all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything. >> this is a transitional period. >> eventually, you will have to refinance at these higher rates and that is the reality of higher for longer starting to bite. >> markets have started to price in these different expectations of the bond markets. >> investors are looking for any glimmer of hope to start a your rally. >> this is bloomberg surveillance with tom keene,

jonathan ferro and lisa abramovitz. tom: i saw him on a cruise, what a great turnout on the cruise. catherine greifeld joins us this morning. she is here and she will explain white piquant is popping -- by bitcoin is popping -- she will explain why bitcoin is popping. yields are up. things are little better but i walk in and i look at the bloomberg terminal, 8.04% on the bankrate 30 year mortgage and we are subtly -- solidly in a percent -- 8%. lisa: we have seen this incredible fluctuation, 20 basis points in a couple days in the

long end of the yield curve and people say volatility cannot continue or can it. they are forgetting the levels. it causes a different reality for people financing the nuts and bolts of their businesses and their lives. tom: economic analysis with bramo. the media wants to go, they going to die. microsoft was like a charm. if -- this is exactly what we were to see, microsoft is on target. lisa: the fact that you had two but he lives comprising 10% of the entire s&p index coming out and you had microsoft blown out of the water, google disappointing on the same metrics which is cloud computing. microsoft winning and google losing and it shows the dispersion we haven't seen before and everything was in line and suddenly you can have one winner and one loser and it

balances itself out in the overall index and you have a consolidation of market shares in specific sectors. tom: we have to get it out of the way, her agent said we had to. what happened? katie: there is a lot of optimism and maybe we are finally going to get the u.s. but an bitcoin etf seems to be the primary driver between what we have seen over the past two weeks. i will note from a traditional etf industry standpoint, we are potentially far away. tom: i have to stop the short because this is about global wall street, they want to sell bitcoin. why cannot they? katie: you can offer in private funds. to get in etf which you can go to your brokerage account and buy it with one click, that hasn't been available but the

question for bitcoin, who will buy it? tom: bramo wants the way in -- wants to wait in --weigh in. lisa: do you like being paid as the bitcoin respondent -- do like being pegged as the bitcoin correspondant? katie: the narrative changes all the time. tom: i will keep that updated check short. -- i will keep the data check short. i want to emphasize yields -- the 30 year bond under 5%. brent crude, i have so many properties. $85 a barrel on brent crude.

lisa: think of canada rate concision -- makeup -- bank of canada rate decision. the two year yield is fighting out and the expectation is they will hold and the new cause that we will get across the complex. 1:00 p.m. the auction will be more exciting. you are falling asleep and this is anything but sleep worthy, yesterday there was a two year yield bond option. normally, no one cares about that but everyone was paying attention because are we going to get the same reaction as we have gotten in the 10 year. you are thinking to yourself, keep selling it but i will keep selling it because it matters. considering with their earnings picture, meta-and rv of sherry's -- meta and ibm shares coming out.

meta-up 160% year to date. tom: ibm off the ghoul cloud disappointment baby has value to peru's and a look at bloomberg technology for coverage on that and we will look to the eastern mediterranean. we start strong with the senior global macro strategist at state street. i guess i have to rebalance, reallocate. as the rebalanced -- is the rebalance formula changed -- is the rebalanced formula change because of the guilt month -- yield month? >> if you are a bond bull, it is

encouraging because they are engaged in the asset class but do they settle below the 40% when they get there? tom: he looks like jim bourque -- jim jordan accept it was 10 below zero. that is all fine and well but to me, the securities analysis is out the window, it is about survival, how do you survive in an allocated portfolio? marvin: you are reevaluating the region in terms of the story and you have to remember the duration is much more than your fixed income holders, the u.s. equity market is the recent heavy so you have to be really cautious of where those long yields are affecting your portfolio. keeping powder dry is not a crime now. given the shape of the curve and

given that the fed will be higher for longer, then people think. keep the powder dry because things will be rough coming next year. lisa: what is that mean, powder dry? do you put it into t-bills? marvin: i love bills, two years feel good to me. if you want to extract -- two extend from your bill structure and a your portfolio, you can add that duration. you can nibble on the 10 year. lisa: does that mean you are concerned about risk equity valuations and other parts of the market that may haven't fully comprehended the level and ignored it because of the volatility that has gotten more significant than what we are seeing in equity volatility? marvin: if we look since the middle east conflict, rates have moved and everyone else has been frozen.

the dollar has moved and affects has moved and equities are trading at a wider range. i say to people, the most important number is the 10-year yield which is unanchored. katie: i want to talk while staying in the fixed income market, the most important question is why our rates rising and i am looking through your notes and you write that you would push back against the buyer strike thesis, why is that? marvin: the institutional investor is still buying and they are trying to get back to their benchmarks. we are able to look at cross-border flows at the institutional level and they are still buying so they are buying it on hedge and there are stories around the dollar that you can infer. mlf data around japanese buyers, they are engaged and china is looking at takes data and they

are not buying as much but they are buying based on what their reserves let them buy so we are not seeing the buyer strike that seems to be one of the themes out there. all of the issuance is an overhang. it is like these options become more important particularly when we go to november and how -- the buyers are engaged but there is a lot of paper and the knife is the big and falling. katie: maybe there is not a buyer strike that there is a lot of supply. do you look forward to next week? we have the refunding announcement in addition to the actual fed decision. for the direction of this market, which do you think is more important? marvin: i think the supply is more important. the fed message is pretty well-crafted. it shows they don't have a handle on how this is going to it evolve and that's part of the volatility but given that they have full back turned less

hawkish with the volatility in the market, they are not looking to introduce much more. i think they are ultimately done and the question winds up being how much longer we stay at what they believe is restrictive levels. lisa: it sounds pretty rough and concerning. azure hosted a 29% sales gain in their cloud service business. you take a look at the doom and gloom and they are rinsing money. why are they not behaving's -- the havens? marvin: they still are and we like the big moats that are defendable and if you look at the return, you have cash and you have companies that can generate cash and return it but they decide it is an advantage. tom: in discerning's season -- in this earnings season, we are

proving it again. marvin: i think active managers will have their day in the sun. tom: i will quote you on that. robert option arm -- robert armstrong was brilliant -- you save this is the time for active managers directly? marvin: it matters in b's duration discussions we are talking about rather than going into it based on what google already capitalization is allowing you to do is important in my mind. tom: marvin loh, thank you so much. better -- the editor in chief cbe emails from london and says keep your powder dry. oliver cromwell, your powder dry. -- keep your powder dry. the editor in chief said i had to do that. when british history comes into

what we are talking about. oliver cromwell. lisa: all i can say you are nailing the keeping the powder dry. tom: triple leverage on cash is doing fine but this is important and this go to the technical construction on the market and we have to pullback price up and you will down. on a technical basis, there is zero veracity to it. we need a lot of constructive work to begin to demonstrate lower yields. lisa: it is basically ping-pong. you are not sure where it will bounce. that is where we are which goes to martin's point, we are getting unanchored in terms of where that yield is. whether it is fundamental or if it is something about refinancing, -- tom: with the ecb coming up, is the ecb unanchored? marvin: no, it is because their transition mechanism is clear.

we are seeing higher yields making their way to the economy and right now, and chair powell said last week, based on the evidence, we may not be restrictive and even though they have been getting restrictive for the last 3-6 months. tom: thank you so much and this goes back to this stunning event of the last six days which is 5% gdp. lisa: the acceleration, the fastest growth in two years. how does that complicate everything? tom: that narratives and eight to 6:00 hour shows the confusion out there. we will try to get clarity and coming up in the 7:00 hour, she is from boston as well. katy kaminski joins us. what is it about boston? -- mentioned the red -- mentioned the red -- mention the red -♪

>> we do not want this board wiped, but iran or its proxies attack u.s. personnel anywhere, make no mistake, we will defend our people and our security swiftly and decisively. tom: our tireless secretary of state, antony blinken, speaking on maybe the triangulation of israel, the north and the east and the south gaza strip and iran supporting different groups and we welcome all of you to

bloomberg surveillance and in the first section, we focused on the bond market but we have to admit the story not only will not go away but increases over the last number of days. lisa: how many different prime ministers and presidents have tried to tempt out any potential liberation and israel but what i have come to terms with, there are different sides screaming at each other and normally these conversations are under wraps and the energy and emotion and pain is probable. -- operable --palpable. tom: we need a brief on where we are and where we are heading to with israel and hamas. leslie vinjamuri is -- i look at this and i have eight ways to go. what is your belief that iran

will be drawn into this conflict more directly? dr. vinjamuri: i don't think that iran has any interest. there are a number of actors we are concerned about and iran is at the top of the list but very few of them have any real interest in getting drawn into the conflict and you could say iran is benefiting right now and seeing israel suffering extreme setbacks and the u.s. being drawn in. regional support and global support for the palestinians. and a surprisingly high level for support even for hamas. iran is in a good place and the u.s. is doing everything it can to deter getting more engaged. tom: i was looking at the collapse of the ottoman empire and 81915 and 1916 and there is winston churchill very young before his glory of world war ii.

there is winston churchill coming up with the conceit, while people are coming in in 1948, better quality people than the people that are there, find. churchill is saying that is ok. from that kind of goofy support years ago, is the support for israel within the western community, the chatham house community. is it drifting away? dr. vinjamuri: you put a lot on the table and first of all, chatham house doesn't have a singular view on this and there is a lot of contest about how the u.s. and the west and europe should engage with the broader question of israel and palestine in the u.s. support for israel is steadfast. there is a growing and enduring support for a two state solution but the second thing you put on the table is the question of history and i want to bring our attention to jake sullivan's

magnificent audit -- article published yesterday. he said states have many things but it is not about history or power. it is about the choices you make and how you deploy them and what we see, people are lurching back into historical grievances when one needs to be done right now is to deal with the context as it is in this particular moment. with sensitivity towards the grievances but with a recognition that israel has a right to defend itself, there is a severe humanitarian crisis within gaza. there is an effort to get humanitarianism in, and the diplomacy that is at work is a short-term effort to avoid more people getting killed, civilians getting killed and states, you mention iran getting involved. part of that is not igniting

these deep and historical grievances that make it very difficult to bring different actors to the table that will need to be at the table and to prevent people being so entrenched that they only hear half of what anyone says. we heard what happened to the secretary-general, people read the part of the statement they wish to read and ignore the part two -- that speaks to both sides and it makes it hard for different -- for diplomats to get this crisis to a landing pattern. lisa: how much has the u.s. lost their leadership role -- and doesn't have the cap -- capability to vote to what joe biden is talking about? dr. vinjamuri: we will see whether that aid package, the demand that joe biden has put forth, that would see aid for israel and ukraine supported.

the rest of the world looks at what is going on in the house and cannot believe that this is the u.s. of america. they also recognize that america has a problem at home but it has some very serious leadership across all parts of the country, not only in government but in the private sector and america is the only country that has recovered and exceeded its re-pandemic levels of growth -- pre-pandemic levels of growth so there is a recognition that there is a resilience in the u.s. not reflected in the house and this is something everyone will be watching as we get closer, now only to the current debacle but especially to the november 2024 elections. katie: this is a fluid situation but one of the many headlines that, you white, the s&p cutting israel's -- the s&p -- that

caught my eye, the s&p cutting israel's rating outlook to negative. also the idea that it will remain centered in a gaza -- in gaza, how big of a risk as the spiller -- spillover here? dr. vinjamuri: this is where active diplomacy is really the name of the game, we can make predictions 3-6 months and the more significant russian is under -- question is under what conditions is if this will run longer than six months and if iran gets involved and if that makes it much harder for other regional actors in the gulf to play a positive role in working with the u.s. to bring some sort of peaceful resolution. tom: i was on a cruise with jon ferro doing a speech and on the

way back, that is what i read, the article shorten or. dr. vinjamuri, thank you so much. i had not read the jake sullivan and i will put both of them out. these are log in free from foreign affairs because of the moment. they are definitive of the three levels of palestinian history, authority over to terror groups like hamas and it frames out cleare then the motion we are gettingr from the day-to-day moves. lisa: everyone is focused on grievances and the history which is painful and it is a competition of pain. there's plenty of go to rome, how do you come up with a solution where people are not ready to come together? it is a fraught situation. all the leaders coming together, not clear they are having a

better time trying to resolve it. tom: we always go into wars and conflict and this one was short. this will be done by christmas. this will be done by the start of baseball season. katie: going off the blueprint of russia and ukraine, that war has lasted a lot longer than most people had predicted and certainly russia. it will be interesting and important to see whether this falls the timeframe. tom: futures red and green on the screen. we will speak of the miracle known as microsoft, coming up, carsten brzeski of ing on the european recession. this is bloomberg surveillance. ♪ endless hardie® siding colors. textures and styles. it's possible.

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tom: good morning from new york. an eventful day here and a ecb meeting tomorrow. what it means for chairman powell and the u.s. as well. 10-year 4.8 6%. we are up for basis points. running green on the equity screen. the vix has come and mice under

20. i guess we will call it $88 a barrel as well. let's -- to it. under surveillance. lisa: republicans still do not have a speaker. their latest choice for a speaker, the fourth in three weeks. johnson is a vocal ally of formal president trump saying he is very confident he will be elected. republicans hold a vote at noon eastern. i have got to be honest, at a certain point, when do you start seeing, we can't keep doing this, the fourth speaker in three weeks. can he get enough support if he is somebody who work so closely with donald trump and someone who has alienated a lot of people in congress. tom: a lot of sharp words being

said. our guest will go there. greg will give us perspective here on to be cordial something original on many people will say damaging on our relationship to our allies. lisa: this issue of the credibility of the u.s. to keep low rates. how much does this have a market move, how much is that underpinnings some of the volatility? >> this is an important time. there is real work to get done when it comes to israel, ukraine. we are hurtling towards a another shutdown in november. tom: the distinction tomorrow -- greg is on the schedule, right? the interns, they are coming in late mid week. what are you, hr?

the point is, it has drifted over to the senates, we moved from the house discussion. why don't we continue before i lose my job. lisa: alphabets cloud division falling short of analysts estimate the concern here is the division is growing between google and its rivals. at a certain point, how much are we starting to see the cloud division, not necessarily a micro story underpinning some of these things? katie: it is so nice we are talking about the cloud division and not ai. the fact that you have this pretty binary outcome between what we saw with microsoft, what we saw with alphabet is going to be really interesting to see what amazon brings to the table on thursday. they are the big leader and then

some. tom: amazon is co-opting microsoft knowledge for their processes. this is one like 10 days ago. they are using microsoft within amazon with their processes. i also wonder google talk about a lack of spending on some of the development. within corporations lisa: is that a macro economic question? i just wanted to talk about the story. really crucial for the global economy. properly -- property developer, country garden defaulting. for the first time ever. now, likely headed for one of the nations biggest ever restructurings. tom, you have been talking about this the property crisis in china.

we are starting to see signs there might be some response by the government. tom: what's it like if there's a big enough crisis when the president of the united states wonders down the constitutional avenue. that happened in the last 48 hours in china. we covered it yesterday when i was coming back from the cruise. president xi showing up in pboc is a bombshell. lisa: the symbolic importance of that is hard to overstate. katie: when you think about the steady stream of stimulus we have seen from beijing, it is still not working its way into the property sector. lisa: the idea that he is willing to let the deficit get deeper into borrow more. this wasn't enough to generate some sort of rally in markets because some people say it is not enough. it really highlights the fear of the scope of the problem and helping people have we heard say

chinese assets are on investable at the time when there is this amount of uncertainty. tom: i noticed gucci went down this sequence. hermes, distinctive from the other says china is nice about. we will get to the arizona diamondbacks in a moment. what is so important here within the academic side of germany is public service to the netherlands of working with the ministry. is lagarde and ecb face originals structure come original challenges that politics? is there still a core of europe? >> who still have the core

appeared in the court will need lower interest rates. the court is germany. -- the core will need lower interest rates. the core is in germany. tom: he said make a charge -- chart. the answer, it will not be like 116, it would be like 150. what euro is more efficacious for lagarde? >> i think currently we are fine because we do have this extremely weak euro. this should help the export sector. given that the world has changed so much, china is no longer just a nice export estimation for

europe, i think the euro matters list for exports therefore for european growth than in the past. lisa: problems that christine lagarde has to deal with and address tomorrow. we saw this yesterday, the pmi data and europe. it looks like they are in a recession and they are likely to experience recession the second half of this year. they are also experiencing sticky inflation. how this ecb respond? do they just stay where they are in paralysis open for something to change? carsten: now, when we get gdp data from the third quarter next week, we will probably see that there is a contraction. a very mild recession coming in the euro zone. this is says -- they have gone so wrong on inflation. they cannot afford to be wrong again. they will have this tightening bias building. which means no rate tomorrow.

katie: if you do that will prices rising and other -- how does the ecb respond? do they hike rates? carsten: i wouldn't do it if i was christine lagarde. this ecb knows, the ecb projected inflation to come down to 2%, only the third quarter of 2025. if you only have one job in this job is to bring down inflation to 2% and another one to .0%, i think there will be inclined to elite leave the door open for further rate hikes.

katie: one evening about the delicate economic drop, what is the line between stagflation and stagnation? carsten: we are alerting in a stagflation environment already. the stagnation in the euro zone will continue. i disagree with the ecb which has predicted that there will be a rebound. i think we are in the longest episode of stagnation. we do have inflation. it will be coming down in the coming months. this is not to 70's. it is a 2020's saturation. katie: investment global in nature and in europe as well. the state side is saying this is doing the fed's work for them, the fed speaker has tried out

the narrative as well. does the logic apply to the ecb? carsten: definitely does. the rise of volume was not as strong as it was in the u.s. when you look at the models and how much you give on models. a change in bond yields is four times the same impact on the economy in europe as the change in the policy rate. this will not do the work for the ecb. have it increased rate more than one year. now, it takes a nether year before releasing the full impact of the rate hikes. tom: it is probably 10 points where they show just stops. the imf meetings in april were -- just stops when i asked him about sclerosis. europe has gone to some new form of better nominal gdp.

do you binance? carsten: no. yes, the labor market is different thanks to demographic change. we have massing the low growth on the labor market -- we have not seen the low growth on the labor markets. we still have high deficits. the world has changed. tom: this is critical. a 2026 year of sclerosis, is that feasible, something we should be studying? carsten: we were already talking about the japan efficacious of nification. europe does not have enough

commodities or resources. we are still hesitant in order to use physical stimulus to get these done. lisa, to me there's is a arched -- this is a arched question. tom: europe is somehow moved beyond what we have lived for years, which is a higher unemployment rate. i got people going -- maybe not. lisa: this is the difficult moment. this is really the big issue, all of a sudden you are looking at the biggest stocks being tied to weight-loss trucks and luxury products. tom: we will dry for the

weight-loss trucks story cleared . katie: since i what we have been seeing with the weight-loss drugs is ai. we are talking about health care. this is going to take years to recognize the years attached in addition to the opportunities. tom: catherine greifeld with insight we would never get from jon ferro. the dow down 33,000. this is bloomberg. good morning.

>> the consumer in these earnings is holding up better

than expected. confirming better retail sales that we got in september. consumer balance sheets are healthy even though at the margins it is deteriorating. eventually, you will have to refinance at these higher rates. that is the reality of higher for longer starting to bite. tom: let's do that poll. lisa: i got to go back to vetbill. ms. kane has a medical history. katie: pat o's impact is on the way -- pet ozempic is on the way. tom: we will have much more on the pharmaceutical. green on the screen. dow up.

i did not know what to make of it. we are down 3/10 of a percent of the s&p 500. we had bill ackman came out, blessed to the bond market stopped. lisa: honestly, come on? am i wrong? it is ridiculous. katie: i will say, if he actually opens the short when he tweeted it and if he actually closed in one he tweeted it. lisa: he did very well. it is not just him. he might be feeling the tea leaves in the market. tom: he is probably watching

surveillance is what he is doing. lisa: do you think you are responsible for this? tom: just on a personal note, get the call and you have a beverage in your hand and these people are smarter than me. a stupid chat gpt is the real thing. what did you learn from mr. mandela yesterday? this was the mother of all reports? >> i think they sort of sand expectations. last quarter it was one of contribution. this quarter it was 3%. they expect it is going to keep

growing. everyone knows they are looking to deploy their large models. this is a secular trend. tom: this is like a complete report. define what copilot is? >> right now copilot allows developers to be more productive. for a fee. they are charging $10. they have about 2 million people signed up -- 10 million people signed up. just like your newsletter. tom: think about it. lisa: you can hire chat gpt to fill a seat. this idea of have we overplayed

eight and not emphasized the cloud enough? what is the real surprised for microsoft, really purely the cloud in the ai discussion not really there in the same story except the first sentiment for google. >> look at how much these companies are investing and capex. there is a huge investment. in terms of the modernization, they are launching a maker 65 copilot starting november 1 -- launching a big copilot starting november 1. at the end of the day, cloud trading is where the money is. everybody knows nvidia had a big lift because of the demand. who are buying the --? lisa: the big fear, googles lag

behind the cloud competitors is only growing. >> google is more nietzsche and the fact that they do not have a legacy in the business as microsoft does. they have to build it from scratch. they're focusing more on the ai side of things rightfully so. some of the deals are lumpy. i know everyone focused on the 2% miss. a very healthy -- growing 25% feared to my mind it is going to accelerate because it is one of the biggest buyers of gdp. katie: you take a look at being search and news advertising sales increasing 10% and the corner -- bing search and news

advertising sales increasing 10%. >> it is very hard to take share from google. google's result last night showed that at $180 billion growing double digits. that goes to show how much power you have. snapchat grew 5%. it is much smaller. tom: did greifeld get the memo we are bing free. katie: are we allowed to talk about snapchat? let's talk about snapchat. they came out with earnings. of share spiked 15% after hours -- the shares spiked 15% after hours.

what were we so psyched about at 4 p.m. yesterday that we are not excited about at 6:53 in the morning? mandeep: when it comes to the guidance, the keeper company like snapchat because they keep losing money. because they had a positive quarter, everyone thought it was going to continue. it was just too uncertain to figure out whether or not this is unsustainable or not. lisa: the larger question of how to market was responding to the response. do you think people are overplaying the slight mess in they are underplaying the potential for ai? does that mean from a markets perspective any results that show you the money are the ones going to be rewarded? not the ones who show you hope, which is what a lot of people were trading on. mandeep: results matter.

with google i see you to being a big business. youtube subscription growth has accelerated. a light nfl content is working. the durability of earnings is there with a name like google. it doesn't change the fact that they have got all of these large businesses with a long run rate. i think that is the thing to focus on. lisa: can you extrapolate on apple? tom: if we saw microsoft through what they do, are we getting the same joy? mandeep: very unlikely focusing on china. we know pcm smartphone markets are still bottling -- bottoming

out. the one risk factor for alphabet going back to that is, if -- check out the distribution from google which has come under scrutiny. other than that, do not see any risk for the business. if apple decides to do their search, that is a big risk. tom: thank you so much. we will have him over your over the art of tech earnings as well -- arc of tech earnings as well. this is one dog division. hermes silk scarves did not move. lisa: the sandbagging, i love that. tom: let's talk down earnings.

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>> this is a transitional period . >> eventually, you will have to refinance at these much higher rates. that is the reality for higher for longer starting to bite. >> markets are starting to price in these different expectations for bond markets. >> investors are looking at any

glimmer of hope. >> this is bloomberg surveillance with tom keene, jonathan ferro and lisa abramowitz. tom: good morning, everyone. we will get a report from jon ferro at some point. katie greifeld joining us with all of the different narratives. i am just going to cut to the chase. global wall street must listen. katie with us in about four minutes. this is about trend based technical analysis. her note is blistering on the risks that are out there. lisa: the cheap risk is earnings. we are getting divergent stories within the textbased. the fact that we are talking about that is wonderful.

i'm trying to shift enter something else and may be these -- will come to the forefront. tom: what is the openings question mark we have priced ? we are just in nowhere land. lisa: people are looking for stability more than guilds coming down. that will be enough to generate some sort of feeling. it will be ok as long as things are stable. the instability is what left people very concerned because it creates a whole host of existential. tom: the real yield, look for that on friday. let's get a preview. katie greifeld. i look at the inflation adjusting yield speaks volumes. what does this say to you? katie: if you look at the two

year yield, we are clocking in 2.4%. the highest levels in more than a decade. for the past few months it has been rate of change and the level that has been shocking. maybe if we can get rate of change to, down we can digest the levels. the levels are amazing as long. well. tom: you should see calculus 101. it is unbelievable. everybody is wearing birkenstocks. katie: i did not do well in calc 101. i was in baby calc. tom: first of the data, i want to emphasize it is at no man's land. as katie mentioned, she knows

this is what i include. you are up to basis points on the real yield. this affects everyone in america. you were talking about tort lisa: the small businesses are getting hammered by this. hearing about that pain and keeping rates where they are. we get the bank of canada rate physician. -- position. this is the new kind of expectation from central banks tomorrow. katie coming to your point i am watching this closely. every single action is incredibly important. this is where the real uncertainty has come from. katie: if you think about the 30 year auction it is so sloppy.

interesting to see if the short and is better received. those options are top in line. lisa: the technicality is something we will be speaking with katie in just a minute. meta and ibm showed the two tales of the loved and unloved in the tech space. facebook, 160% gain. ibm lowered onto .2%. how much is this trading on hope and strength of economic momentum? tom: i do not see this coming. my basic idea is ibm is the one that should have changed its name. katie: very good. i googled everything. tom: katie greifeld giving us grief this morning. this is right now or global wall street the entropy of the day. everybody's -- interview of the

day. the technical analysis of trend going back to the -- 1978. katie, an opening question, what is a trend in equities? katie: equities right now, we finally see some of our signals take short neck. the biggest thing to follow, this goes what lisa is saying, divergence. we have seen long signals and shorts nichols -- signals in the small-cap. that tells the consumer the average stock is in trouble. your big high names are doing well. your average stock is worried about higher rates. tom: i am not a big believer of beta. in this world, do you have to do beta as a sector study or index study, or can you actually have

the confidence to beta on individual securities? katy: we tend to think about looking at sectors because we are trading more than the futures markets but we do also look at cash equity strategies as well. we are seeing tilts right now. you're seeing people talking about tilts are two defensive. tilts to oil companies. at the divergence trade is about finding certain areas in the market that are going to be better or worse in a higher rate environment. it is uncharted water. we have not figured out what is going to happen next. that is the theme. we got to the higher rates. what is next. which stocks are going to succeed? which are going to waver through this new environment? lisa: i was so excited to speak with you today. i was looking for a trend.

how can you find a trend in a market that is unanchored? katy: i have been asking this myself. we have seen consistent short trends for months. i have yet to see a steepener and the relative positioning and trend signals. that is something that i have been looking for to understand when we might have a inflection point. there was more pressure on the longer end this month, which is something that kind of brought my attention that we might be eventually at a buying point. industrial right now, in terms of how we are seeing the market -- it does feel right now, and terms of how we are seeing the market-rate that we have some interest to buy. the next step is going to be what is the next phase of this bond trade. is it weights and cnc fleecy something that can push us to a new shape of the yield curve?

or do we go to a steep were we have worse financial conditions and the shorter and has to release some of the pressure? lisa: are you still shore up bonds? are you seeing this as a sign that there could be more yield increases to, even though you are seeing a bit divide come in around the margins? katy: what is amazing to me, signals in the technical space has been short and fixed income for two years consistently. that has to happen in many decades. i think what we need to strike to see is to see some consolidation and see some actual view that the trade might turnaround. so far, i keep looking for it. i have not seen the end of the trade yet. that suggest we have not seen bottom of the long end of the bond market as of yet. i think we might see it in the next three to six months.

katie: can we talk about the importance of 5%? in the path to higher yields, how much of a hurdle would 5% be? katy: 5% was a philosophical boundary for investors and represents a buying point. if you think about it as a investor perspective as the yields start to go up, there starts to be more trade-off. at what point do you not worry about the intra-point of that investment and start saying it is good to lock in 5% over the horizons. there is some risks that we might have deteriorating financial conditions. purchasing those bombs might actually see like a good idea. that it -- purchasing those bonds might actually seem like a good idea.

katie: let's talk about rate of change. the rate of change has been shocking over the past few months. you look over the next few months, are things going to calm down? katy: i think we have gone through a pretty strong run in terms of trend. fixed income is not linear. it tends to accelerate quickly when it wants to. it can be smooth for some time. it feels like we have gone through one of those phases. now, there is going to be some consolidation until we see something that has the ability to move the curve again. so far, we need to have something a little extreme, perhaps some deteriorating financial conditions or just a excess supply of treasuries that jess has difficulty consolidating -- that just has

difficulty of consolidating. tom: i want to come up with an important question. vix 19.06. katie greifeld looking at 2.4 5% on the 10 year yield. that is extraordinary. we have some dollars strengths and resiliency. i do not know what japan is doing. frozen fixed peso as that country falls apart. any number of other statistics we have the two year yield. lisa: i think it is important. you said dollar strength. i would say euro weakness. we continue to see euro weakness as a significant driver.

tom: i really got to ask this question. your world is the foundation of andrew low of the massachusetts institute of technology founded --. he is a giant of my world and global wall street world. what does he make of a 10 standard deviation move in the bond market? as lisa mentions the level, magnitudes. they are not an textbooks or modern portfolio theory? katy: these types of events i wet the markets hypothesis would call a punctured equilibrium. i like to call them an aha moment. investors come around and realize they have not realized something important. what happened earlier this year, people realize, i can actually earn something on my savings.

recently, people finally learned that way to minutes, we are going to actually have to deal with higher interest rates. that was the recent aha moment we had. we learned that markets are efficient. these type of events in the bond market seem to be extreme. we seem to learn them very quickly. all to side the same time. often times, it is very obvious. tom: katie, thank you so much. coming up, further wisdom from chicago at the 8:00 hour. james bianco.

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>> we did go through many individuals are. i personally did not think mccarthy had to be taken out. i think it caused a lot of chaos. mike johnson was the runner up to tom emmer. i think mike could have been afebrile is job. those 2 -- i think mike could have done a fabulous job. tom: the gentleman from north carolina getting through this. i wonder what we will have to

say tomorrow in 24 hours. can i just say can i just say come in the only thing dumber than what is going on in the house, the red sox is trying to pick a new head of baseball operations. tom: it probably won't be as confusing as what is going on. lisa: we are now looking at a trump litmus test. tom: he is a presumptive nominee. katie: it is amazing to think of the tom emmer experience. lisa: tom emmer was the front

runner. after he was the front runner, he pulled out of the race after former president trump said no. he is a rino as what he called him. now we have mike johnson of louisiana, trump supporter. tom: we do this with a mixed market. joining us in washington, our bloomberg -- you got to be kidding me correspondent annmarie hordern. the start of a of power. who is that she has the balance of power in the house right now? anne-marie: it looks like mike johnson. there is a different feeling mood wise about mike johnson when there was this roll call vote last night. three individuals voted present,

there were about two dozen that were absent. there does seem to be some momentum. maybe it is some exhaustion among the republican congress. it is probably so he is not needed so much that this could be the individual who relax them and get to 217 on the floor. -- who reunites them and get them to 217 on the floor. tom: your work in continental euros and london, what is the effect on our western allies? lisa: they saw a lot of tumultuous politics during the trump administration. annmarie: i think they feel that it will get worked out. when i was in new york for the u.n. general assembly, someone pointed to me it is no longer

the rest of the world. maybe that changes today whether what is going on between europe and the middle east. a lot of stress that people fill around the world, whether it is heads of states or whether it is ceos actually emanates from washington dc. they can no longer feel what they know is coming out of d.c. there are surprises. lisa: a note from a viewer says, are we looking at a trump test that any potential nominee has to get past? annmarie: i think it has been clear for tom emmer going down in flames. he had the nominee for hours and then he dashed off into a suv after basically trump ended it. put out a statement saying he is a globalist rino. political report is saying trump got on the phone with someone and says i killed him. without the backing of the

former president, this individual would not be able to get to the 217. when you look at representative johnson from louisiana, this is someone -- this is a individual who was collecting signatures for a long shot case in texas that they wanted to bring up to overturn election results. someone that not just didn't certify the election, but also someone who was actively working to support the former president request. lisa: how moderate is some republicans to get behind a figure like that? annmarie: the mood music in the shift best feel like it is changing. on the floor can these individuals vote for him? i would note that one cnn reporter did suite a photo of speaker mccarthy's office and

says he was taken down last night. that is why you are seeing this big shift in tone. there are 18 republicans in the current caucus that are from biting led districts. is this individual to tossed it -- too toxic for them question mark potentially they could get through with voting for him. katie: it is striking how different this experience is then the kevin mccarthy episode. now, we're just going through nominees. why the change in strategy? annmarie: kevin mccarthy went through 15 rounds on the house floor. i think that a lot of republicans that were able to get the nominating -- steve scalise did not even take into the floor even though they are able to get the majority within their caucus. when they start to then make those phone calls and figure out if they are going to have more than four people vote against them, steve scalise realized, i

am not going to take into to before, whether one around -- round or 15 rounds. jim jordan did take it to the floor but it did not work for him in a number of rounds. what they saw kevin mccarthy go through, they realized maybe it is best i figure this out. also, now we are months in. this has gotten personal for a lot of people. the battle lines have been drawn for a lot of these people. they have hardened. you have a really good feeling on whether or not you are going to make it through before you take it to the floor. tom: you joe mathieu en balance of power had the gentleman from north carolina. he is a meteorologist. he has cap -- he is a --. are there southern rhinos as murphy you add on last night, is

he a rino to the trump republicans? annmarie: i think someone like representative murphy is one of these individuals who likes to get behind the majority. if the caucus in the majority decides he is going for jim jordan, he is going for jim jordan. if they decide they're going for johnson, he is going to go for johnson. he is going to go to the individual who he thinks will get to 217 on the floor. he wants to go for someone who will get to 17 on the floor. someone who is not trying to get involved in the fight. there are some that really want to stay out of this. there are others -- it is a great moment to make a name for yourself. they are getting involved. tom: thank you so much. our bloomberg correspondence in washington. day by day this torture goes by.

we look at equities, bonds, currencies. greifeld nailing it earlier, the unspoken year-round it up two point 46% on the inflation-adjusted year yield. i am not exaggerating. one is there a collapse? katie: this is what you are seeing in the markets. lisa: i know some people read the beige book and they found a lot of anecdotes that pointed to weakness. this is one that is going to keep the fed on hold. we have not seen it because the company is growing. tom: we will have to see on that. coming up, sonia meskibn. coming up, sonia meskibn.

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tom: bloomberg surveillance. i'm tom keene, catherine greifeld in for us. today, we have four or five emails. nobody in economics cares. katie: we don't even want to go there. tom: she doesn't even want to go there. but we have sam bankman-fried. did i get that right? we will hear on that.

and the vix 19.04 all quiet on the western front. the dollar stronger. the euro through 106. 121 29 in sterling. what reason can jonathan ferro go away like the heart -- like this and live large is because of sterling being up. lisa: he is going to scope out a number of different places. tom: this is breaking news. this is unfair to the control room manager. bowing out with earnings. it will be interesting to see how boeing readjusts off of legit competition airbus. it is not boeing supreme anymore, is it? lisa: they missed a bit. you see shares dipping.

it gets into the slough of our earnings we been getting. i want to talk about other issues. we want to focus on issues overseas. president biden speaking with efforts to ease tensions in the middle east. this is the first time the leaders have talked since before october 7. issues flare at the united nations and the secretary-general good chair as being called to resign after he said attacks by hamas have happened in a vacuum, that is the quote. and it seems like all of these are trying to vent escalation but cannot coalesce around a shared vision. tom: my take, flaring is the perfect word. your this made major headlines. the fold is where there is a newspaper and you folded. katie: i have heard of those. tom: ancient history.

lisa: [laughter] it highlights how this is a war of information in addition to this being on the ground. in washington dc, congressman mike johnson the latest republican nominee for speaker of the house. this is after chong -- tom emmer was criticized by president -- former president trump on social media. we talked about this with anne-marie, but i would love your take on how much you hear about this as one of the features behind the volatility in the long end of the yield curve. another that sounds nuts, but people are looking for a comp this on how to resolve the deficit concerns. katie: you think of all the drama playing out in the long end but we are at the tell end of october. shutdown risk is real. fiscal deficit, supply concerns, it is playing out at the long end.

find investors are looking for any reason to worry. lisa: they have are a lot of reasons to worry. that's why i with them. there's missed profit expectations on microsoft rate -- gaining on growth. an meta-step after the close, amazon were running tomorrow. at this point, how much will this be about actual cash coming in the door? especially since you are earning something on this cash that something that people are pointing to as a tailwind for high rates on big tech? tom: the understory is a great part of this. the under bonding of the cash-rich companies. microsoft for example, it is a heavy burden, 1.9% debt waiting. 1.9%.

there is not a textbook that says you should do that. lisa: white issue debt when you have this much money? you can take the money and park it in t-bills and earn 5% on the cash. katie: it feels like the narrative has been higher interest rates. that is bad for long-duration tech companies. on their balance sheet that is not the case. you look at cache files and they are making honey off of that. -- cash files and they are making money off of that. it is pretty amazing. lisa: this to me as ironic. higher rates will hurt big tech because evaluations and now wait a second, they've got a lot of cash. it seems like tech wins heads they win, tails they do not lose. tom: doug kass knows, you go and there is a room of grateful that records. he answers the point where you have incident they are and candles and other in you burn your incense in your dorm room

as you studied and it was part of a theory. and it was on capital structure. it said if you that the money, issue bonds. it is fascinating to see what companies like microsoft do here. will they completely ignore this theory? lisa: was it something else that was said? i'm trying to imagine the -- you know. tom: is too far away to remember. boeing cut their annual target at 737. free cash flow headlines out there area interesting to see the challenges boeing has in the true global. she studied at the london school of economics and aviation manufacturing. the u.s. macro at bmi mellon joins us this morning with her work at the international

monetary fund on the green book long ago and far away. what is your biggest mystery in international economics now? you have bny mellon. you're planning your end report. what is the biggest mystery you have with national economics? sonia: what we are trying to figure out right now this may be my central banking background but r-star, what is the appropriate level of rates for this economy? what is the appropriate level of this policy? it is not the u.s. story, but the global story. the dynamics in inflation in supply and demand globally have shifted. lisa: this is building on white katie was talking about. how develop a trend if you cannot find it? how do you follow a narrative if nobody can figure out what to look at? what is your comp is for trying to understand what the new

paradigm is globally? sonia: you start by looking at how much people are saving. where are the savings come from -- coming from or not coming from. and where is the investment side coming from today? we think this has investment shifted. we have fewer savers especially in the u.s. as people engage out of the workforce. they start saving less in the market is specially and spending more. on the other side, you have investment. manufacturing even. so many people are worried about manufacturing at the start of this year and last year and we have a rebound. in part it is because of the shift from private spending, or used to be, into public spending. now we have all the physical support from manufacturing. the secretary is doing well. lisa: packing out there cash in savings account and then they get to retirement and they are

spending it. putting it out there in a new yet -- new way. the new generation it is yolo you only live once. they are spending it. how does that impact growth and inflation in the level we have not really envision? sonia: it is important to look at not only savings but investment side. inflation is a function of both of those. you have fewer savers, people are spending more, but you have more investment. katie: who higher interest rates actually pinches in the equity market. the narrative has been the big tech companies. the long-duration cash flows hit the hardest that has not been the price action so far this year. who gets hurt from the higher rates? sonia: i think the small businesses more. they are more exposed as you discussed. they are more exposed to higher

rates. they do still imply a good chunk of the american workforce. almost 50% by some estimates. for that company -- for debt companies, growth expectations in light of ai have been ratcheted up. for the small businesses, of course, not only the cost of hiring and the cost of expectation are lower. katie: -- companies have to tap the debt market more frequently than their larger peers. you look at that refinancing in a higher interest rate environment, how painful is that right now? sonia: it is more painful for some than others. you look at the balance sheet and the profile for each individual business matters. it comes back to jobs. if people have money to spend or enough savings, that is a buffer. even for companies who need to

refinance and the higher rate environment. just as with big corporations and tech stocks, if growth expectations still trump the cost of capital, they are in a good place. tom: in your london school economics, once would say you have to clear economics. i'm looking at inc. charts and financial charts that border on greenland. how do you proceed from international economic spaces with clear robust and financial systems? sonia: in some ways, you know, yield curve that is somewhat less inverted is help 02 banks. -- helpful to banks. and by some metrics, it has been growing faster recently than earlier this year. tom: from a height standpoint it is a

global role is what we see here. the strong get stronger. i don't see a way out of it, it is a once-in-a-lifetime bond investment. sonia: it is huge certainly once in a decade. tom: ok thank you so much. with bny mellon. difficult questions if you're working for a bank of character and longevity as the bank new york area the dividend goes back to 1642. we mentioned this power earlier. lisa: that is the heritage paradigm. -- i am just kidding. i think there is this one about all the older people who are retiring and spending all the money and the younger people who believe you only live once. the idea that everyone is ending and the incentive to save has gone down. it is interesting to me. because it is true, you only live once.

tom: s&p 500 down .3% right now. lisa: i keep going back to the theme we are develop -- see developing whether it is sown or others saying with this idea how do we invest and solidify around this narrative? we don't know the era dime and that is the message the last couple weeks. katie: what we have to rely on right now is these levels. 5% is a big philosophical level. in this vacuum of fed speak weary and right now in the fed quiet period, that is trading. lisa: to be completely honest fed chair jay powell is speaking today but it is non-monetary policy related, rents. -- related conference. i think he is introducing a colleague. it is not to do with monetary policy. it is a whisper of quiet. katie: we will have to pay attention to the color of his tie and how his

hair is parted. [laughter] tom: we will have coverage on that. jonathan ferro reporting from the back of a cruise ship. i have no idea where he is. if you go up and down it can be make you seasick. lisa: have you ever been on a cruise? tom: i have been exactly once. lisa: yeah. tom: is that grace kelly, there is -- it was a long time ago. lisa: katie: there you go. there you go. tom: are we on monday tuesday or wednesday? lisa: monday. i think so. tom: at 8:30 we speak with stephen reshoot a -- steven ricchiuto . this is bloomberg. ♪

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gains and losses. the good news is the end of frame -- it is the end of free money, the normalization of interest rates. bond buyers are getting something in return. and leaving the fear of emergency liquidity to an more normal environment. tom: john stole this has been right on the market. he is chief investment strategist at oppenheimer management. with all the gloom that is out there of the selected few over at deutsche bank, and a number of other people are saying shut up and get in the market. lisa: i do not feel the gloom. i feel the gloom from bond traders. but in the equity space, it you hear people say if you been blooming -- gloomy you've been wrong. you hear that again and again. katie: 35% year-to-date.

i know we stalled out and then some in the last couple months but it is still a good year. tom: we have not talked about this this morning, we pause global wall -- global wall street, but -- 59th street. citigroup 38.93 on a reverse split off of 2007, it is $3.89. you look at every chart in banking, and forget john stole fizzes optimism, it is slipping away. katie: financials are their own special headache. there are idiosyncratic issues. if you look at the sector level as well. but on the benchmark level if you put money in your s&p -- s&p 500 tracking fund you are still having a good year area -- year. tom:

ok pretty good. and what is that say about the regionals and small banks as well. lisa: they are a potential candidate for the zombie roll up. tom: it is a zombie roll up but you never know the way it will be a roll up. people are basically saying chevron sold out of house, i do not know if it is true but it is the talk out there area is a big premium. lisa: it's a different industry when you look at maximizing the stuff in the ground before it is obsolete. tom: alex in london. your brief is where i wanted to go. i'm fed up with the happy talk about ai. what we learn about ai at 4:00 yesterday afternoon new york time? alex: in simple terms it is a real thing. there was a certain amount of questioning read seen all this

spending on chipsets and nvidia to build up data centers that are primarily built by the cloud operators. amazon, microsoft, google and a few others. the expectation that -- if they build it, will they come, looking at microsoft. it looks like a 300 basis point tailwind from the demand from ai offerings. ai offerings often have to do with the openai. microsoft has a close relationship with this. there is appetite for us -- for this stuff. and there is good were ready for google. in the cloud space it did not do as well may be marks were stolen in the ai space. lisa: have we used ai to paper over the nuts and bolts of these businesses too much? are we seeing ai lose share to the others and break back while

others surged ahead? alex: there's a lot of nuance in here obviously. google i along by is the third biggest player in space. microsoft is a strong second, google is a long way behind. amazon right now has not gotten an ai offering. that -- not the ones that ai and google have had. google has one of these things. it is not making a different. the interesting thing will be to see if things are taken out of aws. that will help to answer your question. but there's a huge amount of concern about ai and what it does in general for the global economy. it is not papering over crack but filling them in. lisa: how much overlap is there with the competing clients for artificial intelligence services that are a broad reach. isn't there basically consolidation of market share

and corporate that you can translate from one section of the business over to the other? alex: if i understand your question correctly i think ai will be touching everything. with all the companies that is the huge expectation for ai. the idea it is moving spending around may not be completely accurate. i think that if people want to find the savings and also the opportunities ai may offer they need to invest. that will be additional investment rather than reallocated investment. but with google, none of the reasons it is said to not do as good as expected because there's been a tamping back on spending. we are very early in the cycle still and there's going to be more to come a few judged by the microsoft experience area they have to see that it is the effect that they desire and the technology is not always ai. i hope that it did answer your

question. i'm sorry. tom: my head is spinning, katie, save us. katie: ok. we spoke with mandy earlier. he made the point that soft ai went from a 1% contribution to a 3% contribution. how high could the number climb erratically question -- theoretically? alex: i'm not in the business of making those precise predictions, but 3% of the $60 billion business isn't nothing. that would make it a unicorn on a standalone asis. -- basis. we do not know how high ai can go and what it can do. the question is it coming now, six months, 5-10 years? that is the key russian. tom: you been into stash fed is the key question. -- that is the key question. tom: -- we have large language

models with whatever they are as well. and i said to we ms. jon ferro? -- do we miss jon ferro? and when do we get questions like that answered technically? what can lisa say is not the toxic brew, how bad is the toxic group? when will we get that in ai? alex: five years ago we go from gpt one two gpt for in five years. the timeline in the pace it is exhilarating it looks like it will happen very, very soon. the question is the safety element. does that holdback the pace of the development? it is an important one that people can answer right now. tom: thank you so much. alex webb right there. on the philosophy of what we are

witness not the financial numbers there with bloomberg opinion. katie: i'm curious what copilot said to the question? tom: it crash the server is what it did. people come onto the show and say it will help margins by 200 bps and i'm like really? that is what is coming out of their mouths. lisa: and moody's was saying they will use chat gdp to help but there were words to generate them. if you can have what we are talking about -- with deutsche bank yesterday of how you can use chat gdp to find certain things to go through documents ugly, why analyze fed meeting and it if you can send chat gdp -- this is the question. at what point does it replace humans versus augmenting productivity which is another word of cutting out the work. katie: may be that eventually

translates into margin help. in the meantime companies are spending so much on ai and research and development that has to hit margins. lisa: it may be but they -- it may be worth it if they can get rid of redundant is. i hate that word. tom: i have smart people telling me this will work in selected areas. but you make a joke about it to say which is the toxic brew that will matter today and which will buyout. i just don't buy it. katie: maybe less poetry. lisa: when you think about how much google improve people's efficiency, some of us use google to find information, just imagine how much more you can do. katie: i read about that in our ago. lisa: exactly and then it gives you a better more curated history. tom: i hear from -- that lycos dog pile was there before

google. it is like wow, you can do that. that is brilliant on what we see from microsoft. earnings this afternoon as well area this is bloomberg. good morning. ♪ is it possible to fall in love with your home... ...before you even step inside? ♪ discover the magnolia home james hardie collection. available now in siding colors, styles and textures. curated by joanna gaines.

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>> clearly the consumer is holding up better than expected. >> investors do expect to slow

down but not a collapse. >> over the last several months it is a spot where inflation could confirm. >> this is bloomberg surveillance with tom keene, jonathan ferro and visa number on a wet -- lisa abramowicz. lisa: for our audience worldwide good morning this is bloomberg surveillance. jonathan ferro is still on his cruise and katie greifeld is joining us. and you been talking about the gloom but i see it in the opposite way. the tone is for me a trend they could give you the confidence to go by the tech and everything else. tom: there's issues of seasonality in the time of year. i will make a small issue, we talked about this, is by backlick in. i don't understand the legality of it.

everyone can buy their own shares. they come out with earnings, they get done and go to some spot and they do bond issuance. i wonder if that is what they see from west coast techie. we will will see gazillions of all -- dollars of bonds that they can sell. lisa: you come back from a cruise and then you talk about this. tom: no that's what they are doing. lisa: what you are seeing is cash flow. what you see in the companies is rigor. regardless of if you want to parse through nuances, it is a good pitcher. at what point do you wait for a narrative in the bond market to let you have conviction with the narrative to drive forward some buying pieces? katie: when things finally stabilize you stop obsessing over price return. you think about total return 5% of the treasury yield you think about risk reward it is not too bad.

we wonder if we see stability. katie was laying some earlier. but this is the issue, right? we've had to deal with the calculus of the bond market that was stagnant for so long and suddenly was a jump condition to use your phrase. tom: that is the heart of the matter here in october. we have the fed meeting with our coverage the first day of november. it gets more as you get into december. you think about the rate of change. the rate of change is the accelerated tendencies and how they are linked together across equities, bonds, currencies, commodities. then we get to what we hear from bny mellon, the junk conditions and it is a regime change. lisa: that's what we get more angst around the geopolitical position. that is what is happening domestically. i love when you said what is more next week? we hear from tinto banks, at refinancing agreement or others. the u.s. may be selling more

debt area katie: if you rewind back to early august it feels like things have been on key since we got the initial refunding announcement where the treasury announced there would be selling a more debt than the market expected. there's a lot of issues in the long end but that seems to be when things are taking off. lisa: have you been surprised on some level that we have not seen the zombie roll up yet? tom: we see selective zombie roll up. we see exxon, pioneer, chevron, the oil area, amerada hess, the answer is clearly the pros are telling you they are not done in the premium markup. people are meeting not for financial gain, they are meeting for scale because it is their least worst opportunity. lisa: we see the latest in this with moments ago crossing

stellantis near a deal to buy a share at leap motor. i'm curious given some of the strike activity. in the market, softness, a little bit. hard to get too excited or depressed about this. decline about went to 5% but we see the dollar strength versus the euro versus -- with economic data that came out. 10 year yield, have we reached stability? do you think so? tom: i do think so on a technical basis, it is so great that we have no idea, the line is tubing but there is gnosis or for a trending path to work with. it is no man's land. it is a copout, but it is true i need more information. lisa: people are waiting for more stability before they say i can cling onto a thesis. one who has been good with this is jim beyonca president and macro strategist at blanco research

how long can you wait before you go out there and have some conviction? jim: everyone has been trying to catch visit and then their hand has been getting caught over and over again just take with the metaphor. what i see with the discussion about the bond market is from -- there was a qa period. we have gone up 500 basis points but we have not tightened by 500 basis points or anything close to it. the first several hundred or few hundred of that was getting back to neutral. the amount of tightening or stress that the interest rate market is putting on the economy, i do not think it is as great as people think. tomorrow when we get gdp we will see a number that -- could

change it. and in and the consensus forecast was for zero. we are starting to play that game again as the economy is about to turn down again. we done this a year and we keep saying this. the assumption is the rates are punishingly high. if you're not there is room for them to keep going up. that is what they will do. lisa: i sent a shift on the margin of the narrative. the feeling that it bond narrative stabilizes it is not armageddon, or will cause the demise of a stock rally but the opposite. the stability will allow people to come in and by equity and risky securities because the economy is with stranding the rate -- withstanding the rates. do you think that is an accurate collection of how people are thinking? jim: yeah. people think earnings will come through and the economy will stabilize. companies will have a brighter outlook. however, you have to put that

against the alternative. the alternative is 5.5% money market and in the next couple weeks. a 5% bond fund as well. dr. jeremy siegel updated his great books for stocks in the long run this new addition this year. he said the long-term return for the stock work is eight sent. -- 8%. if i get five in a money market and five in a bond fund i'm getting two thirds of the stock market game with no real market -- much reduced market risk. so the stock market has to do something more than we beat and things are somewhat bright and they've got to do better than that because there is an alternative now and it starts with the 5% money market fund area tom: you're one of the few people i can talk with this about. your remember when there was a chemical rollout. everyone ripped apart companies that made chemicals and said here is what is special, it was basically a zombie roll up.

and productive companies as well. are we had a point because of a new real yield and the cost of capital permeating the system that we get a great merger-thon? jim: i don't think we will get a great merger yet because people are really misreading the yields. they are not ready to react on it because you hear this battle cry that real yields 2.5% on the 10 year tip is the highest since 2009. again it is the highest since the qe period. what is average real yield from 1997 when they started trading until 2009 it was 2.7% we are at 2.5% right now. once people start realizing the real yields are not punishingly high you may see more activity cut -- pickup. but right now everybody wants to wait for yields to back down. earlier you said we will see the

tech company show bonds. if we did, that means the rates are going higher. i suspect the answer is no. tom: late october victory lap. jim blanco absolutely nailing the call. does that signaled the great moderation is over? jim: i think it is. i think that era ended in 2020. i been on the show before and talked about that 2020 was arguably the most important economic event of our lifetime. a can be shut down and restart of the economy globally. it has been coming back differently than it was before. the whole era of zero rates, the rate moderation, i would maybe even talk about top-down index investing on the equity side, it might be changing. now we will be looking at more traditional cycles of 3-4 year sessions and we may be looking

at stockpicking making a big return after 20 years of being in the wilderness. first is index funds, then we start to understand if this -- that this is a very different environment area katie: we did not have a lot of time left. but i want to talk about the shape of the yield curve. when it comes to the tuesday in -- comes to the 2s/10s there is there -- bear steepening. what is it signal? jim: if the fed wants to back off a rate hikes and they the market will do its work, be careful because when the market starts doing its work, it will do it if you want the market to slow things down it will. look last year in the u.k. when the market did not like the many budget and parliament would not do anything about it, the market stepped up and did something about the mini budget and liz truss left -- so be careful when

you say let the market do your work because it will do it and it will do it in a way where it will hear you. and that is why we get bear steepening right now. tom: thank you so much jim blanco with blanco research . folding and the economics and the equity market as well. speaking of the equity market, red and green on the screen, been that way all morning. don't know what to make of it other than we wait for tech earnings this afternoon. 18.96. the tuesday ends -- 2s/10s spread. the noise nails it with the 10 year real yield 2.45% higher real yield. the standard five -10 -- down .2%. lisa: he said he views 20/20 is the biggest financial episode of

our life. you shut down the economy and restarted it and it is completely different. tom: and we did not have a time to get to it with a number of these guests, including bny mellon, but my missed call of the year was underestimating the lay -- legs and magnitude of fiscal stimulus. we talk about the bidens stimulus and deferred -- and the third triage we had and i completely miscast the length of that. -- ms. guests --mis-guessed the length of that. katie: it lasted a lot longer than many were a acting -- expecting. lisa: two years ago if you would have said to anyone that's where we would be, they would say i imagine 25% of the market is in default. that is not where we are. that to me is the take away

because of the strike and the savings. katie: you see it in the banking system. it causing a he cut -- a pickup. a hiccup. in three years, the 10 year yield has increased four percentage points. that is amazing. we are still seeing a lot of resilient and the stock work and the economy. lisa: a lot of people are writing and saying where is pharaoh and what --ferro and what cruise is he on? katie: he wanted to go to antarctica and see the thing wins. tom: he was in high up skyscraper. you could look and see the port and then the star board. it was amazing read this is bloomberg. morning. -- good morning. ♪

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>> if you like the united states, -- tell us the process in public coming in private, through every means. do not -- attack israel's partners. tom: secretary of state united nations ministerial meeting. he will no doubt have a busy day today. and oliver cook traveling today but i am sure we will hear more

from him and ethan leading the coverage in tel aviv this morning. futures negative nine. a little bit of green they are. i give that to microsoft. we will have to see as well as an adjustment. greg valliere of agf investments rights every morning saying that geopolitics could be the biggest issue especially for young voters, the focus seems to be shifting toward isolationism. the idea of spinning another $100 billion of ukraine in israel is becoming less popular. and biden has a political opportunity to become an effective wartime president. this has decent support in congress. that is from greg valliere . and you hear me talk about america's history of isolationism is now a demographic isolationism. lisa: how much will that play out in the contours of the two

front conflict it is israel and ukraine. greg is joining us. i want to start there. is there political support to support israel in addition to ukraine going forward not just the next month or two months, but six months to a year. greg: that is the key question. i do sense a waning of support over the last few weeks. i think biden has enough backing in the senate i think he has mitch mcconnell and lindsey graham and many others who are very hawkish. i say young people are not enthusiastic, a lot of americans do not want to send -- spend $100 billion more. it is soft, that i still think biden has enough support to get an aid package, probably not until the middle of the winter. lisa: what do you make of the fact that you are essentially getting a democratic already that does not seem to back

israel and is moving away from it. enter president leading the charge in that effect. greg: it is quite a dichotomy. i'm shocked to see the democrats in the party that supported israel so aggressively for decades and decades now looking a little bit softer. i do think that we will get a deal. my issue is the timing, i think we are many weeks away from anything new forming. ukraine, israel, taiwan, u.s. border with mexico, that is still a ways off in terms of getting it enacted. katie: walk us through the ramifications of that. if we do not get in a package moved in till mid december outlined, what would it mean for the war? greg: it sends a bad signal to our allies. ambiguous but i would argue that it sends a signal that the u.s. is losing a bit of it resolved. we recall in the last year or year and a half we had the big

issue that we would lose the resolve on ukraine. if we lose our resolve on you rain and -- on ukraine and israel, that sends a negative signal to me. katie: let's see how this ties into what we see land out in the house right now and the efforts to elect a speaker they are. two weeks ago i would have ask if the israel hamas or would more urgent the -- war would put more urgency on this but that has not materialized. greg: no, this deadline of november 17. will go. i cannot see them getting the budget done i then area the new speaker, if we get one, nobody has heard of this guy but he has a good reputation. he is a good denier that biden was elected president. that is not my cup of tea, but he has denied frequently that this is a election result. he will have to answer for that. i think we will go well past the

17th of november to get a deal. lisa: how much is former president trump driving the bus here. we heard him this morning congratulating the congressman saying mike johnson is the strong suggestion from him. greg: it looks like trump has veto power, doesn't it? the guy from minnesota lasted like eight hours for trump. trump boasted i killed the nomination. trump is taking a very over role in the house. i've got to say there's a lot of house members who resent him. lisa: how much is there still discussion about a bipartisan member it was politically not viable on either side. greg: i would not put the pit -- with the chance more than 20%. it is unlikely we get that. if this totally breaks down and we get into the winter without anything, all bets are off. i think akeem jeffries may have to benefit but it is not coming yet. katie: this disarray we see in

the house among the republicans, have we seen the democrats try to capitalize off of that? greg: not as much as i would have expected. what is the old saying? if your opponent is self-destructing, do not get in the way. i think democrats will stay you did, but at some white they may have to be called to enter this fight. -- at some point they may have to be called to enter this fight. tom: i want to go back to what you said because we need to paint this picture. the new york times said the war east of curse on, this is east of odessa, east of romania and ukrainian forces are surprising by moving east along the shores in the black sea. what domain need from us that is going to wait for the winter finance by america? do they literally run out of artillery, run out of ammunition? greg: timing is everything. i think they've only got a few weeks before it is the

four-month season and then we have four months of mud and ice and basically a stalemate. they will get more arms from i think western europe, but again, looking at washington, i think it will come let air -- later rather than sooner. lisa: all wars have propaganda efforts. we see that in history. very notable. this time feels different other it is ukraine or israel. the images on social media and the battles coming out in osha media, how do you view this information as having him materially different nature than previous ones? greg: the first casualty of war as we know is the truth. i think it's going to continue to be very difficult to ascertain who is winning and losing. i do not think that's going to change. tom: thank you so much. greg valliere with agf investments always an important morning note here.

and i think this is been underplayed this morning but i will go back to this theme, many international relations were talking about this, i cannot say enough about cfr, but israel is not just about gaza, it is about that she would suggest the west inc. is a huge throw away from the atrocity in gaza. but then there is also lebanon that is a multi-front war. lisa: it is already a multi-front war when it comes to the emotion behind it and the clashes on social media. at a certain weight, how do you move forward? we were talking about this earlier this morning how do you move forward with the viable solution. if people still have these issues that are coming to the -- unresolved issues of the past. katie: i was going to say the fact it is a multi-front war. they are so involved.

, there are some many actors involved. what secretary antony blinken said in a clear message to iran saying your axes do not attack america because at that point you have to get lost. tom: in the military i do not think the israeli military -- i think they need to make sure they do not kill some people. it is that abrupt and it bounces against the rhetoric out there. lisa: israel right now but i find interesting is the assure that international leaders are racing on israel area we will talk about this and some of the earnings that are coming out after the bell all of that is coming up on the open. patrick rossetti joining us, amy silverman, and daniel solomon of new street research and others joining us. ♪ ind your personal style. endless hardie® siding colors. textures and styles. it's possible.

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tom: bloomberg surveillance, good morning. the ecb tomorrow no. -- tomorrow. and imf meetings about the ecb that needs a trajectory at 2%. and we have katie greifeld in for jonathan ferro. we get ready for an 9:00 p.m. ordeal. i look at the ecb and it is not the same story as the fed it is a different dynamic. katie: it is fascinating. for years coming out of the pandemic and in the pandemic, we

have developed market central banks moving in lockstep. now we see more idiosyncrasies in the economy. and then you have a different response from the central bank. tom: ian bremmer would say that and we will see that tomorrow we will have coverage on that. right now the red and green on the screen. earnings in full force. look for bloomberg technology on the analysis for that around noon. we have a huge value and then steven ricchiuto joins us from mizuho securities . we all get that we were wrong we are in the vicinity of 5% q3 gdp, great, i have an ia, a g and then next on the backend, will they help the booming consumer? stephen: that is a real

question. you can look for a little bit of the trade. the key question is the government component. to be honest with you we do not have good priority data when it comes to government spending have the treasury -- but those do not translate well in the gdp accounts. they do not translate as clearly as other components do. but we look closely another component saying nothing else is contributing. so we have to look at trade and how much we get from government. tom: is there separation in the eye -- in the profitable microsoft businesses like investment. but others are flat on the back. steven: it is. when you look at the noncapital goods, that is a key driver of the equipment investment components you are looking at, they are showing you on a real basis that we are doing nothing on average in terms of investing in the economy. but when you have excess supply globally of tradable good, it is

not good -- not that we are seeing that. katie: if you look at the deficit, the u.s. government ran a $2 trillion deficit in the fiscal year through september. it then you think about what is happening in the bond market. you have a 10 year yield at 5%, does that level make more sense about the deficit we are running? steven: it also makes more sense when you ask yourself the question of what level of inflation the fed reserve w ants. they give lip service to be 2% number but they also pay attention to the main aspect. they shifted the dual mandate which used to be inflation first and employment as a result, it is almost like we want to get employment first and see what happens with inflation later. and maybe we will tolerate re-percent. the upward movement in the road is reflected in the value and i do not think markets have fully discounted it yet. katie: does that tell you that

they see a link between the unemployment rate and what is happening in inflation to get inflation back to 2% you need to get unemployment up. steven: i think most investors see that. i do not think this federal reserve does. if you are the in the economic club lunch the other day with jerome powell, you have to sense that these people or he in particular are looking at things like the joltz data. and there is not that much history behind it. and number two, the history we have is only good for credit recession. this is not a recession that would be driven by a credit crunch, this is an inflation monetary policy. that is a different story. for the reaction it functions differently. tom: did you feed david westin's questions? they were so vicious. steven: i thought they could have gone even harder. katie: can you imagine -- tom:

can you imagine jon ferro doing economic club? katie: it would be good television i have to say. tom: with powell, it is not game changing. he is just trying to get to the event. katie: i will say the thing that stuck with me from that appearance is the focus on financial conditions. i think financial conditions, he said that at least 15 times. when you look at that you'll have the lag of monetary policy. have we started to see that? steven: i do not follow the financial condition indices on the street because they reflect on term interest rates driven by inflation not by real rates. that is number one, number two, i do not look at it because of the currency.that currency is not part of the financial conditions. i look at the availability of companies to bring in the market and get the paper solved. and i look at the treasury ability to bring that to the market and get it solved. all the markets are functioning beautifully, i sit there and say

it is not illiquidity in the system, the issues are not happening in the sense that matters to the economy they are tightening in the sense that we are trying to measure what would cause a credit crunch but there is no preconditions for edit crunch. there's no liability mismatch or a valuation problem. therefore, these things are looking for the wrong indicator. tom: gam a is my greek letter busier. we have the fed meeting and the -- this year. we have the fed meeting. and isn't finally going to slow down? steven: i don't think so. you are in an environment where unemployment claims are telling you we have a tight labor market. continuing claims numbers tell you the same. when people are getting laid off they are hired weekly -- quickly. it will have some weakness in the payroll numbers, month over month a little bit of change,

but we do not see of substantial change. tom: thank you so much and thank you for the frequent visits. it is very valuable. that is steven ricchiuto with mizuho securities today. one of the thing that thing that has been dropping the ball on is the mediterranean, the distraction is the labor economy of detroit and dearborn, we have to have an update. we do so with david welch, he is in bloomberg detroit. herding cats in trying to figure out who gets the lion's ticket this weekend. i guess it is worse, i saw the pickup factory is going to go up as well. have you been surprised by the worsening of the strike as we stagger through october? >> really, we knew there would be a strike. with the rhetoric from the union, the new union president,

he wanted to go for quite a bit. bring pensions back, back cost-of-living allowance, all the 90's 2000 eric kind of thing. big a raise and then compounded it would be 46 percent. and then you get the membership and the latter over you to benefits and pay like that, you have to do nothing that is strong. the companies were as you can imagine really far apart on that. tom: i'm going to look at your hyperdrive in this. i'm sorry, mary barra is not the same page. she's trying to figure out technology forward. explain the despairing time zone between uaw and their nostalgia and mary barra and her ev challenges trying to figure out what 2027 looks like. david: this is annexed essential

question for the union. the workers just want to keep their jobs and keep making money. they see electric vehicles as a threat. for obvious reasons. the blab -- battery plant that is coming is not union they are jointly owned. and the unions have to go about organizing just to get influence in that part of the industry. that will eventually replace engine and transmission workers. look, based on what gm told us on earnings, it will take longer for that to happen. the union has breathing days, but they are working on it now as part of a strike. they are getting some -- framework and understanding about how workers who work in battery plants and other ev and electric vehicle parts facilities will be paid, compensated, and put their benefits where they can get a membership and he wants companies to help with that because they will see their influence go away because technology comes about. katie: talk with us about the distance on the wage level.

i'm looking at bloomberg reporting all three companies are offering 23% wage increase. the uaw has been pushing for 25% seems like we are starting to get closer. david: we and shawn fain said that friday. and the pieces are there for the economics. they are pretty close. gm and stellantis are pretty close to ford's offer which is better on things like cost moving allowance and pension. i think they can get their. what is going on there is that the union added is strike at ram pickup and the catalytic escalate chevy suburban tahoe plant in texas. and he talked about this friday. he said the last mile can be the toughest one he told workers to prepare to strike.

i think he knows that they are close getting about as good of a deal is that he can get, but he has plenty of money in the strike fund and he's going to walk out of a couple more lance to squeeze out anything else he can in this contract. that is what is going on now. they are fairly close but he is also a wildcard known to move -- the goalpost. we will have to see. but if they have one thing they do not that a lot that keeps everybody out. katie: yeah the wildcard. you think about the economic damage inflicted on the company's gm yesterday even though they hold your guidance. they don't know what their profit will look like they said the strike has reached $800 million so far. is that the case at word and stellantis as well? david: they have not told us but analysts say it is similar amounts of money. ford was a little higher because of the walk out of the pickup truck land before they -- plant

before they hit gm and stellantis truck lance and the pickup truck lance they sell pricey vehicles and a lot of them and they make a lot of money. they are roughly doing the same common -- kind of damage. there is perspective when you have the u.n. -- union shutting down every motor plant in 2019 because the company $3.2 billion.the fact they are doing the strikes adding up and tear or they are it does reduce the economic damage my but even if they get a response is weak it is probably a couple more weeks to ratify. there will be more losses. even if the settlement is soon. tom: thank you, david welsh driving the ship in detroit, dearborn for blue work. boeing and microsoft may be starting things a little low. crude oil under $84 a barrel.

one of our views, katie greifeld people, they said on the backend of the show they said we got to go to -- crypto. we will do that. we will talk about sam bankman-fried. it is important. with all of the hysteria out there going on he will talk about this with someone with massive credit and massive authority as well. right now, we've got to get a capture and picture we have catherine greifeld and all of the work in crypto and true reporting with the team and binance and the rest. here is the shot of ruto from the pandemic level up 69,000. that is where i loaded the boat, and then i guess we have recovered. i guess it is the trend with a friend. can you see bull market in bitcoin, is that logical? katie: the term is crypto

winter. and we have definitely been living in a crypto winter. you see a lot of enthusiasm come into the price right now. we see that predicated on the hope that we are finally going to see a u.s. thought bitcoin etf launch. if it does, i will wait you back to the chart area boom we saw the future of etf launch about two years ago in top ticked it it was a cell news event. we have not been there in a long time but we will see if it is a similar experience this time around. tom: bitcoin charts turned radio. that really works. coming up on bloomberg originals, it is ruined the fall of ftx and sam bankman-fried, critically this is a gentleman at berg definitive on the truth in spf -- in sbf. stay tuned. this is bloomberg. ♪

what do you see on the horizon? uncertainty? or opportunity. whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined risk management are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-term returns... pgim. our investments shape tomorrow today. >> i think he had the mentality has to win. >> it is almost like an ethics

101 tour. >> he has become a villain in everyone's mind. >> and then we uncover the full truth, we will have the collapse of ftx. >> i'm in. >> i'm in. >> we are in. tom: finally. that's all i'm going to say. finally. this is absolute definitive zero bs view of this folly. it is ruined, it is a bloomberg original, it is, i guess i could call it almost mean-spirited in its abrupt-ness. it is absolutely extraordinary and it is extraordinary because of zeke faux number go up is the book on this. my good friend has done them --

michael lewis trade men. and he went out and said here is the reality. katie: i happen to be friends with him and he did a lot of her warning. he traveled around the world and that data comes through. i read this book on vacation and i try to not read too much on vacation. tom: i can't read on the road. joining us right now is zeke faux joining us on washington. congratulations. you tell her -- tear apart the celebrity ness of this. you see all the people smiling and doing whatever they were saying. when did you realize that sam bank been read was in trouble -- sam bankman-fried was in trouble and there were serious issues? zeke: i spent a lot of time with him when things were going great. he was amazing at seeming like

he had nothing to hide. i went to the bahamas in the super bowl when he errored the don't --aired the don't miss out crypto by ads. he said pull up a chair and watch me do my thing. he was doing interviews with orders, all the while laying videogames. i wish i could say i suspected something was up, but i thought it was obvious he was running a crypto casino. people would buy random coins and people would lose money ambling on them. but i never that he was stealing money out of the back of the casino. tom: i will suggest pharaoh, abramowitz, and the rest of us. i was wondering if we could go to the bahamas. katie: i got covid that week and i wish i could have. as you lay this out, you did not

catch it, but then you did. what was the process like? zeke: i was very suspicious of crypto. a skeptical if there was anything there.the thing about sam bankman-fried is he had this point when he met somebody who was does skeptic he presented as someone who was skeptical as well. and he would say yeah there are a lot of scams out there but i'm running great exchange and i woke elect a little fee -- will collect a little fee on each trade and as long as it moves in some regard i will make money. in a way even though he looked like a kid who had been up all night playing video games he presented himself in the crypto -- as an adult in the crypto room. katie: it's a good point with the cynicism he seemed to express gave an air of legitimacy. talk about how the wheels started to come off. almost a year ago we saw an

implosion followed by month of scandals. you think about what happened with luna. what was the domino that led to ftx finally loading? -- imploding? zeke: in summer 2022 the crypto house of cards collapsed. and they had $60 billion collapse and there were although crypto lending companies that lent billion's of dollars to hit -- crypto hedge funds. this and other credit contracted. i always suspected, hey, how are you guys earning high interest rate. how are you earning money in crypto? are you going and buying this coin or something like that? and everyone said oh, no area then the truth came out of what they were doing. tom: if -- i have an offspring losing money and does, it is

your fault. you understand their perspective. i want you to look forward in bitcoin, you got ruined coming out on bloomberg originals, sbf distracted to say at the least. blackrock and other entities want to do and etf, it is not the does, the the bitcoin. what is your view of securitizing point for the public? zeke: i think that in the end any company and any coin its value has to come with use in the real world and it is as old as uber or whatsapp, you have to ask yourself have you used bitcoin for anything? is anyone you know using bitcoin for anything? i am not optimistic with people using it as a replacement for gold when there is no use of

transaction. tom: and ruined from bloomberg originals what was the biggest surprise in the narrative of this story? zeke: i think the story, the more you look into the ftx story, the worse it looks. at first sbf was trying to say it was a big mistake and then, i was pretty sure, you made the decision to borrow your customer funds and that is fraud. the more we looked into it, the more we started to see fraud may have started with an earlier than we thought. but at the trial more and more has come out in how they do for -- defrauded lenders to alameda and the affiliate hedge fund how they misled venture capitalist who invested. katie: and ruins coming out, it is a great look at the past. going forward with the trial, what do we have to expect here?

zeke: the prosecution is almost wrapped up their case. they may finish it tomorrow. we do not know whether the defense is going to present a case at all. what i'm curious about is whether sam will take the stand. he loves to talk. he took every call from everywhere order on the way out -- every reporter on the way out and -- way up i don't think he will skip this chance especially with his team not being convincing so far. tom: and this is amazing. it is amazing what you're doing. i think dicaprio for zeke that is what i had look for. and seriously, this is extraordinary, hard-hitting, it ruined the fall of crypto exchange ftx and sam

bankman-fried. this is not some light gloss over, it is they are, it is digital, it is out on youtube and of course on bloomberg as well. tonight it airs at 6:00 p.m. and through all the digital responses. i did not realize the court case was upon us. help me with that, it is like, now? katie: it kicked off a few weeks ago it is expected to last fix weeks. it is amazing to watch -- last six weeks. it is amazing to watch. tom: what is your take on it? katie: i want to hear from sam bankman-fried. we've heard from everyone else involved it seems like. cameras are not allowed inside of the court room and it would be interesting to see. we've had to rely on the drawing of what is happening. tom: this is before your time were actually there was a guy that did this in inc. will --ink quill. katie: we have not seen the sam

bankman-fried. he's been in custody we have photos of other witnesses while in area apparently he has gotten a haircut and i would like to see it. tom: when i get a haircut it does not make the news. crypto here are giving you an update. this is news driving bitcoin -- bit dog up to 44,000. it has been an abrupt move. katie: it's been parabolic. when you look at the one year chart and the line straight up it shows you this is a liquid market. the trading volume is not there. tom: she is busting my chops. she wants to get me in trouble here. she wants to ruin me. that is a joke. ruined. bloomberg originals. the what i did? katie: yeah. tom: air it tonight. on bloomberg originals. and coming up we have richey on a ammann of qualcomm joining us.

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>> i am lisa abramowicz in for jonathan ferro. the countdown to the open starts right now. announcer: everything you need to get set for the start of u.s. trading. this is "bloomberg, the open," with jonathan ferro. >> coming up, markets on edge. futures under pressure. earnings keep rolling in.