>> there is a little shift underway here that we ought to be mindful of. >> we should see positive action through the end of the year. >> the heightening macro uncertainty means investors need to be nimble. >> we do not think there will be more rate hikes from the fed. >> it is far too early to talk about easing. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: live from new york city, good morning. for our audience worldwide, this is "bloomberg surveillance" on tv and radio. alongside lisa abramowicz, i am jonathan ferro. equity markets pulling back, but what a rally over the last week or so. six-day winning streak on the s&p 500, seven on the nasdaq 100. the nasdaq 100 up by more than 7%. lisa:? ? is it durable everyone was

saying it comes down to whether we get stability in yields. clearly, there is a feeling of unease we got from that yesterday, and some fed officials are pushing back on that. are we going to hear more of that? jonathan: neel kashkari in about 90 minutes time. too early, too soon to declare victory. lisa: how much is he pushing back saying we'd rather err on the side of over tightening then under tightening. at a certain point? , who matters? does neel kashkari matter more than fed chair jay powell? is this a game of chicken, or is there something more material here? jonathan: let's get to the pushback. morgan stanley, the pushback. we find it difficult to get more excited about a year end rally. dovish central banks, "knee-jerk positive equities in the

short-term, but the growth will -- lisa: the problem is they have been wrong all year. this is a problem when you have got investors who have gone into equities despite some of these warnings and have made bank, so at a certain point, you have to think, ok, if the companies are delivering, you better dance while the music is playing. that, from all the notes i've been reading, and many of our guests are saying. jonathan: what if i told you you could be really wrong but still bank hundreds of millions dollars? lisa: i will. be in the wrong business. jonathan: wework in 2017. here we are, four years later, and the company's filing for bankruptcy. in the meantime, adam neumann, the founder of the company, managed to take in hundreds of millions of dollars. that is unreal. lisa: there is a question of how much he personally profited and

there is a question of how many broken business models where there during the pandemic with executives getting massive salaries because they counted on a free piggy bank that was the debt market that no longer exists. we expected to see more of this. he might the prime poster child of this, but we affected to see more of this at a time when you had a company that locks in 10 to 20 year leases and said you could come here for a month at a time, pay as a salary, and we will give you free beer and a ping-pong table. at what point do you say this is an anomaly versus something that has some indications of what is to come? jonathan: are you digesting we failed to elevate the world's consciousness? [laughter] you are raising the right question for it have we fully realize the pain associated with taking interest rates from 0% through 5%? no. there is still more pain to come. two, we should do a special on the winners of xerb.

adam neumann has got to be a major candidate for winning that era. lisa: there are a lot of people who are candidates for just look at the stocks are parabolic in the opposite direction of the pandemic. who was loaded during an impression of another era, and who used this money to invest heavily with all of these ideals? i am thinking of peloton, for example. there are a number that came out with highfalutin concepts that drove borrowing but did not drive profits. jonathan: equity futures on the s&p 500 negative by 0.2%. a big rally on the equity market. the longest daily winning streak since the middle of june. yesterday, bond yields actually higher and equities did ok. this morning, lower by five basis points. lisa: i love yields can go up or down on basis points, and it is just a mild about this point. we get a host of fedex become including chris waller and we

will also hear from fed presidents from chicago, kansas city, new york, dallas, and of course, minneapolis fed president neel kashkari. he is speaking to us and michael mckee at 7:30 a.m. i want to know how far he will push back against some of the through the as him -- enthusiasm we are seeing in the market. jonathan: are there reasons for this federal reserve to be more tolerant of easing financial conditions? given unemployment is shifting a little bit higher, wage growth a little more subdued. that will be the question a little bit later. lisa: surgical cuts. the surgical sales, 1:00 p.m., u.s. treasuries sending $40 billion of three-year notes at a time. the treasury department will beat front loading a lot of these sales. we had three straight, very bad auctions in the recent slate of auctions, one of the first times that has happened since 2011.

do we see something different this week? and today is election day, so if your kids are in public school, they are not in school today. what i am personally interested in is what is going on in virginia. glenn youngkin, a potential republican nominee for the presidential election, is trying to flip the senate in virginia to republican to get a sweep. currently, the house is republican. if you can get that, there will be a lot of calls for him to run instead of president trump, former president trump. jonathan: it is amazing we are talking about potential nominees for an election that is less than 12 months away. for people who are not even running. we are still playing that game. lisa: anecdotally, is he not going to pseudo-fundraisers with big people with big pocketbooks on wall street who would love for him to run? jonathan: muhammad yunus of

gallup will come on the program and tell you how deeply unpopular both already's are with the electorate. i am talking about the former president and the current president as well. lisa: nobody wants that election, yet that seems to be the election we have here we are running out of room for other people to come in, so will this be the moment? if he does get a clean sweep in the house and senate, turning to the gop in a very purple state, do you end up with a lot of calls for glenn youngkin to be the republican residential candidate? jonathan: joining us now, global market strategist at eroro. your words --grounds for contrarian optimism. how contrarian is that after the week we have had? >> pretty contrarian. the rally you have seen over the last week is basically being

short covering. it is this consensus caught wrongfooted by this easing -- we have seen that now work the other way. we have seen the relief trade. but from here, that easing buys, the end of the earnings recession, and this good fourth-quarter season, which still includes four sentiment, a year ahead repositioning rally is still to come as people focus on a better 2024. and throw in the restart of buybacks. i think it will be a good fourth-quarter. jonathan: do you think there are reasons for the fed to be more tolerant of easing financial conditions? ben: at the margin, but you will not hear from them. they will have to walk the talk care they want financial good additions to stay reasonably tight to do the work for them.

if they give an inch, the market will take a mile. they will do all they have to do, but i would take it with a grain of salt. lisa: we were talking about morgan stanley, jpmorgan, other strategists who are still bearish on risk assets heading into year end, especially because of weakness to come. given wall street bearishness, does that make you more bearish or more bullish? ben: it make me more bullish at the margin. i think this four sentiment that is out there is a significant ingredient of improving the risk reward. this poor sentiment does two things. it means there is a lot of money sitting on the sidelines that could come into this market if i am right, things get incrementally better. and it significantly improves risk-reward. if we get bad news, it is already priced in. you do not need news for this market to move higher. you just need less bad news. we got a huge reminder of that

last week. we saw unwinding of six weeks of underperformance in one week to our show to a lot of people the risks of being out of this market. lisa: one thing that defies my sense of reasonableness is people keep talking about the excessive bearishness out there. looking at year-to-date gains on the nasdaq of 30% and more than 15% in the s&p. it does not scream everyone is on the sidelines, sitting under a blanket. ben: so we have the earnings sentiment index which is not the level of maximum bearishness that it was 6, 7 months ago, but it is absolutely below average. in this summer pullback we saw, it fell below average. we are focused on the fundamentals. that is what will get this market higher. it will not be sentiment. that is the icing on the cake. i think we have seen the top of bond yields. i do not think we see oil

sustainably above $90. we had the end of the u.s. earnings recession. we will get clear visibility on the fed getting ready to cut interest rates. i think the fedput is back. the economy will be slow but earnings will be resilient to that, and we will be discounting the fed cuts cut that are coming -- and we will be discounting the fed cuts that are coming. jonathan: that is not a bull case, that's the bull dream. why do you think the fed puts back? ben: inflation is at 4%, ppi is half that. if we get that hard landing, which i do not expect, but if we do, that is the market bear, and it will drag earnings with it. it will pull inflation down, and inflation is close enough that, if you get that, the fed can start cutting interest rates. this is a huge difference from

even six months ago, where the economy had fallen off a cliff, the fed's hands were tied. lisa: fed put was traditionally that, if there was any weakness, the fed had already blanched to stimulate the economy. you are saying the bar to cut rates has been lowered materially over the last couple of weeks. is that what i'm hearing from you? ben: no. it has been lower material over the last few months. six months ago, the fed could not cut rates. now, it can. if you are a bullish investor like me, that is your insurance policy for their not being a soft landing and for me getting the economy completely wrong. i now have the fed standing behind me -- they were not standing behind me six month ago. jonathan: cut back to what? a lot of people in fixed income or having that debate and cannot figure it out. where are you in that debate? ben: inflation is not where it needs to be yet. obviously, if the economy cools,

it will come down a bit faster. i do not think the world is completely changed. a lot of the structural drivers of that, whether it is debts, demographics, technology, they have not gone anywhere. i do not completely discount it. jonathan: ben laidler of etoro. appreciate it. what has changed between now and last week? two weeks ago, we were north of 5% on the 10 year yield and we were talking about budget deficits, yield curve control at the boj, a lack of editable buyers in the treasury market, a loss of that in places like china, and here we are sitting, with conviction, saying we have seen the highs in bond yields. lisa: what has changed is that the excessive short positions on treasuries have basically been washed out, and we saw some

repositioning there. the treasury department came out a threw the market it bone and said we will focus our issuance on the short end. and the fed came out and was not that hawkish. that was basically the insurance policy the bulls are looking for. jonathan: they are chewing hard on that bone. s&p futures negative 12:45 percent. next hour, neel kashkari of the minneapolis federal reserve. live from new york city this morning, good morning. ♪

>> we are announcing historic investment in america's

railroads. i've been talking about this for a long time. finally, we are getting it done. more than $16 billion. too many people have been left the hind, or treated like they were invisible. we are building an economy from the middle out and the bottom up, where no one is left behind. jonathan: president biden announcing $16 billion in new funding for passenger rails p this ahead of the elections, where a recent new york times poll has president biden trailing former president trump. i do not know anyone who loves amtrak aside from the sitting president. i do not get it. lisa: especially because -- i feel terrible, because i am sitting in tom's chair -- but you come from the european train system that is really fast --

honestly, you go anywhere, they are fast, on-time, clean. here, they have got delays p they run the same trains, if they have expressed, the are the local ones, which is a problem. jonathan: i'm an amtrak i. what does that say to you if you are an amtrak guy? i do not get it. you come back from switzerland and you say i am a swiss train guy, i get it. but they are putting $16 billion into it, so good news. lisa: i hope they build another track so the express can actually go express care that is my dream for this country. jonathan: we will talk about amtrak joe in a moment. futures on the s&p 500 negative by one third of 1%. we are pulling back after a six-day winning streak. you always read the stories after you do not get day seven nordea. what are you expecting, it will move in the straight-line and keep on gaining? you have to come up with reasons it is down today. it is down today because neel

kashkari will not claim victory? come on, stop it. lisa: this is the reason why this market has been dizzying and difficult to explain and address with a new thesis, because that seems to be happening. come up with a new thesis, and everyone will jump on board. jonathan: we will get to a piece from gallup -- two major political parties remain unpopular in the united states. 66 percent of americans view the republican party unfavorably, 68% of the same view of the democratic party. i've been reading through this piece. neither party is well-liked. you pointed out the gop maybe has an edge on certain issues. can we talk about the likability of both parties right now? how unusual is this? >> unfortunately, it harkens to your amtrak conversation earlier. the are at a state where both parties are not really doing that great in terms of favorability. it is nothing new,

unfortunately. it has been quite a while since americans have had a favorable view of either party in the majority. we are also at a time where there is a record high of americans saying they would like to see a third party in american politics. of course, easy to say i want more. it is not necessarily mean that party would exist or actually be powerful. but we are also at a time where there is a high of people that identify as independents. that's important, not only in the current moment, but also in our analysis over generations, what we find his younger americans today are actually sticking with that independent id much further along their lifespan than previous generations. so certainly, americans are highly dissatisfied with national government. they are really, in some ways, most satisfied with both parties. that being said, today is a local election. i know it is tempting for us to jump to 2024.

americans line up today to vote on local issues. there is a huge difference in the way people perceive local government versus the national government here in the united states. jonathan: what is a big difference between the two currently? mohamed: trust and competence. americans have very low trust and confidence in the national government and national's assertions. perceptions of corruption are high pier 1 it comes to local government, people have a much more positive -- perceptions of corruption are high. when it comes to local government, people have a much more positive perception. americans line up at the ballot box today. they are hearing a lot of echo chamber and the national, what it means for 2024, but really what they will be focusing on our local issues p the national conversation will inform that pure that is why things like abortion, things that indicate -- attitudes about big and small government, for example, they will be discussed.

they have been a focus of the campaign. in ohio, there is a really big push on abortion. it will be a really important weathervane whether or not roe v. wade's overturning, the impact of that, has faded or is still with us. lisa: as you are talking about local elections and how different they are from the nationals, they are probably not on tiktok, local elections, not on facebook and how much is it the social media echo chamber that polarizes people and gives them worse than excited views of national politics in a way that ogle politics might be slightly immune? mohamed: i thing that is a great point. it is much easier to check the bs, if you will, on a topic or issue if that is where you live. you know that reality, you have direct information from people you know. where you live, you can talk to your neighbors, local religious or community leaders. with national politics, it is a

very different thing. it tends to have now become a sort of war of the propagandas of both parties, where truth is very hard to identify, but both sides are absolutely out there to religiously convict you -- excuse me, religiously convert you to their worldview. that is certainly a factor. when it comes to 2024, everything that we have done with regards to national elections really comes down to one thing. americans focus on the economy. the economy is king, queen, and bishop when it comes to picking a president here in the united states. that will be a huge factor in where people will place their votes in 2024. as you all know, we are light years ahead from where that is in terms of assessing where the economy is going to be then, and that will be the major factor. when it comes to party advantage, the republicans definitely have maintained their historic advantage in terms of americans viewing them as more

competent and keeping the country prosperous, the economy booming, and the country safe. lisa: that said, how much are you looking to glenn youngkin today? the local issues have global -- whether glenn youngkin might be the republican candidate. is that a stretch? mohamed: looking at the polls now, that is a stretch. it is hard to argue trump is not the front runner of the republican party. every poll you do -- we do not do too many political polls that much, but it is hard to see someone jump astronomically ahead of him. that being said, we have not had a president in modern time facing the legal challenges he is facing, and that is a whole other sort of curveball being thrown here. it is not clear what his situation will be come rubber meets the road come 2024.

we heard from david axelrod on the democratic side. i would not rule out any surprises or sudden departures on either side. jonathan: just to squeeze this in and finish where we started, you mentioned that the gop holds advantages on certain issues. which issues specifically? mohamed: there are really three issues -- one is keeping the country prosperous and republicans have a pretty sizable advantage to democrats in terms of perceptions of keeping the country prosperous. the other one is keeping the country safe. as you know, we are now very focused on two pretty significant conflict across the world. hopefully, that does not become a reality for us in the united states. as americans focus more on security issues, republicans have that advantage in our polls. the final one is who is most competent to handle the most important problem facing the country?

what is fascinating about that question is the most important of him facing the country, as i've said on this show many times, right now is poor leadership and government. so americans identify the quality, the low polity of national leadership as the most important problem facing the country. so it is the most important problem, the economy, and keeping the country safe. jonathan: mohamed younis of gallup. mohamed el-erian writes in, "i like amtrak." that's two people. lisa: did you respond? jonathan: a little later. this is bloomberg. ♪

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jonathan: taking a break on the s&p 500. s&p futures looking like this. and negative 5.25%. what a run we have seen. the longest daily winning streak going back to the middle of june. seven on the nasdaq 100. that is the lowest on that since january. lisa: yields are going lower. when they went higher, they also benefited the stocks. you wonder whether that will be the big performer, in perpetuity.

jonathan: the daily market map. every day, up to say up or down. that is the part of the game that i have a great amount of sympathy for the people who have to play it. equities continue to run at the front end of the yield curve, double digit curve, yet we still shrugged. lisa: it is about how far we have come. if it is 4.61%, it is not a big deal. the question is, how much do we need volatility to come down? is it that the levels have to keep going down or is it stability? jonathan: help us define stability. we had a big move out of nowhere and then another big move yesterday. we have yields coming back down

from the highs, but to be have stability? lisa: is it considering stability? if you know they are going to be trading in a range, is that enough to give people the confidence? it's basically, if you are counting on that kind of model, ignore the noise and call it a day. it's -- jonathan: where do you think the test is on the curve? lisa: tends 30's. did the treasury department do enough to give people confidence that they were not selling more debt and would destroy the curve dramatically? if you see very orderly auctions, could that turbocharge

rally into year end? there is a lot to chew on. jonathan: that was dreamy stuff. i have not heard that from anybody. lee; it was a little bit shocking. everyone has been saying, we are not going back to the regime used to be in. our people who believe in the transitory story, however many years it has been debunked. here are the questions that people are trying to hook into how to lead off their columns. jonathan: it is pretty transitory. that is the extent of my philosophical ways. let's finish on foreign exchange. everything is weaker against the dollar yesterday. in the fx market, that dollar

strength continues. lisa: the unit -- it cannot get away from this. the european economy is doing a lot worse than the u.s. economy. that has been the story and continues to be the story. there is nothing that we are getting that pushes against that. jonathan: reducing expenses this year. the credit suisse came in at $2 billion. the stock is higher by 3.4%. lisa: i'm looking at the money coming in, including the credit suisse unit. i would like an understanding of what this money is. is it credit suisse clients coming in and newman a coming into credit suisse?

70 questions as we hear from really good people who have yet to be integrated. the integration is still very much in question. you are seeing that today in the stock. jonathan: lifting nearly $19 billion. it had entered into a agreement. the company had once been valued in 2019 at 47 billion u.s. dollars. adam neumann is long gone. long live adam neumann. now is the time for us to pull the future forward by addressing and improving our balance sheet. we are pulling the future forward. lisa: there is a lot about the euphemisms and the spiritual the of going to the office every day. there is a question of how much of an era it was that has been

killed off by the pandemic and inflation. adam neumann is the poster child , but remember this company that sold $699 juicers that attached to your phone with all these highfalutin concepts? there is a question about whether the highfalutin discussions are getting lost in the reality of cost of money that is something rather than nothing. jonathan: think about peloton. we are going to strap a tablet on an exercise bike and build a community. because of the internet, we are going to connect lifestyle and health care. it will be a key feature of your life as you look to stay healthier. lisa: i actually admire people who thought of the internet as elevating us as humans.

it is this concept that is divorced from the baseness of capitalism. it is sort of in the area and it seems to be fading. jonathan: on average, people lose 50 iq points. i think that is what happens. you lose 50 points across the board, on average. lisa: they have more buildings. what happens with that? the consequences of the loss of those iq points might be a problem. do you feel smart? jonathan: i do not know if i do, but i hope they do. preferable to doing too little.

saying, i am not ready to say that we are in a good place. joining us in a half hour, look out for that conversation. we will start a conversation this morning right there. jennifer, d think we took it away from the federal reserve last week that led to this big on market? flex it is difficult because the fed is trying to deal with what is going on in the markets at the same time as influencing what is happening in the market. it was a pretty clear message and that is absolutely clear. but by making those comments, it has caused a bit of a reversal. not tidy enough.

lisa: does that seem reasonable to you? >> not really. i think that is going that far. i do not think the fed is trying to support financial markets more generally. and as an inflation goal that they need to consider, particularly the state of financial conditions. there is so much uncertainty about the length and how quickly you will see this, but what we know is the increasing interest rates and what we have seen in the u.s. -- it has never happened without a recession following it. lisa: people are thinking more surgically about fed cut.

responding to weakness in the economy, responding sweet as in the markets and being more accommodative. there are -- do you think they have become weaker because of larger signs of next? >> i think that banks have not generally experience this for decades. it has been an eye-opener about how much it has visit. i think that means that the bar is much higher. they are going to need clear evidence that they are loosening before they feel comfortable cutting interest rates. jonathan: i think there is some confusion. this signed specifically.

likely to wear on activity hiring. how fluid is an assessment like that? is it already dated? what is that, in your view? >> it is a good point. the fed is influencing markets at the same time, so it means these communications become that dated. a lot of that is overlong terms. the pace at which businesses and households need to refinance is relatively slow. it will increase over the coming months. then we will start to see the previous increases coming through.

it is about averages and the pace of which they are passing through. we must bear in mind these average rates are very important. jonathan: it looks like we have gone through a real rebalancing. can we take some data away from what we have seen so far? we are still doing ok. >> wage growth is coming down. there is no surge in market. this is a soft landing. it is how these things start. it shows something more worrying

jonathan: it looks like a soft landing until it does not. lisa, top line for him. lisa: that is the reason why the might have's -- we might have heard a shift in tone. it looks like a soft landing until it is not. how do you know it is not just a normalization versus the beginning of a progression into weakness. jonathan: look out for that conversation and this as well.

following the latest numbers. welcome to the program. session lows, negative by 0.4%. yields up big time. we had down three basis points.

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>> i think that is very encouraging to see. it is interesting to see how they are responding and to offer them the best.

sadly, they need to be restructured and comfortable that we can mitigate the painful part of the job it is necessary to create something that is sustainable. jonathan: let's turn to the s&p 500. yields i coming down three basis points. this is quite a turnaround. you can point to the data, treasury funding -- take your pick of the moment. lisa: they are not responding from here because we have already moved 40 basis points. at this point, we are looking at the potential volatility. the refunding agreement is what

he did off. there are other questions. the bank of japan and what is going on over there, investors getting a better sense that we have seen a peak. it is incredibly high. that is my -- jonathan: you know what stands out? lisa: they were talking about $100 a barrel of oil. at this point, we do not even know why.

is it a lack of demand or are they -- i would have a difficult -- difficult time believing the latter. maybe demand is not coming in as strong. jonathan: that stock is positive in swiss trading. let's start with the good news. >> we are getting stabilization. i think that is what they were looking for from this set of numbers. this is the first quarter that we have seen them bang together. the analysts do not really have a handoff for their estimates. you look at what is happening under the hood.

that is great news. and got over on a more even keel. we are not going to know that until february when we get sergio unveiling the plan strategy. that he is going to deliver at this bank. it tells us that they are making progress and are on track. to be honest, that is buying the shares are rising. things are rising and they are on track. lisa: do we know who they are keeping and who they are not? >> this is one of the critical questions. 500 million is being set aside

for key staff, to make sure those people stick around. there has been this person and that person leaving. they need to stabilize that. they are parking money to make sure that does not happen. if they are going to make progress from stabilizing the numbers to growing the numbers, those are the people who are going to do that. they are going to have to pay up to make that happen. lisa: a lot of clients would previously have gone to credit suisse and u.s. to diversify their risks. now they are going to take all their funds and put them at ubs. we have a sense of how much that is coming to the for for

institutions in the region? >> i do not think we are in yet, but it is an issue. they have to manage these different pools, and how they manage that process is going to be very difficult. people would see them as competitive. i think it is unclear if it is smaller, but maybe it does, but then it grows. one of the key questions, corporate and wealth are asking themselves, how distracted and are they going to be?

again, we got to stabilization but whether or not that money is figuring out whether he needs a better diversifier -- i think that remains unresolved. we have only just started this process. i did not think the answer to that question is in any way clear at this point. jonathan: after the events of the last nine months, particularly in the u.s. banking, we have been talking about consolidation. what does that look like at the moment? >> i think it looks like a long way off. the banking union -- we have

been doing this for quite a while. we are miles away from it. it is still a patchwork of banks, banking regulations, so i think it is really difficult. they do not have capital markets the way the u.s. does. a consolidation process that is driven by a desire to create bigger, cross-border banking within europe is a much more difficult process and governments do not seem to be on board with it. i saying we are going in the opposite direction. jonathan: thank you. enjoy zurich.

lisa: we have been talking about this on why you are not going to see some kind of consolidation after march. how much is this from different banks and not wanting to disrupt that and how much our regulatory hurdles because it is such a lightning rod for different politicians. jonathan: it had been 54 minutes and you had not mentioned it. lisa: if anything, it was a lot more positive and suddenly they do not matter again. this was supposed to be the crisis moment. something was supposed to break, but it did not. we are not seeing consolidation or structure changes. we had adjusting the band-aids

over the edges. jonathan: short treasuries. every time we backed away, i turn around and say -- she would still say, is still short. right now, is she still short of treasuries? lisa: that is the question i want to ask her and is there some trade or is it too noisy to follow the kind of trans she is known for doing? jonathan: equity futures on the s&p. six days of gains. bonds with a rally a bed. from new york city this morning, good morning. ♪

>> there is a little shift underway here that we need to be mindful of. >> we do not think we are getting any more rate hides -- hikes from the fed. jonathan: good morning. from our audience worldwide, alongside lisa abramowicz, i am jonathan ferro.

games, gains, gains. seven days of it on the nasdaq 100. lisa: a tone shift, yes. everyone either rolls their eyes or looks exhausted. it is difficult to come up with a narrative. jonathan: the fed is done. we can discuss surgical rate cuts. i love the tweets. call them whatever you want. this one here. sensible as expecting a rate hike.

lisa: talking about a fed put back in play. when i look at when i am looking at these companies, they are passing through a lot of the cost. when you look at all these basic things, they are getting more expensive and people are still paying. jonathan: the federal reserve talked about it yesterday. it is no good telling people that the rate of price change is lower than last year. they are not going back.

lisa: it is this economics lesson that is not really making its way through the sphere because people are seeing how much more prices have gone up. there is a key question about whether we are going to reach a stasis. that is what people are keying into and companies are able to keep selling. jonathan: we will catch up and about 27 minutes time. are there reasons for the fed to be more tolerant of using conditions? isn't that the question right now in this market? lisa: maybe they are more comfortable with it.

it seems to be the theme that we are hearing from different investors. jonathan: less than 30 minutes away. equity futures on the s&p 500. bond market rally this morning. i cannot keep up. yields are lower by a couple basis points. lisa: we were just talking about neel kashkari. fed presidents from, kansas city and new york -- maybe they can give us more insight into whether we are seeing some sort of softening in the economy that justifies using of conditions. we will get his view in just a little bit.

this is going to be an interesting kickoff to the options later in the week. really key to see if the calm beneath the surface continues in the treasury market as this is tested as to how much demand there is. i am focused on virginia. it could flip the senate of the state to the gop. there will be calls for him to run. there are so many articles pleading for him. it gives you a sense of how popular it is. jonathan: i appreciate that sarcasm.

lisa: is there any discussion about how it will change? i think it is important to watch this. jonathan: joining us now, katie. it is the number one question for us. are you still short on treasuries? why? >> it is about persistent trends in the market. i want to point out that signals have been short for nine quarters. this is the first time in many decades that this has been the case. we have been saying short, short, short all year and it is starting to feel like we already had it come through, so what is next? yields are at interesting levels.

maybe we have finally hit that point. i think that the data has come out to support investors, but i also think that a narrative that has made since to me is investors have woken up to the idea that 5% yields, at some point there is a buying point where this could go down and now you start to see this equilibrium occur, which is something that we have been looking for. lisa: are you seeing value? >> we are seeing consolidation in signals, so there is a reduction, but i will say that we are seeing more and more positive signals, so on the

shorter term, you will see more potential buying for treasuries, but i do want to remind everyone that inflation is still an issue and rates can be higher for longer. we might see a lot of volatility instead of a new trend emerging. lisa: which points i going to be action drivers? is it going to be every inflation read, or do you buy into the idea that it is treasuries supply that has been dictating a lot of the angst that we have felt over the last month? >> how often do people actually talk about supply? i think people understand the equilibrium of what yields should cost. from our side, on the technical

side, what we are looking for are potential breakouts. it will depend on what happens with the economic data and if we actually see something very extreme, where we saw higher yields again. it seems very unlikely right now, but it is a point to start watching every data point to see which direction yields will go. jonathan: we will catch up with neel kashkari soon. there is a second paragraph in the statement that reads as follows. tighter financial and credit conditions are likely to weigh on activity hiring and inflation. could you write that same sentence today after the move we have seen? what do you think it is?

>> i think these numbers come in different frequencies. we had a massive buying, but this could be somewhat of a relief rally, given how much movement we have seen downwards. let's be honest. at 5%, yields started to get exciting. i think there is -- this could be the tip of the beginning of understanding has areas financial conditions have changed. if it is enough to warrant a point where he might actually have cuts at some point, earlier than some would have thought, like myself, who has been very pessimistic about rate cuts. jonathan klein do you have an understanding of what would lead to this rate cuts? >> we would have to see pretty severe deterioration to see rate cuts, given the mandate of the fed and the fact that the other factors that they are focused on have not come down to their target level.

the fact that inflation is sticky and the fact that we have a strong workforce and all these conditions putting us in a good place, they have been clear that they are going to keep us hired for longer. if we had some sort of severe drawdown or deterioration in credit that was cleared, i think they would have to act. that would be a situation where we would see those rate cut, if you saw something in the credit markets, in terms of consumers struggling. lisa: so it exists, but at a higher pain point. >> i think it always exist somewhere, but it has moved a lot compared to what we liked in 20 and before. jonathan: given your uncertainty, why maintain the short? why maintain the short when it can be as expensive as it was on

weeks like last week? >> we just need more data to know the answer. over longer periods of time, the market is good at giving us indications and it is particularly these short-term movement where you want to lean on your own gut, but you should not because that is what systematic trading is all about. it lets you tell you -- it tells you where you are going. jonathan: negative by .25%. let's call it for 62.8 -- 462 --

four point -- 4.6287. lisa: it is alive, the frankenstein of all things killed off over the last couple of years. does he like that, or is it counterproductive to the goal of the fed? jonathan: at the start of the year, he put out a blog about the three stages that he sees the federal reserve going through, step one, getting rates up quickly, step two, considering whether you have to do more. step three, that is when you have conviction. is it going back towards target? that was a really good guide throughout the year. i wonder if we are at that point where we are getting closer to

step three. lisa: we are trying to get to the next one, so it was easy to see the pause after the hikes. it is harder to see what is on the other side of the break paz. jonathan: this is a market that wants to trade to a recession we have not read yet. lisa: i am not proud of it. >> i am immensely proud of it. lisa: i just kind of feel guilty. ♪ ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf

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>> the courts during this case made references to assets that were very valuable. this is a scam and a case that should never have been brought. jonathan: speaking to the press after testifying in his trial. leading joe biden and five key swing states. shaping up as follows. yields are lower on the 10 year. moments away from a conversation with neel kashkari. lisa: does this set them back? suddenly, the bond market is

doing nothing for them. is it fine because the economic data is softening to the point where they are comfortable? jonathan: asking that question that you have alluded to, whether they can be more tolerant. they have been looking at equities and foreign exchanges as well. lisa: here is the conundrum that many are struggling with. stock market -- smaller companies are. doing well. at what point are they taking their cues from business leaders telling them that we are really struggling between higher financing costs and saying, things get easier. it is fine. but others are doing fantastically. you can go all in on the stock market. i think that is the complexity

that a lot of people are trying to map their heads around. jonathan: stocks are up, look at the s&p 500 and select names. take your pick and asked them how they feel about this economy. lisa: it raises this question over whether their fate is being accurately reflected in the broad stock market, the s&p 500, so i wonder if the fed will listen more to that than the equity market. the fed put is coming back into play because they are responding to a different market, he economy that looks very different. jonathan: we used to have these problems in the restaurant business for a long time. i cannot imagine how much more

difficult it is. lisa: i spoke to a restaurant owner friend of mine and they said how much the cost of food has gone up. they have to pay the higher rent . if business falls off at all, they have no safety net and cannot borrow to offset that. the rates are too high. this is the rate. jonathan clement start day. is it a local issue when we face these little later? >> absolutely. what you are seeing as pulling has ramped up is that time and time again, the economy rates number one and when it comes to

the economy, even though we are seeing good data, the fact of the matter is, americans are still concerned with inflation. grocery prices. you were talking about what is going on at restaurants and the cost of goods. either a single person, a family of four -- everyone is feeling how important it is. is there any sort of referendum as to what is going on in washington? but there are a lot of single issues that are also being fought. abortion is one of them in ohio. there is an initiative to enshrine abortion into the constitution in ohio. it will be interesting to see the results of this and what they can tell us about next year's general election. lisa: how much are you looking at this?

>> terry haynes says ignore everything but what is going on in virginia because what happens in virginia means -- there are a lot of discussions and we have seen reported that donors are cozying up to glenn youngkin and asking him to jump into this election, but he has this governorship until 2026. don't -- due to the law in virginia, he cannot run for consecutive terms. it gives him the perfect timing to launch a 2028 presidential run. let's see what the results show this evening. he has worked really hard with local legislatures to make sure they keep that house of delegates read and to try to flip the senate read. it sets him up nicely for whatever path he wants to take.

lisa: how much time is there to change the ticket? >> i do not think there is an exact deadline, but it is getting very close. if glenn youngkin were to jump in, he would not be in the next debate in miami. that is tomorrow. there is some leeway, but i would say by the end of the year, if he was to get in, she would need to make that decision asap. for many people in d.c., it feels too late, but outside the beltway, they say there is still a path. it is an odd election year, to say the least. a former president testifying at a civil trial in new york state. that could be these black swan moments. jonathan: yet he is a candidate for the party.

people are still questioning whether he will run at all. what does that say about his prospects of winning? >> it will come down to these key swing states. maybe they saw our polls showing that he is winning in key states. there is one caveat in that new york times poll, the fact that these voters say if trump is convicted on the january 6 related trial in d.c., they would switch their vote to president joe biden, even though many believe the current president is just too old, they are not feeling the effects of bidenomics. he was talking about amtrak yesterday, but the fact of the matter is, if there is a conviction, it will change the poll numbers very quickly.

jonathan: what does that mean? >> it is not pulling well. there was a post where what you saw was the majority of individuals could not explain what it meant. they could not explain parts of the inflation reduction act that they like to tell. when they talk about but i did not they point to three key legislations. what used to be a joke under the former president. this is why biden was touting it , i actually got it done. why are railroads in america not as good or up to speed as those seen around the world? then they will point to the reduction act. tax credits for ev's.

when you have inflation eating away at family paychecks, this kind of stuff is not landing. jonathan: thank you. they are great. they are pretty decent, aren't they? lisa: i love trains. i want to love amtrak. jonathan: it is going to leave perfectly on time. neel kashkari is up next. ♪

jonathan: a6 day winning streak could be coming to a close. equity futures are slightly negative. seven days on the nasdaq. a seven day winning streak on the nasdaq. down to 0.1% on the session so far. 10 year, 10 year, 30 year. yields are aggressively lower last week. a little bit higher last week. lisa: that is basically no motion whatsoever. maybe we will get a new tone or narrative that we can lead into. jonathan: from 47 billion dollars to bankruptcy, we work. we mentioned this 90 minutes

ago. is it adam neumann for adam neumann? lisa: he really does take the cake when it comes to having a philosophy where the nuts and bolts are getting 10 to 20 year leases for properties 700 to 50 buildings and renting it out by the month, and suddenly the market collapses. that is what you are seeing today. they have asset of about $16 billion. jonathan: this morning -- >> we are pleased to bring -- to have neel kashkari at the table today. only for us, i'm sure. nothing else this morning, except for bloomberg surveillance.

you are known as the guy who is the most hawkish. you have left open the option of doing more. how much more do you think the economy might need? are we talking about the dot plot from september? if you have to start raising again, do you have to go further? >> thank you for having me. i wish i could give that certainty. there has been so much that is unusual. how long it has taken in the dynamics as the process has happened. we have to let them guide us just to point out the obvious, our forecast has not been great. we are all committed. everyone is committed and we

have to get inflation back to 2% over a reasonable period of time. i just do not know. >> at what point would you believe that you have tightened enough or not tightened enough? what are you looking for? >> it is running at about 2.5% and it is lower than the one year data. that suggests that the disinflation is real. if we continue to see numbers of that range or lower, that would tell me that we are now on a path back to 2% inflation. but if we start to see that ticking back up again, that would tell me that our job is not yet done again. >> a couple of tenths higher?

or does it have to be a significant move? what are you thinking about for september? -- for december? >> we have been by how strong consumers have been. they have held up remarkably well. when activity continues to run this high, that makes me question, is policy as tight? continued strong economic activity on the real side, that would tell me, ok, we might need to do more. it is hard for me to say, this data point needs to be here. jonathan: have we outsourced doing more to financial market? >> this is a complicated question. some people to point to term premium.

i always joke it is the residual of all the stuff that we cannot explain. it is that dark matter is out there. some people say that is driven by physical. if it was school, i would have expected to see a weak dollar. usually, their currency weekends, but ours has been strong. another possibility is the path of policy over the next few years. that could explain the stronger dollar and a weaker stock market going into the last meeting. maybe it is a combination of all three of these. these are things that we are spending a lot of time trying to figure out what the markets are doing. i'm not comfortable saying which of those three it is because it determines what it means for policy. if it is the neutral rate or if

it is the former guidance of the path of policy, we would have to follow through to preserve those rates. jonathan: where is that coming from? >> that has been in there for a long time. it has led to some tightening of credit conditions across the economy, so i think that is right. jonathan: cannot change meeting to meeting? some of those comments have inspired movement over the last week. >> we always have to be careful of putting things into the statement. as soon as you take something else, all of a sudden, people say, they are declaring that all of the banking stresses are over. i would look at all the range of commentary that you get.

look at the press conference to get a bead of the thoughts. lisa: people do not want just certainty. they want a guiding philosophy. do you think fed chair powell has some kind of philosophy on where the bar is to cut rates and how to raise them further? >> we are committed to getting back to 2% inflation. there has been chatter that maybe we should raise the target. we are going to get inflation back to 2% and we are going to let the data guide us. we have made a lot of progress on inflation and we are not done yet. if we need to do more, we will. lisa: the five to cut rates has been lowered. suddenly, not only are we reaching a pause, but also, the

fed will cut year, maybe he surgically. do you want to push back against that? do you think the bar to cut is as high as it was? >> there is no discussion amongst me and my collies about when we are going to start cutting me. at some point, when inflation is on its way back down, if we did not back off a little bit, we'll rates would be getting tighter and tighter, but that is mass. lisa: is there weakness in the economy? >> look at the print. for the last 12 months, gdp has been very strong. unemployment rate has ticked up, but we have also seen a huge surge, which is really positive, come online. i am seeing consumers that are really strong.

my airplane was 100% full yesterday. it will be 100% full today. >> you are on board for longer, so you must have modeled out some idea of how long you would need to leave rates unchanged before you could get down to a level low enough that you could take your foot off of the break a little bit. how long do you think you will be at 5.5, into 2024? >> it depends. if we end up with two .5% core inflation and it continues to trend down, that would give me evidence to say, we should look at backing off, so the real policy is not getting tighter and tighter. but i do not want to point to

one data series. >> you talk to businesses in your district all the time. what are they telling you about your growth, hiring and pricing, going forward? >> it is moderating. people, especially in the dakotas have a hard time finding workers, but in minnesota, it is a tight labor market but not as tight as it was a year ago. it maps to the data that we were seeing but one that is still very warm. depending on the sector, they are saying, we feel pretty good about things. obviously, they read the news. there is a lot of economic anxiety that people factor that into their own business planning. the outlook is still optimistic, but it is cautiously optimistic.

it is funny because they still have some pricing power, more than they had during the pandemic, but not as much as they had six months or a year ago. jonathan: can we finish on hiking? is that dutch housing? is the housing market broken? closely and structurally under built the number of units that we need. that is about regulation, creating more supply coming in. it will settle out, over time, but structurally, we have to bring more supply online. jonathan: it could be 20 to 30 years. the legacy could be a generation of people knocked out of the housing market. there could be a generation of people who never sell their home. >> people in needing to move. and people do not sell their

home because they are locked into a low mortgage, that is less supply, but also one less buyer. that affects both the supply side and the demand side of the housing market. jonathan: i am renting and cannot buy, so i am not selling anything. that is the generation i'm talking about. are you concerned that could be the legacy? >> the legacy is that we have dealt with the pandemic very aggressively. we were surprised by high inflation and then we moved aggressively to bring it back down. >> i want to ask you about all the financial ceos in hong kong. very down about the prospects for the economy. they suggest that things are pretty fragile in the economy and the markets, given everything going on around the world. how worried are you?

>> we have teams of people looking at scenarios around the world. geopolitics, when thomas attacked israel, the first thing that we thought of was, what is it going to do to commodity prices? the response has been muted. the broader geopolitical issues are so far outside our bounds of forecasting and we are trying to forecast where geopolitics is going. we just have to focus on what we can control. lisa: this is why trying to get it right is impossible. i'm just saying, people are talking about that now. jonathan: always a pleasure. alongside mike mckee, we will pick up on some of the comments

and catch up on the data. equity futures pulling back just a touch, following a six day winning streak. seven days on the nasdaq 100. the longest going back to january. we had a gain of over 7%. we can talk about that. it yields are lower by a single basis point. from new york city this morning, good morning. ♪ ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf

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so great getting to know you, let's take a look at your new investment plan. ok, great! this should have you moving in the right direction. thanks jen. get ongoing advice; and manage your investments in the chase mobile app. >> we have to let the inflation data guide us just to point out the obvious, our forecast has not been great. we are all committed. everyone is committed that 2% is our inflation target. we have to get back to a

reasonable time. i just do not know. jonathan: this conversation will continue. looking at some of the scores. a touch negative. yields a touch lower. the dollar is a little stronger on the euro. lisa: the strength kind of raising doubts about the story that the yield increase was really do to the increase in the deficits, increase in anxiety around the u.s. political system. the fact that we have not seen a weakening questions whether this is a supply driven story. this has been one of the big conundrums.

jonathan: they cannot talk about rate cuts or imply that they are talking about rate cuts. good morning. let's go straight there because i had messages from you. we are a long way from neutral. what do you think is going on? where do you think this is going? >> i think i agree that it does not pay much to forecast right now. you have to look at the data as it is coming for you. the unemployment rate is up above the fed's forecast for this year. that is the first time it has happened since march 2022. when you are in the thick of it, it is hard to know whether that represents the start of something much more onerous or if it is a normalization of the

labor market, but i think for the fed, i think the dove is on the -- president kashkari tends to lead on the hawkish side of the consensus. for the doves, they have all the mission. they need to basically put the hocks in a casket. i think that is the way i would think about it. you can point the pickup and you can point to what powell has said. when central bankers say proceed carefully, risk management, that is code for doing nothing. finally, the employment report was probably understating payroll growth. there was a lot of strike activity, but at the end of the day, our earnings are running just over 3% over the last

several months. i do not think the hocks can use the labor market as a rationale to be hawkish anymore. that is over. i think they can say that the labor markets have been rebalanced. if they can say that implicitly, it means the door is a little bit cracked open for a cut. it would not be the first time that he basically flipped on a dime. we're a long way from neutral. we are not even thinking about tapering or hiking. to me, the fact that they are not talking about it is irrelevant. it is all in there for next year. jonathan: what are surgical cuts? >> they are cuts to stabilize the economy. the issue is, the extent to

which cutting quickly translates into rapid economic stabilization. as an example, let's say what happens with purchase demand. we have seen mortgage rates coming down to 7%. lisa: you were talking about way more economic strength than people had expected and now you are talking about surgical cuts to stabilize the economy. i you saying they are warranted? >> part of the tension is that my job is not to tell people what i think the fed should do. my job is to get into their head and figure out what they will do. i would probably be more hawkish than the consensus, but i am not there. >> do you think the consequence of surgical cut to fortify the economy will be prolonged inflation?

how do you arrange around that? how do you lean into the rally that we have seen in the bond market and say, wait a second, you have gotten ahead, based on the game theory that they are playing. >> i do not the maran market is getting ahead of itself. i think the distribution of risks have changed. that is what i think the bond market is doing. i think they are right to do that. think about it on basically three prongs. if the fed can look at the labor market and say they are rebalanced? that is checked. done. you cannot use that as a reason not to be hawkish. the distribution of risks are that they would cut because of labor markets. if they are thawing, that will give them increased confidence

that inflation will be thawing. finally, if that is the case, they are not going to be particularly concerned about the easing of financial condition since last week. jonathan: that is what we have been talking about this morning. it feels like perhaps they will. work with me here. it feels like you believe that the world may have changed. do you sense that they still believe that we are still in the same world? >> they do. even chair powell. there is quite a bit of reluctance to just say that neutral rates are higher. jonathan: why do you think that is? >> i do not know. in their mind, things have not changed. he saw it in the press conference last week. if you do not think that the

world has fundamentally changed, you will be more cognizant of tightening risks. you may have thought, maybe you overdid it on the sea might be willing to cut sooner. >> you expect inflation to remain higher? this could be a policy era. jonathan: i would love to have you around the table next time but what you think is the number one thing that indicates that the world has changed versus pre-pandemic? what would you .2? >> look at the obvious. you have done a lot and yet the economy is still hanging in there. household formation reads, but they did after the financial

crisis -- it is easier to tell the story about an anomaly. i think we are going back to the old normal. you think about all those people during the financial crisis period that were saving up for retirement. many have since retired and are saving. think about income inequality. it is something that we were talking about through 2010. people at the lower end are seeing more rapid growth. they are seeing unions getting big wins. those people have a higher propensity to spend. i think it is not right in my view to say that things have not changed, but if that is what the fed believes, you have to recognize what that might imply for what they might do later.

just because they are not talking about cut now does not mean that they will not be talking about them in three to six months. i think -- i'm not willing to fight the move yet. jonathan: you know you are one of my favorites. that is ultimately the dividing line right now. some people still believe in the old world, that we have not seen a change. it is pretty brutal. lisa: i do not know if this is the issue. in fairness, let us move on. jonathan: 20 us shortly come in the bond market yield on the treasury. your 10 year yield. this is bloomberg. ♪

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>> everyone is still so bearish. >> we are seeing more focus on selectivity from our credit investors. >> the markets are telling you that they are pricing some easing. >> it's a matter of who will blink first, the consumers or

the corporations. >> this is bloomberg surveillance with tom keene, jonathan ferro, and lisa abramowicz. jonathan: live from new york city this morning, good morning. good morning. this is bloomberg surveillance. alongside lisa abramowicz, i am jonathan ferro. the last 30 minutes perfectly captures the debate in markets. fed officials say no rates are coming, and then you have a guest saying that rates are coming. lisa: anytime they tell you something is not happening, three month later, guess what. the key question is how much is this a reprisal, how much is this true weakness in the economy versus becoming inconvenient to have tight policy when people are feeling pain? we had this conversation a long time ago and the pain never happened, so we never had to test the resolve of fed officials. jonathan: you'll kashkari wants

to remain vigilant. the risk here is that you will undo things. you need to have conviction that inflation is going back to 2%. i will read what he wrote earlier this week, ultimately the labor market is no longer a reason to be hawkish. lisa: when you are seeing pricing the market. how long were you practicing a tale of two neil's? that was really good. sort of the morning of twomeil's. views that are polarizing the market. the fed put his back and that is your insurance policy if things go south. is that when you are feeling and broader equities right now? jonathan: that is the bullish review. here is the pushback. jp morgan, falling bond yields, dovish central banks, take your pick.

ultimately the growth policy trade-off will be challenging into year-end. the trade-off is important. the fed stays on hold until year-end. growth into the third quarter will be slower. lisa: could you get little pain and the fed still cutting rates? that is essentially what you're looking at from the bullish hopes and dreams, soft landing, disinflation, and a fed that adjusts because they don't need to do more. what we can see now is the fed has no way of guiding people because they are watching the data as everyone else. markets are still tied to the idea that the fed cannot hurt them too badly, and that seems to be where we are. jonathan: the warm embrace of chairman powell. s&p futures keeping it together. lisa: so many images this morning. jonathan: equities on the s&p, -02%.

tons of issuance this week. we will talk about it this week from the treasury. this has to become a mainstream story. all the issuance coming from treasury, all the supply. $48 billion in three your notes. 24 billion dollars in 30-year bonds. that is a lot of supply hitting the market. lisa: we have not talked about supply for decades, and the reason we are talking about it now, if yields go up, all of a sudden is more difficult for the u.s. to keep spending. that ends up in a political discussion because interest payments in 2050 will equal something like 8% of total gdp if rates remain where they are. if you look at that kind of math, it is deeply uncomfortable politically versus people going back to lower rates in making this sustainable. jonathan: waiting for the day

when the white house press secretary opens up the briefing with the yield on the 10 year. then you get all of these d.c. journalists try to ask questions about the bond market. who knows. alicia levine, head of investment strategy and equity advisor solutions is here with us. have we opened the door for a year-end rally? alicia: i think we have. there is clearly a market clearing price in the 10 year, a little bit about 5%, and that is where our ceiling is here. you have seen, trying to get above 5%, gets batted down again. i will say this. the geopolitical risk out there is still somewhat, the tales are growing, but ultimately the fear and loathing in this market has been about supply and yield. what we learned last week, the

market clearing price will take care of the. jonathan: i mentioned markets and jp morgan, stressing that the growth policy will rain challenging into year-end. mike wilson, morgan stanley, bearish all year. what do you say to all of those guys? alicia: it has been impossible to reject anything in this weird environment. even if you got inflation right, sticky on the way down, fed hiking more at the beginning of the year, still up 14% on the s&p. let's talk about how the disconnect between financial assets and what happens in the fundamentals. it is very rare to have two very negative years in the equity market following each other. it can happen, but absent a calamity, not likely to happen. those are known risks. the fact that we have tightening, the loan officer survey shows further tightening going on for six quarters. that is known.

all the problems out there are known. in a weird way it is a tailwind because sentiment is quite negative still. it is not that they are wrong. it makes intellectual sense. i feel at home with that. but we have to invest client money in the real world and not just talk about it. if you are underweight equities this year because you figured a fed-induced massive recession and unemployment come you didn't make the year. lisa: we talk about equities as if they are a monolith, but the russell 2000 really underperforming, kbw bank index really underperforming. there are spots that are hinged to the real economy that are struggling. is it those areas or your usual suspects that have been doing well all year? alicia: we are talking about large cap america, the s&p. small caps are most exposed to the right cycle because of the refinancing cost and the need to grow. the further you go down on the

cap scale, that is where it is. having said that, to neal dutt a's point, there could be a rally in small caps. that in itself is interesting because, you turn the page, the mutual funds in october, everyone else until the end of the year, and then you wind up with a reversion trade in january. it could be a great investing opportunity. it is not that we don't know that small caps are vulnerable. that is why they are priced the way they are today. lisa: people are looking at the rally in equities, saying it is because we found stability in bonds. is it stability or was it a rally? what is the difference? is it enough to have yields bouncing around in a range that is below 5%, about 4%, and even if it is a pretty broad range,

it will be ok? alicia: great question about stability and the rally. excellent question. lisa: i stole it from him. alicia: i think the issue is the stability. this year, the volatility in the bond market, less so volatility in the equity market, which hit 13 at one point, it is the volatility in the bond market that has driven some of the risk off behavior. you get stability there, some sense of pricing, may be ceiling on the 10-year. the thought of 6% yields seems less likely today than two weeks ago, and that is information, stabilizes the equity market. jonathan: where you want to be if that starts to evolve? consumer discretionary really beat up over the last few months. alicia: i think you have to be in large cap tech.

that is about growth without needing to borrow. that is part of the reason why this sector rallied so far in the first part of the year as the fed was hiking. company that don't need to borrow, they have inherent growth, they have a psycho coming up with ai. i like going into sectors that are most hated. there is always a reversion in the following year. people are going to dump the losers into the end of the year. then i think you can get in front of it. for the most part, we are overweight u.s. assets versus rest of world. 60% u.s., 40% rest of the world -- we don't do that. you have not gotten paid to be in emerging markets or europe. i'm sorry, jonathan. jonathan: not personal, don't worry. alicia: we have run data on this all the time. while you can have a great year

or two a great performance, over time, long-term money, you are not being paid. we are there because we need to be, but is not really diversification. jonathan: a guest came on the side and said on the air, don't get me wrong, europe is great for vacations and bad for investing. that was the mantra for the next decade. lisa: how do you feel about being the ambassador for investments in all of europe? jonathan: t.k. still things i am paid in sterling. the legacy of zero interest rates. wework, to go from a $47 billion valuation in 2019, but to learn this morning it has gone bankrupt, have we fully realized the pain associated with everything that we got up to in this market 10 years ago? alicia: the poster child. when money is free, what you can create, negative cash flow can

sustain a business with ever-increasing valuations. u.s. government has the same problem, as you talked about. that interest costs were 200 billion. low interest rates allow for a lot of spending. in a sense, every balance sheet look like a private equity firm because you keep on funding it. that is over. the weworks of the world will be getting a valuation cut. the areas that we will see, commercial real estate, but not a secret. that is why the small and medium-sized banks feel traumatized right now, probably static. that story is not completely done. i don't want to paint a picture that it is perfect but we know where the risks are. jonathan: there is a difference in the opportunity of the year and and not having the financing yet. we could say that fed funds is whatever, but can you say that people are paying it? we talked with neel kashkari

being locked out of the housing market, sitting on 2% mortgage rates. so much of this has still not come to the surface. lisa: borrowing costs have gone. for corporate america in the past few weeks. alicia: they can finance their debt because everyone has debt at 3% and they are making 5% on their cash. that can continue for a while, and my we have not had the recession. jonathan: great to see you, alicia. if you are just joining us, welcome to the program. the s&p -0.2%. lots of issuance still to come. the 10-year is tomorrow. $40 billion worth of 10 year notes. lisa: some are saying that yesterday so love came because there was a slew of investment grade issuance. we have not seen that refinancing wave. if we get stability in treasury yields and people start to borrow, do we start to see how many weworks there are out

there? wework is its own story and philosophy, situation. 750 properties they have to deal with, but a question of how many similar types of debacles are lining up? jonathan: adam neumann. if there is a bubble, but it, and then he got out. and he got pushed out. gregory daco coming up later on. coming up, henrietta treyz of veda partners. (sfx: stone wheel crafting) ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently.

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at&t business. >> can focus on the economy. it is not only kidding, it is king, queen, and bishop. that is going to be a huge factor in where people place their votes in november 2024. as you know, we are light years ahead from where that is in

terms of assessing where the economy is going to be then. that will be the major factor. jonathan: 12 months away, mohammad yunus over at gallup. you can watch the conversation at bloomberg.com. putting out this recently, worth reading. two major political parties remain unpopular with 56% of americans viewing the republican party unfavorably. 58% say the same about the democratic party. this is really important. 53% of americans believe the republican party would do a better job of keeping the country prosperous over the next few years whereas 39% choose the democratic party. that is a problem for the white house into next year. lisa: that is something ongoing in terms of the perception of both parties, one theory, one party tends to govern when things are going well, the other one comes in when is are going badly. the real question to me is what

is the economic issue people will hinge on? bringing down inflation, the debt, international involvement or local involvement? what are people feeling if they are still getting raises? if you look at the overall economy, fed officials say it is strong. neel kashkari says he is not seeing weakness in this economy. jonathan: we just had a quarter of gdp close to 5%. lisa: people are saying the economy is not strong and not going along, so what are people talking about when they talk about economic strength? jonathan: they are talking about prices. you cannot get away from it. you can talk about inflation, prices not climbing at the same rate, but ultimately you look at your bills and you think about things personally. not cpi, when you think about how wall street reacts to it. people feel things are a lot more expensive now than four years before the pandemic. lisa: it is unclear what they

can do to fix that unless time heals all and we get real disinflation or deflation by next year. jonathan: the fed cannot reject any of this, we cannot predict 12 months out. it makes it difficult to be dipped anything about the economy, politics into november. equity markets are slightly negative by 0.2% on the s&p 500. bond yields, 4.62. joining us now is henrietta treyz, managing partner over at veda partners. new york times, siena college, terrible readings or the sitting president. do you expect that to change anytime soon? henrietta: i want to see with the turnout in virginia looks like, tells us where the polls are right and wrong. one of the striking components of that pole, you are looking at a state like nevada, historically very tight but reliably blue.

it suggests that pollsters are finding a 13-point swing away from democrats toward republicans. i don't need to tell you that is in a normative swing. americans don't change their minds like that. to see that kind of swing is either an outlier. the polling is consistent with others that we have seen but we will see a real opportunity whether that polling holds true in virginia today, where there are house and senate elections. it could potentially get glenn youngkin to decide if he wants to jump into the republican race. i think we have something rare in d.c., a real poll that we can watch for an election. lisa: people debating if this is real, if glenn youngkin truly wants to get into the running this cycle, or if he will wait after his 2026 term ends. do you think today's election could truly determine and push glenn youngkin into the race? henrietta: absolutely.

i don't think there is a lane for him in the first place. nikki haley has usurped that with her strong showing in new hampshire. but the three remaining candidates, they are light years behind donald trump. it would be smarter for him to wait until 2026, get in the time around, but this is a signal that maybe he has an outside chance to win. if there is a red wave, i would assume he would write it, try to bolster his ability, in advance of the next cycle. all pollsters, prognosticators in virginia are predicting a democratic win tonight, particularly as the votes come in later. i don't expect him to get in, but it is something that could well happen if the results are surprise. lisa: the fact that we are talking about it i like the fact

that people are not excited about a matchup of trump versus biden. do you think it is realistic that one of the candidates on wednesday's stage will rise to the occasion and take the place of former president trump? or is this essentially what people will have, this is what the landscape will look like next year? henrietta: this is what the landscape will look like. to say there is a presidential candidate in all of the primaries running 31 points ahead of his next closest competitor is ridiculous on its face, to think it would be a different outcome. my anticipation is it will be trump and biden. what you're seeing in the polls right now is discontent with both of them. you have a huge chunk of undecided voters who will either not participate, have not gotten comfortable with the fact that these are the only two options. lisa: do trump's legal issues matter? henrietta: i think they are presenting him as very fiery,

sort of engaged and excited, which is something that biden notably lacks. that narrative of him being old, despite the two of them being separated by a couple of years, makes them look vibrant. it makes biden look lethargic, and that is probably the entire goal. he is likely to lose these 91 different counts, but the point is to present as aggressive and vivacious, and that is what he is doing. jonathan: i want to put together two stories from the past week, the situation in the middle east, israel, they will always be division in a party over a single issue. always an extreme fringe to the left or the right. i want to talk about things to the left. how do you think this president will handle some of the pushback he is seeing from within his own party to his support that he has offered israel following the terrorist attacks that we all

witnessed on and rather graphic, tragic ways in the last month? henrietta: all eyes are on antony blinken right now. certainly doing work across the entire region to try and at least stem what could be a massive escalation. the white house's position to strong-arm israel behind closed doors is increasingly becoming untenable and they have to go public with that. the atrocities are now seeping out into mainstream american news cycles, and they are atrocious on both sides. i think voters on the left and the right are having a really hard time with it. my question is how long can biden keep his anxiety, pressure system on netanyahu in private? that is the next step. i wouldn't be surprised if that comes quickly. that is why they are trying to pass this government funding bill as fast as possible with aid to israel, saying it is

contingent on next, y, z. you have to stop the atrocities. jonathan: henrietta treyz, thank you. the pressure building. we have been talking about it for the past few weeks. lisa: headlines talking about how the u.s. is getting frustrated in terms of how much influence it has over israel, even as all of the worksheets -- warships, submarines go to the mediterranean. in a political sphere, whether it matters at home. jonathan: it is so complex. we don't need another armchair general. this is so complex to get your head around. lisa: deeply emotional and polarizing. as you say, we are seeing divisions on the left that are challenging for president biden, especially heading into this election with wing states, michigan in particular. jonathan: coming up in the next

hour, jim caron of jp morgan, and a whole lot more. equity markets are slightly negative. i have not seen this for a while. six days of gains on the s&p. seven days of gains on the nasdaq 100. multi-year how is that we had a look at a couple years ago. from new york city, this is bloomberg. ♪ at cdw, we get the importance of clear communication. and when your teams are spread out, that's not always easy. our experts can help by implementing poly audio and video solutions to keep you connected. from headsets to collaboration tools, poly solutions offer simple setup and eliminate distracting background noise, so the people you're talking to only hear you. to collaborate with quality, trust poly and it orchestration by cdw. people who get it.

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lisa: one hour into the opening bell, softness across the board. welcome back. this is bloomberg surveillance. jonathan ferro is preparing for his next hour. we are looking at a real dearth of economic activity so far this week. not getting a lot of data after last week's 1-2-3 punch that sent yield plummeting by 40 basis points. 4.62%, just talk to basis points. a little bit of sog on the equity indexes after a robust seven-day rally. real questions around how much we are seeing stocks and bonds reflect the soft landing scenario that a lot of fed officials have been talking about. earlier we spoke with fed

president from minneapolis neel kashkari, talking about the need to do more. michael mckee with us. he has given up his mantle after not coming out with anything interesting. mike: i heard you were here and thought i would say hello. we do have some data. september trade balance, $61.5 billion, a little bit higher than the $59.8 billion initially reported. on the margin, slight take away from gdp, but not really going to move the needle. basically at this point, it is a dull week. john claims on thursday and that is about it. everyone is looking to the fed. 11 speakers this week from the fed. 17 speeches or appearances, and almost none of them, with the

possibility of jay powell, matte r, because they are not talking about monetary policy. this is a long way of saying that our interview with neel kashkari matters to the markets. lisa: especially when he is one of the few hawks pushing back against this idea that the fed is definitely done, complacent. not seeing much of a reaction to the trade data that we deemphasized in advance of this, but you do see the 10 year lower on the day. i find it interesting people are starting to bake in rate cuts, saying that the fed has reached a point where they are comparable to the degree of weakening in the economy. how much is that borne out by the data? that you have seen a softening in the fundamental employment and other outlooks that would justify this shift in narrative? mike: you have seen a softening in the data. unemployment went up, pointing to the gdp numbers.

it is kind of ridiculous but it shows a drop off in the economy so far. at the same time, the last cpi report, another one next week, on a month over month basis, prices went up. the fed is still in between, where they don't know which way it is going to go. you characterize neel as a hawk, and he has been, but it is hard to put a real label on people because there are people who think we don't have to do more and probably won't. and there are people who think we don't have to do more and maybe we will. he falls into that latter category. not ready to give up yet but saying that we need to raise rates again. lisa: not much economic data this week, but on another level

we have a lot. $112 billion in treasury auctions. how important is that for fed officials to understand where demand stepped in, where prices seem to be stable in markets at this point? mike: the markets are always clear. neel and i were talking about that, it is just about price. what do people think they will have to pay to absorb all of this paper? we are not just talking about $330 billion in treasuries, we have corporate as well. what are they going to pay for that? as you heard when neel kashkari was out here, the fed does not think that fiscal issues are really what is driving the market. a day to day issue in the markets, but probably more the state of the economy, where they think the fed will go, short-term and long-term with the neutral rate. lisa: michael mckee, thank you

so much. i loved neel kashkari's description of term premium. parsing that out is something that is a feat of physics. joining us now is gregory daco. i want to start there, with the question of is the economy truly showing signs of softening to the degree that would support some of the moves that we have seen, belief that the fed is done, poised for cuts next year gregory: i think we are seeing evidence that the economy is slowing. the labor market has been the key pillar. it is not the retrenchment that we see a had a recession but it is evidence that employers are being more cautious with their hiring decisions. proceeding with some resizing decisions, and importantly, they are optimizing wages, implementing wage growth compression to limit cost. the key factor that is training

the economy is this environment of cost fatigue. in terms of prices, wages, and in terms of interest rates. that is what is wing down the economy. the key question is whether this continues and whether we see this disinflationary momentum that would allow the fed to hold put in terms of monetary policy and eventually start easing policy. lisa: do you believe in easing rates next year? gregory: there is a high probability. the key risk right now is that the fed has to delegate some of the tightening on the monetary policy fund to monetary markets. when there is so much volatility in the data, where you remain backward looking in terms of your perspective with monetary policy, that is a key risk. you will get these wild swings in interest rates. that is never good in terms of financial market stability. what we need to see is more of a proactive and forward-looking perspective from the fed to ensure that they take back the

mantle in terms of guiding monetary policy, don't delegate not to financial markets. lisa: they have set higher for longer. what more can they say? gregory: they have also said they are extremely data dependent. one week it is all good because data is showing that spending over the summer was good. the next week because there is a slower labor market print, all of a sudden we are easing policy, or that is the signal they give. howell was given the opportunity to reaffirm the hawkish position in the dot plots for the end of the year. he backed away from that, did not say that the fed was open to further tightening. he said the dot plot would to decay. instead of reaffirming this optionality, he maintained the window open, but not his desire to change policy further.

there implementing new financial market conditions, tightening, and at the same time extremely backward looking. that duality is difficult to comprehend from the markets perspective. lisa: do you think that was a policy error? i keep asking the question to understand whether it is justified economically, so everyone will run with it, and it will not be a problem for the fed even if conditions ease? gregory: the argument was that financial markets were doing some of the fed's work. we had seen a rapid ramp up in interest rates, everyone trying to understand why we came to the term premium for that increase in long-term yields. now we see a retracement of about 50 basis points. does that mean that the fed needs to do more, or is there an argument to say that they have done enough, markets are pricing rate cuts today? that is the paradox we are facing today. difficult exercise to plan one

thing about fed policy. that uncertainty is hurting businesses. business executives we speak to our highlighting this level of uncertainty as to where interest rates will be. what is the cost of capital going to be next year? lisa: something underpinning the borrowing that we have seen starting to thaw. i want to delve further into this question of where we are heading to. this was the debate we had with neil dutta, neel kashkari. army going back to what we used to know in 2019, or are we in a higher inflation environment? do you have any conviction one way or the other? gregory: undoubtedly in a higher cost of capital environment, likely to remain there for the foreseeable future. we know central banks took the elevator on the way up. they tightened rapidly in the face of unprecedented inflation.

now they are likely to take the escalator on the way down. beyond the fact that they are likely to go gradually, the fact that they are likely to settle at a higher rate than was the case during most of the pre-pandemic era. they are likely to settle in an environment where short-term rates are around 3%. that means long-term weight will be around the 3%, 4% range for the foreseeable future. that is a new world to which the business world needs to adapt. it means there are still investment decisions that make sense, but there needs to be more scrutiny toward investments that have the highest return, and focusing on productivity growth. we are hearing a lot more from businesses, clients, talking about how to alleviate cost pressures in this high cost of capital environment. the key avenue is increasing productivity growth. it is not just a tech play, it is a broad play driving

innovation via innovation and more efficient work. lisa: at chipotle, a robot slice of the avocado, somebody does the matching. to your point, this is something that people are doing. gregory: staying power in the market, less churn, also way to drive productivity. lisa: is this a way of saying that the fed put is still there, only taken out of the closet when there is more pain, and you will see the fed cut rates and support market valuations and corporate balance sheets? gregory: what is being priced and is this environment that is perfect, a soft landing, where monetary policy is gradually eased over the course of 2024 because inflation is returning back to the 2% target because economic activity is not plunging, and the fed decides

real interest rate environment is the most important, and want to recalibrate that to a more neutral stance. that is the soft landing, goldilocks scenario. there is a high probability that we don't end up with that scenario either on the upside or downside. this pricing that we are seeing today 75, 100 basis point cuts next year will not materialize because there will be a lot of shift in terms of economic activity. lisa: thank you so much for being with us. good luck today on the election day, when all of us have kids in public school, no longer have them in school. if you are joining the program, the s&p is a bit softer today after six days of gains. down by about .2%. not a lot of drama. we are looking at euro weakness, dollar strength after quite a bit of euro strength, reprising a bit of value after a significant fall.

10-year yield, 4.61%. michael mckee, i am looking at the university of michigan sentiment survey. which of these data points matter most at a time, or at one point, an increase in interest market valuations torpedoed the market and no longer had relevance? mike: the markets are sensitive to economic data now, and that will move around a lot their expectations as they come in. the fed is definitely looking at inflation expectations on a market and consumer basis. they will watch that but they will watch several months of it because both big consumer surveys have their biases. gas prices really move the michigan survey, jobs really moves the conference board survey. if gas prices are going down,

maybe we see a drop in the michigan expectations. if those things start to get embedded and stay at a higher level, the fed up with that in the box and be worried. lisa: so glad that you brought up gasoline. we will be speaking with nadia martin wiggen on oil prices, some of the tieups we have seen in the shale patch and beyond, real questions about what is next in an industry that was left behind, and suddenly a very hot trade. this is bloomberg. ♪ the chase ink business premier card is made for people like sam, who make- everyday products, designed smarter. like a smart coffee grinder, that orders fresh beans for you. oh, genius! for more breakthroughs like that- i need a breakthrough card. like ours! with 2.5% cash back on purchases of $5,000 or more. plus unlimited 2% cash back on all other purchases. and with greater spending potential, sam can keep making smart ideas- a brilliant reality! the ink business premier card from chase for business.

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>> if we continue to see inflation numbers of that range, 2.5% or lower on a go forward basis, that would tell me that we are now on a path back to 2% inflation. three months data is still only three months data. if we see that take back up again, that would tell me the job is not done.

lisa: that was neel kashkari speaking with us about one hour ago as he parsed through what the deliberation process is at a time when nobody really knows where this economy is going. softness to the tape after a number of days of strength, rally last week. this week, a rethinking around what exactly transpired, while yields went down 40 basis points on the heels of a trifecta of weaker data points, a fed that appears to be ok on hold, less treasury issuance of the long end of the curve. i want to look at names moving ahead of the opening bell. ubs coming out -- we were talking about this with guy johnson. shares up 3.2%. the focus being the consolidation efforts, reaffirming some of the 2025, 2026 goals, how it will bring the units together while getting rid of two thirds of their

investment bank. uber shares lower by 2.6% in premarket trading. before they were up after giving a forecast that topped analyst expectations, talking about everyone still going around. food delivery business still strong. i will dig through this and try to understand why shares are lower, especially given the fact that going forward they appear to be consolidating the market share. third quarter revenue came in well below wall street expectations. d.r. horton shares basically flat. worse than expected quarterly orders for this homebuilder. given the fact that mortgage rates are so high, it has been dampening demand. a lot of the focus today has been on potential geopolitical risks. everyone has been pointing to oil prices. why have they not gone up given there is an existential threat

that seems to be escalating every day in the middle east? joining us to help us understand what to look for, nadia martin wiggen, director at svelland capital. what do you make of the fact that we are seeing crude low 80's dollars a barrel again today despite what is going on in israel and gaza? nadia: great to be on. i think what we saw last week is that hezbollah and iran, right now they are on the sidelines. they don't want to show an escalation of the more going on in gaza right now. that has taken off some of the risk premium. the last 10 days, we see the implied volatility in the options market come down. it is not just happening today, the last 10 days, that trend. in addition, when that initial shock goes away, as we saw was the case with the more in ukraine by russia -- war in

ukraine by russia, the market begins to think about how to work around that. we have seen freight rates go much higher. it is like a risk balancing. if we cannot flow through the suez, we have to go around, let's de-risk things if it takes longer. they have price that it is as if they have to avoid the duez, which they haven't had to do. so things have come down in the market. lisa: if you are looking at freight producers already coming up with alternate routes that avoid the suez canal to avoid potential blowback from iran, does this mean that oil prices are actually higher than what they would be at this point if there was not this geopolitical overhang, because it is being priced into the market in a material way? nadia: if we look at what is

happening to the market in oil before the october 7 attack, we can see prices are coming off. a lot of pressure on refinery margins, physical crude trading poorly. we had the largest overhang in west african market that we have had in years. more than 25 million barrels unsold in the november program. we saw that kind of weakening. this is where the market would like to rebalance. we saw physical premiums come down in that space, but futures has remained quite strong. this is where we have to see that rebalancing. when we look at the momentum, what is happening to pure speculative traders, cta's and so forth, that short-term momentum has been down. that is bringing pressure, bringing us to where we are now, wti just above the 200-day moving average. long-term momentum is still

intact for a strong market. there are still those longs in the market that we have had since all of this started. but again, the market is preparing in case something were to happen. things had been ticking along well in the middle east, were about to have a deal between saudi arabia, the u.s., israel, recognizing israel which would take off a premium. instead we have gone the other direction. lisa: how much is that you as a swing producer, seeing companies trying to realize the value? pump the oil while it is still valued in the world? nadia: that deal of exxon, for example, that really shows they are focusing on the permian. exxon announced interestingly, they believe with their agreement and knowledge, they can bring in a total of one billion barrels of oil more out of those same assets that pioneer was able to.

if we think about the terminal, regular production rate in the u.s., that goes from around 14.5 million barrels a day to 15.5 million per day. the question is when we can reach that. august production was 13.1 million per day. it would probably take two years but that depends on a short-term oil price and the signals short-term meeting, monthly, quarterly, yields to shale producers in terms of activity. a weaker price would slow that down. stronger price with speed that up. lisa: given where prices are, do you expect more consolidation to be expedited currently, or will people wait until prices go up further? nadia: prices are reasonably strong. the whole oil complex is in a good situation in making money. what we saw at the start of october was that demand was starting to get hit. we had producers selling for

more than $100 a barrel, and then we saw, for example, companies complaining. russian crude continues to flow, we had price caps breached. you were paying more than six dollars a barrel, maybe $70, and on average $100 was becoming difficult. i think we have been in a pretty comfortable space in the $80 range for everyone to make money, so it makes it right for consolidation and valuable resources. we don't really need things to move much higher. lisa: all things equal, will this be the range for the foreseeable future because of the pushes and the polls that are working in equilibrium? nadia: from a technical level, yes, but things can change very quickly. the middle east tore the negative, toward the positive. that could really shift things. a number one thing to keep track

of is that inventories were expected to draw up steeply in the fourth quarter. so far in october they only drew around 300,000 per day. so the market is waiting for evidence that actually we have tightness led by the supply cuts, and demand is not weaning. on the other hand, if it continues waning, we could see further falls in price. lisa: nadia martin wiggen, svelland capital, thank you for being with us. gasoline prices in the u.s. have fallen from a recent peak in september of $3.88 to $3.40. pretty significant drop despite the geopolitical pressures outside of gasoline, which also has the refinery aspect. crude has come off quite considerably so far this month. despite some of the fears about what is going on overseas. coming up bloomberg tv at noon

eastern, on the heels of her earnings, the uber ceo talking about the outlook for ridesharing, how much wages have to go up for those drivers, which has been a serious issue, consolidating markets. also a question about how much people will pay as prices continue to go up. uber shares lower by 3% ahead of the open. we are looking at a bit of softness as people recalibrate after six days of gains. s&p futures lower by just a 10th of a percent. weakness versus the dollar. 10 year yields dropping even more, down four basis points, reversing some of the increases we saw yesterday. this is basically no motion. this is bloomberg. ♪

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jonathan: six days of gains on the s&p 500 and equity futures are little bit lower, the countdown to the open starts right now. ♪ >> everything you need to get set for the start of u.s. trading, this is bloomberg, the open with jonathan ferro. ♪ jonathan: live from new york, fed officials pouring cold water on the rate cut talk and we were going from $47 billion to bankruptcy and ron desantis getting a boost from governor kim reynolds. >> the fed is still a bit