is considering a broad package of stimulus measures. china's central bank has unexpectedly lowered a key short-term interest rate. the ceo of barclays says there are several ways to look at the takeover credit suisse. they spoke to bloomberg in an exclusive interview. >> credit suisse and ubs merger is too important consequences. for the financial system as a whole, it has stabilized it because a slightly wobbly bank is no longer there. it's a very solid transaction and as ubs develops its business model, it will be an important

client for markets business and a competitor as an investment bank. lisa: ubs is posted nearly a dozen of barclays top technology bankers. the first time since the start of the covid pandemic i'm offices in new york city crossed the 50% occupancy mark. occupancy last week was up more than four percentage points from the week before. global news powered by more than 2700 journalists and analysts in over 120 countries, this is bloomberg. ♪ j.p. morgan wealth management knows it's easy to get lost in investment research. get help with j.p morgan personal advisors. hey, david! ready to get started? work with advisors who create a plan with you, and help you find the right investments.

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♪a lovely day (lovely day)♪ ♪(lovely day) (lovely day)♪ ♪(lovely day)♪ a bank that knows your business grows your business. bmo. >> even today, 80% of the way the world operates around energy is still fossil fuels.

what's more striking is the fact that the the demand for it is going up. we need to get that to go on the other direction. tom: the competencies a breakthrough energy ventures investments and describes how he's trying to move forward the dialogue and energy. look for the full interview tonight at 9:00 p.m. the markets are off of what michael mckee called a status quo inflation report. michael told me that what's really going on here is the dynamic of service sector inflation. there is anebbing of the american economy. you get it in a better market and the nasdaq up 0.3%. the vix 15 comes into a nice 14.59.

seven basis points on the two year yield. oil finally getting a lift off three days of agony. american oil is $68 68 cents. there is growth on the service sector side. joining us now is david rubenstein, cofounder of the carlyle group area the wrap on david rubenstein is he only speaks to the great and worthy is wrong. not this time around. he speaks to mr. roberts about the view forward and energy. let's start with carmichael roberts. who is he? >> carmichael roberts is a man who runs the breakthrough energy investment committee which was started by bill gates to find young companies that could be invested in that would help break the dependence on oil and gas and help climate change. carmichael roberts who have

known for a long time, i was chairman of the board at duke university and he was on the board and is a duke graduate and phd in chemistry and he's had a lot of investment experience in the venture capital world. when bill gates was looking for a chief investment officer to run breakthrough energy, he selected carmichael roberts on the spot. they have now made 100 investments in breakthrough energy along with other investment people who want to make some didn't and the idea we can find energy sources that are not completely oil and gas dependent. it will take a long time. the investments will take many years before they come to fruition. so far, they are on their third fund and it seems to be doing well. i haven't gotten any profit distributions yet but it looks hopeful. lisa: i believe michael bloomberg, the founder of the company we work for come is also an investor in this particular

fund. i'm curious his approach highlights a shift in the renewable energy area which we don't need to get rid of fossil fuels but it is one piece and we need to focus on mitigating some of the effects. can you talk about how that is the new shift in the renewables world? >> obviously, we are dependent on oil and gas and it provides 80% of the energy the world uses. were there new oil and gas, wood civilization be further ahead or further behind? most people say civilization would be further defined had we not discovered oil and gas. but we have it and we are now so dependent on it that we are probably hurting the atmosphere in dramatic ways. i think there's a push by bill gates and many other people around the world to reduce our dependence of oil and gas to alternative sources but it will take a long time and much more expensive to use some renewable sources. it's a real challenge but it's

clearly people want to get it done. i am not likely to live long enough to see the bull -- full benefits of it hopefully my great-grandchildren will live in a world where we are not so dependent on oil and gas. lisa: what's been evidenced by the lack of comments by c-suite executives of recent earnings calls talking about climate change in talking about investing in renewables, there's been a shift away from that saying you need to focus on the bread-and-butter of what you're doing and you're seeing that with the big oil companies. have you talked about the shift in sentiment? >> 10 years ago, it was difficult to find an oil company executive with minute there was climate change or that it was caused by oil activity. climate change has this is human

induced activity is probably caused by the excessive use of gas. that doesn't mean they are getting at of the oil and gas business but it might be something they have to do but large oil and gas companies will be using oil and gas for quite some time. they are doing more than they were before and trying to invest in renewables. there has been a pushback from some people saying we can't be dependent completely on renewables because we are dependent on oil and gas to make the world operate. they cannot act like they did 20 or 30 years ago. we is roughly 105 billion barrels per day around the world. that's a lot. there is an anonymous amount of carbon in the atmosphere it will take 30 or 40 or 50 years before the current carbon is out of the atmosphere. it's not likely all of us on the show are likely to be around

before carbon is gone. tom: i remember looking at newcastle coal in australia. there is a basic idea that esg is in retreat and there is a large part of america, i don't know if they are anti-climate change or doubting climate change but they are certainly anti-tsg is a corporate statement and philosophy. from where you sit with all of your connections in the view forward three years for five years, is esg in retreat? >> i don't think so. the state of florida has pulled some money out of blackrock but larry fink has said more people of come in because of the strong position. i think it gets attention because when you say you are against esg come it is newsworthy but generally the zeitgeist of the era, people in my generation and younger are

saying yes, esg is something that's here to say but that doesn't mean you have to do only things that are good for en as g. you have to recognize that everything you do will not be just esg but the younger generation certainly recognizes more has to be done. esg many -- means many different things to many different people but the private equity firms have significant esg programs in large part because they think at the right thing to do but also because their investors want something to be done. it's difficult today to raise money for oil and gas but it's easy to raise money for something that esg oriented and that reflects the era. tom: you suggest 24 months that we won't see a breaking of that enthusiasm to invest because we want to. it's the idea that there is a calculable business advantage to doing e has g. that still remains after the battles of the last three years? >> i think that esg, while it

has its detractors is not going away. as we had climate change problem throughout the world, people are seeing this is something we got to deal with. in new york, had fires coming down from canada and it polluted the air in washington as well. these kind of things don't just happen. they happen because we are going through a shift in the way climate is operating on the face of the earth. i believe people increasingly in all parts of the world are seeing how climate change that affecting their lives. as a result, i don't think esg is going away. there is always pushback. change in anything always produces some pushback but the pushback we have seen from the governor of florida is not insignificant but i don't think that will be the majority particularly with younger people realize they have the ability to do something in their lifetime to affect climate change. tom: thank you so much.

david rubenstein with us and look for his wonderful interview tonight at 9:00 p.m. just generally, lift to the market. jason furman on twitter with a breakdown beneath the headline data, disinflationary trends in place. lisa: it's lower than where it started and you are seeing more significant decline if you look at the initial knee-jerk reaction. if this doesn't change the narrative, will people start moving away from betting that the fed will start lowering rates in july? are they done at the disinflationary process has started or is it too soon? tom: it's too soon, we've got to get beyond this meeting. we've been waiting from -- for the stage to get to tomorrow we will have the coverage tomorrow with wonderful guests lined up for you. the three of us are here tomorrow morning. ok fine.

we will do that tomorrow. michael mckee will be at the press conference from the fed. ♪ it's easy to get lost in investment research. introducing j.p. morgan personal advisors. hey david. connect with an advisor to create your personalized plan. let's find the right investments for your goals okay, great. j.p. morgan wealth management. conventional thinking delivers conventional results. at allspring, we break away with purpose. harnessing data-driven insights and boundless curiosity. we dissect the market from every angle. helping to build portfolios that redefine what's possible. ♪ because investing isn't one size fits all. ♪ allspring. purposefully divergent.

jonathan: no news is good news. equity market positive .5%. the countdown to the open starts right now. >> everything you need to get set for the start of u.s. trading. this is "bloomberg: the open" with jonathan ferro. jonathan: live from new york, no ugly surprises from the u.s. inflation report, leaving the door open for the fed to skip june as china continues a