and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything. >> this time on the timeline, it's a great time for investors in equities. >> i would belong treasuries between now and the end of next year with a nod to the fact that it will be a choppy ride. >> what is concerning about last month is there is a massive risk on rally with weaker economic data. >> we are seeing things trickle into the economy that will make the economy fall into next year. >> it is important to remain invested even in times of uncertainty. >> this is bloomberg surveillance with tom keene, jonathan ferro, and lisa abramowicz.

jonathan: good morning, good morning. this is bloomberg surveillance on tv and radio alongside tom and lisa abramowicz, i am jon ferro. i major move again in the bond markets. t.k., treasuries advance, yields lower. tom: is that something? it was important to see the differentials of governors and presidents, but it was a real jump condition. the first thing that i looked at this morning was different technical constructions of the market. i didn't realize how much we had surged higher. katie kaminski yesterday nailed it. we could go higher in yield because technically we really haven't rolled over yet. you look at katie kaminski yield and the fancy phrase technical support, we are getting near the tip point where we decide lower yield or higher. jonathan: let's go through the

numbers. we went through 5% and we are down to 4.2 nine down three basis points in the treasury market. this is a change. super hawkish, now he's basically suggesting to the market that he is done and then some. something appears to be giving and it is the pace of the economy. lisa: if we see disinflation continue for several more months you could then start to lower the policy rate just because inflation is lower. he is saying the unspoken words the fed did not want to entertain, entertaining and discussing rate cuts at a time you're seeing a robust u.s. economy. tom: david rubenstein more on that in the coming days. he went to the real yield moments ago. 2.07 right now on the 10-year. can you imagine a 1.9 nine real yield and what that means for the likes of professor waller? jonathan: let's see if he endorses some of the language

governor waller used, intriguingly the two-year point that we ignored. governor bowman saying something different focusing on governor waller. lisa: it tells people are focused on disinflation, focused on figuring out how soon they can declare victory for the federal reserve, that they achieve their soft landing, fueling the feeling that everyone got it wrong. they were able to achieve a soft landing this year, maybe, if we did. maybe lean into that for next year. does that tell you more about sentiment than the actuality on the ground? jonathan: retail spending in america, record shopping black friday into cyber monday going into the holiday season. what matters more? how much the consumer in america is spending or how they are spending? by now, pay later. this from the journal. a 43% surge from last year according to adobe in by now -- buy now pay later options.

lisa: i saw the 14% surge in terms of cyber monday. how much of this is younger individuals who feel disenfranchised or do not want to participate in credit cards? another aspect is you see something come you like it, you buy it, you don't think about how to pay for it over the longer-term, and how much it fuels the ability to keep spending even beyond someone's means. tom: if you look at a refrigerator are you going to do buy now, pay later on the refrigerator? jonathan: do we pay cash? lisa: we pay cash. jonathan: we pay cash. tom: the calvinist theory with lisa abramowicz. jonathan: lots of people did not. they reached for buy now, pay later options. from the journal saying that sellers using square enough to pay platforms with 17 million transactions over black friday cyber monday weekend, up 14% from the previous year reporting

a 19% increase in buy now, pay later purchases made through after pay. you have data from adobe backing up the same story. there's a lot of reaching going on. tom: a digital space, a digital future of banking, meetings today about what to do. the death of credit cards know that people are revolting against 26% and 28%. jonathan: here are the scores. equity markets look like this on the s&p 500, posited by 0.3 percent. yields lower on the 10 year, 4.2936. the middle of october, for what it's worth, we were looking at 5.25. we are down to the 4.60's. lisa: to see the benchmark fall by a percentage point in the space of weeks is quite shocking. this is perhaps why the story of disinflation or mystery of disinflation, how far we are in

that process at 8:00 a.m. we get the latest read in europe. germans headline cpi price inflation will come out and this will feed into tomorrow's read in the rest of the euro region. how much are we seeing this in a way that is sustainable? we got spain's cpi that came in lower than expected but 3.2% above expectation. at 1:45 p.m. yesterday i was dismissive about fed speak and how much they can move the market and i was wrong. i want to say that because chris waller moved the market. do people pay attention to the cleveland president speaking about financial stability? she says kind of the point that we saw yesterday. jonathan: apparently they say what we want to hear that seems to be the take away for me yesterday. lisa: that seems to be how much people are going to look at anecdotes highlighting the slow down the we heard from the walmart ceo, which has been the

reason may be that we've seen the u.s. economic surprise index fall to the lowest level since last april of this year. i'm going to keep talking. jonathan: [laughter] tom: victory lap, seven-year auction, you did it again. lisa: it wasn't that good and no one cared. tom: it spiked up, the world is coming to an end, and it came back down to where it was before. why? lisa: a failed auction did not fit the narrative of the day. jonathan: i am with bramo on this. governor bowman says one thing, open to more hikes base case if we need them, and governor wallace saying we are done. we are putting more weight on one voice than the other. it is a shift for more rework 12 months ago, but there are still voices out there pushing for something different. tom: this is with great respect to mrs. bowman, people have immense respect for mr. waller, academic respect.

if he walks into a room people take notes. jonathan: tell us what you really think. we will have this conversation a little later. joining us as the global chief investment strategist at deutsche bank private bank. christian, the holiday spending in america, what matters more? how much consumers are spending or how they are spending? christian: timing wise, short-term how much, which is positive. but then you have to pay the bill. we are talking buy now, pay later. as we see high for longer the bill is higher for the consumer than some people might think. from that perspective it is something to be watched. tom: in your view forward note come you have a magnificent phrase which sums up the angst of the moment. you are in search of 10% growth. how do we find 10% growth next year? christian: i would say, in general, we are in search for

growth because we do expect economies to grow at slightly below 1%. that is true for europe and the u.s.. you see higher growth rates in china and india. you have sectors where it is more than 10% growth on single companies. they should do well in this environment. you have seen sectors where this is continuously the case. the environment we see for next year, that should give us decent performance. lisa: your outlook calls for 170 five basis points a fed rate cuts next year. it talks about have a look like something harder than a soft landing and yet there is this optimism around equities. this is confusing. how do you put these together? christian: the outlook comes to 175 rate cuts in case of a severe recession. you have to also look at the other side. if there is no severe recession a mild recession you would say three counts from the fed and the ecb from our point of view.

it could be more volatile in the beginning of the year and then it should come down. if you think about volatility, bond volatility is still higher than equity volatility. equity volatility is priced for a soft landing so everything that gives us concerns on growth will increase equity volatility. that could happen at the beginning of the year, but should calm in the second half. lisa: who is right? that we are seeing the massive deceleration in the consumer, the fact that we heard from walmart and target, that you see the economic index rolling over to such a degree, versus the perennial spending that keeps happening that john was talking about, versus consumer sentiment that we saw yesterday tick up higher than people expected? how do you put these ideas together? christian: it is the timing. there are still consumers who want to spend, but if you hear more that the economy is slowing

down, and we haven't heard much to be honest, then the consumer will lower expectations and react to this. that is the picture we have for the beginning of next year. lower growth in the u.s., not only there, by the way, and that should impact the consumer. tom: from across the pond, is there pressure to own america? how do you do it? how do you affect a policy to buy america? christian: if you look at performance in recent years, potential growth rates, there is no way not to own america, right? if you look in europe at potential growth rates, it is substantially lower than the u.s. i would be surprised if you see a decoupling of europe from the u.s. there is a lot of discussion about valuations in europe that look very cheap compared to the u.s., but i think that it needs to find a trigger that people look into europe. for the time being, it is about owning the u.s., and i have not

seen the trigger to move to europe at this time. jonathan: there seems to be a radical difference in the transmission of monetary policy in the united states versus europe. i was looking at the credit data in europe. how challenging are things in the european economy right now? christian: if you look at the growth perspective, literally in the same number for europe and the u.s., the potential growth rate is stronger in the u.s. if you look at the combination of indices, s&p, much more on the growth side towards the s&p, more on the value side, more export-oriented. it is a different composition of growth. in terms of china getting stronger, that would be positive for europe in terms of lower yields. rather positive for growth. that is rather positive for the u.s. jonathan: thank you. the outlook on the united states versus europe. u.s. exceptionalism and the markets has been a major thing

for all of the hopes and dreams of international outperforming. luxury in europe faded pretty quickly. here we all that here we are talking about the magnificent seven at the end of the year. lisa: the one takeaway is the story of artificial intelligence with people building on it in terms of its application and potential productivity gains. if that is the case, people lost interest in the luxury story, lost interest in the mining story because china underperformed. i am waiting for people to lose interest in the ozempic story because it is overplayed. jonathan: i refuse because i love this story. the pillar of the economy in america is built on obesity. when you look at maybe pushing 40% of the population being obese, think of the changes off of the back of the drug. the number one killer in this country i believe his heart disease. imagine if you change that.

if you can do more about addiction beyond obesity, gambling, all kinds of things. again and again. i think that it could be huge. tom: i believe it is rather expensive? who is going to pay for it? lisa: my question is the side effects, number one. number two, who will pay for it? number three, sustainability over a longer time, but you are right, it is potentially transformative. jonathan: it is not personal. it is not personal. equities on the s&p positive. from new york, good morning. ♪

>> we will be talking about the crisis in gaza and the broader middle east. we are pleased to see hostages returning home, coming back to

be with their loved ones. we are hoping to continue that for as long as possible and bring as many people home as we possibly can. jonathan: u.s. secretary of state antony blinken speaking earlier today as he attends a two day nato meeting. set to make stops in israel, the west bank, and uae in coming days. good morning. the s&p 500, we are positive by one third of 1%. yields are lower again. it is a break of four point 30, 4.28 59. a month or so ago through 5% on the 10-year and a conversation about six, maybe seven. never ending bond market selloff, and here we are, crash landed. lisa: we heard 8% as a theoretical number and that was not unreasonable. we are looking at a situation where people have whipped down to disinflation and buying in.

is this the final move or the latest episode in a dramatic whipsawing year? you have andrew hallman horse talking about underpinning inflation next year. tom: the derivative guys, all of the various views have told me that they are looking at collared trades. no one is calling a direction. they are saying this is the set up to go to lower yields and higher yields. it was stark yesterday between katie kaminski looking for higher yields versus many others looking for a trend below 4.30. jonathan: what is the low trend growth? we get rate cuts and we will see much damage to labor market? tom: i don't know what the consensus bet is. the bet is to hang on every data point. lisa: it doesn't matter what your academic outlook. jonathan: looking at some of the

calls. it takes a while to perform some of the consensus. we were talking about that earlier this week. it feels like consensus has coalesced around the view that low trend growth but no recession, rate cuts are coming, and ultimately it doesn't matter if you get the recession, stocks are all right. 100 percent. 4700, five k, 51, something like that. tom: i'm less focused on recession and more on what nominal gdp will do. that has inflation and the real gdp part. i think the point is wildly open to review and that is stated dependency that we've got. we also have data dependency looking at the politics of the nation. joining us is the chief u.s. policy strategist at agf investments. i have eight ways to go with the different narratives out there. we start as we saw the secretary of state doing what henry kissinger used to do. do the republicans have a foreign policy? >> they are very divided on

foreign policy, as nikki haley and others have shown between the hawks and people that are more isolationist. the good news is that we have established lines of communication between israel and some persian gulf countries with the u.s. and others being intermediaries. the bad news is, and this is getting worse by the day, i'm not sure about aid to israel and ukraine. that is starting to slow down and congress. tom: nikki haley has a lot of effort here. she is the 29th u.s. ambassador to the united nations. how foreign is nikki haley to republicans? greg: to many republicans she is viewed as a non-preferable candidate. what strikes me is that young, conservative republicans are in different to aid to israel or ukraine. i think that it's a great mistake and i worry a lot about

iran, i worry in terms of ukraine that putin could start thinking about lithuania, estonia, latvia, other places to invade. this is a real threat, but i sense that isolationism is growing in popularity in the u.s. lisa: there was a poll that came out written in a washington journal article yesterday showing nearly half of americans ages 18-24 think that hamas' october attack was justified by grievances by the palestinians and how they are looking forward to not only a cease-fire but feel like there's a tit-for-tat. only 9% of people 65 and older feel the same. how much of it is the divide of generations wider than the past? greg: it is a big deal. it is not only on this issue, it is on guns, it is on wider immigration, wide range of issues. for the white house, it is astonishing to see that among that young group that you cited,

biden trails slightly. he won that group 20 points in the last election. if it is tied, he loses. lisa: how much of it is something that he wants to cater to versus just shrugging and saying that they aren't going to show up anyway? how much of it is individuals in the country versus those being active on college campuses and social media but feel marginalized in the political sphere? greg: the marginalized people, it is a puzzle that the white house cannot solve. the marginalized people think that the economy is terrible. i would disagree. again, it poses a real threat to biden's reelection. tom: the news over the weekend and the thundering silence in the gop in the senate about their candidate going after something that's 13 years old, the obama care act. the divide between president trump's desire is second time around versus his team.

i believe that i've never seen that. greg: it was a remarkable development. in sports we talk about unforced errors. this was an unforced error. i think the trump is a loose cannon on a lot of issues. a lot of veteran members of congress were like, what? he wants to reopen obamacare? it is settled. the public likes it, it pulls well, there is no alternative. yet trump wants to raise the issue. it would be disastrous. tom: what does the first 100 days of a trump administration look like? greg: vengeance. i'm not even sure what his agenda is. tom: greg is freezing. greg: he wants to get back at people who slighted him. he wants a -- that is going to be the biggest concern. jonathan: we have to leave it there. apologies about the technical problems at the end of the conversation. i was slightly distracted.

sometimes the title of southside research catches your eye. this is from the fx team at wells fargo. goldilocks and the five bears. race case, weaker dollar into next year. we caution against extrapolating out against the dollar's weakness too far into 2024. a realization of the broader global slowdown could take place in the first half of next year and the prospect of rate cuts, lingering china weakness, rising geopolitical risks, and a drum roll for the fifth one, heavy 2024 election calendar. next year is a big year. tom: but the election calendar, jon is talking about global elections. the many elections worldwide. we stagger from one to the other to the next. you take the imf gloom and where global gdp, all kinds of bad things happen with sub 3% global gdp.

what do you do? you buy the dollar. maybe it is dollar resiliency pushing against the consensus. lisa: maybe the five bears is why there is very little consensus. is that why we are seeing people come out with varying prognostications about the economic outlook but the same one when it comes to amazon, apple, google, openai, microsoft. jonathan: sam altman. we have not mentioned them altman for five minutes. openai. lisa: this is the story. we heard yesterday about how this will really fuel bank earnings with some of the efficiencies. tom: i think that charlie monger was right on ai. their world clearly be some winners but can you imagine the number of losers who go into the concept of ai without the intellectual authority that we are seeing out of microsoft? what we can establish is a trend for next year that if you have five bears at wells fargo we know where the sixth is. there is no question.

bramo is the sixth bear. lisa: show up at the holiday parties? i will tell you my scenario. jonathan:jonathan: they are thinking that they will have nice drinks, some canapes for the holidays, talk about christmas, and bramo shows up. let me tell you about your call for next year. t.k., you mentioned charlie monger. the late great investor partner to warren buffett. we will spend time in tribute to the man himself. tom: i am honored. jonathan: a big conversation on bloomberg surveillance. ♪

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jonathan: actual quote from bramo in the commercial break, i will be happier this segment. lisa: the context. jonathan: equities -- tom: you will see us on the break. jonathan: a camera on bramo during the commercial break with audio. tom: she ignores us. jonathan: the nasdaq 100 up zero point 4%. yesterday the stock market pushing out a small day of gains. stalling out, recently, over the last day or so. lisa: really, i think there is a

little more recognition that bad news is not necessarily unmitigated good news. there is a concern about what sort of slowdown could percolate. jonathan: still on course for the best month of the year in the nasdaq, quite phenomenal. let's sit on the two-year. the front end of the curve. mid to late october, 5.26. down another four basis points. this bond market yesterday choosing to listen to governor walter more than governor bowman. tom: i think 4.4. the addition of equity markets up, up, up since halloween is the basic idea that we have stasis. have we rolled over? i don't see any violation of moving averages here. we are waiting for the next news. jonathan: you have been telling clients for a while, one more streak, lock it in.

they're worried about their reinvestment risk a year from now. u.s. t-bills at mayview sit here 12 months later, will you be happy that you have dry powder or disappointed that you didn't go further in the curve and lock in the sealed? wen yu -- this yield? all of a sudden the attitude starts the change. under 30 basis points from having a conversation about the freeze, and then people feel like they missed out locking in five for a longer and this feeds on itself. in either direction, anytime you have a 50 basis point move in one direction to the other. lisa: are we going to see next 4% or will this be the trade that peter scheer was talking about, 4.25 to 4.75 and bouncing around us people's mood shifts based on the data, the wind, at the bears.

jonathan: the conversation changes drastically from one basis point move to the next. if you watch people in fixed income, do you think the next 50 basis points is lower or higher? if you give them a 12 month of you, lower yields. -- 12-month view, lower yields. tactical call on this market? tom: the momentum is there in seven stocks. you have others that maybe aren't there. what mr. monger would say, mr. buffett this morning, the use of cash matters. that is may be how you get 10% growth. jonathan: charlie monger, the man who build berkshire hathaway alongside warren buffett has died. buffett pay tribute saying that the company could not have been built to its present status without charles' inspiration, wisdom, and participation. he was one of its biggest shareholders. he was 99. tom: 99. a long, wonderful life.

i said this to nathan hager in the last hour. the singular feature, and i was a young kid, was the shock of 73, 74. he was formed by big double-digit negative losses. what i called the pittsburgh recession is when pittsburgh evaporated. in 73-70 four he lost a lot of money and that framed his humility moving forward. lisa: he also had great wit. one of my favorite quotes i was reading yesterday, around 2016 an acquaintance asked which person in a long life he felt most grateful to. my second wife's first husband. i had the love of this woman by being a somewhat less awful husband than he was. isn't that one of the best things? jonathan: can you give us your official view of the situation? lisa: i love that quote.

to mean, the love stories behind some of these figures, the 60, 80 years that we talk about, is notable to me. tom: the zip code is omaha. i was stuck in the omaha bus station a million years ago. omaha is not manhattan. to mean, that is a huge advantage. you put your pants on one leg at a time. a lot of people in manhattan don't do that. jonathan: it will be a tribute to charlie monger throughout this morning. howard marks is joining us at about 8:00 a.m. eastern time.the second, talks underway to extend the truce between israel and hamas as the deal in terry dittes final 24 hours among accusations from both sides that the truce was violated yesterday. hamas releasing 12 more hostages. secretary blinken schedule to arrive in israel tomorrow. the framework for truce in the last 24 hours, accusations from both sides, yet it is still a truce that holds. what you take away from that?

lisa: there are reasons on both sides that people want the temporary cease-fire to take place, but there's no reason why either side wants to see the conflict end entirely. right now israel is under incredible pressure to bring the hostages home and hamas needs to read -- reboot and regroup . the cease-fire will benefit, arguably, hamas more than israel at this point barring getting the hostages home. after that the goals have not changed. the animosity, if anything, is even larger. how will we resolve this? tom: we won't. experts will go back to 1948 or before. to your point, i thought you were good on this in the last couple of days, the day by day cease-fire, even with certain violations here and there, has to have a cumulative benefit to all. but then, it ends. i have no idea how close we are to that. jonathan: let's see when it ends and if it is extended.

turning to the big story of the last 24 hours in this market, the fed rate cut debate. fed rate cuts could, soon as the first quarter of next year according to bill ackman. >> there is a risk of a hard landing if the fed does not start cutting rates soon. the market expects sometime in the middle of next year. more likely as early as q1. jonathan: the full conversation on peer-to-peer conversations with david rubenstein on december 6 on bloomberg tv. i understand what bill is saying, lisa. if you are worried about the cumulative timing, if you want to time this perfectly, which i think is near impossible but you understand the reasoning why you want to start easing earlier than in the past that the federal reserve is willing to engage in this particular conversation. lisa: agreed which is what the market is feeding into as well.

bill ackman got a ton of kudos saying that he was shorting bonds in september. how much is he calibrating the emotional moods of the market right now? tom: we need to find someone who can perfectly calibrate. that is eric nelson joining us, particularly on foreign exchange. perfectly calibrate dollar trajectory for next year. do you have a clue? eric: we are coming into the year and there's a lot of hope and consensus for continued dollar weakness throughout the balance of 2024. we are happy to play for that in the next one to two months. we are seeing a positioning that is quite long dollars the fed becoming more comfortable with rates where they are. maybe even shifting towards an eventual pivot. the question for us is if we are going to end up in a broad-based global slowdown by q1, q2, including the u.s., is that an environment you want to be short

dollars? history says probably not. you want to be careful. relative value opportunity shying away from the dollar in 2020 four may be the best course of action. jonathan: your outlook put out 10 minutes ago that i shared on air on bloomberg tv and radio, goldilocks and the five bears. can you tell us what the five bears are? erik: a couple of things to keep in mind. one of the big ones is growth. a couple of other things to keep in mind. one of the big things is the election calendar. broad-based rate cuts across the g10. i think those are the big ones to focus on as we get into 2024. the question from me is at what point do these bears rear their head? we are looking at next week's u.s. jobs report. that's the big one and will tell

us, are we going to see an earlier turn to global slowdown risks or another 100 80,000, two hundred thousand number and push out the rate cut outlook? that is where the near-term risk is for all of these outlooks, including our own. jonathan: how is it that binary going into year end? erik: we have seen a big move in positioning. you look at the move in rates and fx. yes, there is probably more room to go if you have a situation where it becomes clear. look at wilder's speech yesterday. he acknowledged that the pace of job growth is still ok. we have seen unemployment rise but initial jobless claims have not moved that much higher. the extreme moves up and down in rates and fx would suggest that there is room in a low liquidity market to see wild swings. lisa: how much do call with conviction to buy the dollar versus simply do not write it

off, that it won't be a clean trade no matter what you do? erik: the clarify, i think that were not at a point yet where you want to be long dollar. i think that the next one to two months our base case is continued slow down. inflation stays low enough to give the fed comfort to keep rates where they are, maybe hint at eventual easing. yeah, as you get into the crystallization of some of these growth risks, especially verse in some of the higher risk currencies, that is where you can look at tactically outright buying the dollar versus some of the more sensitive pairs. lisa: is there a sense that some of the strength in the u.s. can continue even if there is a rate cutting cycle next year, even if it starts in the first quarter as we heard bill ackman predict? that the u.s. will be cutting rates less in 2024 then europe? erik: i'm glad that you brought this up, because in most normal times, non-recessionary times,

ethics is about rate differentials -- fx is about rate differentials. that relationship can break down. look no further than march 20 when you saw rate spreads and the dollar moving in different directions. even though the fed is probably going to cut rates more than the ecb given the starting points, real rates, etc., it won't be euro-dollar positive. at the end of the day we will see more consolidation once the recession risks are personalized. jonathan: congratulations on finally getting the outlook published this morning. i know that it's tough sometimes. it is difficult to get everyone to agree. tom: some houses want that, but other houses like morgan stanley is very fractious. jonathan: more division. they need to turn to gm. the stock is basically what it was 10 years ago. the multiple is about four times less than forward earnings.

the market cap is less than 40 billion and they are trying to do something about it this morning. the stock is up by 5.4% so we have a height to the dividend buying back 10 billion dollars in stock, spending less on the robotaxi unit as well. a lot of pressure on mary barra. tom: it is a lot of pressure on mary barra and more than that this is a bombshell for every cfo. there are 490 three cfos that will go over this with a fine tooth comb. it is so important on tv and radio, if you look at the magnificent seven, it is 72% debt. apple is 4%. this is a use of cash announcement like you would see from the magnificent seven. jonathan: we seem to be trading on the cut to investment and things like robotaxis seem to be moving higher off of the back of the capital return program.

restate guidance and to get hands around the new guidance, net income will be between 9.1 billion and 9.7 billion. the previous going into the strikes 10.7. during the strike they had to withdraw the guidance. the new guidance is a touch lower. what you make of this? lisa: $2 billion in fixed cost reduction, to me the question is the cuts and how much this paves the way forward for others facing similar income constraints. jonathan: may be more cuts at the same company further down the road. coming up shortly, from new york city this morning, good morning. ♪ get heeaching your goals with j.p. morgan wealth plan, a digital money coach in the chase mobile® app. use it to set and track your goals, big and small... and see how changes you make today... could help put them within reach. from your first big move to retiring poolside -

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>> we are now starting to see lots of different things trickle into the economy, which will maybe make the economy follow next year. what is interesting next year in

fx's north america is the center of the slow down. asia is the center of the recovery. europe sits somewhere in the middle. jonathan: that was the global head of global and ethic strategies at td securities. the call to the slowdown was in the u.s., the opera performance would be in asia delivered by what was happening in china reopening. and then what eventually materialized was that the u.s. outperformed china massively underperformed. the call going into next year is for asian to be the center of the recovery and america the center of the slowdown, which is like the 2023 outlook on repeat. lisa: putting much everything about this has been the 2023 outlook on repeat. it was basically slow down, delayed, deferred, the disinflation accelerating, the transitional kinds of inflation, it is transitory.

reinstated, essentially. people are saying that it will be a weak first half but the second half will be good fueled by rate cuts and the sense that we have entered the new era. jonathan: but would you do if the fed turns around and says that it was all transitory. it was transitory, basically tries to give themselves a nod to what they said two years ago? lisa: they're not going to do that. jonathan: some kind of weird victory. lisa: tarred and feathered, it's not going to be them. they are not going to try to claim victory. they will be quiet about it. but you will hear, we have achieved a soft landing. you will hear other words, but you won't hear the t-word. jonathan: cross s8 yields down again by three or four basis points -- cross asset yields down again by three or four basis points. general motors up in the premarket nicely by 5%. $30.35 in the premarket.

we will be catching up with mary barra later this morning. i will be interviewing her at about 9:30 eastern time. the news this morning as the hike in the dividend, 10 million dollar buyback, and lisa mentioned the cuts, reducing investment in the robotaxi unit. reinstating guidance slightly lower than the previous guidance but a big capital return program may be giving us some cheers. cuts to spending. tom: the real economy, this is the first big announcement at 2024. how many other company has are going to come out with attitude adjustments like this? the summation of this is 1, 2, three different ideas. the basic idea is that this was pounded through to be a new gm, right or wrong is not my opinion. i'm not qualified to have the view, but how many other companies like lemmings off of the cliff are going to say we need to act? jonathan: the bar was low. t.k., you have been covering

this longer than i have. trading four times forward earnings. tom: i was on rochester carburetor and i've never owned auto stocks. maybe it is my childhood, but it has been a train wreck for so long. my colleague at citigroup nailed the ascendancy of gm but you haven't seen it in the stock rice. jonathan: how investable are they now even with the capital return program? this is a conversation that we will have, but a lot of it is skipping over a low bar. you see that with footlocker this morning. sales -8%, the estimate can we get footlocker up premarket? it is skyrocketing by 11%. it is beating a very low bar. lisa: there is the bar to not file for bankruptcy. at this time it is about inventory unwind and the idea

not performing as badly and not losing as much market share. how long can that last? jonathan: the opening a few hours away, $26, up about 9%. the outlook for next year according to the oecd, warning of a deepening slowdown in the world's advanced economies predicting that fed rate cuts won't start until the second half of next year. the quote in their outlook is unemployment will continue to inch up through the first half of 2024 and inflation will decline allowing for monetary policy easing in the second half of next year. the outlook could worsen if the effects are stronger than assumed will lead to financial stress. tom: i can't say enough how cautious this view is. i would suggest that they have been a little more optimistic than some of the shops. joining us now is their chief economist with work at the london school of economics oxford and the government of the united kingdom. thank you for joining us. what i am thunderstruck by is the duration of the slowdown you

have a 36 month average, two point 87% real gdp for this world. have you seen this before? is there a precedent for the duration of your slowdown? claire: we have not seen global growth at this low level -- obviously the global economy has grown at higher historic levels than we are projecting here, but our projections are for a fairly soft landing. that's central economies as they get through inflation coming down and they get through the monetary timing we are seeing. tom: how long is a buoyant united states of america? how long is america in your global analysis? clare: well, we have revised up

our predictions for the u.s. because we have seen stronger data and the economy has proven more resilient to the tightening that we've seen so far. they aren't alone. other economies are also doing reasonably well. japan would be another example of a country that i would .2. end -- and across emerging markets it is mixed with some performing relatively well. lisa: you don't expect the u.s. to start rate cuts until the second half of next year which goes counter to a growing consensus among investors that it will happen in the first half of the year. when you think will take so long? the economy will be better than expected? the fed will proactively be late to the game of cutting rates? clare: we have seen more strength in the u.s. economy than people previously expected which is part of what is going on here. there is strength in the american consumer.

to show a persistent downward trend and come back to target. that is why we are predicting longer monetary policy. it will be restricted for a time. lisa: you don't think that the ecb will loosen policy until the beginning of 2025 even as we see inflation come down. we will get the german inflation read soon. we got earlier lower than expected spanish inflation. why do you think the ecb will hold on to early next year given that people are talking about stagflation, slowing growth, and recession in the region? clare: we are seeing slowing growth. we have revised down our projections. we are expecting inflation to come down, but come down slowly thinking about headline inflation. what we need to see his inflation persistently returning to targets, and that is why we

are expect a time of restrictive monetary policy while the inflation is squeezed out of the system. we have seen record rates of inflation in response to the shocks that the economy has been through, so it will take time for that to come back to target. jonathan: appreciate the update. thank you. clare lombardelli of the oecd. i think governor waller is speaking to a lot of this. some comfort for governor waller who alluded to this. tom, some comfort that policy is sufficiently restricted to get inflation back down towards target. "i am increasingly confident that the economy is well-positioned to slow and get inflation back to 1%. i am encouraged by what we have learned the last few weeks." i would like to know what he is looking at specifically. tom: his esteem is earned out of the research house.

it is widely understood among the 12 federal bank that st. louis invented modern research. i won't bore you with the details but he is a distillate of 30 or 40 years of rank of st. louis excellence. when he opens his mouth, people listen. i didn't hear the job economy and i still go back to the dual mandate. lisa: this is why i think that immaculate disinflation is on the table. "there is no reason to say that you would keep rates really high and inflation is back at target, for example. if inflation gets back down not to 2% but close to it, can they call the all clear sign and start cutting?" jonathan: something like four or -- 4.5% on unemployment. i don't think that ed wants to be that precise about it, but that is the -- that the fed wants to be that precise about it, but that is the conversation we are having. sam stovall, does he like the

auto stocks? that conversation, next. ♪ ( ♪ ♪ ) ♪ (when the day that) ♪ ♪ (lies ahead of me) ♪ ♪ ( seems impossible to face) ♪ ♪ (a lovely day) ♪ ♪ (lovely day) ♪ ♪ (lovely day) ♪ ♪ (lovely day) ♪ a bank that knows your business grows your business. bmo.

>> with this time on the timeline, it is a great time for investors in equities. >> i would be long treasuries between now and in the end of next year with a nod to the fact that it will be a choppy ride. >> what is concerning about the last month is there is a massive risk on rally on weaker economic data. >> we are seeing different things trickle into the economy that will make the economy likely fall over next year. >> it is important to remain

invested, even in times of uncertainty. >> this is bloomberg surveillance with tom keene, jonathan ferro and lisa abramowicz. jonathan: i can't share the conversation during the commercial break. keep it together, bramo. jonathan: from our audience worldwide, this is bloomberg surveillance on tv and radio. your equity market is posited by zero point 4%. general motors and the premarket, the stock was up by 5% the last time that i looked. t.k., an update to the guidance, lower than previous guidance with the stock up 7% with a big capital return program. $10 billion stock buyback program, and then you have some cuts to spending in certain areas. tom: sam stove all, the interview of the days you and mary barra in the 9:00 hour. this is a multi-faceted screen from an underperformer. jonathan: change in strategy or

execution? tom: on the financial side a change in strategy, no doubt. the making of automobiles, which is a lousy business, i am not the auto guy. lisa: there is an important transition with ev's and who will win given the preeminence -- certain asian producers i would argue have come out with lower-cost models with bigger pools of lithium and resources. there and -- and there is the question of labor in the u.s. the uaw negotiations, was at the last gasp of labor preeminence and industry that is increasingly looking to transition to something else? jonathan: we're talking about 25% pay increase, cost-of-living adjustment, no doubt that is hanging over the stock the last 12 months in a material way,

particularly low last few months. it is not just the last few months, it is the last 10 years. this stock is exactly where it was a decade ago despite some record numbers when it comes to selling automobiles in this country. how do you turn that around? tom: 17, 18 million. the pandemic will be there excuse but it is a primal financial scream. lisa nailed it. i don't have it in front of me, but it is a 2 billion dollar cost reduction which i'm sure is on top of a previous cost reduction. if every cfo, 400 93, has to review this release. jonathan: robotaxi, sometimes these bets on the future are harder to deliver on. sometimes you have to find out the hard way that it will cost more, take longer to realize gains, and were finding that out on this issue. lisa: what happens when a robo taxi stops in front of an ambulance and won't move.

they had to have someone come and take it away. these are the things that are transpiring. tom: a lot of it is the financing of automobiles and i get that, but this is something that every southside analyst outside of autos has to review, this transaction, and a look at analogs over where their stock is. jonathan: up 5% to 7% in the premarket. let's get to the equities futures positive on the s&p 500. this rally in the bond market continues with selective hearing for treasury investors with yields down by three basis points, we listen to waller and we don't listen to bowman seems to be the message from the bond market. lisa: we are listening to disinflation. is it enough? the germany inflation read. we got one from spain this morning coming in below expectations at 3.2 percent year-over-year. i don't want to but i will say

this, is this the easy part? it kind of is in terms of that inflation is coming down year-over-year. what happens in the last leg? that to me as one of the key questions. jonathan: i thought that you are introducing me and giving me some space. i am sorry. i forgot what i was going to say. lisa: you were saying with respect to disinflation. i apologize. the cleveland fed president will weigh in on all of this and then at 2:00 p.m. we get the beige book, which we will be reading. the question is, is disinflation the last mile? this question of not understanding exactly where we are, how far the fight can go, and when we can call victory. tom: the parts that, -- parse that, the stickiness of a three handle on inflation versus the intuitiveness that people like john waller of new york are

modeling. that to me is the forward distinction. jonathan: i am sorry to jump in. tom: do you want to jump in right now? jonathan: it was actually goldman. goldman thinks that the hard part is over. that is what i think is odd about their outlook. by ought i don't mean that i think that it's wrong, just that it's unusual what other people thought two-year into. when sarah talked about the last mile to get inflation down to 2 from 3,4, that was the hard part. then goldman says the disinflation is in the pipeline, the hard part is done and the tailwind of growth will persist into next year. not my call, it's theirs. he basically said this is why for equity market investments this is a soft landing nirvana. you have governor wilder basically saying that i need a few more months of this and we can start talking about cutting rates. economists on the street can see what is in the pipeline and are basically saying what you're going to get a few more months

of this. i don't know what happens beyond this, but you will get it. the fed is about to be engaging in the rate cut conversation may be a few months from now based on what we are seeing in the data. lisa: that is why if you get cuts in the first half as soon as the first quarter, how much that fuels risk appetite at the same time. jonathan: the chief investment strategist, sam stovall. he does not have selective hearing. the bond market does. what did you make of it? sam: my feeling is that the interest rates are going to continue to climb -- to decline on the 10 year yield. i think that they are simply reminding us that high free longer -- high for longer come not higher because my belief is that the fed is done raising rates at this point, but high for longer because we don't see it cutting them in the second quarter. we think that they will wait until the third quarter. tom: sam, i talked to howard ward yesterday, he has had a

terrible year. he is up 41%, just really bad. it is because howard ward and sam stovall are in the market and it has been a glorious into the year. explain how you stay into the market next year. use of cash by corporations? sam: tom, i like to use stockmarket market history as virtual volume. -- virtual valium. what has traditionally occurred when you look to seasonality, the presidential cycle, etc.? one thing that is incredibly encouraging but not a guarantee is that in the election year of first-term presidents, if they are reelected or not, the market has meant higher 100% of the time, gaining 15.5%. you could buy options and do

leverage, etc., if you want to get that excitement. we were talking about autos and i was going to say we have very few buy recommendations around the globe at ferrari is what i would recommend for you. lisa: ferrari is one story and they can hinge off a formula one and i can talk about it worse than my coanchor sue can go into detail, but the nuts and bolts in the car industry, how much can you get behind some industries in transition that need changes in order to adopt the morgan framework for their business? --modern framework for their business? sam: not only do you respond to the consumers changing desires but the pressure put on by the government in terms of fuel standards, emissions, etc. we are neutral at best on the auto industry globally. we do have some buy recommendations based on the preinterview discussions that you guys were having.

lisa, for you i would say that hyundai motor is a buy recommendation. jonathan, polestar automotive is a four star. ford is three and a majority of the others as well as this point. lisa: you heard me say that i had a kia and all of a sudden it is buy hyundai. looking forward, you will understand how much you can see a broadening in u.s. stocks. how much have we seen year to date has been enthusiasm around artificial intelligence? where is that momentum coming from? from rate cuts, from the end of the cycle, from cash coming out with conviction into the market? sam: i think that it's coming from the decline in the 10 year yield, the removal of the uncertainty surrounding what caused it to move up and challenge the 5% threshold.

when you look at the number of stocks in the 500 in positive territory this year, you're looking at about 60%. everyone talks about the magnificent seven, but we still have 53% more in positive territory. if you are looking at the number of sub industries in the s&p 1500, now 84% are above their 50 day moving average, and almost 60% are above their 200 day. there is a lot of participation now. tom: are the magnificent seven standard six-star stocks? sam: six stars? that means with extra credit? it means we still favor the growth side of the equation. we still think that there is value and growth in terms of the earnings growth expectations for next year. also, realizing that following up years in the market you want to let your winners ride,

because the top three sectors in the prior year when it has been positive has outperformed the market on average about 60% of the time in the subsequent year. to top 10 sub industries were averaging 17.9% outperforming the market about three of every four years. jonathan: it is great to get an update from you. sam joked about ferrari, the absolute king of operating margins in the auto sector. something like 25%. gm is a quarter of that. tom: you have one and you can get in it. i cannot fit. it is too low to the ground. jonathan: most people cannot afford one, but this is what is stopping him. it is too low. you see much better cars in

london then in new york city. for obvious reasons. if you are just joining us, your equity market on the s&p 500 is posited by 0.4% and yields are lower by three basis points. the big conversation about what is next from the federal reserve. we want to jump from pause to cu ts. give us data that supports that view. my own personal view that they will cut soon. lisa: we were hearing from sam stovall that you have a an openness to rate cuts. you were saying that based on goldman sachs baked into the data we will see that slowing. i have so misunderstood this cycle that i don't understand exactly how housing fits into this, i don't understand the variable lags, how consumers can be running out of cash. tom: you went to the long and

variable leg of -- lag of the pandemic. are we really be the stimulus of the pandemic? tomorrow, personal income and personal spending. i and everyone else has been so wrong on that. will give us another poignant tone to what the consumer is doing? jonathan: jobless claims and then onto next week. just around the corner, big conversation, howard marks. that conversation about 45 minutes away. from new york city, good morning . ♪ (sfx: stone wheel crafting) ♪

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>> i am increasingly confident that policy is well-positioned to slow the economy and get inflation back to 2%. that said, there is significant

uncertainty about the pace of future activity, so i cannot say for sure if the f1 seat has done enough to achieve price stability. jonathan: that was worth a 15 basis point move at the front of the curve. that was governor wallace speaking to the american enterprise institute in washington. your two year started this week opening at 4.9591. that was monday morning. the two-year right now is 4.69 on the session coming down another four basis points. tom: i will watch for 1.99 real yield. the answer is the inflation-adjusted yield. we are 3.01%, 2.90%? never got there. 1.99%, do we turn into a pumpkin? jonathan: is that what happens? i thought that good things happened. tom: cinderella. jonathan: bramo wants to be a

pumpkin. ok. no idea where this is going. i often feel that way on this program. tom: we will have to see. it will be an interesting time and an interesting 2024. for those visible in the public market and the private market as well. long ago and far away, there was kkr in 1976 with history made in a style and a method that was original. an update from their co-ceo. >> i'm standing back with the co-ceo of kkr. they are doing this because they are buying the rest of global atlantic, big insurance company that they don't already own. you are also creating a new unit that houses a core private equity business. if you had to give the market

one way to understand what you're trying to do, what is it? >> it is great to be with you, thank you for having me. what we are trying to do is lay out the big three growth engines that we have as a firm. we are buying the majority stake in global atlantic that we don't already own. we are buying the other 37%. global atlantic has been a great partnership for us. this is a transaction that we did in 2021. the company has more than doubled since we announced the original deal in july of 2020 and it has been highly recurring with a lot of growth earnings for kkr. we are modifying our compensation ratios so our asset management business continues to scale and our has doubled. we are reducing the conversation ratio and fees making an offsetting on carrie and that will create more for shareholders. sonali: you're changing the way that you pay people?

>> in effect. providing more fee-related related earnings to shareholders and more carry to our people. the net is neutral, but it will be more fee-related earnings overall. the third thing that we are doing, and this is relatively new for us, is we are creating a new segment for the firm. we have historically reported asset management in returns and we are adding strategic holdings. what we will include are the dividends that we are receiving and will begin to receive in greater magnitude from our core private equity portfolio, which is a portfolio of diversified recession-resistant companies that we've been ailing for the last several years. sonali: kkr, apollo, brookfield, they are all buying insurance companies and diversifying in meaningful ways. private equities by the dollars, the assets under management, the smaller part of all of your business is. what does this mean for the future private equity?

>> private equity is still a growth business and we expect to grow that part of kkr for a long time in respect to the flagship strategies and we have created a number of different growth strategies in the core private equity business. it is now a $30 billion franchise for us. this is not about an or it is about an and. we have been seen to grow parts of kkr and we have diversifying meaningfully in the last 10 to 15 years and we are just continuing down that path. sonali: what does global atlantic do? it seems like it's giving you a balance sheet to compete on. there has been a lot of competition from your industry to the banks. how does this help you compete in a bigger way? >> global atlantic is largely issues and annuities to individuals. we work for pensioners and retirees all around the world. now family offices and individual investors as well. global atlantic distributes products to that same kind of audience.

historically, we have worked for tens of millions of retirees. we still do but just now in the form of policyholders. our mission at kkr's to do a good job for the people that we work for. the second part of your question on capital markets is what global atlantic allows us to do is to create more synergy. we did not necessarily see all of this three years ago and we started down this path. we think that there is more that we can do to unlock value between the two companies and capital markets is one of those examples. sonali: capital markets means that you may appear on more deals lending a balance sheet to provide capital for big finance and other leveraged deals. >> right. we are already in that business. we built our business by partner industry so we will be alongside traditional banks and investment banks as we build that business. global atlantic rings us the ability to expand division for that franchise. global atlantic, when they do

their large institutional blog transactions we can put some on the global atlantic balance sheet. some can go into third-party funds. and we can syndicate the access through our capital markets franchise as well just like private equity and infrastructure transactions. it applies to insurance deals as well. sonali: you already told investors this will add 10% operating earnings and your boosting targets into 2026 for fee-related earnings. what are the financial impacts and what can stockholders feel over the next two to three years? >> they will see that we are going to grow all three of our recurring forms and earnings in a more meaningful way going forward. he related earnings will be higher. we will see organic growth in our businesses by changing our compensation ratios. we think by virtue of what we are announcing today we can do more with global atlantic where we invest that portfolio. it has gone from 72 billion when

we announced the transaction to 158 billion over the next few years and we think that we can do even more together. they will see more insurance operating's earnings, which we believe our recurring and fast-growing. we will have this third element, the core private equity dividends holding segment. if you put those three things together, we think that that will be 70% or more of our overall pretax incomes and we will introduce a new metric called operating's earnings that will talk about later with our shareholders. sonali: thank you for joining us on a big day at kkr. tom: the gentleman from kkr, the future of what they do. we will go to apollo. is it next week?these are big questions and is not about the old transactions and the pr of it all, it is 2024. in the old days you would go, what is your internal rate of return look like? a guy like david rubenstein

would tell you. now, there is so much more invested into the economy that i want to know from apollo what the energy looks like in all of their different distress areas. jonathan: typically what we believe that private markets are all about his leverage finance. they're trying to change to make you think about private markets everything on the bank balance sheet. marcus also has this really interesting framework thinking about markets because of the index in public markets, the opportunities in public markets have absolutely dwindled. if you find a stock that's not in the index and you think that it's really fairly valued or undervalued you should buy it. what do you do if no one else does? in six months you sell it. this is what we have to talk about next week. tom: the other question with the

likes of gary gensler, how do you regulate private markets? in the old days you had a private memorandum and you either didn't or you didn't. now the overlap is extraordinary. jonathan: we will catch up with apollo next week. it will be a nice couple of hours to go through big issues. you will be there. i will pick you up and make sure that you arrive on time. it isn't looking encouraging, is it. lisa: will i be there? will you pick me up too? tom: do i have to dress like a private equity guy without a tie? a cardigan? you can wear patagonia.

(car engine revs) (engine accelerating) (texting clicks) (tires squeal) (glass shattering) (loose gravel clanking)

jonathan: a really small day of gains this morning up .4% in the nasdaq up .5% in small caps of .8 percent. there was a move down in the bond market. jonathan: look at the two-year, a big turnaround. the 10 year, the middle of october, back down to 4.2898.

tom: it is still above technical support. the next moves are important to the next level and find a new area of the vicinity. jonathan: push it through the fx market in the euro against the dollar, the euro strength over the previous four days at 1.09. at the end of the month we would be talking about the best month this year for the euro against the weaker dollar off that bond market move. lisa: based on those rate cuts you were talking about. the staying power of this, at what point do deeper rate cuts signal something negative rather than a relief to people investing in riskier assets.

people are betting on the resurgence of china. if you're confused listening to me you're not alone. jonathan: we have a great guest on foreign exchange with us. on surveillance talks are underway to extend the truce between israel and hamas. both parties accused of violating the offer but hamas has released 12 more hostages. antony blinken to arrive in the area this week. you have accusations on both sides over the past 24 hours that either side violated the truce for the framework and yet it holds. is that encouraging? lisa: it's encouraging that both sides want something that has

not been achieved yet. whether it's hostages coming back to israel and its signals whose pulling the strings. saudi arabia has approached iran about providing support if they pull back fighters from hezbollah and hamas solidifying that they want a stable middle east. jonathan: and the source of instability in the region. antony blinken, that's coming up later. general motor is up more than 9%. they were announcing a 10 billion share buyback program. we will be catching up with the ceo at 9:30 eastern time.

tom: this is a shock to 493 companies trying to figure out what to do with the see changes next year and the use of cash and cost reduction. i'm interested to see how the big banks swallow this kind of shock. jonathan: i think it's the right story to stick on. is it a change in strategy or execution? are we moving away from robotaxis. lisa: or improve the technology behind it? tom: or competing with hyundai. jonathan: are you thinking about hybrids? tom: i don't know what i'm thinking. are they competing against for? jonathan: they are trying to but they're struggling to compete

with each other. text billionaire mark cuban selling his majority stake in the mavericks to the widow of sheldon adelson. it puts the value of the team at $3.5 billion. what did he pay for it? 285 million 23 years ago. what an investment. lisa: all up front about this, you know you have reached the top when mark cuban gets out. have we reached the peak with these teams and their valuations? tom: cuban will stay in charge of basketball. he is not giving it up. but your idea here, why are people stupid about sports

franchises? because there is a value. jonathan: do you watch shark tank? lisa: i used to watch it with my kids. jonathan: we call it dragons den and you guys call it shark tank. tom: he has never been on shark tank but he's agreed to join us here. global fx interest rates strategist with lots of experience. love the first sentence of your note, don't believe the hype. are you combining the dovetail with your low rate call for a slow in the economy? >> the narrative from wall street is that the reason the 10-year gilts has been coming down is that where in the

disinflation phase. i agree with that. we will see disinflation in the u.s.. it will come in rents and consumer discretionary spending of one of the reasons we will see this is because the consumer is slowing and you have the don't believe the hype story. i don't believe stories about record-breaking black thursday and by friday sales. i think the sales were on the back of heavy discounting. if you look at what the corporate execs said prior to the holiday season and they talked about the crisis in walmart talked about deflation. but let's keep in mind this will come in a weakening from pricing power at the consumer product and services level. it will be driven by a slowdown in demand. jonathan: and how they're

paying, by now, pay later. thierry: it shifts spending to the early part of the season because normally you would have to save up a few more shekels as you approach your deadline to get those purchases done with by now, pay later you don't have to do that so you can spend earlier if you don't have access to credit. that's why we may have seen these record breaking days on last friday and monday. if spending only pulled forward it's not an aggregate we will get that much hype. lisa: people have viewed weaker u.s. data as a positive. but you could see the bond rally significantly going forward but will there be a divergence in term of risk assets to fuel a bond rally?

thierry: to the bond rally extend to where the 10-year gilts gets to 3% it has to be associated with the selloff and risk assets. to get that kind of forceful move early in the bond market you need to have some kind of dislocation and risk assets and drop in stocks. i think we can see a situation where disinflation continues slowly with the bond yield going down to where it was in the spring at 3.5% without a stock market drop as long as it happen slowly and steadily. tom: if i go back to bear stearns, you had a security analysis team looking at the slowdowns. i don't buy the gloom that corporations like gm will adapt. thierry: technological progress

they can adapt to. different policies about ev, but what do you do when banks are cutting off credit to buyers ? what do you do then? you're not in control of that situation. you're in control of your factory floor, promotions. maybe you adapt by cutting prices? to hold onto market share in the face of excess inventories and slower demand. jonathan: you've identified a series of places where we can see lower prices. retail, cars, what is the biggest threat lingering for you? that disinflation continues through next year? thierry: supply shocks.

the lesson of 2022 is you cannot control what happens in the rest of the world as it pertains to supply of oil and natural gas. if we get another shock and that market and it doesn't have to be because of the war. it could be that opec+ decides to curtail supply with brent going to the low 90's. that is the biggest risk right now. the good news is that gasoline prices have been following for six weeks straight steadily and i think that's going to show up in the cpi by the time we roll around the november and december numbers. the real reason the cpi will see disinflation is because of rent. in the new tenant market are coming down. we will get that disinflation

for the next few months. jonathan: this is what meal data is talking about, the disinflation is in the pipeline for rents and used cars. it's not that much of an "if" but when. tom: i would dovetail it into the labor economy which we have barely touched on with job claims in the jobs report on december 8. the basic idea is when is the labor economy go? if you get the labor economy to go you will get there instantly. claims 280, 320. jonathan: if you're just joining us welcome to the program. the scores look like this

with yields lower by three basis points in the dollar is stronger this morning but it is dollar weakness this month which catches most people's lives. lisa: with this ongoing feeling of disinflation. gasoline prices have been steadily falling for six weeks. they are currently at the lowest level since january 2. to give you a sense of how far they have fallen. is this underpinning the disinflation people feel? have we seen the p? eak? jonathan: we got the supply shock and it didn't happen. in the 90's we had a drop of 10% and crude. tom: in the bloomberg commodity

index there is a disinflation links to china and i get that. jonathan: in just a moment, doug kass on the life and legacy. life on tv and radio over the next 30 minutes or so. equity market is positive by 0.4%. good morning. ♪ (sfx: stone wheel crafting) ♪

the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ a few years ago, i came to saona, they told me there's no electricity on the island. we always thought that whatever we did here would be an emblem of what small communities can achieve. trying to give a better life to people that don't have the means to do it. si mi papá estuviera vivo, sé que él tuviera orgulloso también de vivir de esta viviendo una vida como la que estamos viviendo ahora. es electricidad aquí es salud.

>> is the nature of the enterprise. they don't have to accept change

and that's exactly what happened. jonathan: that was charlie munger speaking to us in 2011. he passed away yesterday at 99. tom: we are thrilled to bring you howard marks, he wants to talk about mr. munger. i can't say what an honor this is. 10 years ago he was the ultimate short panelist at the meeting of berkshire hathaway and you lit up the investment world with sharp conversation. what did charlie munger mean for warren buffett? >> first i just want to say it's

great to be honoring charlie munger. this was a beautiful friendship, and exquisite love story. far more complicated than ryan o'neal and allie mcgraw. it was a six decade of two great friends and investment minds. to of the greatest investors of all time. he was a compendium of reason and value. like my friend howard marks, we worship at his altar. warren buffett held his tongue but charlie could be defiant. they were both very blunt and both very brilliant. i think charlie was far more

intelligent. he considers himself the smartest man in the room but he was. he had no patience for idiots and told most people they were idiots. the question you're leading to, what were the consequences for berkshire hathaway? there has been on line of succession established and charlie munger mentioned in the meeting that greg abell would become the chief executive. this is a big personal loss to warren. he lost his confidant and best friend and long ago he embedded the idea of quality and concentration with charlie performing to buy a wonderful company at a fair price over a

poor company at an attractive price. warren originally bought broken companies but he changed with charlie on the scene. tom: i think it's so important. when you were down the hall from julian robinson. you and i would wait for the annual report of these two guys. explain to her younger audience, what was so special about the berkshire hathaway printed annual report. the only proxy i have is jamie dimon's note. >> might annual reports are dogeared because i have read each one over 50 times. the value in them was the with and sayings. one of them was if i can be optimistic when i am nearly dead

surely you can accept a little inflation. so-called derivative accounting a sewer. tom: you were the gloomy guy in the meeting and when you battled in that meeting, how many hits did you take? douglas: i took a bad head with my most important question. warren wanted to do something different. never in the history of shortselling would you short the stock and ask hard-hitting and tactful questions. i sat next to them in the question i asked was would you consider giving a couple hundred million to manage a short portfolio and after two years i

failed to outperform the portfolio would return the investment back to berkshire. his response was pure charlie munger. he said with his unwillingness because he doesn't like to trade. jonathan: you reference the quote and i'll share it again. far better to buy a good company at a fair price, can you talk about the evolution of their approach to markets in the last decade or so given the explosive nature of indexing and buying the s&p 500? how have things changed? douglas: it's an essay answer

but i'll try to be brief. he used to try to buy companies that were in trouble whether it was american express or the oil troubles. because of charlie he started buying quality companies. he would pay her for those companies. i run and discussed in one of my questions. he was searching for gazelles in the old days but he was buying them at a prices consumer companies he was comfortable with. i think he was protecting berkshire hathaway and morphing them into something that resembled and s&p stock.

impenetrable amounts, impenetrable suite of products and companies. jonathan: douglas cast this morning, we all appreciate it. we were talking about ozempic can you talk about how that would change the markets? has it changed your view? douglas: i have said that for now ai is an elegant parlor game and ozempic will have the next 3-5 years a much more profound impact on the economy than ai. jonathan: where do you think the impact will be most profound? douglas: lower insurance costs, most importantly. i think this is an area where you can get partisanship in washington dc. jonathan: doug, fantastic to get

your thoughts on the legacy of charlie munger. the approach to markets how to change. tom: at the time the magnificent seven. the times he spent shortselling. it has been a sporting 2023. what is timeless here and sobering into 2024 is the idea of what you do with quality? lisa: an understanding what quality is. you think of warren buffett's first company in his adjustment to buy a company at a fair price. he liked a candy and he paid a price that he would not of paid and it delivered 2 billion in profits. it isn't tech or ozempic it was

see's candies. tom: as peter lynch was saying. i was so honored that he join me on the day of don templeton instead. if you have to explain what it is that is a bad start. apple, they cell phones. jonathan: one thing that has changed in a big way, the benefits of having that concentrated pool of capital. the federal reserve response to the pandemic. they didn't need to go to warren buffett for cash. coming up on the open richard bernstein, sarah hunt and the gm

ceo mary barra. ♪ j.p. morgan wealth management knows it's easy to get lost in investment research. get help with j.p morgan personal advisors. hey, david! ready to get started? work with advisors who create a plan with you, and help you find the right investments.

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it's an amazing thing when you show generosity of spirit to someone. and you want people to be saved

and to have a better life, then you don't stop. we have been able to reach over 100 million people impacted and affected, and at risk of hiv. the rocket fund takes all of the work that we're doing, all over the world, and looks at the most effective ways, to get resources to them, to get services to them. the idea that we have saved five million people's lives, it's overwhelming. it's everything. >> central banks are going to cut regardless of the set up for next year. >> we expect to see because from

the fed next year. >> it is possible to make it to the fourth quarter without making a cut. >> people a very quick to think things are over when they take time to look at the system. this is bloomberg surveillance with tom keene jonathan ferro and lisa abramowicz. tom: good morning everyone, markets up, yields down. an extraordinary day. what we have is markets on the move in the death of charlie munger. what a privilege to have done cast with us and mr. marx coming out on the impact charlie munger had on all of us.

let's turn to the markets and in the last hour, may be off the gm bombshell. a furtherance of the good feeling from yesterday. lisa: the german preliminary coming at three .4% with inflation at two .5%. this is driving the good feeling. disinflation without the proportionate amount of pain. is it the illusion of a soft landing or is this what people had been expecting? tom: we will do the check in the moment but russell is up 1%. spx of .5%. john will be speaking with mary barra and this is not a mundane

press release for gm today. lisa: talking about cost cuts and dividend buybacks. how difficult it to parse through market at a time where industry is in flux? i think about that with the auto and tech industries and mom and pop shops. i think it's why it's important to talk about charlie munger who live through a couple of see changes and how to value companies and what it means to have a wonderful company and fair value. tom: charlie munger was formed off double-digit losses and 73 and 74 and that steeled him for the fundamental analysis he did into the future. the 10 year yield at 4.29 and

the five-year crescendo 4.67 futures are up 22. what does this spread market signal? howard marks has 20 bloomberg screens in his study. what does the spread market say? lisa: i know howard marks looks at balance sheets more closely. there is a question we can ask him but to me, the question is whether we are seeing complacency in public markets? a lot of people talking about how they are not reacting to the slow down and the likelihood of a higher for longer regime and pricing in the goldilocks. tom: we will go through a group data check.

if you could get me general motors when you can. having a big pop with features of 22, oil up a dollar. watching gold is towards the man well over 2000 and general motors is up 8%. lisa: where will they cut costs and invest to compete, not least of which with china. tom: i think to the days of john templeton and we do this today with charlie munger. done cast with his intimate relationship with berkshire hathaway. we finish with howard marks chairman of oaktree management

and author of three important books on investing and what to do and what not to do. on charlie munger, getting the odds on your side. how did charlie munger get the odds on his side? howard: he started off with the brilliant mind and brilliant partner. he intensively studied financials. he held for many years. he was a great practitioner of sit on your hands and he did up flawlessly. tom: in the modern day i remember reading this annual reports and there was no financial media, no blogging internet. what is the lesson of charlie munger's long-termism?

howard: if you want to hit the long ball you have to be patient. when the stock goes up 20% you can't start taking profits. they would hold things for decades. and charlie always talked about this. you have very few men shots. charlie said within the last year that most of his wealth came from for decisions. what if he started changing those decisions early? he went out of accomplish 20 dead and i think warren would say the same thing. warren is famous for having said put all your eggs in one basket and watch the basket closely. the idea of concentration in

patience, coupled with good decisions. concentration of patients don't mean anything if you can't make above average investment decisions but putting it altogether is a formula for success. lisa: you wrote that charlie munger had definite opinions regarding the investment management industry. he regarded it was skepticism and i found myself in agreement with him. what are you talking about a particular? -- in particular? howard: i thought they both found our industries made substantial differences in their clients well. he always questioned incentives.

you give me the incentive and i'll tell you the behavior. i think warren and charlie, was not a corporation or partnership and they considered the people they manage money for their partners and considered to be working for their partners and not themselves. their own wealth and success was a byproduct of doing great work for their partners. i would like to put myself in the same boat. those sentiments appealed to me greatly and i've tried to follow that. lisa: how difficult has it been to adapt the strategy to different eras? how did they think about the changing concepts of what a

wonderful company look like and what fair value was? howard: on one hand you have to evolve with the times and on the other hand, they never went full bore into the tech sector. they are famous for having made money with apple but most tech, they put it on the "too hard" file. if you understand that your success comes from a small number of holdings you don't need to exploit all the sectors. just find a few great ones. on the other hand, we are in a new era with the communications we have a part of what that means is the world's a more interconnected and intelligent place.

50 years ago we could exploit things that nobody else knew. today there is very little information that doesn't make its way around the world. tom: help us with one final question. they have a covid buildup of cash of 412 billion up to 525 trillion. you are living with money market fund growth. forward here for berkshire hathaway, what is their best use of mounds of cash? howard: people who run berkshire today understand the limitation of size. size makes it harder to outperform.

they have the best probability of our performing any company their size but their size will matter. one of my professors, i asked him how would you manage a big fund and he said i would index the court and manage the periphery. i would imagine they would have to move in the direction of something like that although they will not give up on our performance. tom: howard marks, thank you in remembrance of charlie munger. howard: thank you for having me on in such an important moment. tom: it reminds me of the death of john templeton when abby joseph cohen stepped up in the common theme is the short termism we have fought for

years. there has to be a long-term perspective particularly when you look at the failure of the retirement system. quickly here we have to look at the data. s&p up .5%. lisa: i wonder if charlie munger were growing up in today's market private markets would have a different environment than public markets because of the indexing and difficulty to have value in? tom: howard alluded to that. the methodologies and hagiography we do is not replicable today. it's a different world. does the market close at 4:00 or 12 noon because we have cell phones. the rhythm of the market has changed let alone fundamental investment. lisa: size has shifted out a lot

of investment firms and at some point you have to be the index and just have a slice but trying to make really good bets. it raises the question if the outperformance may be in smaller funds. tom: jonathan ferro has a clock on upper earnings and when you get to the size you manage for profit not revenue growth because it doesn't move the needle. thus what we see with selected companies. thanks to our team, this is been fabulous on charlie munger. good morning. ♪

>> i think any part of the business can be made more efficient. one of the things i tell the team is pretend this is your own

money how will you spend it? that's when people do their best work. tom: coming up we will have gm's ceo of mary barra. jonathan ferro's in charge of the clock. grilled by jonathan ferro. right now, we get a prebrief with david welch of the detroit bureau chief. he joins us this morning. to me it was a set of announcement let's talk about the cost-cutting. can you do use of cash because he will pair the budget to the bone at general motors? >> in a way they are forced to do because because because of

the new labor contracts and they have to find other places to cut if they want to keep profits growing. they have plans to double revenue. they are on pace for a 12% gain in revenue despite the strike. but all this new market share from evs, are stuck in second gear so they have to find ways to cut costs. tom: is this pressure from the ceo or is this the board pressure or is it outside activist pressure? david: we don't know if there

is an activist in there. i think the threat of that is there. the share prices down 12, 14%. is slower than the ipo of 2011. wall street is in a fan of vehicle companies. gm does generate a lot of cash. mary barra has had record cash flow. and they want to return that to the market. lisa: there's a question of the connection to now versus three months ago. how much is gm trying to

piggyback off the new contract with worker saying we have higher cost and we have to cut elsewhere and become more efficient. how does that work towards the narrative? david: among the various things weighing on the stock over the past year, the labor contract it is certainly one of them. the market knew it would be an expensive deal because the last few labor contracts were cheap for car companies and with record profits they were sharpening their knives and they did. a lot of it was built in inside gm. finding new ways to engineer vehicles that reduce variable costs. lisa: how much is this an excuse

, how much is competition from china? may be combustible engines will not be long-term but right now, we are not competing with what's coming out of china and korea and japan? david: it's a tough time to be running any of these old car companies because you have tesla stealing the luxury market. you have this threat of companies from china company coming. and they're struggling to come out with their own electronic vehicles. this is the one thing they can do to keep investors happy. tom: i saw an inventory chart,

tell us about inventory us into the winter months? is everything on sale? david: we haven't seen that yet. as interest rates eat into consumer confidence and raise monthly payments for vehicles which were already really high. i think you are going to have to see incentives to come in to offset the interest rate effect. interest rates have an impact on the economy. they slow activity down, thus economics 101 and thus what the fed wants to see. prices are still at historically high levels. tom: david welch is a pro, go straight to the heart of it. david wells shopping new cars for bloomberg and driving all of

our coverage. mary barra coming up with jonathan ferro with the engineer from the gm institute. i can't say enough, about the legacy that david touched upon, wall street has ignored the auto companies. his tesla an auto company or not? -- is tesla an auto company or not? has the stock been there? no. lisa: we have seen that since 2009 after the bailout. how much are some of the auto manufacturers ratcheting back expectations because of auto

loan raised in delinquencies? the latest data from the new york fed the projection rate for auto loans is the highest since 2013. tom: we are all hardwired for 200, 300 a month. but they price themselves out of the american market and even used cars you have a true disinflation of the price of used cars. ford and gm are doing better than stellantis and chrysler. there are a lot of cars out there. lisa: delinquencies on younger borrowers who have to borrow to buy cars creep up to what we saw during the pandemic, exceeding

that by significant margins. do they reduce production that you end up with sticky prices? tom: on tuesday bloomberg surveillance is on a record high watch for the nasdaq 100. russell 2000 up 1.1% futures 16.155. lisa: fueled in part by the rally in the bond market. moments ago citigroup saying we continue to think these normalization because are a theoretical possibility but the

fed is likely to wait until the economy is entering a recession before cutting rates. what's the threshold to make that move? we will be listening for that from some of the fed speakers. tom: third quarter gdp it will be interesting to see the makeup of the price index and claims on the 30th. claims will be extraordinary. continuing claims and initial jobless claims. 218,000, that used to be called fully employed america. stay with us, on the american economy. this is bloomberg. ♪ and see how changes you make today... could help put them within reach. from your first big move to retiring poolside -

and the other goals along the way. wealth plan can help get you there. ♪ j.p. morgan wealth management.

tom: good morning to all of you on radio, television and worldwide. car play, do you have car play? lisa: i'm going to get it. do you have a car? tom: no, the driver has one. he asked me would you like your car play mr. keene? good morning to all of you we have eventful work yesterday on the bond market driving equities higher. lisa?

lisa: they are pricing in a quarter-point rate cut by may and you see it in yields that keep coming in at 4588 now. chris waller out an event yesterday says he's encouraged by recent economic activity. >> i'm increasingly confident the policy is well-positioned to slow the economy and get inflation back to 2%. lisa: fellow governor michelle bowman leaving the door open for further rate hikes because here's what she said. i remain willing to raise the dead bond rate -- fed fund rate. fed chair jay powell speaking in atlanta tomorrow.

i find it interesting that lisa bowman yeah, yeah, yeah. what if you make of that? the markets really cheated in took chris waller and not michelle bowman. mike: that she's not saying what they want to hear. chris waller getting support from the gdp numbers this morning. tom: shocking? mike: fourth quarter gdp revised up to 5.2 from 4.9 well above the 5% that was thought and that comes from increased business investment that came in pretty low in the initial report. we are seeing more nonresidential investment. the gdp in terms of personal consumption is lower at 3.3%

compared to 4%. lisa's refrigerator turns up in the fourth quarter. retail prices which the fed doesn't really pay attention to come in lower than anticipated coming in at 2.3% compared to 2.4. we will look to the pce numbers tomorrow to see if we have the same thing. the advance good trade balance in october 89 billion from 86 billion. thus a little bit of a subtraction of the first month of the fourth quarter. inventories come in weaker, down .2% and flat. tom: futures at 24.

the vix gets love at 12.58. the russell 2000 up 1.2%. lisa would say it was because of bonds. i have to go to tomorrow's data and the idea is that no one is talking about the job market. what if we get another glorious jobless claims under 220? mike: for market participants they will keep their bets that the fed will start cutting rates by the mid part of next year. no one seems to buy into the argument of the first quarter. it's a week from friday that we care about in terms of jobs. we also get cpi before the fed meeting. two of the biggest data releases

come in the quiet. period. we will see if that shows the economy is slowing them out. i know you are nominal guy, nominal gdp for the third quarter, 8.9. tom: you get me going on this. i was guessing a .1 and i figured you would say 7.8. did you say 8.9%? absolutely stunning. michael mckee knows how to make me speechless. on an 8.9 nominal gdp america. what's so great about your economics is you've got them from the litmus paper of the fx market. how alone is the united states with an 8.9% nominal gdp when

rishi sunak is telling he's worried about austerity? laura: growth continues to surprise to the upside into me is remarkable the inconsistency between talking about rate cuts in this idea we will have rate cuts to support the economy or that we have seen the labor market is slow where we are seeing an economy firing on all cylinders. the only pieces residential construction. we are the standalone reader on growth. tom: there's an assumption by the bill ackman's of the world that it will plunge down to 6%?

even that us a boom economy. lisa: they're talking about the inflation component and that's what i want you to weigh in on. how much does it matter if we see a slow down if we continue to see the pace of disinflation we've seen so far this year? lara: there are two pieces to that argument. i'm reticent to think we will get this magical slow down and inflation back to the 2%. on the good side we have a lot of indications that just from slower demand and some of this resolution and inventory were going to see where ignoring the elephant in the room which is services. we have a hot labor market and we have wage pressure that is higher than prior to the pandemic and the resting heart

rate of inflation as well above 2% and the services side is the problem here. we need to be careful about being complacent about inflation coming down and that feeds into this non-recessionary rate decline goldilocks complacency that's taken hold of the market. lisa: at the fed meeting they said there's no reason you would keep rates really high if inflation's back a target. how high is the threshold to cut rates? we do see year-over-year with auto pricing disinflation with rents coming in with the fact that goods, prices are going down outright. lara: the fed is good at looking around the corner with the rent issue.

rent is a lagging indicator but is sticky for a reason. all of the indicators that were pointing to rents coming down have reverse. rents are far below the cost to buy a home per square foot it's costing you less to rent and landlords are rational. they are going to push rents higher again. it's something you can't ignore in the core. i get worried when the fed tries to micromanage the process. tom: are we beyond the pandemic? it doesn't feel like it to me. it feels like the stimulus is still popping. are we beyond covid? mike: i think we see this

trampoline affect and q3 gdp numbers are a great example of that. you're getting these big swings and factors that are disguising what's going on underneath demand that's really red-hot. the piece for looking out for 2024, a move away from reliance on savings towards income. it could be a period of lower growth but the sentiment about household economics as you see income catch up to inflation. tom: give me some 2024 outlook members, real gdp? mike: 124 and i think the 10 year stays high. i will put it up for percent.

tom: these are huge slow down numbers and the question comes so what do nonfarm payrolls do? lisa: do we get slow growth, high yield along with the fully employed america and job creation that chugs along? lara: we look at the recession so we have had in 2000 and in 1990, we saw little drop in output but a decline in labor. in this year we will see a slower economy but i think companies view labor as a scar ce resource. we are going to see it stay

quite low. tom: slower economy around the buoyant news looking at the end of the third quarter with those gdp statistics. what i would say that so important with futures up 22, half a percent all of a sudden we are looking at record highs going back to the summer and you have to go bad before that as well. a leg up off halloween in the present slope of good feeling from november when you bought your refrigerator. nevertheless, there is so

persistence he did this without question. lisa: s&p futures up .5%. one thing i'm surprised you didn't bring up wall street reporting apple has dish goldman sachs. you've been talking about the consumer banking efforts by goldman sachs and how it has not taken off and this is the last drop in the bucket. tom: i'm not an expert but i would say, there is a white car to buy well and i'm not happy with. separate for that, this thing was clumsy from day one and i would love to talk to alex webb or dan ives or the guy on the

west coast who gets up at 10:00 a.m.? lisa: ed ludlow? tom: i could never get to talk to i would like to know what he thinks about the clumsiness with apple inc. goldman sachs? lisa: apple wanted a very high approval rating. but it was the crown jewel of the effort goldman was going for. tom: i can't find one air, can i get some new airpods? lisa: by now, pay later. tom: futures up 21. bloomberg surveillance. ♪

>> artificial intelligence is finding its way into our business in different factors.

the data helps us make better decisions when underwriting also presents risks when it comes to other companies and how they use large language bottles. lisa: aig chief executive officer speaking with david rubinstein. you can hear more tonight at 9:00 p.m.. that was a snit but wanted to focus on the question of artificial intelligence how it's transforming the financial industry. tom: and the avoidance of the shocks that something aig sees when it comes to hurricanes, wars in europe. it's a different analysis by insurance companies that worrying about productivity. can ai help them with disasters? lisa: i'm so pleased we get to

speak with david rubinstein and host of peer-to-peer conversations because he talks with all the executives across wall street, main street and beyond to find out how they're dealing with these transformative technologies. i want to start where the similarities are with how executives are thinking about the developments in artificial intelligence and generative ai. david: everybody wants to be an expert on ai and how it affects our company but nobody really knows how it will work. were really on day one and everyone's trying to hire experts are good people in their firm to help them assess whether artificial intelligence will be useful or helpful nobody knows you. tom: david zaffino has to

deal with disasters. what if you learn about how he handles the unexpected? david: insurances about dealing with the unexpected so aig became the largest insurance company for many years and as a result of that, it had tentacles throughout the financial complex and extended itself too much and did not anticipate the problems that arose in the mortgage area and had to be bailed out by the u.s. government to the tune of 180 billion. is no longer the biggest company in the world but a profitable company. tom: david rubinstein with bill ackman yesterday, the track the

nation will take. what did you learn from him? david: he's an impressive person who has been outspoken on many issues over the years. recently it's been visible and what he's been saying about harvard. he said in the interview that he has made a new bet. a number of macro beds that have been positive. one of them he made 100 times is money and now he has made a bet that interest rates will be cut sooner than is otherwise expected. thus a big issue many people are grappling with. will the fed the size and needs of lower interest rates before the political season? lisa: is it surprising that a

hedge fund manager is focused on making big bets on treasuries right now? david: many hedge funds are doing that. he has not done the treasury trade others have done where he is shorting treasury futures. this is about that the fed will succumb to the pressure to lower interest rates before too long. the conventional wisdom on wall street as the fed will lower interest rates during the first or second quarter and his bet that they will go sooner than conventional wisdom. i've said before that the fed will get in trouble if it lowers interest rates around the political season because republicans will say you're helping joe biden by lowering interest rates. they will lower interest rates they will have to do it sooner rather than later. tom: you mentioned mr. ackman

and the mediterranean. i want you to talk about the great and good about how those of means and success should deal with their shock at our american universities? david: the american university system is still the envy of the world and our private universities are places people all over the world want to attend. many people did not realize how strong the anti-israel feeling has been in the result of that has been outraged by alums. i'm the chairman of the board at the university of chicago and we do not issue statements on political matters and we have not issued one in this case. but other universities have not

had the policy and gotten in trouble. it's a difficult way it's a walk this fine line. tom: a glorious day for bloomberg surveillance with doug cason howard marks in remembrance of charlie munger. talk about berkshire hathaway? david: charlie munger was from omaha and moved to los angeles and reconnected with warren buffett. he had worked for his grandfather in the store once. he was an outspoken lawyer who transition from lawyer to investor and his track record was better than warren buffett's early on. on they teamed up and made an incredible team of people who were known to the public for

their annual meetings where they would answer questions for six hours and he was well known for his dismissive ideas of other peoples's thoughts about investing. he was a fundamentalist investor and transformed warren buffett. he was taught to buy things very cheap. it was charlie munger that you should buy good companies and pay a reasonable price but buying good companies was better than buying cheap companies and warren buffett give some credit for having transformed his views on the investment world. tom: thank you for joining us today with our remembrance of charlie munger. with your conversation with peter zaffino and your conversation with bill ackman

that move the trading market yesterday. lisa: bill ackman has got his timing right this year. back in the day they used to make big bets on a specific company. there is a question if interest rates are at the behest of some of these levered trays and how that has played into the action this year? tom: the biggest there even on multi-days, stocks seem to have this oomph. i guess it's seasonal. i have futures up 21 and for the first time i'm on a record high watch at 16.1, a record high. lisa: the nasdaq is of 11% so far in november. it's been a great year.

we were hearing that earlier this month. but we saw that 10% pull down and was hot enough to bring everyone back in? tom: i need to see apples christmas sales before i buy my first shares of stock. do you really make 15%? i say no, there are a lot of expenses involved. the general counsel has to get their fee. were double-digit but not 15%. lisa: how much will it just be cpi, pce? tom: and also i'm going to go over to the job economy. what if we get all the secret sauce and a fully employed america? general motors will be making cross because they've made that clear. their ceo and conversation with

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and to have a better life, then you don't stop. the idea that we have saved five million people's lives, it's overwhelming. it's everything. jonathan: your equity market looking good. the countdown to the open starts right now. announcer: everything you need to get set for the start of u.s. trading. this is bloomberg the open, with jonathan ferro. jonathan: live from new york -- equities heading toward a big month of gains. one fed official signals he is likely done. bets growing rate cuts a