and freedom today, tomorrow and for as long as it takes. [applause] pres. biden: we all what this war to end on just terms. return to the basic principles of the united nations charter that we all signed up to. sovereignty, territorial integrity. these are two colors of peaceful relations among nations. one country cannot be allowed to seize and neighbors territory by force. russia could end this war tomorrow by withdrawing its forces from ukraine. and ceasing attacks on russia. -- i russia on ukraine, against its children, women and children, its military. unfortunately, russia has shown no interest in the diplomatic outcome.

putin still wrongly believes he can outlast ukraine. he can't believe it is their land, their country and their future. and after all this time, he still doubts our staying power. he is still making a bad bet that the conviction and unity among the united states and allied partners will break down. he does not understand that our commitment, values and freedom is something he can never walk away from. it is who we are. throughout this war, the people of lithuania together with our baltic brethren have been among the most fierce champions of ukraine's right to a future of its own choosing. one that is free. because you live so long with freedom denied, many of you who are older no better than everyone how precious the right

to determine your own future is. precious to people everywhere. not just ukraine, ella bruce, georgia. and all of the places around the world where people continue to fight to make their voices heard. so my message to all of you tonight is keep it up. keep it going and keep reminding the world of hope that lithuania embodies. you embody hope in this country. i mean it. i'm not joking. i mean it sincerely. we must never forget how much this matters and never give up on a better tomorrow. the defense of freedom is not the work of a day or a year. it is the calling of our lifetime. of all time. our unity will not falter, i promise. folks, as i look around the

world today at the moment of war and peril, a moment of competition and uncertainty, i also see a moment of unprecedented opportunity. opportunity to make real strides for a world of greater peace and prosperity. liberty and dignity. equal justice under the law. human rights and fundamental freedoms, the blessing and birthright of all of humanity. that is the world the united states is working toward. it is one we will only reach if we do it together. and i mean together. we need to take the same spirit of unity, common purpose, determination that we have demonstrated in response to russian aggression and ukraine and bring partners along as we continue working to build we want to live in at a world we want for our children. my friends, most fundamental level, we face a choice.

it not hyperbole. we face a choice. a choice between world defined by coercion and excellent tatian , where might makes right, a world where we recognize that our own success is bound to the success of others. when others do better, we do better as well. where we understand that the challenges we face today from the existential threat of climate change, to building a global economy where no one gets left behind, are too great for any one nation to solve on their own. and that to achieve our goals and meet the challenges of this age, we have to work together. the world is changing. we have a chance to change the dynamic. that is why i have been vote -- focused on revitalizing alliances that are the cornerstone of american leadership in the world. these past years we brought the translink partnership to new heights, reaffirming the

relation between europe and the united states as an anchor to global stability. the idea that the united states can prosper without a secure europe is not reasonable. it really isn't. not a joke. [applause] pres. biden: we are building up alliances with the indo pacific, australia, japan, the philippines, providing security and returns to that region of the world. through our partnership with australia, india, japan and the united states, we are bringing major democracies a reason together to cooperate, keeping the indo pacific free, secure. we have demonstrated during this nato summit indo pacific partners are joining us for the second year in a row, we are working to deepen connections between the atlantic and pacific

democracies so they can better work together toward the share value -- shared value we all seek. strong alliances, personal partnerships, collective action to meet our shared challenges. the world has shrunk. that is how we built a future to see that we share and know that we share challenges and work together. we have to step up together, filling the broadest end deepest coalition to defend the basic rules of the road. to preserve all of the extraordinary defense of the international system grounded in the rule of law. we after come together to protect the rights and freedoms. to underwrite the flow of units and commerce, which have enabled decades of global growth. yes, territorial integrity and sovereignty. but also freedom of navigation and overflight.

giving our shared seas and skies open so that every nation has equal access to our global common space. and as we continue to explore the possibilities, our rapid advances in innovation, we have to stand together and ensure them common spaces of our future reflect our highest aspirations for ourselves and others. as my dad would say, everybody has dignity. artificial intelligence, engineering, and other emerging technologies are not made into weapons of aggression but rather tools of opportunity. working with allies and partners to build supply chains that are more resilient, secure so they never again face the situation like we had during the pandemic. when we could not get critical goods we needed for our daily lives. we all must summon the

commonwealth to address the existential threat of accelerating climate change. it is real, it is serious and we don't have a lot of time. it is the single greatest threat to humanity. and it is only by working together that we will provide the worst consequent as from ravaging our future and that of our children and grandchildren. we also have to recognize our shared response ability to help unlock the enormous potential that exists in low and middle income companies around the world. not out of charity what our own self-interest. we all benefit when people are healthy or a more prosperous. but it's true. we benefit when entrepreneurs and innovators are able to pursue their dreams.

to better address the needs of today in this interconnected world. world work climate disasters, conflicts make it harder to address poverty and instability that holds people back. that is why the united states is leading an effort to transform the multilateral development banks like the world bank. help them better address the global challenges while enhancing the core mission and reducing poverty. and boost shared prosperity. we're working with our partners at g7 to address the enormous needs, especially in low and middle income countries in africa, latin america and southeast asia. it is a statement about the world we want to build together. we stand at an inflection point. an inflection point in history, where the choices we make now are going to shape the direction

of our world for decades to come. the world has changed. willie turned back to unchecked aggression today to deter would-be aggressors tomorrow? will we stop the climate crisis before it is too late? we harness new technologies to advance freedom or diminish it? will be advance opportunity and allow instability and inequality to processed? -- processed? -- processed -- persist? it is going to take all of us, i believe that with ambition, confidence in ourselves and one another, with nations working together for common cause, we can answer these questions. we can assure a vision can we share and the freedoms we cherish are not just empty

words. in a troubled time. but a roadmap, a plan of urgent action to a future we can reach if we work together. matt: chris biden speaking in lithuania at the nato summit delivering a message of unity, saying our commitment to ukraine, our collective commitment to ukraine will not waiver. and saying he needs to bring major democracies of the indo pacific together. spanning regions, talking about globalization as well. let's bring in and report on, traveling with the president and she joins us from lithuania. i thought the president was very clear eyed, he seems fired up. what do you make of this speech? annmarie: it sounds like he's doing a victory lap in terms of the work that happened on the

ground in lithuania. the expansion of nato, which the president really wants to take credit for, not just vineland but with turkey giving the green light to sweden and the fact that the g7 is here making agreements with ukraine for the short and long-term. then as you can see, he pivoted, what sounded like a campaign speech, the president is trying to talk about his vision of the world. potentially a contrast to his predecessor, who likely, potentially in november of next year, could be that man he is up against on a rematch. he is talking about a secure europe and how it would be ridiculous to think the u.s. is not stronger without a secure europe. ai, climate change, supply chains. this is really not just a moment that a president is taking a victory lap of the work happening regarding their invasion of ukraine and the support to ukraine, the expansion of nato, but this is

also a campaign speech. he is making an argument to the american people about how he views the world order. matt: thank you, annmarie hordern speaking about the victory lap campaign speech. he is finished with his remarks and building quite a crowded capital. you can see the american and lithuanian flags waving, captivating images there. let's go to crypto and talk about the macro picture. someone who can do both, mike joins us, galaxy digital founder and ceo as well as bloomberg about ps sonali basak--bloomberg's sonali basak. a pleasure to have you. let's talk about the macro picture, mike. you are a unique guest. we have an inflation number that is encouraging this morning.

it looks like that fed rate hikes have had some good effect in bling -- bringing down inflation. cpi at 3%. what is your take? >> markets have been waiting for inflation to break. the fed have said we expect two more cuts, the market was skeptical. this number probably says they will still cut, even though they probably should not, in july. but that will probably be the last cut unless things change dramatically. the markets are sniffing that out, a big selloff in the dollar, euro dollars and the short rate contract rally, fixed income rally. it is good. matt: what does it look like from your perspective? the fed raising rates, it is necessary to bring down the inflation. last year we had 9.1% cpi readings. it has done damage to your industry, the crypto industry. how do you view rising rates from galaxies perspective?

mike: we have always been against the debasement of fiat currency, which inflation is part of. it rallied well when we were doing quantitative easing. it sold off when it got really hawkish. the market is starting to sell out that workflow through the end of the cycle. bitcoin is a macro asset but there is another piece for it. we are still early in the adoption of people believing bitcoin is a macro asset. larry fink went on your show, they said bitcoin is the digital gold, this is a stored value. it is a long way from where he was four or five years ago. as blackrock wants to adopt bitcoin at etf, invesco, the biggest etf provider. the idea that we are going to get an etf in the u.s., which is probably going to happen, it is

another step in what i think is the broad adoption of this new idea and technology. annmarie: explains of intimate. when you first had crypto come to the fore, it was supposed to be an answer to finance, another universe. now you have big asset managers stepping in. why believe in the story of traditional financial managers stepping into the crypto space when crypto is supposed to be separate? mike: it was never going to be snap your fingers and we switch from one financial system to another. even galaxies role is bridging traditional finance with the crypto universe, explaining what it is, bringing people into the system and making them uncomfortable. so blackrock is going to help do that. bitcoin is just one part of the crypto universe. it is what i call a

decentralized money when you think about it. there is a whole other piece to crypto. decentralized finance. nft's, stablecoins, tokenization which is also making progress. so -- sonali: what role do other assets play? as someone who has been in the world for a long time, where you have inflation starting to ease, how do you view the dollar? are these assets you would be willing to trade alongside bitcoin? mike: i bought more today. i think rates coming down. the real problem with the global economy is fiscal. we are still running a 5% budget deficit. fiscal spending is close to 24 at when he percent gdp.

it should be at 20. when we are at full employment, we should be close to a surplus, not a 5% deficit. governments are spending too much. we have populace among the left and the right. that is going to keep the debasement of currency. it will keep it through $32 million. inflation will go up and down. in some ways, central banks can't have inflation with as much debt as they have. it is a tricky game that powell and yellen have to play. our bet is that no great stewards are going to be able to deal with the hand the politicians keep handing them. which is i want to spend. matt: does powell have to keep raising rates in the face of a fiscal picture that continues to raise inflation? mike: there are structural things and cyclical things.

we had that cyclical move from the huge impetus around covid. that is winding off and maybe there are a few more months of people having excess stevens -- savings, but student loans are getting turned back on in october and people are slowly spending through. you can see credit card debt going back up. i think the economy will slow and that takes the heat off of powell. will we go back to an environment where it feels deflationary? i don't think so. i don't think the politics will allow it. i don't think so because we have supply chains that are broken, we are building this new infrastructure with the bill that got past because we have a trade war with china or some form of cold war with china. there are a lot of structural things that are different than the great moderation. sonali: let's go back to crypto.

you've been doing well this year, bitcoin is up meaningfully. but in the last couple of weeks since blackrock announced its etf filing, did not see bitcoin move meaningfully past this. do you think it still breaks out or is there more downside risk, where does it end the year? mike: we are consolidating between 28 and 32,000. we will have an ice leg up. that might be when the fed flinches. people have made a lot of money so there is supply pressure. it appears the government is selling some of their bitcoin before they are going to improve dtf. they are not the best of traders. but that is why bitcoin is performing today. what i do think is blackrock,

invesco, the group of etf providers is a real signal that adoption is coming. larry fink travels the world talking to the biggest pools of capital. it makes it easy when he is out there saying bitcoin is an alternative. if you are worries about -- nervous about who is your custodian, the etf is an easy first step. and it is for a lot of people. i just think if it happens, if the seal of approval from the sec in the u.s. government that this is an asset, there is this giant infrastructure. it is not just blackrock. invesco are bigger etf's then blackrock. there are many players. the sec is not going to approve one. you will have these giant sales forces giving access to people that did not have access before. matt: do you think you will be

able to list in the u.s. before the end of this year? mike: that is a $64,000 question. this sec has been shaaban -- stubborn and tough crypto. no one of significance has gotten through the listing process. we are in process. it has been a long and frustrating path. so yeah. we are probably going to need either a change of heart at the sec or change of administration to see real progress in crypto regulation in the u.s.. sonali: you mentioned at a conference recently that you are expanding outside of the u.s., but you would have more staff outside of the u.s.. what timeline are you working for and where are you moving staff to? mike: i leave this interview to sit in meetings are about four

hours looking at that stuff. we are expanding in hong kong, the u.k. as a start. we have a office in the bahamas. u.k. is being crypto forward. abu dhabi, dubai. hong kong. it helps when you know what the rules are. it has been frustrating. for our ecosystem to filler -- flourish, it has to be part of it. by no means am i giving up on the u.s.. it is being practical, how do you and up on the right side of the authorities? you're seeing lots of crypto companies do the same thing. matt: tim draper, a comment he made yesterday talking about how they avoid ftx and block fight and these pitfalls. listen to what he had to say.

>> the ftx sentence a message that we don't want centralized currencies of income. we don't want centralized currencies of any kind because they can be controlled by one person in that one person can take us off. matt: i use that to ask what you think about other coins. bitcoin does not pass the howey test and the sec does not consider it a security. but you can see how other coins and crypto do. do you avoid those going forward? mike: the pure bitcoin position, it is one you can have. i think a lot of the revolution happens in between. i am not anti-every centralized organization. centralization works wonderful in a lot of ways. i spent my whole career first at goldman sachs, then fortress and most companies have done well.

i do think, though, with a breakdown of trust in the world there is plenty of space for decentralized systems to come in. and the transition from birthing an idea of a decentralized system to actually having it decentralized often does not -- it is not like immaculate conception. we have a giant ridesharing business that is decentralized. sonali: when you think about that decentralization and what happened with ftx as we've been talking about, you talk to your friends across wall street, many hedge fund managers that you know, are they sold on the story? do they need to see more before they get back in? mike: i think the bitcoin story is a simple one. it is easy to sell. people are bought in. i think all people believe that stablecoins of some form are going to be a bigger and bigger part of the future. that is a regulatory wrestling

match. if you had an interest-bearing stable claim backed by u.s. securities, paypal, mastercard and visa would accept it, you put that business out of business. in your wallet that you owned, a token that is backed by u.s. governments, paying four or 5% interest, or a positive event that looks like a hedge fund that is paying 2% interest. it is one reason the fed is stopping and the government is trying to stop the development of stablecoins. which is ironic because it solves the problem overnight, it cuts out costs. elizabeth warren should be screaming and cheering for a stablecoin that pays interest. matt: we are going to talk to her later and i don't think she is going to be cheering. but it is a great point. never enough time to spend with you. mike of galaxy digital, and

sonali basak. always appreciate you. this is bloomberg. ♪

it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything.

jon: i'm jon erlichman. welcome to "bloomberg markets." matt: and i'm matt miller. the cpi number was cooler than expected. you can see the s&p 500 is now up 0.8%, trading at 4475. the 10-year yield is moving down at 3.86. investors are buying the bond and the dollar is also weakening. $12.08, down almost 1% as the euro and yen rally. oil up $.92 per barrel and we

are talking about west texas intermediate, not brent. the benchmark has increased above $80. banner day for a lot of assets. jon: and a lot of those considerations weighing on the canadian dollar. the weaker greenback, we have an interest rate decision in canada. two meetings in around we have seen the bank of canada hike 25 basis points. we have rates at 5%, the highest in 22 years. the door remains open, according to the bank of canada governor, for additional moves, even though we have seen some improvements on the inflation front. let's hear from the bank of canada governor talking about the balancing act that lies ahead. >> if we do not do enough now, we will have to even more later. but if we do too much, we risk making economic conditions unnecessarily painful for everybody. we have come a long way and do

not want to squander the progress we have made. we need to stay the course to restore price stability for canadians. jon: let's dig into this with dawn desjardins. and get perspective on what matt talked about. kevin cummins is the chief economist at natwest. dawn, i will start with you. we heard from the bank of canada governor saying we have to stay the course and continue the fight against inflation. were you surprised they raised rates again? dawn: the data was strong when we saw the first quarter data where the consumer really did spend aggressively. we had labor numbers on friday. another month of solid job gains and i think we are seeing fraying on the labor market side. but i do not think it was a terrible surprise the bank of canada took this and said, ok,

we need to move one more time. jon: the big question today in the markets in the u.s. was perhaps we see another 25 basis points from the fed. but after that we are starting -- at least the market -- is leaning against if the bank of canada were to move again, would you be surprised? dawn: i think the governor was clear. it is data dependent. we think the economy is slowing. we think there will not be solid reason to continue to raise policy rates. we think the consumer is starting to flag and to that end, it suggests that forecast, but the economy will continue to move along slower pace but continue to grow, will be disappointed. i think that should be sufficient to see the bank step back. matt: let me ask you, kevin, about inflation numbers. your take on how quickly the fed

has been able to get inflation under control. does it necessitate another 25 basis point hike? kevin: i think the guidance we have heard from the fed chair at the end of june in portugal was pretty hawkish. i think he very much set up the market to expect another rate hike later this month. while today's inflation data are a step in the right direction, i don't think it prevents the fed to rethink they need to remain on hold later this month. i think they are going to follow through with the guidance we have already heard. even though my own forecast is for inflation to move lower, closer to the fed's 2% target. but today's data are a step in that direction. but that probably means the tightening cycle is at an ending this month on the 26th. matt: how damaging is that to

the economy? more and more people are talking of the possibility of a soft landing. but some plug the 4.5% into the model and it shows gdp growth affected substantially next year. 12 to 18 months of lag and this brings us into recession in 2024. kevin: if you hike rates 525 basis points in 15 months, when all is said and done the economy is going to slow dramatically. we saw slowing in the economy last year throughout the year and monetary policy works with variable lags. we are likely to tip into recession next year. the timing is difficult but we have seen a very restrictive

set of standards. they will see if it is more pervasive than what we have seen heading into the turmoil in markets with regards to the banking sector in march. inflation is moving the right direction. i think they are going to become less restrictive quicker than people think. i think they will start cutting rates later this year, even though the guidance, as of june at least, was for at least two more hikes this year. jon: that would be a very interesting development. dawn, i want to bring you back into the conversation. 15 years ago in the united states where it was about the u.s. housing market, it feels like today there is so much focus in this country on the canadian housing market. canadians have taken on huge amounts of debt. we have a different mortgage market. a lot of canadians have felt the

impact very quickly of these higher mortgage costs. it is part of the inflation story at this point in canada. at what point do you get concerned about the housing market within the story of the economy? dawn: the thing about the housing market in canada is the mortgage market is structured differently. we know about one third of canadians have a mortgage and the rest do not. yes, they are renting. that is filtering in through the economy. but in canada we have a supply constrained market and lots of immigration. lots of persistent demand for homes -- not necessarily to buy, but to run as well -- all of these factors are going to keep the housing market on level ground. maybe not accelerating sharply but not headed for a u.s. style crash. jon: kevin, let me bring you

into the conversation on the mortgage picture stateside. matt was talking about tour since lock -- slock who said if you locked in your mortgage, maybe you felt less impacted today by the interest rate realities. what are you seeing on that part of the equation? kevin: we have had a little bit better news on the inflation data after several months of weakening through last year. we found a little bit of stability in more recent months. i do not know if the worst of it is behind us. we may have a more, you know, less drag from housing. but the direct impact on the u.s. economy is not likely to come from residential investment. it is likely to come from consumption slowing. we have seen more wavering this year and if we are right and the labor market is slowing and we see the unemployment rate go higher, we are more than likely to see some pullback in

residential investment. but the share of housing in the u.s. is probably not going to be all that big of a drag. even if we are wrong and it starts to pick up, given supply is so tight in the housing activity, it is not going to offset any downside risk to the economy. matt: dawn, if the fed is near finished and other central banks continue to need to hike more, what do you think about the fx effects we are going to see? will the dollar continue to weaken like we are seeing today? dawn: if the fed actually goes through with her next one, i do not think from the canadian perspective we will see more. we are likely going to see the rate hold. i think from the currency's perspective, a lot in canada depends, from our perspective,

on oil prices. they have come up and that has been an underpinning factor today. going forward if things level out and we do not see the bank of canada move further, it will not be a huge increase in canada's currency. matt: i was think about the euro, the pound, the yen. those currencies that seem to beginning more strength the last few days. is that going to pick up? kevin, what is your view? kevin: i am an economist not fx strategist. i will hold off. [laughter] matt: wise choice. jon, what do you think? [laughter] jon: i am neither an economist or fx strategist, but i like to ask questions for a living. dawn, what is the most important thing to watch to try to determine where the u.s. and canadian economies go from here? dawn: i think it is confidence. we have seen deterioration in confidence in canada on the

business side and the consumer side. if canadians get on shaky ground, i think that will be a key factor for the bank. matt: dawn, pleasure having you with us. dawn desjardins and kevin cummins joining us from net west. thank you for joining us. coming up, lucid tanking after ev deliveries for the second quarter disappoint. that is the stock of the hour, next. this is bloomberg. ♪

jon: this is "bloomberg markets

." i'm jon erlichman with matt miller. time for the stock of the hour. we are tracking shares of lucid. they fell short of delivery expectations. that disappointment even as lucid started to push ahead with shipments to saudi arabia, which at this point is the biggest financial backer. matt: if you broaden out, you got the one-day chart, but if you look over the last month you will see this stock is coming back to the level where it has been trading. it was down three weeks ago under 550. a couple of days ago it was trading for more than 8%. -- it was down three weeks ago under 5.5%. a couple of days ago it was trading for more than 8%.

and has to prove that the market it can reduce cars and powertrains. this backward looking report does not do that and that is why the shares have taken a dramatic plunge. but he does have time. i think the market is going to give it time to show what it can do, like rivian, and look what has happened to their stock. it is absolutely soaring. lucid has to show that it can execute. but it seems to have the plan in place. jon: i guess at the price point at which they are operating, how many vehicles are they going to be able to sell becomes a question about selling more technology. what is the best business strategy going forward? we will continue to see how that plays out with the lucid story. we talked about the inflation story as well. coming up, with the latest cpi report says about food price inflation. we will speak with a restaurant owner about the challenges that sector is facing. that is next. this is bloomberg.

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>> every time the fed meets we restauranteurs start sweating. we are stuck in the middle. we have cities that are instituting wage hikes that we have to keep up with. we are challenged to keep our employees making a living wage. we need to increase our menu prices and we are holding off as long as we can. if you price too high, you lose your customers. at the same time the costs are up. the restaurant industry over the last three years is notorious for thin profit margins.

jon: we recently talked about the challenges facing the restaurant industry. price inflation overall continue to moderate. cheetie kumar joining us, chef and owner of aija restaurant in raleigh, north carolina. we talked about the menu realities. you deal with this every day. there is only so much people are willing to pay regardless of how great and delicious the food may be. cheetie: that's right. thank you for having me on. inflation impacts everybody but when many prices rise on restaurant menus there is whiplash. what happens is people are impacted up and down the food chain, the supply chain, the cheese maker, the dairy goes up, gas goes up, freight is affected. where the last link and we can

only -- we are the last link and we can only absorb so much. as caroline said, our profit margins are already so thin. we are lucky if we make 30% to 5% -- 3% to 5% profit. people have this expectation that a corner restaurant owned by a person or couple or family should have the same prices as a big supplier or big chain. but we are not in the position to negotiate pricing. aija cannot get the same prices as chipotle. when you have artificially low prices of food something along the way is being compromised. whether employees are not going paid what they should or there are practices that are not good for the planet. things are being automated in big chain restaurants and jobs

are being lost by that sector. meanwhile, jobs are being created by people like me. jon: i am glad you mentioned the challenges in having that negotiating power with respect to your input costs. are you seeing any signs that some of those price pressures are easing? cheetie: not really. everybody talked about eggs. eggs went down but other stuff went up. it is fluctuating all the time but it never really goes back down to the original pricing we had maybe two years ago, definitely before the pandemic. i think there becomes this desensitization to paying $55 for a box of oil whereas before you could get it for $35. we will never see that price again. that is why the independent restaurant coalition is

continuing to educate policymakers in washington, d.c. there are certain policies that impact mainstreet businesses and communities like ours in raleigh, north carolina. matt: do you continue to have problems finding workers? labor has been a huge issue in the service industry the past few years. is that starting to turn around at all? cheetie: i had a restaurant before aija that was open nine years. i was fortunate i was able to give my old staff jobs. they stayed with me. but that requires -- we redid the labor model and yes, labor is still an issue. it is still difficult to hire people to work at restaurants. it is difficult to get them to be full-time. when you get them trained they leave and they get a job selling insurance or something. there is a lot of people leaving the industry but i think we get

lumped in with big restaurants and it is not the same kind of job. our restaurant trains people on a lot of different types of food and ingredients and wine and spirits and cocktails. this is a skilled physician but when people hear about restaurant jobs they think it is low skill, entry position for somebody who is in high school or out of high school. we are trying to cultivate careers here. in answer to your question, it is still difficult. matt: you are talking about the non-customer facing roles. when i think of the restaurant jobs i think about being a waiter. that is what i did when i was younger. it was all about the tips. in a bad economy, they were tight. in a good economy, they were flowing. what does that indicator look like right now? cheetie: sticker shock. when people see -- they think, well, i can make a burrito at home for $4 but they do not realize how much labor goes into

the free chips and salsa you expect on the table. all of the ingredients that are hand cut that goes into each of those burrito plates. it is a curry or pasta that is handrolled. it is difficult to convey all of this costs to consumers and when they already have sticker shock and they say, oh, i can make pasta at home for $8. why is it $26 here? even at $26 the restaurant is probably losing money or breaking even. the tips -- tipping is a different conversation -- but they might skimp instead of paying 20%. they may leave 15% or 18%. if you are front of house staff is reliant solely on tips and you are not supporting them with a living wage that is beyond the $2 something allowed in this

country, it is going to perpetuate the problem further. matt: great to get your perspective. thank you for joining us. cheetie kumar, chef and owner of the aija restaurant in raleigh. looking at markets the better inflation data than we expected has been a boost to the equity markets. you can see the s&p up 0.9%. 4477 is the level as investors buy bonds because they are not as worried about fed rate hikes. although one is priced in. jon: and one is priced in and the market started to change its tune on what happens beyond that. reassessing as we watch the s&p up 0.9%. as you mentioned, we are seeing broader north american equities advance on this wednesday. for matt miller, i'm jon erlichman. this is bloomberg. ♪

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