>> the higher for a longer narrative is still in play. >> inflation is high. at some point, that should weigh on activity. we probably get some broader downturn. >> we do not think there is a recession next year. >> -- at least after the election. >> it would the v.a. catastrophic crisis for them to be forced -- this would be a catastrophic crisis for them to be forced. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. lisa: we are thankful for --

gina martin adams with me. welcome. this is "bloomberg surveillance ," live on bloomberg tv and radio. i guess tom would say you had pulled the short job, being here. how was your thanksgiving? gina: it was great care how was yours? lisa: great. i did some research on what aspect of the meal was the best. gina: i really love the sides. my husband is a specialist in the side dishes, from the green bean casserole to the stuffing to all kinds of corn dishes and things all of the sides are wonderful. as much as i love a turkey, i love all the sides, variety in the sides. lisa: an associated press survey came out that said you numb in 10 people so the turkey was the highlight. more than 20% said the sides. this is a morning that will be slow, and a lot of people will talk about what they talked

about last night. they will also talk about black friday. gina: it will be really interesting, because there are very low expectations for the consumer, and this is something that is not often times discussed. we are all worried about the consumer, but we have been worried about the consumer for so long, so i think what we need to realize with this season is how bad is it getting, not is it still good. we can talk a lot about that going forward, but that is the psychology embedded in market prices -- is the consumer going to hold in there, we are so worried about the consumer. we have been for some time. they keep beating our low expectations mark. lisa: is it a good or bad thing if people take advantage of discounts today and for cyber monday? gina: this is a really good question. to me, it is a good thing they are shopping at all, considering expectations. if they are shopping last week,

this week, next week, they are shopping. if you think about the broader landscape, there are no fantastic products making people run out and get them, no big, fancy gadget, no new electronic device that will stimulate them to go out, so that already sets the bar low. they just need to shop at this point in time jade i know that sounds crazy, but we have been in an environment where all they happened spending on anyway's services. they have been pulling back on goods or investment goods. you do have a few buyers going out and buying cvs and holiday gifts. i think that will be enough to sustain expectations. whether we get that is still in question. lisa: and maybe there is a feeling people need to get out of the house after last night and avoid further conversation with their family. as we take a look at today, there is good news, which is a cease fire starting between

israel and hamas and the hostage release of people who have been held by hamas as well as a prisoner release by israel. there is a feeling, in my view, markets have moved on from this story. do you believe that, or do you think people? are still watching? on a personal level, people are still watching and reading the developments. it is an bowling people into active debate and anger. but from a market perspective, is there any kind of care? i do not see it reflected anywhere. gina: this is a good point, because markets always struggle to price some sort of geopolitical risk in general. we did not see a tremendous amount of market activity related to the war, even as it gout -- even as it broke out. the reason is we do not see huge changes in commodity prices, nor inflation expectations, nor huge budget impacts as a result of this particular conflict.

so the markets struggle to price it as it is, so therefore it feels like a perfluoro issue. that said, to the degree you are feeling it, any trader or investor is feeling it. there is certainly some sort of depressed risk premium tolerance, a risk tolerance that continues to play out in markets. this might the a little bit of relief from a risk intolerant kind of climate. lisa: i do want to say we are seeing a pretty quiet are cap. people are maybe mired in tryptophan. 4572 again, given some of the levels people were expected to end the year. the 10 year yield up almost seven basis points. this comes on some discussion from germany about not sticking with -- is net zero dead

incursion? we will talk about that ahead. 7:00 a.m., we will have an interview with macy's ceo, jeff gennette. he will be joining bloomberg television with our own caroline hyde. we get global pmi data, taking a look at whether we start to see a softening on the services side. we have early seen spending on the services side. and markets close early. the stock market closes at 1:00 p.m., the bond market closes at 2:00 p.m. or those stuck trading, at least there is a reprieve and you can crash afterwards. joining us now is steve sosnick, chief strategist at interactive brokers. someone who has seen the swings in the market and the different underpinnings all year. i am curious how much you think this rally to risk has legs? steve: good morning. it is one of these things we can -- markets can always move

longer than it should or would or could, just because people -- it is animal spirits argument. we can see this across the board. the question is how can it stay brought? how can we get beyond seven stocks driving the narrative and onto a broader narrative? gina: when you look at the activity inside interactive brokers, i am very curious as to what you're seeing with respect to traders and their general risk tolerance this year. you go back to 2021, and the meme stock craze was heat connectivity, peak risk tolerance, but how do you see this year playing out relative to last year, and what do you think it means for 2024? steve: a few things. certainly, short-term options trading has been a game changer for a lot of the customers. we have always been an option trading focused firm, and they

are certainly diving in full force into the so-called zero data options. the daily expirations on index options and etf's. no one really traded s&p index options. no individual used to do it. now they do it all the time because they are cash settled and give you tremendous leverage. on the other hand, they are the most likely options to expire without a premium, but that is a discussion for another time. they also tended to be focused on their favorite names. i look at the top names they are trading all the time -- it is always pretty much tesla, nvidia, amd, so they tend to be speculating, they tend to like their names and trade in and out. they have been, on balance, accumulating those top names more than selling them off, but they have not really been diving in wholeheartedly.

it has definitely been speculation in the names you would expect them to be speculated in. there have not been huge net buyers, they have sort of just been trading around their favorite positions. gina: so this theme of concentration risk continues to play from a trader perspective as well as a market sector. what do you think are the catalysts that are likely to emerge to shift that? what could we see emerge in the market that improves the confidence and broadens out trade, beyond those favorite names, the top seven in the s&p 500 or the more selective trading? steve: we basically need to get into a sense where -- we need some clarity in the economy, one way or another. you were talking about consumer spending at the top of the hour. we need a lot of clarity in terms of consumer spending. we basically need to know, is this going to be a soft landing, is the fed going to be cutting

rates, and if they are cutting rates, why will they be cutting rates? that is a big bet being placed in the market, is somehow we get maybe a rate cut by may, certainly by june, maybe another one in july. but why? is the fed just going to be preemptively deciding real interest rates are too high? are we going to have won the battle against inflation, or are things going to be lousy? the problem is inherent in a lot of these bets about cutting rates is a very much of a careful what you wish for scenario. do we want the sort of circumstances that would force the fed to cut rates aggressively? every inclination i see is for them to move slowly. they will not come down at the pace they went up, barring some sort of reason for them to do so. without this clarity, it is hard

to move away from the stuff working into the stuff that is a bit more of a value heart. lisa: what are you looking for when it comes to sniffing out some downturn in retail spending? we were talking about is a a good or bad thing that people are looking for discounts today? it is all spending good spending? steve: from an economic interview, i guess so. it is like empty calories versus healthy calories. i think if you're doing economic measures, it does not really matter. my perspective on black friday is possibly an odd one because my dad was a retail analyst and was covering the retails. i used to count bags collected on black friday for him. lisa: you must be so glad you do not have to do that anymore. [laughter] steve: i do not go anywhere near a store today as a result of that. but that is always the metrics. our the parking lots crowded, are the malls crowded?

but his point was make sure people are buying things. i do not think it matters too much in terms of how they are spending, it is just a question of consumer confidence. are they spending, do they feel ok? we are in an interesting spot where the vast majority of people who want drops have them. that is what an unemployment rate with a reno handle tells you. the vast majority of people have the jobs that can allow them to buy things. on the other hand, they have been tightening their wallets, their belts. it is kind of interesting. gasoline prices, which is a big driver of consumer sentiment and people's perception about inflation, have been coming down. by the narrative about the economy is not good, despite any evidence to the fact that it actually is ok, that it is quite good in some respects. so will the customers be slowing

down there spending? i think we just want to see them spending. if the early sales that have been coming through my inbox are any indication, retailers are nervous customers will not, and as gina alluded to earlier, let's see if they do. let's see if the expectations are dire enough, so to speak. lisa: steve sosnick, thank you very much for being on this show when most people are sleeping in. this idea that no one wants to be near a store on a day where there will be massive discounts and massive hordes, i wonder how much will move online? whether people go to the store to get out of the house, try something on, then order it online. gina: and how much it gets spread out over time now that online is an option. it is permanently embedded after the pandemic experience. what is the reason to go to the store? you can go out to the park, all kinds of other places.

it does not have to be the store because of the convenience of online shopping. i do think we see the season spread out as a result. lisa: did you ever line up outside a store? gina: i never date. i cannot say i was ever into this. i remember when i was a child, when there were really key toys, my mom making a huge effort for us getting those toys, and i can remember her getting out and getting things done. i had the twins set. it was amazing. she did that on our behalf and for us. i am grateful. but i certainly have never wanted that. lisa: thank you to gina martin adams' mom. bloomberg -- this is bloomberg. ♪

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a brilliant reality! the ink business premier card from chase for business. make more of what's yours. >> hamas also took hostages in order to constrain and delay an israeli ground campaign. the hope is pressure will mount. a four day pause will turn into

a 6, 7, 8 day pause. pressure will mount for what hamas really wants, and extended cease fire. lisa: we soon to have gone a pause and now as we get the hostage release from hamas to israel, and there is this cease fire at the moment. that was aaron david miller speaking with us on wednesday. a real question of what is actually transpiring while there is this temporary pause in fighting and how likely it is it can extend into a prolonged piece fire -- cease fire or peaceful resolution. bobby ghosh joining us now, bloomberg opinion editor. howdy understand what this is, whether it was a pause or a temporary cease-fire, whatever language you want to place around this. bobby: i suppose it is a cessation of hostilities. it matches the definition of a truce -- both sides agreed, in

the middle of a conflict, to stop shooting at each other, allowing some humanitarian aid to take place. it meets the definition of a truce. it is only meant to last or four days. israel has been signaling, from the start, it is not interested in a longer duration at this point, that four days is what it will allow. and benjamin netanyahu says it will resume the war until, by its definition, hamas has been completely destroyed. there has been some talk that the truce could be postponed day by day if hamas continues to release more hostages. but then there are military calculations israel would have to make. clearly, israel feels four days is a good enough time to extract some hostages without giving hamas the breathing room to rebuild its depleted weapons, to

regroup, reorganize its forces, and represent a greater level of danger. whether that will still be the calculation on day 5, 6, seven, we will have to see. lisa: do we have a sense of what kind of progress the israeli military has made, how far, exactly, they are in their goal? bobby: the goal is so vague, it is hard to tell. destroy hamas is a sort of impossible thing to cackle it because we are not talking about traditional military forces. this is a terrorist group that lives within a civilian population. israel has surrounded gaza city, so the northern part of the gaza strip. it has destroyed vast proportions of gaza city. it has told the palestinians living there to go south to the southern part of the gaza strip. but now it feels -- and this

should have been predictable -- that some of the hamas readership and many of the fighters traveled with the palestinians who went to the south. so now what do you do? you can't tell the people in the south to keep going, because the egyptians beyond the south will not have them. it has now designated the smallest strip of land, about 2.5 miles along the coast, and telling people to go there, but of course a lot of hamas people will go as well. so what do you mean by destroy hamas? if the goal cannot be defined, it is almost impossible to say how far they have succeeded in that goal. gina: can you give us a deeper sense of the hostages that will be released? who are they, how many are there, what nationality, where will they go to seek refuge or permanent residence? bobby: 50 hostages is what we

are seeing, mostly women and children. most are foreign nationals. on the israeli side, they will release 150 palestinians they have in their prison. israel says they will be women, children, juveniles, boys under the age of 18. those are the terms at the moment. gina: and what is the temperature of the surrounding nations, with aspect to this temporary cease-fire and the hostage release? if you could characterize how is egypt reacting, all the different nations who have taken on some refugees from the turmoil. what is there temperature right now? bobby: relief, i suppose, even if it is temporary. any cessation of hostilities means those palestinians civilians, innocent of any terroristic activities, that those people will get a bit of a

break, and that humanitarian supplies can now be accelerated into the gaza strip, particularly from egypt. so there is temporary relief, but i do not think they will be satisfied with a four day pause. if all this does is allow some people to be released from both sides and then hostilities returned to where they were, then the neighbors will not feel particularly good about it. they happen asking for a cease fire which is, in technical terms, a little more advanced than a truce. a truce only means two sides stop fighting. a cease fire implies they stop fighting and begin discussions towards a permanent cessation. that is not happening. neither israel nor hamas so far has negated any interest in that, so the neighbors know this will not go away. lisa: do we have a sense of what iran's role has been in these

discussions? because we are seeing increased hostilities on the northern border with hezbollah. do we have a sense of whether they are in a truce for the short-term and in discussions for a longer-term cessation? bobby: hamas is completely a creature of iran. it is trained by, its weapons systems come from iran. a similar story with hezbollah. iran would have had to at least sign off on the truce. i cannot imagine hamas making an agreement of this nature, even if it is temporary, without at least acknowledgment and approval from iran. the iranians have not been, in person, part of the negotiations, which have taken place in qatar. iran has good relations with the qatari, so it may feel it has had good representation.

but as far as we have been told, iran has not been at the table in direct discussions. but this truce probably would not have happened without israel -- iran's tacit approval. lisa: there is a question about a longer-term trajectory of who will rebuild gaza, who will govern it, who will be the leadership who shepherds some sort of evolution to something else? there seems to be, at least from what i read, and it is unclear, that there is a reluctance on the part of other arab nations to really take part in that in any capacity. do you understand how much wiggle room there is, why this is? bobby: i can tell you why. the arab countries say we cannot be responsible for cleaning up israel's mess. they say israel cannot keep bombing the palestinians and expecting that we turn up with

the check book to fix and rebuild these cities. and then a few years pass and israel turns up and bomb these cities to the ground again. that is their official opinion. is there wiggle room? there might be. i think the arab neighbors will take on some of that response ability if -- and this is a big if -- if israel, this time, makes firm commitments towards a permanent solution. a two-state solution, where palestinians, whether in gaza or the west bank, are allowed a much greater degree of freedom that they enjoyed before all of this started, that there will be progress guaranteed, whether by the united nations, the united states, another group of nations. guaranteed progress towards a permanent two-state situation, where the arabs and israelis can have their respective freedoms

under supervision and guaranteed, with assurances from both sides, they will not be a assumption either of terrorist attacks by hamas or of military attacks by israel. if that sort of deal is on the table, i could see the arab states saying, ok, we will take this. lisa: bobby ghosh, thank you so much for being with us and giving us that clarity. coming up, marc chandler of bannockburn discussing the latest. we see ongoing weakness in the dollar. how long that can last? markets up 0.2% in the s&p. ♪ but you can invest in them. at t. rowe price our strategic investing approach can help you build the future you imagine. t. rowe price, invest with confidence.

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lisa: three hours to the start of the trading day. this is bloomberg surveillance. tom keene, jonathan ferro are off together. maybe admiring jon's tree. gina is here and we can add that to our list of thanks. interesting in the bond space. you can see equities a little bit of a lift but giving it back as people parse through some of the goldilocks talk, plus the prospect of potentially some sort of slow down. nasdaq giving away after some incredible rally we have seen. in the bond space i think this is fascinating. gina, the idea that europeans --

europe's market is dictating a little bit of the action in the u.s. and the fear of issuance seems to be climbing. gina: it is a global trend among developed markets who spent a lot of money to shelter their economies through the pandemic experience. that money is continuing to be spent. how do we pay this back? once you start spending and you initiate programs, pulling them back is almost impossible at the federal level. we are experiencing this throughout developed markets. it is a stark reminder of the issues being replicated abroad. lisa: i thought you were commenting on how people feel about the season. you are seeing a bit of a euro pop. 109.12. we were at 106 a couple of weeks ago in terms of the cross. how much does this have to do with slightly better than expected data over in europe

versus this feeling that maybe the u.s. will not raise rates further and we will get some sort of rate cuting cycle next year? a truce between hamas and israel. qatar, israel and egypt are brokering the deal. they were expecting to release 50 of the 200 hostages they captured from israel last month. israel released 150 jailed palestinians and allowed eight into gaza. this is the first major pause by . the israeli military vowing they will continue with a truce ends to destroy hamas. i have spent a lot of time thinking about the details about this agreement. what kind of trauma the hostages were released will be coming back with in terms of coming to a hospital and getting cared for. what is going to happen to people who have been displaced and are trying to figure out what we do next now that we

don't have to worry about being bombed? the amount of trauma and all of these parts is mind-boggling. gina: also the idea this trauma is only potentially partially paused. the idea it is a four-day pause but it's coming back. there is no guarantee they will not be more hostages taken after four days. there is not a guarantee this will not reengage this whole conflagration continuously getting worse. this is the broader scope. we have this temporary pause, and wonderful. 50 people will potentially get relieved, though traumatized. we are doing nothing necessarily to extend this pause into something else. there is a strong commitment on both sides that we will reengage. that is my concern. ok. we get a little bit but no guarantee this is the end. no steps it seems towards an ultimate resolution of this conflict. lisa: something developing as it

has been throughout the days and weeks ahead. we were talking about the spending of developed market. robert habik -- the german government announced it has a constitutional limit on net new borrowing. that has been lifted for four consecutive years due to the pandemic. habik speaking to the green party said we have voluntarily tied our hands behind our backs and are going into a boxing match. the others are wrapping horseshoes and their gloves. we don't even have her arms free. this highlighted this feeling of frustration and a place like germany that has not had a massive fiscal -- not been a massive fiscal spender and are competing with the u.s., the ira, different subsidies in nations and saying what are we going to do now. we have to keep spending. gina: i don't completely understand the metaphor of the boxing match and who they are boxing against. i need some clarity on what's

happening here. i will take a minute on that. i think it is symptomatic of the fact that every economy did their best to get through the pandemic experience, now backpedaling out of some commitments is very difficult to do. at a time when interest rates are going higher, this is the bond market's primary concern. we have moved from concern of inflation, supply dynamics resulting in longer-term inflation pressures to what are we going to do. how will governments be able to pay back what we spent during the pandemic? there is no resolution and i think it will continue to weigh on us for some time to come. lisa: elon musk taking it to x, calling it insane that a number of labor disputes can slow tesla's operations in sweden. if using to do anything related to tesla. the move protected in the law. it is in solidarity with the

industrial union that's been on strike for the last month. talks of ground to a halt in sweden. about two and three working adults belong to a union. it highlights the thrust of labor and how much elon musk has tried to avoid any interaction whatsoever with that kind of organized movement. gina: i find this really interesting. flashback if you want to go and we were talking about the uaw strike, which only impacted the american automakers to a large degree. the traditional gm and fords of the world. now tesla skirted the edges. the electric vehicle workers not part of the union in the united states. generally, tesla did not is billions stress. here it is coming at them from another area of the world. labor is internal in a different position globally than they have been in the last several decades given the lack of workers, a lack of available labor.

they have a degree of power and they are certainly using it to the best of their abilities. lisa: one of the hottest topics at thanksgiving was who was going to suffer the biggest job losses as a result of artificial intelligence. we all decided we should become plumbers and become anything in the physical world. that is what cannot be disrupted as much. some of these other white-collar jobs. gina: that requires hands-on service workers. not a lot of displacement that can possibly happen. lisa: shifting gears to the market of currencies. marc chandler at bannockburn global, we were talking about germany and the fact they are kind of abandoning their net zero, net neutral debt issuance yet again because they are trying to compete. how does this affect how you look at the developed market world at a time where inflation is a problem and spending is

still necessary in terms of the politics? marc: i think you are right. i think the 10-year yield is playing catch up with what is happening in europe. i think you're right that the focus is on germany. a high court this week said that many people think germany is a fiscal example of fiscal austerity. they put a lot of things off budget. the high court ruled what it is trying to do off budget is unconstitutional. this has blown about a 35 billion euro hole in the budget. this is the tragedy. earlier this year the greens, whose decision it was in the german government was forced to swallow their pride, swallow their values and extend a nuclear plant longer given the energy crisis in germany.

now we have the free democrats finance minister suggesting he has a compromise. he was the one who advocated reinstating the -- now he's had to backtrack. this is a european problem and i suspect the u.s. yields might have stayed a bit lower if it was not for what is happening in germany and europe today and yesterday. gina: can you talk about how this translates into currencies? it seems the entire global financial markets are in one big trait. but dollar rallies, s&p 500 sells off, the dollar rises. how does this play out in currencies? what we get to a point where we ultimately see some detachment and all of those markets emerge? but will create that point in time? marc: i think you're right. there is one big trait going on but i would begin with the dollar and the stock market.

i would begin with interest rates. we saw the dollar strengthened from about the middle of july through early october. partly in the november. partly on the idea of this divergence. the u.s. looks so much better economically than europe. the eurozone could stagnate or worse inq4. the japanese economy contracted in q3. the dollar rallied. the driest towel on the rack. i think the divergence in reversing itself now, we have convergence taking place with the u.s. economy poised to slow down dramatically here in q4. i think that has helped push interest rates lower. we were seeing the 2-year note in the u.s. at the shorter end of the curve. the u.s. to year -- two-year got above 540.

i think this is a reflection of the market anticipating the fed cuts. the federal reserve told us they were still planning on cutting rates twice next year even though inflation would be at its target. gina: can you give us a sense of what's happening with emerging market currencies? i sense there is some divergence there where there is one big block trading around the dollar with respect to developed markets. emerging markets seem to have some evident divergences. what is going on and emerging-market currencies right now? marc: it is hard to talk about it as a homogenous block. it's been attractive to a lot of people this year, the latin american currencies. typically high interest rates, commodity-backed. i think this -- when you look at the other zones, the central europe dragged down by the europe and the weakness of the eurozone and european economies. asian currencies. you have a lot of challenges

with china. both south korea and taiwan have seen an increase in their exports of technology. this is a sign of maybe a better recovery. i think the mexico story is the outstanding one. mexico, despite a depreciating currency, their exports remain strong. carry is large. they have an overnight interest rate of 11.25%. you get a double return and you can in the u.s. they have strong central-bank independence and a strong supreme court that has guardrails to some of the more populist policies from the government. i think you are right. when the federal reserve begins easing i think it puts a floor underneath some of their emerging markets. lisa: marc chandler marc chandler of --marc chandler of bannockburn global. this has been one of the biggest

questions of what will happen in china and asia to drive growth when they had been the engine for so long. there was a story talking about how china seems to be gearing up to support its property market much more substantially. i don't know how much people will buy this. it seems like there is something more underneath this. gina: expectations are so low. i think china is a potential bright spot that nobody is talking about. take whatever i say with a grain of salt. i think much of market sentiment over the last year has lined up around the idea that china is a giant disappointment. they will be no geopolitical resolved between the u.s. and china. china is a standalone nation now. we got to the point where the trade was extreme. that opens up an opportunity for china. if they don't do a lot there's an opportunity for an upside. if they do come into the market and start supporting the property markets, start trying to reinflate and stimulate growth and importantly try to

repair some of the geopolitical relationships, in particular with the u.s., which we saw signs of that last week, this could be a positive upside story that emerges in 2024. nobody is talking about it and nobody is expecting it. lisa: i'm curious whether you think companies bought the message to xi jinping. gina: it is too early to say. it is just too early to say. i think they are reticent to do so. lisa: i really do wonder about that. coming up, shannon seery of wells fargo talking about what we will see in this retail season.

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ceo of jcpenney with what to inspect going forward for the holiday season. i was doing some research. it looks like about a third of people surveyed are going to use artificial intelligence and other generative ai to their shopping for them. gina: you're kidding? lisa: chatgpt and things of that nature. they wanted to use ai to search for deals and gift alternatives. hey chatgpt, what should i get my 13-year-old? gina: that makes sense. making for efficient -- make me more efficient. i would have never thought to do this but i suppose it is a natural evolution in the way we shop online. we are getting chatgpt right at the top of any search you do now. it kind of makes sense you take advantage of it. wow. it is really hitting as quickly. lisa: i think about the generational divide and people are used for taking more shortcuts when it comes to looking through things which may

add to productivity. joining us to talk about the retail season ahead of us is shannon seery at wells fargo. i want to start with your expectation for a 5% gain in sales for this holiday per iod, which is pretty good. is a good enough? shannon: it will be decent. it will not be a blowout year like some of the years coming out of the pandemic. the average annual gain over the past decade or so has been closer to 4%. we think momentum in the first half of the year will carry us through here towards the end. there is some worry among consumers amidst elevated prices, rising interest rates, things of that nature weighing on consumption. a decent holiday season. 5% above the long-run average but a step down from the rates out of the pandemic.

lisa: is it a good signal or bat single if people come out to buy deals? if they are looking for the biggest discount in order to buy? shannon: i deafen on think we will see a consumer that is really deal hungry. we saw a lot of retailers trying to pull forward holiday sales. we saw sales starting in october. even though today's black friday, though sales have happened in the past few weeks and are starting to pull forward. it is really black month, not just one day. the whole month has become characterized by sales activity for the holidays. i think we will see consumers pushing for those deals. even as inflation is flowing we are seeing prices are well ahead of where they were ahead of the pandemic. i think that is adding to a consumer picture where they are dealing with higher prices and higher interest rates. they are facing less liquidity. a lot of these factors come together where consumers looking for more deals this holiday season and order to purchase all those gifts.

i don't know if it is necessarily a good or bad thing but i do think it is indicative of this consumer progression we have seen where households have less liquidity at their fingertips. gina: do you do any work to disentangle what that 5% means in terms of net sales, volume sales versus the total sales picture? this is something that popped up repeatedly in the last six weeks. how much are your net sales? the investor base wants to see the volume come through understanding inflation is decelerating. shannon: when you think about that 5% figure we forecast, that is nominal. adjusted for inflation that will be lower. in terms of volume, we expect most sales activity to happen towards the end of the holiday spending period. in december, volume will be higher but not as much is that 5% figure indicates. that is not adjusted for inflation.

there is some effects in terms of the volume measures as well in terms of how retailers can assess this year versus years passed. gina: can you talk about what drives your forecast? it's really interesting to see a 5% growth number in an environment were suddenly the consumer outlook has turned quite grim in the last couple of months with consumer sentiment turning over. are you generally seeing the consumer sentiment is going to lead to a slower sales pace or dismiss that as a short-term impact? shannon: the sentiment and confidence measures can be somewhat overlooked in the near-term. the fact that sentiment and consumer confidence more generally have been very low and consumers have spent at a robust clip over the past six to 12 months is indicative that they don't move one for one. sentiment is driven by inflation. we may see a balance given lower gas prices. want to think about the spending environment specifically, consumers are becoming more

vulnerable. we have momentum from the beginning this year helping to feed a decent holiday sales season. as liquidity dries up and borrowing costs become more expensive, that will impact the consumer. gina: you think about the nuances with that figure, there are a bunch of different retails and categories to discuss. hobby stores, electronics, are likely due for a payback this year. interest sensitive categories will probably not experience a big gain. you have some nuance under the hood of the game we are forecasting. lisa: the picture sounds rosier than some discussions on the likes of walmart's ceo and others talking about possible deflation and the market deceleration from where they had been thinking earlier. do you have the sense that maybe things are moving quickly and we might get there early signs of a more significant slowdown or this is idiosyncratic to specific companies that deal with specific clients? shannon: it's a bit of both.

where you are seeing a slowdown from the past few years and i know this is a simple point but it sometimes gets overlooked that we have an extremely high base effects in terms of retail and holiday sales specifically. the slowdown does not surprise me. the forecast is rather weak. the risk of recession is quite elevated. going into next year be the holiday season i'm growing concerned about the consumer generally. i think we can get through this holiday season with somewhat of a decent gain. i don't mean to come across overly optimistic. i think consumers are struggling more but it will come out with a decent holiday sales gain given the momentum we have seen. i don't want to dismiss the pessimism over the weakness we are hearing and some of those equity areas, but it depends how we transition and terms of the consumer picture more generally. lisa: i'm old enough to remember when people would line up outside of stores and try to get the deals. i remember when people would flood in and the shops were

crowded. in the past couple of years they have not been that crowded on black friday. there has been a feeling that people using them as dressing rooms to go order things online or they will stay at home and order online. how much has it gotten spread out where you are not necessarily going to see all of the consumer spending on black friday in the same kind of way and you have to look more towards cyber monday and the amazon sales as much as anything else? shannon: i think it is getting spread out. i remember people lining up outside of stores. i think the sales have been pulled forward throughout the month and into october. retailers are smart. the earlier the households spent the more likely they will spend over the whole season. the october retail sales report came in a bit week. --weak. obviously, spending has been happening throughout november. the data will be indicative of

how it will happen over the next month as well. a lot of evidence suggests consumers are looking to spend more in december as well. i think that is where the deal driven mindset is coming in. it is part of this game where retailers are trying to spread it out and consumers are reacting to that when they see a deal, particularly as they become more vulnerable in terms of less liquidity. i definitely think it is more of a spread out season than it has been historically. lisa: bannockburn global --shannon seery grein, thank you so much and have a wonderful weekend. gina, will you be shopping this weekend? gina: no. lisa: i try to get the boys to go shopping and my younger son said absolutely not. i don't want to be with crowds. gina: i have not gone out shopping in person over the thanksgiving holiday weekend in years. it is not something i generally do. we do a lot of family activities. we do a lot of searching online. i get lists together and that

kind of thing. there is not a lot of shopping that happens over the holiday we can. lisa: what was the hottest topic last night at thanksgiving? gina: we talked about generally was happening with our kids at school. lisa: hot topics. gina: i can't say we were talking about the financial markets. even the political situation did not come up. this is a neighborhood gathering. it was more about the kids in schools and how we will deal with the kids in middle school going in the high school. it was all about our children. it was kind of kid obsessed. lisa: and then the family comes and things might change. we talked about generative ar. coming up next, macy's ceo jeff gennette talks about the shopping outlet. caroline hyde will be with him on the floor or looking at the crowds, maybe not. this is bloomberg. ♪ ♪

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>> inflation has been high and at some point that showed way on activity we should get a broader downturn in the economy. >> there are no diseases, stay on hold until after the election. this has to be some kind of catastrophe for them to lower

rates. lisa: here comes the retail therapy this is bloomberg surveillance with tom keene jonathan ferro and lisa abramowicz. with me is gina martin adams to discuss and go through what we've learned this year and check out the holiday sales because that is the tradition. we have not talked about the incredible rally in stocks how much is retail therapy just buying equities in the u.s.? gina: most of it is a reflection of where we are. we were deeply oversold and sentiment was low. we have a seasonal tailwind that emerges in november and december. i would attributed to short-term dynamics rather than long-term recovery rally which is the

start of a major shift. who knows what could emerge with fourth-quarter trends but i think it's more short-term than rally which is the start of a majori would like to. lisa: bank of america global came out showing global stock funds saw 40 billion of inflows in the third week -- in the past three weeks. even then, you take a look at the inflows and it's been 1.2 trillion into cash funds and only 143i would like to see. lisa: billion in equities. cash a much bigger draw than stocks. gina: can you blame investors? if you're going to get five-5.5 and your money market why take the risk in stocks? there is a rationale when you're getting paid to own cash

investors go where they get paid and there is very little confidence the equity market can produce a more robust earnings recovery. lisa: that lack of confidence is apparent today where you're not seeing a lot of action. there has been a slight lift in the s&p although the nasdaq is slightly negative. euro gaining just a touch after better-than-expected european data. 10 year coming off earlier highs but managing upward at 4.4 up six basis points when it's clear the germany intends to keep spending. this is one of the biggest stories for this market. gina: what happens in the bond market is important to what

happens and all asset classes and we saw this emerge over the past six months. the bond market is the leader and all the rest of us are trailing along behind. what happens with fiscal spending and government debt is important for all asset classes now. lisa: coming up we will hear from caroline hyde in just a moment. the u.s. pmi data coming out, do we see a falloff in the services sector? let's get to it. an important conversation on a day devoted to celebrating retail sales. let's head over to macy's where caroline hyde is joined by their ceo jeff gwinnett.

caroline: this is your super bowl, what are they buying today? >> everything on their gift list. fine jewelry, cashmere, outerwear for the family. we have great deals as we always do on black friday going through the holiday season. we have all of our key items loaded to bear. we had a great day online yesterday during thanksgiving. caroline: you said that on your earnings but it gets earlier and earlier. how important are the next few days? jeff: when you think about black friday deals that start right after halloween but this is a pilgrimage. america is traveling and coming into stores like this one today

they have been online all the way through. we look at black friday through cyber we. in those last 10 days they become increasingly important as one of the three stages where wear out for christmas shopping. caroline: clearly it's about inventory management. how do you ensure that you have the right thing at the right time for a consumer were all trying to understand right now. jeff: consumers are under pressure but they still need gifts. i want the story to understand where we are and all of the content and all of our categories. thus attribute to the work we've done an inventory control. caroline: people are having

stores but e-commerce has been the focus. how are you managing to be in the right time and right place? jeff: you have customers who are shopping online and they want to come into the store and try it on. the opportunity to make it as convenient as possible however and whenever they want to shop. doing that with the national footprint as what we depend on. caroline: you have living for higher end purchasers and more income ret with macy's. what are we seeing in terms of the consumer? jeff: you have customers under pressure. inflation is still high. it's abating from the higher rate but still high and customers have a limited budget.

some are spending it on experiences. we want to make sure we have the right price points. but you still give gifts. and that's where we really shine. we will have the right content at the rice price point. we have been spending a year getting ready for that. caroline: people may be worried that your managing decline. jeff: if we weren't a department store today we would invent one. were able to get categories in the marketplace online at bloomingdale's and macy's. i made my career in department stores and it still very relevant. we are looking at where traffic is moving.

we will be ready for where the customer is evolving and we have strong assets to be able to do that. caroline: evolving into out world using chatbots nai. is that the investment? jeff: we have 40 million customers at macy's and we know them well. we have all that data and being able to personalize values is where this is going. how do you make your brand more relevant? it's no longer broad-based promotion. based on what you buy and what you're interested in to be able to serve that up in the way you want it served is the secret. caroline: you've been this throughout your career, you've worked at macy's for more than 40 years and this is your last black friday. you have been thought of as a

turnaround focus. you weathered covid, do you feel that you have macy's where you wanted to be as you look forward? jeff: i did not accomplish everything on my list but the focus on relevant content, values in customer experience is the path forward and i cannot be more excited about my successor he was able to do this. he knocked the cover off the ball at bloomingdale's. he will now do that for me seizing. he has a good game bad -- plan. caroline: have a good last black friday and he will be here a ceo through february but with that we send it back to you in the studio. lisa: that was caroline hyde and

macy's ceo jeff gwinnett. talking about the importance of gifts. he emphasized that people still buy gifts even if they are focused on experiences for themselves. gina: even if they pull back elsewhere they make the holidays and special time for their loved ones. he also brought out that customers are still buying luxury and high end products as opposed to looking at extreme discounted products which is a divergence relative to the commentary we've been having about how the customer is focused on value in the best deals but they are also looking at luxury items as a component of their strategy. lisa: and they are also different shoppers. which is why i was wondering if it's walmart was different than

macy's shoppers? with high-priced things are not looking for discounts with milk and bread. gina: in the differences we see a different income levels. higher food prices and cost of thanksgiving dinner and higher gas at the pump all of these things weigh on their sentiment significantly more. lisa: coming up a gut check on if this thanksgiving dinner was more expensive than last year. we are looking at equities basically range bound. a quiet morning ahead of the opening bell. at 8:00 a.m. we have michael purves and later in the show jason wolfer's, the economist

who talks about the price of thanksgiving has gone down materially but the differences, that is year over year. this goes to the defied to why people feel so much worse than the economic data suggests. gina: a big difference between what the financial markets think is important versus the everyday consumer in terms of inflation and we see that being played out in real time. generally, wall street cares that inflation is rising at a slower place. this disinflationary outlook is important to asset prices but is it enough to change consumer psychology? the consumer is still worried about inflation and price increases. they are still thinking about price as a component of their budget. so year-over-year does that matter to the consumer?

lisa: i wonder how much this is a housing story. i think a lot of people are locked into their homes are locked out of buying. what are some of the things underpinning that dissatisfaction? we also have terry haines from geo polity talking about what we can expect at years end and geopolitics. i'm focused on the bond yield space given what we saw in the european space. just inching higher here. this is bloomberg. ♪ that inspired the world to invest differently. it still does. what can you do with spy? ♪

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>> this hostage exchange will provide four days for them to ingest a massive amount of information from prisoners, laptops to the shape of future

attacks and 4, 5 days. lisa: that was norman roll speaking to us as we prepare for the cease-fire that has taken place. a temporary cease-fire. the language is disputed as we get a brief reprieve as the hostages are returned to israel. some prisoners have been released back to palestine and there's a question to how long it can last. i want to start with what is happening with the u.s. negotiators during this pause and cessation of fighting? terry: they are grabbing as much information as they can. they're trying to figure out this much as they can the other thing happening is the israelis are resting and replenishing because what needs to be understood is the ultimate war

aim has not changed, it's the destruction of hamas and if people think there is a serious deflection or difference in how israel is going to address this war going forward. lisa: as the pressure getting too great for him to take a role rather than trying to argue for cessation of fighting? terry: the president is focusing on what he could focus on that is the likeliest to yield a result. this sounds politics but the me hone in on it. -- let me home in on it. by then influencing israels war

aims will remain limited. this is a two edge sword. they want to celebrate the idea that they have some hostages out to the extent that they can deflect israel's war aims that allows people within the administration to prosecute their vision of what middle east peace should look like. we should not overestimate the degree of influence the president has over the prime minister or the israeli government. from the israelis perspective how deep and profound a shock the october 7 incursion was and is and how that will influence with the israelis government and military do going forward. gina: presuming the truth does not lead to a cease-fire, which seems to be the consensus here

that this world will continue. how do you see that impacting the presidential election? terry: it tends to depress enthusiasm among democratic regulars for biden. there is a big split and that enthusiasm is already not great. the degree to which the international situation continues to look perilous in the geopolitical risk looks high. as the highest geopolitical risk and 50 years. that augurs against the president making people more enthusiastic -- less enthusiastic and gives the opposition on the republican side the opportunity to say we

need something more coherent, consistent and has particular goals in mind. that's how we protect america and protect our power. it's a difficult time for biden. gina: if you dig deeper into the republican candidates and how they art distinguishing themselves is this issue is coming as a distinguishing factor and how can it play out with republican candidates? terry: you are really down to three candidates president trump, governor desantis and ambassador haley. they all prosecute the line i gave you before. they all have their own mannerisms and how they talk about that. but the line is consistent.

the only person in the republican field who wanted to make a different line is vivek ramaswamy who has never really caught fire. on the republican side, you have a strong foreign policy that's very interventionist and also in very critical of aydin. biden. governor desantis making up for his diplomacy experience with his military service. but opinions remain consistent across the board trying to draw

a contrast with biden and the arabian policy. lisa: the polls show that people don't want to run on either side and nobody wants to talk about it. over 90% of respondents said they don't want to talk about politics or joe biden or the presidential election at thanksgiving. decide tell you something about voter enthusiasm and turnout? about what could happen a year from now? terry: fundamentally it tells you where the electorate is and

how unusual people who talk about nothing but politics incessantly. purists on both sides have the ability to influence how primary candidates are vetted and chosen. there is a great yawning middle that has been looking for solutions and is not getting them and feels they are not getting it and they are exhausted between the politics and the pandemic and would like to get back to any semblance of normality. if there are candidates from either party or a third party in the middle that could tap into the desire to get back to

normality and stop the screeching there is going to be a big audience for that. lisa: thank you so much terry haines. i was struck by the pole. gen z said they would celebrate thanksgiving with friends to avoid family drama. gen z topics of conversation is weddings, gossip and basketball. millennial family planning and gen x is football. lisa: politics way low on the list of priorities. people who can only talk about

politics and there are people who don't want to hear it because it's gotten so polarized that it feels exhausting. gina: and inevitably leads to tension and depletes the purpose of the holiday which is to try to enjoy yourself and your family. lisa: what does uncle joe say this year? gina: we don't want to hear it we just want to talk about our pets. lisa: anna rathbun from cbiz to join us here next. this is bloomberg. ♪ drawing on deep expertise across the world's public and private markets in pursuit of long-term returns...

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lisa: two hours to the open on those shortened trading day. gina martin adams alongside me on a quiet day. in equities and bonds, it seems to been put on pause. you see a little bit of a lift in s&p futures but generally stasis but in the bond space, what do you think has driven the shift upwards? this inflection up and yields? gina: i think it's inflation expectation. the u mich sparked a little bit

of panic and consumer policy. there is no room for complacency. when consumers think inflation expectations are on multiyear highs there is a risk that the consumer psychology has shifted in the bond market assessing that out. lisa: reiterate some of those numbers that came out earlier this week. one year ahead inflation expectation increased from 4.1 to 4.5% which given gasoline prices and the 5-10 year inflation is in-line with the previous read but above where

the expectations were. it points to this is the cumulative effect or other cost that outweigh gasoline. gina: we are obsessed with short-term movements that we forget to include the long-term psychological shift which does include housing. house prices have failed to correct in this environment preventing supply from coming onto the market. what is that mean for the consumer who is thinking about buying a house? i don't think were getting a new reprieve on that. we have spoken about the israeli war with hamas and during wartime people think of war as an inflationary dynamic. we are speaking about

expenditures and the consumer has been thinking about this as inflationary. even though gas prices are falling it's not the only driver. lisa: at the fed meeting minutes he talked about wartime psychology. a four-day truce is in effect between israel and hamas. qatar, egypt and the u.s. brokering the deal. hamas planning to release hostages while israelis release palestinian prisoners. this is the first major pause in fighting since october 7. the military vowing that the war is not over yet and it will continue in order to destroy hamas. barclays cutting 200 jobs in an effort to reduce costs by 1.3

billion in the coming year. top managers are reviewing the plan which would shed 2% of the banks headcount. they lowered guidance after cutting its outlook in july. it raises the question of how much cost cutting there is in the financial sector? we also saw this at citigroup, is this showing more to come? gina: we've seen this in bits and pieces for the last two years. in 2022 we saw tech and communications companies but financials are also cutting. this is an enduring trend where they are really rationalizing their spending and not getting a lot of revenue opportunity and having to consider what their spending out look looks like. it's a death by a thousand cuts

considering how small each of these cut programs are. barclays suggesting about 2% and it will not come all in one chunk. financials is not adding job growth but taking away job growth in tiny pieces. lisa: maybe that's why people have not been that excited about lack friday shopping. but macy's ceo reiterating that the competitive landscape has shifted to black friday deals prior to black friday. they expect holiday sales will increase 3-4% from last year.

it makes sense because how much stuff can people buy? this good versus services dynamic we've been talking about. gina: and spending has been so depressed that we have no expectation this is going to do a whole lot anyway. any spending will be expectation but the real risk is not the consumers not paying attention tunnel black friday but that they slow down their pace of travel, going to restaurants and pick away at the services spending which has been resilient and stronger than good spending. lisa: taking a look at the retailer this will be front and focused, chief investor --

>> i've learned not to bet against the american consumer because they like to spend and we have a tradition of spending. anna: we think we will see some strength, maybe not the levels we saw pre-pandemic but rates before the pandemic and 2019. consumers are not the same. we have seen weaknesses. you mentioned expectations being 4.5%. not only is there a psychological component to it but it drive spending patterns. going back to third quarter gdp, it happened with the savings rate going down a credit card

balances going to record highs. thus the enigma of inflation and not something the fed is going to be fighting but this is not the look of a healthy consumer. this is the look of a creative consumer who is trying to buy it today, looking for bargains and value over a long period of time. lisa: how would this impact your overall investment strategy? the consumer has been a resilient source of support for services spending. as a consumer approach is the holiday season how does that play out in risk assets? anna: is not the best picture for risk assets.

if prices are coming down because of bargains that is margin pressure. for a lot of retailers that will be of volume gain versus a margin game. that's not a great place to be and that has to do with the weaknesses we have talked about as an investment community regarding the liquidity of the consumer. we are shy on the risk assets. with the fed policy forever on this rate hikes cycle that may be we have hit bottom. but that's not our view. as some point we believe there will be a rush to save. lisa: whad if the consumer is buying what they can now do you expect prices to be higher later?

you get that type of situation what is the breakpoint? why will it not continue with the positive momentum that people have been surprised by this year? anna: the breakpoint is people running out of money. we are seeing the taking up of the weaknesses, auto loans, credit card defaults, delinquencies past 90 days are picking up to levels we haven't seen since 2011, third-party collection accounts are up. i don't think we can go at this pace and credit card balances are over one trillion in aggregate. the interest rate is not what it was last year. that's billions of dollars that will be spent in paying interest

rather than spending on the economy. this is not a scenario that the american consumer can continue to spend the way they have been. lisa: anna rathbun from cbiz thank you so much. everyone is expecting the consumer to run out of cash? what if people are getting real incomes rising because of disinflation will that fuel their ability to do more? lisa: there's a lot of confusion as to where we are in the cycle. because the consumer did react in 22. i don't know why people have not recognized it. gina: in 2022 we were talking to target and walmart about inventory problems in the consumer was pulling back when

prices were exploding higher. prices have not corrected to the degree many anticipated and stabilized and that's the conundrum. the consumer has pulled back on spending and they're not going to retail stores but they are spending on services. going out there and spending on airlines, restaurants. that's where there is a potential for pullback. and we have not yet seen it with the degree that the consumer can sustain it. the consumer is not running out of cash because they're getting paid for that cash. they are actually making money on their money now. lisa: this is something we will pick up on. the s&p is up just marginally up

.1%. the nasdaq is really quiet. you see a lift in the euro versus the dollar. 1.09. is there an on the margins, as stimulative effect of earning money on your cash? when you lower rates as stimulative? but when you make money from your money and you can go out and spend that money? gina: when less than half of income is coming from jobs. when you look at the bucket of disposable income just a portion of that income comes from wages and salary so were somewhat dependent on the job market. consumers are earning money's on diffidence, and in homes, cash

and retirees are a huge portion of this population that are not sensitive to the job market but more sensitive to investment strategies. lisa: say that one more time? gina: half of income has nothing to do with wages. lisa: this has pretty significant implications on the monetary impulse and how important the job market is. we will be talking about that in black friday and what they're seeing on the streets. joe will be joining us next. this is bloomberg. ♪ ♪ 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪

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lisa: veronica clark talking about why rates could stay higher for longer and why betting against the american consumer has been a losing proposition. we have spies out in the stores. in macy's, there were people there. to give us a scene from white plains, new york. joe feldman, this is the tradition. you go out to see what's happening in the stores. can you give us a rundown of what your take is this year? joe: i did get up early, part of the tradition. it was very quiet. i was in best buy and target, not too many stores are open. they are all ready for block friday, well-stocked, the signage was great but not a lot

of people. and i think it's because you can get those prices earlier. you can get them online and a lot of the stores started their sales earlier and that's elongating the season and less of a rush to get out first thing in the morning. gina: i want to key in on this idea that retailers are not open yet. over the past couple of years we were extending the opening hours with a lot of retailers that would open on thanksgiving. what is the change here? is it just the extension of the season and advent of online retail or is there a labor component to this? is there something to do with lack of available labor and pushback from labor as to what they're willing to do? joe: that's a great point

because i think labor is a component here. retailers have decided given the volume set they have seen in the past couple of years maybe they should treat their employees better and not have everyone out on midnight on black friday or at 6:00 p.m. on thanksgiving. the traffic in the stores just was not enough to warrant spending on the labor and giving labor a break in the store employees a chance to rest and enjoy the holiday. i elongating the season that helps alleviate some of the stress and puts less emphasis on black friday alone. i think we will see a pretty decent day but is just a longer period we are seeing.

gina: what is that mean for that longer period? what are you expecting from holiday sales? we spoke this morning and they were expecting a 5% raise? joe: we have seen estimates between 3-5%. until the data is formalized is somewhere between 3.5-4%. we looked at all the forecast from the companies and top down on the macro data, 3.5-4 percent, the 4% is a long-term average and it feels like it will be a normal year. lisa: the main topic of discussion was generative ai and

how it will transform our world. i know that sounds like us scintillating holiday discussion. we have a nerdy household. i'm curious on how that changes the way people shop. a third of people responded that they use some generative ai to figure out how to shop. how is this shifting the way these companies really try to cater to their customers? joe: i think retailers are starting to embrace him. it still feels very early for them and the quality of the generative ai and responses you get are mixed. but they are working aggressively to do things more efficiently for their own organizations and serve the customers better. when you think about the chatbots or language models have

more natural responses. i think it is coming, but people are embracing it. people are trying to get there. but i think it's a couple of years away before we see a major impact. lisa: there is something else given the catastrophic realm of talk which makes thanksgiving exciting. i'm curious about what this means for the employment picture ? you don't have to pay a robots to work during the holidays. with cash registers that are self checkout and personal shoppers. there is an evolution that can cut back base costs but how much are we seeing that in the stores at this point? joe: i think it's relatively low because of generative ai but we are now seeing technology reduce cost to help them run more efficiently.

automated self checkout, you have one person manning five registers at the same time. and if you can get people on the floor to help customers in stock the aisles butter. on the backend, there is so much you can do. the generative ai has a lot more to come but they still need people to harness it and software engineers to write code and embrace it. there is an important element where people are so crucial to the system because it does create jobs for people, may be more skilled labor on software engineering. but when in the story to want customer facing people.

you still want people to help people. you just change the tasks for labor rather than cut labor to thin. gina: can we talk about the broader, competitive landscape. i'm struck by this idea that consumers are focused on experiences in spending on services, restaurants. how retailers thinking about the general competition for consumer dollars in an environment where consumers are willing to spell on -- spend on services rather than goods? joe: try to create a more interesting environment whether that's in-store or online. a more efficient and fun experience. more discovery and treasure hunts. the other part is innovation. when we see in innovation of products, apparel, furnishings or electronics the consumer

tends to respond. when we have had that innovation and consumer response. the retailers have been prudent in their outlook and understanding services spending is still recovering to get back to pre-pandemic levels. we are not fully there yet so the assumption as you will see continued spending and retailers are trying to find a way to create interesting merchandise. that's why in think we'll see a decent holiday season. the consumer has money they're just spending in different pockets and that choice. ending is where you see the shift. holiday giving us where you will see that shift back. and then post holiday people

want to spend it on trips and get away. lisa: joe feldman, of chelsea advisor group thank you for being with us. i am not the best person to talk about the buying of stuff. but there's a question of how many people are locked in homes that are smaller than they need so they don't want to buy more things to fill it? gina: the other aspect is higher interest rates generally impact good spending than they impact services spending. you tend to finance heavy, durable goods and less likely to do that when it costs more. lisa: coming up we will be speaking to michael purves to purse out what exactly consumers are doing this holiday weekend. ♪

♪ (captivating music) ♪ (♪♪) (♪♪) (♪♪) (♪♪) (♪♪) the first law of thermodynamics states that energy cannot be created or destroyed. (♪♪) but it can be passed on to the next generation. (♪♪)

♪ >> the hollow lake really is very much in force. >> it's an environment where equities are expensive and profits are ok but everything is priced in. >>, less and less calls of

recession next year. >> i don't think this ends in a soft landing, it's either a higher landing or you were just stuck in inflation. >> this is bloomberg surveillance with tom keene, jonathan ferro and lisa abramowicz. lisa: five hours until the end of the trading day for stocks in the u.s., not that any of us are counting. welcome back. tom keene and jonathan ferro are enjoying a well-deserved day off. i am thankful to gina who is here behind -- here beside me. we are parsing through all of the retail glory that's in force on black friday. what are you looking for? how important is this to understand? gina: i think it's one day in an overall season. i'm watching inflation expectations because retail

sales peaks in 2021. the consumer has already done some adjusting to the higher interest rate environment. it's probably a little more important to watch services spending like how much they spend on travel to see family and how much they spend at restaurants is important. obviously, no one wants to see the consumer completely turn over here so we need to see some degree of the stability over the fourth quarter at large and black friday is clearly a key component. lisa: where proportion of u.s. workers in the financial sector are in the office today? gina: maybe 10%? lisa: maybe but probably less. it feels like put it on auto trader if you need to. gina: absolutely, i think there are very few people trading at all even from their raisman on a day like today, the volume will be limited and volatility will

likely be interesting but not what normally is on average trading day. lisa: at the university of michigan sentiment survey and how it came out with inflation expectations that were higher than expected, i wonder where this is coming from. at 8:45 a.m. eastern we will talk about how there are a lot of sectors where prices are going down and things are cheaper and yet it's not really factoring into the way people feel. gina: you brought up housing prices on the cost of housing and the cost of rent is a key part of the consumer psychology with respect to inflation that doesn't typically get covered as a component of inflation. we think about retail sales is the primary proxy for what the consumer is doing but that's only a portion of the story. what are they doing with their houses? they are stuck in them and that's great for wealth for those who own the houses but

it's not great for the consumers thinking about getting into houses. they see the endless price increase in the future. lisa: we will speak with justin wolfers at 8:15 a.m. you can see that quiet lack of engagement and a lack of action on s&p futures going nowhere. you are looking at a bit of euro strength but no drama. the real drama today would be the 10 year yield, 4.7%, up more than six basis points. we are talking about germany and the possibility of issuing more debt or allowing them to continue this issuance and not having to go back to zero addition to their debt pile. it speaks to this ongoing fiscal stimulus regardless of the inflationary backdrop. gina: ongoing fiscal stimulus is

perceived as quite inflationary so it's contributing to the psychology that fiscal governments -- spending is unable to pull back in this environment even though we are technically in recovery. there's been no recession declared. the fiscal expenditure is still enormously high and there is a question as to how we will pay for that fiscal expenditure. how do you pay for it or cut it back? lisa: this is the reason wise been difficult to come up with forward-looking projections. we will bring michael purves into come up with some projections. i'm wondering what this holiday pause that has legs but leads to perhaps a reassessment beginning of next year. >> my framework now is that we will get a continuation of what we've seen and the sprint to year end. there is a lot of seasonal patterns of work.

i went back to 1928 and looked at the market up more than 20% coming into q4. more often than not, the market is up nicely into year end. there are a couple of notable excess -- exceptions. you've got seasonals but then coming into november, what do you need to check the box for the bullish sprint? you need stabilization in rates and you can check that box for now. you need a decent earnings season and you can check that box. on top of that committee got dollar strength that has rolled over. it has softened financial conditions. i think there is a lot of flows coming into the markets into year end. to we get to 4700? it's on the table but you never know.

all that said, if we get those levels come i think you will get a pretty reasonable hangover in january and february where i would be navigating into protection as the market climbs. as we look into 2024, 1 of the things -- i'm not particularly bearish on the markets become a more on the economy but the expectation of large earnings growth in the upside surprise factor we had this year is not in the cards. i think there is evidence that nominal gdp will be lower and that will probably mean some of the earnings expectations are not going to be quite as good as many expect. gina: we are talking about a potentially poor start to 2024. what will that mean for the rest of the year?

we could normalize into the latter parts of the year or is this the beginning of something more nefarious? >> i don't think it's anything more various. probably the downside case of maury range bound equity conditioned year as we go through multiple regime adjustments and on the earnings side, i don't see a real recession here but i see a slow, below velocity degradation in growth from what we have known over the course of the summer. that's going to reflect in some earnings. there is the magnificent seven in the big tech earnings less economic sensitivity or classic economic sensitivity and that's an important pillar of overall index earnings. i think that will probably be decent next year.

bottoms up consensus for next year is about 12% year-over-year earnings growth. i'm coming out more like 7% earnings growth. i think the markets will have to adjust to that and then there is what pete e.u. want to pay for -- what p/e you want to pay for. lisa: what is the pain traded? what is it this year? heading into 2024. >> that's a good question. i don't know if this is a pain trade but a lot of people thought the treasury sell off the backend is over and i don't think it is. i think there is a lot of evidence to suggest that term premium is going -- it shot up

in september and october and retraced all of that but a lot of that was a function of very aggressive trading and positioning closing out trades. the broader theme here -- if you look the fed calculation term premium, it looked negative from 2018 on in this year, it started coming back into positive territory and now it's back down to zeroish. global central banks are retreating from policies. i think that's structural and i think that will continue. we were talking about germany increasing supplied. there is a supply condition that will only exacerbate terms. could we get to a 10 year back to five or 5.25%? absolutely is one of those cases. the worst is over for the back

end of the treasury curve. i'm not in that page i think there could be another move higher. [no audio] about 5%. that move from 4 to 5 was incredibly painful.

gina: we see the same in the earnings outlook and the estimate revision probably has to move a touch lower its earlier next year. if you have negative revision at the same time as yields are going higher, that will peeing for -- that will be painful. lisa: some people are getting squeezed out of that. if you are just joining us, we are seeing a market that is quiet as you would expect. we are seeing bond yields go a little higher. you can either attribute to that what we saw in germany or with respect to that university of michigan sentiment survey. s&p futures are up slightly. you bring up an interesting point. one thing tom talks about all the time is that inflation is

good for earnings. gina: on a nominal level, you see more money coming in. lisa: doesn't matter whether it's bigger volume were not. you are starting to see that around the margins. gina: and that was affecting the top line. lisa: how much is sticky inflation a bad thing versus a good thing? gina: it's an industry-specific story. in an environment where inflation was based upon supply constraints, demand was holding up but supply constraints were driving the inflation. goods -centric industries are generally pressured most. when oil prices are surging higher, that points to retailers is most likely to experience weakness. the inflation we have today is very different than the inflation we were having one year and two years ago in that inflation is potentially more embedded and potentially changing psychology but not

necessarily based upon supply chain constraints and weakness in the geopolitical environment. i think you have to be careful. it's not the same over the course of the equity market. we can't painted with a big brush. the fact that energy price that comeback is a big support to equities at large but you are seeing a lot of consumer companies suggest their net sales volumes are contracting. lisa: we will speak about that coming up. justin wolfer will be with us now raking down the price of yesterday's thanksgiving meal and i would effects sentiment. ♪

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at least after the election. lisa: a cancer consensus call -- a counter consensus call. we were looking at the pain trade. we are seeing a very quiet day in the markets. it's an early close to the u.s. trading day with a lot of people not in the office. you are seeing no movement on the s&p 500, giving back earlier gains but no drama. the big drama is that 10 year yields are up almost seven basis points. people are parsing through whether you could see stickier inflation or more issuance globally in developed markets. and whether the fed might be done raising rates but will not drop them any time soon. we are talking about what to do with your leftovers including the money you have left over after what we saw for thanksgiving, black friday. justin wolfers is taking a look

at thanksgiving disinflation sing the cost of living is up and consumer per test perceptions up and everything is more expensive and the price of your thanksgiving dinner fell from a year ago. pumpkin pie was up almost 4%. justin is joining us now. it's interesting you put this out. it seems like it's interesting on the face level of thanksgiving but there is a deeper message here about where there is disinflation and how that isn't necessarily showing up consumer sentiment. what is your take on that? >> i'm glad you saw the message. it was almost a form of performance art. i pretended to care about these individual prices. if you want to track the cost-of-living, you need to go and visit hundreds of supermarkets in dozens of cities and sample thousands of goods that have sophisticated

computers to put it altogether. thank goodness we have someone who does that for us. what we hear every year and every new cycle is some interest group were one side of the political spectrum or another will pretend to care about things like the price of turkeys. it's always the case that whether inflation is 2% or 4% that there is a bunch of stuff going on. the bread rolls were a little more expensive. there is a bunch of stuff going down like that price of fresh cranberries. turkey prices are plummeting because the birds are growing. trying to tell the story of the whole economy through graphics like this often is an absurd way of tracking the macro economy.

gina: you correctly note that airline costs are going down so the cost of services is intriguingly going down year-over-year. in that environment where we see generally prices rationalizing from the sky high pace of inflation, why are consumers telling us they are expecting more inflation going forward? >> the simplest model of the consumer mind, they are not running sophisticated models that we are. they go into the store. one of the best ways to predict inflation is what is currently happening will continue to happen. all the rest of the other stuff that's going on with oil prices or food prices is a slight modification of that. consumers are incredibly responsive to the most salient prices like gasoline and be that

food. consumer inflation expectations tend to track those things a little too much. the problem with this is what's not salient. the cost of health care, the cost of education. these things are huge part of the consumer basket and the cost of housing as well. inflation expectations are perceptions and may not track reality particularly well because we are a little bit too focused on what we see at the store and not what really matters. gina: what do you think policymakers are looking at, perception or reality? >> every policymaker says they should look at the data. if you talk about political policymakers, they've got to figure out what is going on and convince the electorate to reelect some of the silliest commentary we get on the economy including on inflation.

it comes from congressional representative is because they are looking for the juiciest, least representative soundbite that helps their side the most. i worry that if you spend your time all day every day saying that biden inflation has caused the price of general to skyrocket that you might eventually believe it. i think i worry about those folks and their view on the economy. jay powell and the federal little more sophisticated. they are focusing on the real data with folks pouring over every line of the cpi and the pce and i think they are telling the correct story which is that inflation is moderating. there are good reasons to be optimistic in one of the most notable themes that has happened over the past year is that jay powell has started to talk about inflation in terms of supply shocks. that's an optimism that the supply shocks are behind us

which gives you reasons to feel optimistic that we have better times ahead of us. lisa: they talk about this being a supply shock that is behind us. how much are we starting to see the demand-side pickup especially with real wages turning positive in a more material way with how much inflation is coming in? >> what matters for inflation with is what's going on with nominal wages. nominal wage growth is feeling moderate, not for off what would normally be consistent with 2% inflation. now you have to have inflation plus productivity plus some catch up for real wages having not kept up for all of that time. i see every reason to feel optimistic. the big question you asked is is

this about supply or is it about demand? on the supply side, is it a bad supply shock exiting the system or maybe are we on the cusp is a -- of a positive supply shock? are we seeing productivity rice levels we haven't seen before? are we seeing the economy expand with generating inflation and that might be what's going on with immaculate disinflation. what because this positive supply shock? i've never seen a three year period in which i saw this many businesses reorganize what they did, reorganize the economy in fundamental level, everything from work from home to supply chains to global shipping routes. just maybe that has pushed back the frontier what's possible. i am optimistic that's possible but perhaps more interesting, i'm definitely hearing a sense from jay powell and the fed that they are starring to believe maybe this is what happened.

lisa: will you be shopping today? >> i've got a phone and a wish list so sure. lisa: good luck with all of that. we love having you on. thank you and have a wonderful holiday. he has the idea this is an increase in productivity that people are talk about on the margins you don't want to get confident about it. how much is generative ai the game changer and how is that transforming things in real times in ways we cannot fathom yet? gina: it's the next generation after the pandemic kicked off a whole adjustment in the business sector to a completely new reality and adjustment in terms of labor exposure and adjustment in terms of supply chains. it struck me that when we look inside the profit stream for the s&p 500, we should pay more

attention to productivity. margins gave us the clue we would see a pretty big dip in 2022 fact the economy seemed kind of fine. margins could be the really big story margins continue to improve which is a reflection of the major business practices. lisa: i'm wondering if people are more productive when they stay home. i hear a lot of executives saying come back to the office. coming up, fidelity international as we parse for the holiday rally and was to come after that. ♪

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lisa: we can see a bit of quiet across the board as people reset after a tremendous november rally, the biggest rally we've had all year. the s&p 500 is up more than 8% so far just this month. what a great year's been for november is what it seems like. that's what it feels like. this was a tremendous rally that nobody was expecting. gina: especially after the floor appeared to fall out for the s&p 500 and the russell 2000. we were looking at breaking through pretty critical resistance levels. you call this a technical hoops

because we rallied right back up , proving the resistance levels at new support. this is fascinating to see how rapidly things turned around. lisa: we could have been looking at a different projection as to what to expect next year. november really helped. gina: it's -- it puts these equity strategists in quite a position. it was my former life were suddenly the prices surged to the 2021 price target at the end of the year because you get a seasonal left and it creates a good outlook for next year. lisa: what do you do with that? gina: most of us have some degree of fundamental models. you migrate with the data and it is proving to be the case for the optimism, then so be it but it was a technical correction and people are jumping on board, it's sentiment base. you got to balance the risk of

sentiment versus what's truly happening with fundamentals. lisa: fundamentals are driven by consumer spending which is why black friday is taking on a particular importance this season. caroline hyde was speaking to her guest in new york city in herald square and start of a asking him about today's kickoff to the holiday shopping season. >> we've got great deals as we always do for black friday through the holiday season. we are ready we have our key items and we are we are in herald square as a good opening and we had a great day online yesterday during thanksgiving. caroline: you said your earnings, it gets earlier and earlier. how important are the next few days and the run-up to the holidays? >> it's still very important. black friday deals but they started right after halloween. america is traveling and they

are in homes and coming it to stores like this one today. they've been online all the way through. when we look at black through cyber week, it's 10 days were people reset in the last 10 days become increasingly important. it's one of the three stages of christmas shopping. caroline: your earnings showed is that it's about management in many ways. how can you ensure you have the right thing at the right time for a consumer that we are trying to understand now. >> the consumer is under pressure but they still love gifts so we want to make sure we have the right gifts. i just walked in this entire store to understand where we are in the content across our categories and we are in great shape. to the work we've been putting into inventory control. caroline: when it comes to online versus in-store, you've been shifting the company.

e-commerce has been the focus. how are your managing to be at the right time and the right place. >> the strength of macy's in bloomingdale's, you have customers shopping online and they want to commit to a store and try it on and maybe have a transaction on the cow later that night. it's convenient to make it that way for the customer. doing that with a national footprint and a great website is what we depend on. caroline: you have bloomingdale's for the higher end purchaser and more income breadth when it comes to macy's. what are we seeing in terms of the consumer? will they be spending more pulling back? >> consumers are under pressure so when you think about inflation still being high in the inflation rate is changing and customers have a limited

budget. we want to make sure we got the right price points across the entire spectrum. you still give gifts. when you have someone on your gift list, we will have the right content at the right price point. we do trial runs on valentine's day and mother's day to make sure we have the right gifts. lisa: that was caroline hyde with the macy's ceo. it raise the question of how people can be so pessimistic. they are arguing that people will keep spending. delinquency has been rising and the pullback around the margins. it's been negative from the likes of walmart so how do you put it together?

you are calling for a cyclical recession next year. what is that in light of the fact that customers are spending and are likely to continue? >> cyclical recession is were growth slows down but relatively modestly. we expect two or three quarters of negative growth which is a recession. it's not a very deep recession but nevertheless, a slowdown across the board. the tightening we have seen from the fed is still working its way through the system. we believe the transmission mechanism is delayed and we are close to the tipping point where we are starting to see more forceful transmission across the board. consumers in the corporate center specifically in the u.s.,

we think cyclical recession is the story for next year. gina: can you talk about how the cyclical recession is comprised? when you say across the board, are you looking at declines in consumption and fiscal investment and business investment? what is the composition of the deceleration it is relatively light? where are the bigger and lesser risks? >> on the external side, it depends on the cycle a lot depends on china and emerging markets in general. domestically, we expect a slowdown in consumer spending and also support on the fiscal side will be much less then we've seen this year. it's across the board but there is a particular weakness in the corporate sector.

the debt burden is high on the maturity walls are high. the financing burden might lead or will lead to that weakness across the board incorporates. gina: would you see that to be an international trend? developed markets have weak times ahead when it comes to refinancing. is that also the case within emerging markets? >> in europe, this maturity is much higher and steeper than in the u.s.. europe is already approaching a recession in germany is probably in a recession now. this is where we have seen forceful transmission across the board. the u.s. will follow to some

extent that pattern but later in 2024. on the other hand, we think some emerging markets can still do relatively well in the environment shows resilience. a lot depends on the china cycle and what we will see there. lisa: do you think the u.s. is the cleanest shirt and a dirty laundry basket? >> as far as opportunities, yeah, the global cycle has diverged to some extent and is not been very in sync this year. europe is already going into recession and the u.k. is probably there already in the u.s. is still a few months away.

china is stabilizing. we see stabilization in our base case is what controls stabilization. lisa: thank you so much. we appreciate you taking time and have a wonderful weekend. we are looking at these diverging fates of the different countries which i find fascinating. some people were expecting europe to outperform the u.s. and come out of this earlier. now it seems people aren't sure what to make of what. i'm not feeling any cohesion in the story. gina: back in the days when we used the word global synchronization, those are gone. those words are over and we are

in a different environment especially because what happened in 2022 when china shut down and the rest of the world started emerging. i think that's creating a lot of differentials in the cyclical story and there's differentials for that more tech exposed economies. they generally benefit from the ai and capex wave. you've got commodity producers of the world which is probably been the biggest undercover story. commodity producers had a bang up growth year in 2022 but a real struggle this year and that's a big fundamental shift when you look at underlying corporate earnings. lisa: you said that china might outperform in a more material way. this might be the biggest surprise of next year because of how underestimated it is. where will the signs come from, consumer spending or businesses reemerging and coming back into china? gina: this is my pain trade.

i think the pain trade of next year is probably upside out of china because expectations are incredibly low. it comes in a couple of different things starting to work together. the first was signaled this week when president biden and president xi are actually talking into have talks emerged between the u.s. and china and positive potential talks for the first time since 2018 is a huge potential benefit we need to watch carefully. any resolution of geopolitical tension is important. we have to overcome the tech hurdle.there's a great desire of both countries to be the leaders in tech so how will that resolve itself? thirdly, the idea that china may start to support its property sector and may produce some domestic stimulus over the course of next year is something to watch as well to reverse the psychology. lisa: if you are just joining

the program, it's not a negative drag on the market ahead of the open but not much of anything. everyone is still in bed. yields are up about seven basis points, grinding higher throughout the morning. that will be the story is how much we will see the glut of issuance that germany and the u.s. and the rest of the world is being forced to issue including china. they were deleveraging and they will have to reverse that. how much does that create a sticking point and a headwind that leads to these higher yields? gina: and ultimately how much does it delay or restrain the potential growth on the part of the corporate sector? you think about fiscal governments thinking about how they find their debt is we might

have tax increases across the board and a reversal in tax. tax expenses accelerate for corporate's. we will have to fund this somehow and how much will get funded out of the private sector? lisa: we will talk about the inflation of the point you might turn a different companies. it's basically use your points now because they will be worth less later. i will check that with brian kelly founder of the points guy next. ♪

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especially in the north atlantic and the caribbean and mexico as well. there were three -- those are the three of the biggest markets where we see declines. lisa: the focus on the airline industry and wonderful to hear about that. we will speak more about the travel plans. it's been an active travel season for this holiday. i want to go over a couple of stocks that are moving that are pretty interesting including the maker of the rumba device. it can suck up all of the test, up 30%. reuters is reporting that amazon is set to win eu antitrust approval for its acquisition of this company which raises the question -- jonathan says i don't want that thing tracking all my data. what is it exactly collecting as it collects dust? gina: if he has alexa he's

already doing this. it's hard to say but it's a little bit freaky. when you speak about an issue, you get emails about that issue on your telephone maybe we haven't given permission for this to happen. this is just another aspect of the tech companies taking over our lives. lisa: the concept of that data will be fascinating in the application of artificial intelligence but as the hardware that's captured everyone's attention. nvidia shares are down 1.6% after skyrocketing this year after reuters reported it told customers in china is delaying the launch of a new artificial intelligence chip into the third quarter. it's interesting that it's down and people are shrugging and saying we can take profits for the moment into the holiday. this is an exciting conversation because if you don't spend your

points now, you could lose them. we've been point savers when it comes to airlines and hotels. brian kelly is here to explain why it's a terrible idea to do what i've done so long. let's talk about points inflation. how real is it? >> you are not a points saver, you are a points order and many americans are. when it comes time to redeem them, it looks nice to have a lot of points. use your points. the airlines have officially become banks. many thanks are selling their miles to credit card companies. that means there's more miles an ecosystem in the amount of miles it takes to travel israel. southwest airlines just announced their points will be worth less when you redeem them. use your points now and take the

cold hard cash you would've spent on travel and put it towards other things. lisa: i feel like i have to be in points porter anonymous. how much are you seeing companies offering perks. people have traveled all they want and they are pulling back a little bit. >> this is good news for consumers because for the last three years, it was bad news. airfare was raising 20% month over month. we thought six or 7% inflation was bad. we are finally seeing a reprieve in those ads and airlines are getting hit the worst. there is still huge demand for international. international airfares are through the roof. his to mystically where people

are having trouble and we are seeing $111 fares to puerto rico this winter. a little -- $69 to go to miami. it's one of the top places to go. there are good deals out there for consumers now. gina: can you talk beyond airlines? where are you seeing the greatest points of deflation? is it car points and points for car rentals? are there differences between those sectors? >> car programs are pretty useless. there is only one or two big players. car-rental companies it's about the person getting elite status. if you have a platinum card, you may get elite status, national or hurts. that's where i would say looking

with car-rental companies, it's about recognition and not waiting in that line but the points are meaningless. hotels are pretty valuable. the hyatt has a great program. they are a transfer partner of chase. you can easily get two or 3% of value. my ketek when it comes to loyalty is don't be loyal to a hotel or an airline, be -- be loyal to a credit card. you can a croix -- accrue points in amex and then you transfer them to different partners on this allows you to not just be with one airline or committee gives you other option. the amazon credit card gives you credits to spend at amazon or other credit card companies that give you points to spend at

retail. how should we approach those point systems? >> if you want cash fact, i removed -- i recommend getting a straight cash back card. citibank gives 2% with no annual fee and that's the gold standard. instead of getting with one retailer might have wonky earnings. the amazon card is pretty good but instead of banking with one retailer, get an overall cash back card that gives you flexibility. if you get cold, hard, cash, you can use it. lisa: why should a delta or united or american try to cater to their loyal clients if this is the business model? is it about them being a loyalty arm tied to a credit card company? >> you might only fly a couple of times a year but you using your credit card every single day.

delta in their recent earnings said 1% of total gdp spent in americas on it delta card. even that in frequent traveler, delta is earning money when you go to the grocery store or pay for your expenses. it's a brilliant business model to bring people in and give them these points and encourage them to fly on the airline. while there has been a devaluation currencies, you can also earn more miles. the u.s. in particular, you can get 100,000 points sign up bonuses earning five times in certain categories and not all is lost. you have to play the game correctly and use the credit cards where you spend the most money. lisa: what is the most extravagant trip you've ever taken using only points? >> i do love emirates first class. it's an iconic experience and i took my parents on and around

the world trip. they've got a big onboard bar. my dad and i were drinking $300 scotch. we flew over the himalayas and it was $200 out-of-pocket. we were getting it for cheaper than coach and that's why i love points. lisa: brian, thank you so much for being with us. gina: amazing. lisa: how much time do you have to devote how to gain on all the programs? gina: david's your business, you have the time. what a great business. lisa: thank you for being with us today. gina: i am grateful to you and i give thanks. it's been a delight this morning. lisa: what will you do for the rest of the year? gina: we actually run our own recession model says the u.s.

economy is very weak already. i am looking for signs that things potentially stabilized into next year and we recover. this is partially a function of the fact that i'm internal option is and i'm an equity strategist and equities tend to move first. i'm looking for signs of a bottom forming in the economy as a result of this decelerating inflation pressure. we will see what happens. lisa: thank you so much. coming up on bloomberg television at 1 p.m. eastern, the president and ceo of tanker factory -- of tanager factory outlets. we will see if of the good news story for people looking for discounts or caution into the remainder of 2023. it is a quiet day with people taking up -- it is a quiescent day after people taking a breather after a breather after couple of weeks. ♪

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lisa: i am lisa abramowicz in for jonathan ferro looking at a quite markets. the countdown to the open starts now. >> everything you need to get set for the start of u.s. trading, this is "bloomberg the open" with jonathan ferro. loose up: -- lisa: stocks on track for a fourth consecutive week of gains and retailers