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major market opens. vonnie: good evening from new york. the top stories this hour -- u.s. markets barely move as we await lots of catalysts including the instacart pricing. the chevron ceo said we may reach $100 a barrel in oil. haidi: a rare meeting with foreign banks and companies. vonnie: instacart set to plan ipo pricing of at least $30 a share. let's get a quick check on wall street and see where futures are trading. looks like we are moving higher but that is after a lackluster day. a no luster day. looks like markets are awaiting the fomc meeting and decision on wednesday. particularly the dot plot for a

little more direction perhaps on where the fed things we are going. the fed whisperer wrote today that every hard landing looks at first like a soft landing. so that seemed very ominous to traders and investors who were reading the journal today. the 10 year yield is at the highest now since 2007 at 430 an d change. at one point earlier we had a bond maturing in 27 years, trading below $.50 on the dollar. the bond bear market is really severe at the moment. do we see $100 a barrel wti? it looks like we might. $92.27 for a barrel of new york oil right now. haidi: the question is how does that feed into the inflation picture? how much does this complicate the scenario for various policymakers, including the big one we are looking ahead to, the fed, and whether that means we will see global rates staying

higher for longer and what does this mean for the equities trade. at the moment we are seeing sydney futures looking muted, about .3% lower. we will be watching energy players to see if we get that boost from that sustained resilience in crude prices. the aussie dollar, just shy of $.65 at the moment. we are watching new zealand where we are about a quarter of 1% lower. dollar-yen holding steady at about 14758 japanese markets are coming back online after the long weekend. a little bit of a cash down if you will, as we continue to watch for hints of what we could get between now and the bank of japan decision. bank of japan officials seeing that discrepancy between what governor ueda said which really moved markets, and how traders have interpreted those remarks. officials say they did not signal policy change.

the other big story we are watching is the woes in china's property market and the broader economic slowdown and equity of chinese stocks. starting the week with losses. we did come off session lows at one point on the mainland the csi 300 hitting the lowest 2023 intraday level. that gauge sliding more than 2% in the monday session. we continue to watch for development when it comes to country garden and weatherby will see any rebound today. that equity route is really one of the bigger stories we are watching here in asia. our next guest is still positive on market in the near term and says the third quarter is likely to bring an end to the earnings recession in the u.s. joining us is laila pence, president at pence wealth management. you sound pretty sanguine when it comes to fed expectations, whether any kind of inflation is

coming from energy prices could mean we see higher rates for longer. laila: we think the fed is going to skip this week and will look past the higher energy prices because they see core inflation declining and they need to give time to all the interest rate hikes to start showing an effect on the economy. i think they are getting impatient. at least for this week. and they may hike later this year depending on if oil prices continue to go up. that could change. but for now i think they will skip and wait-and-see. vonnie: what are some of your favorite trading themes? haidi: i know you like ai, but valuations are looking pretty pricey. laila: yes they are. but they still have so much growth potential.

the new thing we really like are the weight loss drugs. we think that area is going to just explode. they have not even hit international markets. and we think last year there was only like, $2.8 billion in that area, which we expect to go up to $75 billion by 2030. tremendous amount of growth. i see clients coming in losing a tremendous amount of weight. it is a game changer in the house industry -- health industry. we really like this area of investment besides ai and technology. vonnie: so you are positive on the markets in the near term and we are seeing more and more people saying we are at the end of the earnings recession just as the fed is about to pause. but there are still some risks. what would be your main risk? laila: the energy crisis. it is really because of the supply issue.

so that is a worry. we also worry about the possible shutdown of the economy, with the government shutdown. although that is not a big worry right now. but those are the two main things. of course if the strike with the uaw continues for a long time there could be another risk. although we think that will be short-lived and they will come up with some resolution. but those are three main risks. the big one is really the energy prices and that will go up which could have the fed raise interest rates sooner and of course that would not be very good for the markets. vonnie: particularly inflation expectations than has a knock on effect. i am very curious as to what you are calling the ai trade. can you give us some specific companies? it seems like every ceo and coo that comes on a conference call talks about part of their business being ai. which are the ones that are actually going to earn revenue from it? laila: unfortunately i cannot

really name specific companies. but you know they are the big ones. the ones that just this last week have had a drop in value. we think those are opportunistic prices right now. i think with this dropped some of the main companies you are familiar with have dropped quite a bit and we think those are a buying opportunity this next week or so. so in the long term we really do like ai. the weight loss drugs and ai are game changers for the future. we are long-term investors, and so we think any time see something go on sale, it may be time to end. vonnie: the weight loss drugs is an interesting one as well. are there really that many companies that you would put money to work with just on this one particular, i don't want to call it a fad, but this one particular movement in health? laila: it really is not a fad. the first-timers, the first

companies who are leading the way right now, and you know all of them, they will have an added advantage. a huge added advantage. i can tell you i see it in clients coming in, i see it eve ry day, people are coming in losing 20, 30, 40 pounds, and their health is better. it really is a game changer, and it hasn't hit international markets yet. this is very good for individual's self-confidence, for diabetes and all the complications from that disease. if you can have a game changer there, he could reduce our health care cost which is a huge cost for the economy and gdp. it could be a game changer. vonnie: thank you so much for during us today. laila pence, president at pence wealth management. revealing macro associates ceo says the ecb and ble must keep

raising interest rates to ward off the risk of stagflation. the famously pessimistic economist told us how structural changes to the global economy will keep inflation high. have a listen. >> i have argued that the era of the great moderation of low inflation and stable growth is gone and we are entering an area of what i call great stagflationary instability. high inflation will be caused both by supply-side factors, deglobalization, geopolitical conflict, aging of population, restriction of migration, re-shoring global climate change, pandemic, cyber warfare, inequality, deglobalization. those are all supply-side factors that increase the cost of production. on the demand-side we are living in a world in which there is so much private and public debt and that will mean higher because we

have to spend more against inequality, against climate change, the pandemic, inequality coming from globalization and ai and so on and so on. so, spending really higher. taxes will not rise as much, structural deficit will be higher. haidi: still ahead, antony blinken meets china's vice president in new york, the latest in a series of these ongoing efforts at engagement to try and ease tensions. we have the details coming up. first, china's central bank governor host top foreign companies including tesla. more on the outcome of that unusual meeting, next. this is bloomberg. ♪

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vonnie: instacart has priced 22 million shares at $30 per share. that is the top of the range instacart was looking at. once again, instacart's ipo price to 2 million shares at $30 per share. that will work out to about $660 million, which is higher than it was originally looking for. it had been looking to raise about $557 million and that was already upgraded. it looks like instacart is definitely taking its listing cue from softbank's arm and the health of the capital markets. once again, instacart pricing its ipo, 22 million shares at $30 million -- $30 a share and that is the top of the range. haidi: as you mentioned, between arm and instacart we are kind of getting this renaissance when it comes to equity capital markets. much-needed relief after the longest drought since about 2009 in the depths of the financial

crisis. it will be very interesting to see this venture-backed consumer startup, how successful it is when it starts trading in weather that could open the door for other companies looking to go public. we will be watching instacart and of course arm as it continues to trade in the first few weeks. turning back to china, the central bank is avowing to improve the business environment for foreign companies after the government met with companies. this is about trying to build confidence back. annabelle: that's right. what a position of course china is coming from here. you take a look at what has happened over the last couple of years in china. first there was covid that really dented the profits for overseas companies and ones locally as well. geopolitical tensions never far from the headlines between the u.s. and china in particular. we have seen local economic weakness. that has been another issue.

consumers not reaching into their wallets. the operating environment, there are ambiguous rules for business and a lack of clarity. that is a short list of some of the issues for foreign businesses that are operating in china. but as a result confidence is significantly down for these foreign firms. this latest effort is just an attempt to try and restore that. the pboc as you said, they met with a lot of different businesses. not ceo's but representatives of the companies, but very well attended. jp morgan and tesla, and another of others including ubs, bnp paribas, and hsbc. vonnie: what is the pboc promising? annabelle: this park is a little unclear. we got a statement out from the pboc following the meeting but it was quite like on the details. a couple of highlights in particular. first from a statement it said,

authorities will consider more measures to stabilize foreign investment and trade. and the pboc says it will continue optimizing the operating environment for overseas companies. nothing too concrete. you can see that is quite light. not the first time we have seen an effort like this either because we have already seen a number of officials talking ross to try and wingback investors. as we touched on earlier it is becoming of the meeting that is interesting because it is a signal of how serious china is becoming about storing confidence, and just taking a look at the foreign flows in and out of china. it is really the red bar as you want to highlight in particular because foreign funds have been net sellers since the start of august. if you were to look at all the money for investors have poured into chinese equities, half of that has left the market at this point pretty another signal to us that that weak confidence

among the international market, not only the companies by the investor money as well. vonnie: thanks for that. oil producers, traders, and analysts are starting to talk about when, not if, prices will return to $100 a barrel. su keenan joins us now. physical barrels are surging. su: that appears to be the key driver as we have seen oil run close to $100 after being mired in a slump earlier in the year. first it was the oil curves imposed by saudi arabia and russia as part of the opec cartel. then being extended to the end of the year. now it is the physical market-leading the strike. across the world we are seeing premium for physical barrels, surging with surprise -- supplies from saudi arabia and even russia commanding huge premiums as providers are scrambling to make as much diesel, which is also soared. drop into the lumber again you

will see bullish analysts argue that even with crude now in the mid 90's, bullish positions are rising and many funds are still under invested in oil. so as those funds jump in, many say oil could go higher. chevron ceo mike wirth told bloomberg he now sees $100 oil as a real possibility. >> sure looks like it. we are certainly moving in that direction. the momentum, supply is tightening, inventories are drawing. these things happen gradually and you can see in building. i think the trends would suggest that we are certainly on our way or getting close. su: check out the price charts. the strength shows up in the strength of the oil futures in the curve as well as the year-to-date price charts. on monday the nearest brent futures contract was at a premium of more than one dollar to the next month. look at that most recent rise on the right-hand side.

that structure known as backward decision is indicative of scarce supply. it is the biggest since november. traded here in new york also on a tear moving higher. even the most bearish of analysts are conceding that 100 a lot more likely, particularly when you consider the political risk of oil producers such as libya and nigeria and those areas heating up. haidi: our technicals also telling us we might be in overbought territory? su: yes. the technical analysis is the only thing telling us we might be having a pullback. you have the relative strength index and other indicators showing that oil is shaping up to make a big move perhaps in the opposite direction. but citigroup says more says we could see $100 for a short while. if you look at the five-day charts for west texas intermediate and brent, there is

no indication of any pullback. they are just continuing to jump higher. citigroup analyst says there is progressive loosening on the horizon. supply from outside the opec-plus alliance, u.s., guyana, brazil, those are also possible suppliers of oil down the road. meanwhile the saudi energy minister in a conference in calgary says opec is targeting stable oil prices. they are not trying to move prices higher. they are probably unaware of a lot of criticism coming their way. they also say in terms of demand for china, one of the key drivers of global crude prices, the jury is still out. vonnie: you can get a roundup of the stories you need to know to get your day going into today's edition of daybreak. terminal subscribers can go to dayb . you can also customize your settings so you only get the news on the industries and assets you care about. this is bloomberg. ♪

vonnie: grocery delivery business instacart is selling 22 million shares in its ipo for $30 apiece. let's get the details now from ryan gould. it is the top end of the range but they did not boosted any further. could they have? ryan: it was certainly a consideration on the table. we heard early on they were considering $30 apiece. i think having had such good momentum this past week with arm, pricing tomorrow for trading on wednesday, perhaps there is some consideration giving to being constructed with investors. probably in this case $30 at the

top of a revised range, it is a good result for them i am sure. haidi: does this combined with arm make something of a renaissance for equity capital markets at this point? could we see more companies coming to market? ryan: what we are hearing is that we are not going to see too many people rushing out of the gates. it will be constructive through the end of this year. into 2024 after the first quarter results we could be in a position where once there was awarded we see a few more deals. what we are hearing from sources is this is certainly a time that if you are sitting on a premium asset, then why not test the waters? by all means there are some other names like birkenstock we are expecting before the end of the month. they will probably only be in a small smattering we see beyond that for thanksgiving. certainly looks as though the first quarter of 2024 could be the period we're all watching to

see anything more robust. vonnie: any trepidation on how arm traded? we saw that 25% pop, but at one point it was down almost 8% today. so early enthusiasm definitely faded. ryan: it is worth noting today was the first day you could trade options for arm. it has been known to put out calls to the one. i would say wait and see with that one. but i think this has certainly been a good week. with instacart pricing tomorrow, this is definitely still a bellwether moment for ipo's. i don't want to be the one to say, yeah, this is your time, let's get out there. haidi: you would be a brave man indeed if you could say that right now. ryan gould with the latest on instacart. we will continue to watch that and arm in this first month or so of trading. let's get you the other top corporate stories we are

following today. two private equity firms are suing morgan stanley for $750 million claiming they were defrauded in a deal to invest in a luxury high-speed rail line. they allege the bank unlawfully restructure the deal. the firms invested in a loan to a company developing a rail line between los angeles and las vegas. morgan stanley says they believe the claims have no merit. they have overhauled its corporate structure, combining parts of its retail and commercial banking businesses. they say it will help simplify the business and boost profitability. sources tell bloomberg the move will probably trim management layers and result in some job cuts. citigroup says its restructuring announced last week -- the newly appointed chief client officer told us the resulting job cuts are needed to simplify the bank's structure. that also means the roles of

thousands of back office workers are currently being reviewed. coming up, the latest high-level meetings between the u.s. and china paving the way for a possible biden/xi summit later this year? we will have the details. this is bloomberg. ♪ ¡se fue la luz! pero todavía tenemos wifi para hacer las tareas. ¿y eso es algo bueno? wifi y estudiar. buenísimo. wifi y pedir una pizza online sería buenísimo. presentamos storm ready wifi. solo de xfinity. ahora puedes mantener una conexión confiable durante apagones, con datos celulares ilimitados y batería de respaldo de hasta 4 horas para mantenerte conectado.

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>> it is also in many areas a win-win relationship in the sense that our trade and investment flows produce gains for china and gains for the united states.

and much of it is uncontroversial, should thrive, and it would really be disastrous to try to decouple from china. haidi: u.s. treasury secretary janet yellen there on trade with china. the u.s. secretary of state has met with china's vice president in new york this week. it is the second high-level conversation in as many days as the two nations try and repair frayed relations. let's bring in our chief north asia correspondent stephen engle joins us from hong kong. can we say that some measured progress is being made? stephen: sure. the difficult issues still remain obviously. taiwan, the war in ukraine, and other tech export curbs by the u.s., and china's diplomatic moves in the south china sea. there is a long list of issues that caused this frayed relationship. but it's good they are talking

face-to-face and at a high level. so these talks on the sidelines of the u.n. general assembly just comes 24 hours after jake sullivan, the national security advisor, met with long the, the foreign minister of china, in malta. just before wong ye headed off to moscow, where he is this week meeting with his counterparts are gave. s-- his counterpart, sergei lavrov. there are many overtures being made, but this is an important meeting because from my reading of it, he struck more of a conciliatory tone that we have seen of late from beijing. he said u.s.-china relations faces a lot of challenges. it needs us both to display more sincerity, more efforts, and meet each other halfway. this is also what antony blinken had to say to him. >> from the perspective of the

united states, face-to-face diplomacy is the best way to deal with areas where we disagree, and also the best way to explore areas between us. the world expects us to responsibly manage our relationship and the u.s. is committed to doing just that. stephen: anyway, it has been a long diplomatic road leading up to this upcoming november and it tech meetings that will be held in san francisco. a lot of these meetings are trying to lay the groundwork for a potential summit between presidents biden and xi jinping. they have not met in person since last october, november, at the g20 in bali. and of course the relations between china and the u.s. kind of got derailed after that fairly warm meeting on bali because of the spy balloon and various other diplomatic snafus. vonnie: you have to wonder about

the level of good faith being displayed by both sides. these diplomatic overtures are happening on the one hand as china sends warplanes near taiwan, and we have u.s. officials visiting the island on the other hand. stephen: that is a good way to put it. because you can say many things and display good faith, but it is the actions that speak louder than words. but again, the united states would likely say we will continue to have the right to sent officials to taiwan and that is what china is upset about right now. the arizona governor is in taiwan this week as well as an undersecretary of commerce for technology and standards. they are on taiwan and presumably this display by the pla, this is file footage, but essentially taiwan saying 103 warplanes yesterday, in the 24 hours to yesterday had flown around taiwan, 40 of them according to taiwan defense

officials, across that median line of the taiwan straight into the southwest and southeast air defense identification zone. so taiwan says that is a serious reach of security and a provocation. china has long held it will continue to do so when it sees it is appropriate. a pla general was quoted yesterday by state media saying he expects another display by the pla perhaps even larger and yesterday, today. with the arizona governor there, why would the arizona governor be in taiwan? taiwan semiconductor manufacturing is pledging $40 billion to build capacity at chip plants in arizona and obviously the commerce department official who is there as well, probably there talking about the continued luring of taiwanese manufacturing to the united states. and again, this is just going to

continue to happen as u.s. officials feel that is in their right to visit taiwan. haidi: stephen engle there. staying with geopolitics, we are getting an update when it comes to the prisoner swap arrangement that was made for those five detained americans and iran. they were freed in a prisoner swap deal, having landed safely in qatar. we are now hearing perhaps the most controversial element of this deal, which was the agreement by the u.s. to allow access to the $6 billion in oil revenue that had been frozen in bank accounts due to sanctions have been released. we are hearing from the south korean finance ministry that a statement that the funds have been transferred to qatar. this forms part of the prisoner swap deal with the five americans having landed safely in qatar. it is towards what some people hope will be a diplomatic effort that will seat easing of

tensions and potentially open space for progress on the nuclear program of iran. we're now hearing that $6 billion in oil revenue funds frozen in south korean banks, south korea's finance ministry saying they have been transferred. u.s. saying the money can be used solely for food, medicine, and other humanitarian purposes, but iran said it can spend the funds however it wishes. so it has been subject to some criticism in terms of where those funds will go towards. vonnie: president biden wants a full accounting of what actually happened as well. those prisoners on their way home. the rio tinto ceo says chinese demand for iron ore remains strong. he told us while china's demand will level off in the future, the global need for steel will continue to grow at a healthy rate >> the demand is good.

you will have seen that there is tight supply and demand and isis have gone up the last couple of months, etc.. the chinese steel mills are producing and there is demand for their steel. >> do you see that continuing? is that sustainable as we get into next year? >> there is always uncertainty about the future of course. we tend not to look so much at the short-term. we tend to think about the long-term and look five to 10 years down the road. more steel demand will continue to be good. there will be more recyclability which is good and therefore slightly less demand for iron ore. china's demand will probably stabilize where you see other developing countries like india growing significantly. but we see a good and stable demand long-term for iron ore production. >> we would be remiss to not ask you about what is happening in

the alumina market. one of the worst performing markets at least in terms of what we see in the futures market. how much of that is impacted by what we have been seeing with russian supply and where that supply is going? >> first of all, the u.s. have put on a tariff for not importing russian aluminum but that is not the case around the world and around the rest of the western world. we are not doing business in russia. we are condemning the war. we would have thought they would be some limitations on how to import russian aluminum. i don't think we can blame it just on russian aluminum. just in general there is significant supply. one of the challenges we are having in a week like this, climate week, is unfortunately the crisis is the same

regardless of the carbon aluminum. aluminum is the most energy intensive metal on the planet, and therefore if you use coal for producing aluminum you have very significant co2 emission. vonnie: the rio tinto ceo there. turning back to market, wall street is gearing up for a so-called hawkish pause from the federal reserve. let's discuss and bring in annabelle from hong kong. traders are really going to be focused on the economic forecast, obviously the sep. annabelle: that's right. the so-called dot plots in focus. two main questions. first, will policymakers stick with their view we are going to see one more 25 basis point hike by the end of the year? secondly, how much easing there looking at over the course of 2024. because back in june the idea is they would see it for 100 basis

point reduction over the next 12 months. this meeting will be very much in focus not only setting the stage for other central banks making decisions over this week, they will be discussing a 36 hour bonanza of decisions, but setting the stage for markets to the end of 2023. highlighting one of the views we have heard so far. speaking with a lot of investors about this. the fed is likely to sound hawkish at the upcoming meeting and so they are suggesting in this sort of environment it makes sense to stay diversified with a relatively defensive portfolio across equities and looking to extend duration within fixed income. changing on, morgan stanley wealth management has also been looking at the outlook u.s. stocks. morgan stanley has been very bearish on the outlook for equities over this year. the wealth management ceo also echoed it -- echoing this and saying equities in the u.s. likely to stay range bound over

the coming six to nine months. even though equity markets so far the focus has been on the fed being able to engineer that soft landing. he also sees further downside ahead for u.s. equities as much as 10%. a big exclusive interview we had in the show yesterday, essentially he said we are entering an era of great stagflationary financial instability. you heard that at the top of the hour. he also spoke to us about the outlook for the fed. take a listen. >> i don't think they can say they are done because the economy is still growing above potential. headline inflation is going higher. therefore potentially they will

be the option of another hike. haidi: coming up next, -- this is bloomberg. ♪

vonnie: emerging market investors have found a winning strategy in buying shares in

smaller companies. the e.m. small-cap index has outperformed is large-cap cousin this year and is on course for the second-best relative returns in the past 14 years. let's get more now from our emerging markets reporter. tell us more about how e.m. stocks have actually performed this year and outperformed. who would have thought it? >> the msci index for small-cap are up 14% this year compared to a 1.5% gain for the large cap counterparts. that is because china stocks is dominating over half of the large-cap index and really suffering from chinese economic troubles. they are benefiting from local growth stories, especially india and investor craze for young companies that are related to artificial intelligence or

electric vehicles. haidi: what are some of the examples of small-cap stocks that have seen outsized returns? >> some of the cases in point are taiwan global unit shipped corp. they have soared 244% and 125% respectively this year as well as indian stocks including some companies like dell stainless and rail. they have risen over 100% as well. as well as south korean companies and brazilian companies have also seen outsized returns. vonnie: thank you very much for bringing that to our attention. natalia gurushina is chief economist for emerging markets at van eck and she joins us now in the new york studio alongside me.

thank you so much for joining us. it has been a great time for e.m. small-cap stocks. e.m. economies though, not necessarily the best. what is your outlook for where we will see the next india, the next japan, the next great ghost story? -- growth story? natalia: it is more mixed and nuanced. for example, if you look at latin america, mexico and brazil outperformed growth. the rest of the region looks more depressing. in asia, india is a success story not just in terms of growth numbers but the underlying structural change behind it. that is definitely a success story. vonnie: how much is china

muddying the water in all of this? natalia: china is important. china is currently the only independent emerging market global growth driver. so it is important not just what authorities are going to do in terms of stimulating the economy right now but what will happen to china's growth model in the longer term. i think a good thing is that china's process is relatively small -- slow-moving. there is a degree of awareness that something needs to be changed. but what you're going to get the remains a question. haidi: there have been times where we have seen almost a de-coupling with the role that china and the yuan, chinese assets have traditionally held in the emerging markets world. do you see that changing as the soft power, the economic soft power receives with its own domestic issues? do you see any other em's taking

more of that role? natalia: i think india is definitely number one. i am very optimistic about some latin american economies. and maybe i'm going to say something controversial but zillow implemented a lot of reforms the last several years and this might explain why the economy is going to foster the unexpected despite such a high interest rate. india is perhaps given its size and population, that is probably still number one. haidi: in brazil has even faster growth but without inflation. do you believe that goldilocks scenario can be reached easily? natalia: brazil is a very interesting example of a country where you have a very -- very

credible central bank which convert -- very early action managed to bring inflation down and keeps expectations relatively anchored. i think brazil's structural reforms is a hidden story of sorts. it's a very good example that shows when emerging markets, not just in terms of monetary policy credibility, but improving the structure environment, that shows up eventually. vonnie: one of the things you point out as you were surprised, investors are surprised officials have reaction to market pain. you postulate it is much busier -- bigger than investors seemed to think. natalia: i think perhaps we are looking at china sometimes through western eyes without realizing that there are different objectives, policy targets, and perhaps ideologies as well, which affected the

vision which is often a longer-term vision than in your traditional western economy. as i said, in china there is awareness about the need to change the growth model. who is actually going to foot the bill for this change remains to be seen. but the question is how you are going to invest in china the next few years. perhaps it is in favor of a more tidal wave in terms of types of investments, playing the policy cycle in china. at least until they have more clarity on the issue. vonnie: a lot more volatility to come up there was not enough already. our thanks to natalia gurushina. she is chief economist for emerging markets at van eck. plenty more ahead right here on daybreak. this is bloomberg. ♪

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haidi: the chevron ceo says oil prices may soon reach the $100 mark he tells bloomberg he is confident the global economy can withstand such a price spike. >> it sure looks like it. we are certainly moving in that direction. the momentum, supply is tightening, inventories are drawing. these things happen gradually and you can see it holding.

i think the trends would suggest that we are certainly on our way, we are getting close. >> what impact do you think $100 a barrel will have on the u.s. economy? what impact will and have on the global economy? >> certainly those are higher prices than we tend to see out over the long term. so i think it will have some effect on the economy. but we have had relatively higher oil prices here now for most of this year and certainly all of last year. the recession everyone has been talking about has not arrived. and so, i think the underlying drivers of the economy in the u.s. and frankly, globally, will remain pretty healthy. i think it is a drag on the economy, but one that thus far i think the economy has been able to tolerate. >> have you adjusted your price deck? meaning, are these higher prices sustainable for the long term? >> we take a very long term

view. we have not changed our long-term price, but we really do not change that very often. and not in response to our short-term. we have been in a volatile market really going back to the pandemic when things came down, the recovery when it was high, the war. this has been a time where prices have been unpredictable and volatile and not what you would call midcycle. >> if i worked for you, for mike wirth and chevron, with this be my cue to say, mike, can i have a pay rise please? >> i think you are making rise to -- reference to what is going on in other project the world. we are seeing organized labor in many different industries now assertively step forward and say, look, we want to be compensated, we see the inflation in the economy. and we have seen companies recover. we have had a very strong paid program and we try and stay very

competitive and i expect we will continue to do so. >> so far, cargos have not yet been impacted. you using nonunion workers. is there a point where that would change? >> we certainly hope what we will see is a negotiated agreement. others in australia have reached agreements with these unions. we have been at the table bargaining in good faith. vonnie: chevron ceo mark worth -- mike wirth there. coming up in the next hour we talk with franklin templeton investment's chief market strategist. ♪ when it comes to getting your flu shot, cvs is pretty... flex. wanna schedule one online while prepping dinner? gravy. avoid the wait by scheduling for you... ...or the whole crew.

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