tom: bill dudley, we go to you on this question. wage growth but also the lack of wage growth over the last 15 years or so. is there fear of a wage spiral different now than it was decades ago? william: i think there has to be some fear of it. we have 1.9 unfilled jobs, an all-time record. the consequence of that should be higher wages. higher wages should be the consequence of headline inflation and what wages are doing today. wages should go higher. lisa: do you agree with chris who came out yesterday saying there is so much froth in the labor market that we can withstand a softening that would be more beneficial rather than detrimental, even if it led to fewer opportunities? william: i think that is what they have to do. i think they are trying to sugarcoat this a little bit. we can reduce the demand for labor without increasing unemployment. so if you were, but don't worry, you will get a job. that is again sugarcoating it. that will be painful. lisa: when we talk about the drivers of inflation, it is one thing for the fed to re

jonathan: bill dudley coming up. his view on how high do rates need to go on the federal reserve, probably higher. lisa: if that is the view how do we explain the rally we are seeing in treasuries, in equities? there are number of different expectations inflation will not come in as hot and i do not know if i buy that. i do not know if this is any sort of statement rather than a pause. jonathan: do get the feel like the market is shifting attention away from inflation towards growth. mike wilson of morgan stanley say we are expecting decelerating earnings growth and we continue to believe the u.s. market is not priced for the slowdown in growth. lisa: that is beginning to be priced but you're not seeing it fully priced in. mike wilson would agree. even though spreads have widened they have not widened that much. how much are we moving to that kind of narrative and how much does that change if we see inflation pickup further than people expected? jonathan: freight line up on bloomberg surveillance. equities are elevat

bill dudley talked about fiscal policy, a fiscal contraction.ld wait six months, but if the monetary policy is not working six months, year from now we should be having a serious conversation about fiscal policy. guy: jason, isn't it the case we are already behind the curve? waiting for another six months, isn't that a huge risk at this point? jason: just to be clear, the fed should not be waiting and the fed is not rate -- the fed is not waiting. guy: but what the fed is -- has currently got priced, the market, what is currently expected is clearly not going to be enough. if it is going to remain behind the curve doing the period you were talking about, that six month. i appreciate what you are saying, we are going to take action, but is there data we are still going to be behind the curve and have to do even more further down the road? what is -- what does even more further down the road look like? jason: i have a-inflation forecast, but i would not put everything on my forecast being right. at this point the thing you should do is say there i

former new york fed president bill dudley saying the u.s.age about how high interest rates need to get. dudley, also a bloomberg opinion economist, speaking to bloomberg. >> the fed has not been forceful enough in just stating their goal of 2% inflation, but also the means of achieving their goal. fed chair powell last week didn't want to talk about monetary policy may be having to not only go to neutral, but tight, and i think tight is required to get inflation under control. >> why are they timid? >> it is not clear. they are not to mid when they talk about the end goal. but if you're talking about an end goal of 2% inflation, you get there. if you start to sugarcoat it, financial conditions don't take as much and you run the risk people lose confidence in the fed. one thing in the fed's favor up until now is that people are confident the federal reserve is going to do their job. if you keep under promising what is required, i think there is a risk of stability down the road. >> you think this really is sugarcoating, or do you think that c

bill dudley has suggested hiking rates to 5% or higher. chinese premier li keqiang has urged officials to use policies to help the economy. cctv says he oversaw a meeting of the state council, where authorities were urged to stabilize prices. it said measures would be taken to secure supply chains and finance infrastructure projects. hong kong media reports say the police arrested four activists. they were detained on suspicion of colluding with foreign forces. rthk reported the four were released on bail. ferdinand marcos, jr. is looking to prioritize the economy, energy prices, and infrastructure as he looks to boost growth. the country has had one of the fastest rates in southeast asia this year. his campaign says he has an unassailable lead. >> it will be critical for the next several years, because of the pandemic and the economic crisis, so that is something we are looking at very carefully. >> gdp year-over-year at 8.3%. australia's opposition leader has been declared the winner of the third and final election debate. they were ques

shery: former new york fred president bill dudley there. to the first word news with vonnie quinn. vonnie: president biden says the fed has primary responsibility for fighting price pressures, placing the burden of his problem with the central bank. biden called inflation on acceptably high and reducing it is his top economic priority. meantime, during a visit to a family farm outside chicago, biden praised u.s. farmers for helping to curb price pressures and maintain global food supplies. ecb president christine lagarde signaled a move on interest rates as soon as july. policymakers at the central bank are increasingly open to take an interest rates above zero for the end of the year. she said the first rate hike in more than a decade may happen weeks after bond buying ends early next quarter. the hong kong monetary authority moved to support his local currency for the first time since 2019. they are buying nearly 1.6 hong kong dollars. it comes as the hong kong currency hits the weak end of its trading ban for the first time in three year

michael: a lot of your former colleagues including bill dudley and don cohen have said you cannot do this without inducing a recession. michael: i've heard the same thing. i understand that but i think the thing we have to be mindful of is that this context is nothing like we've ever seen in my lifetime and my policy space. pandemic driven disruptions and a lot of things that are intersecting in ways that i think makes it hard to know where the economy is likely to go. i'm keeping my mind open. i am an optimist but a worried optimist. i were all the time so i will pay attention to see where things go. michael: it's an election year and there is a lot going on step you feel any political pressure? >> i'm not but we have a clear job to do and that's to meet our mandate. today the labor market is doing fine but the inflation is the real challenge. michael: thank you for joining us this morning. everybody is back together for the first time in a couple of years. jonathan: i hear it's beautiful which is why you are so happy and not so gloomy. thank you as always. the equity market is stil

. >> carley: fed chair bill dudley said the word recession gets thrown around a lot. enter a recession, what does that mean? >> brian: slow down in the economy, what do businesses do, stop investing and hiring and you are talking about a jobs problem. jobs have been a fairly good news story this economy, that could reverse with recession and wages start to fall. inflation is a bad problem, recession is a bad problem, this administration and fed back themselves into a corner where we're facing one or the other right now. >> carley: inflation rate numbers are coming out next week, what are they going to be? >> brian: i think near that level, may not be higher and here is why, inflation started to kick in last april, now you have inflation on top of inflation, even if that rate comes down a little bit, it is built on previous inflation, which means people are still feeling massive price hikes, even if that rate goes down a little bit, it is tough for the consumer. >> carley: it is. people are feeling it, as reflected in the polls, thank you for joining us. you brought ba

bill dudley would say i'm wrong. jonathan: how soon? tom: don't know.ou never make a time function call. jonathan: i could say we are going to have a recession, but if i don't give you the scale, magnitude, and the time -- tom: the houston astros hit five home runs off the red sox in the second inning last night. that's magnitude. jonathan: twos, tens and 30's look like this. higher by about a basis point to 2.9952%. sterling, cable negative by 0.7%. inflation in the u.k. at 9%. the bank of england stuck between a rock and a hard place. as for the euro, we've had a visual after official talking up interest rates getting back to zero. i have to say, one of the more neutral members of the ecb, not want to be most hawkish members, talking about a be quickly getting back to zero. that is the story and foreign-exchange. let's get you some single names. let's get to bramo for more. good morning, lisa. lisa: i will get to the astros review at some point. i will not give you a timeframe. we will get to retail and a second, but before we get to that, the elon mu

we are trusting the people who helped get us into this to get us out of this >> i once said to bill dudleyral bank is the source of and solution to every crisis right? >> yeah. >> we got here because of the fed. now i think we're running the risk we will create another crisis. >> are we? >> we are on path. >> what kind is it a credit event what is different between now and 2008 2008, we had crazy driven. this is not then >> that's right. >> stock market is falling faster now than it did then. >> right i think paul put his finger on this because the fed is withdrawing liquidity. if you look at a number like m-2. >> monetary money supply >> it is contracted over the last three months. we had the massive run-up in crisis as we take liquidity out of the system, markets are becoming ill-liquid you see the markets moving that is a liquidity problem. i believe muhamed is right a liquidity problem has a way of turning itself into a credit problem. a credit problem has a way of turning itself into a general financial problem. if we don't stop the course we're will >> do you think we have seen the p

obviously chairman powell has talked about financial conditions need to tighten, bill dudley, the former fed president and vice chair of the fomc, he is saying conditions need to tighten. stocks and bonds need to reprice. i would keep the index back at 2000 levels so we are not tied it all, which is tighter than the past two years, and the s&p 500 would have to change. it started the year at 175% of gdp, down to 140% of gdp. but the 2000 bubble peak we were at 120% of gdp, so there is still a long way to go before we find stability. with all of the uncertainty just in the headline risk out there, i would not take the chance right now. i would be more cautious and focus on value needs have more attractive valuations at this time. tom: are you going to be in cash or something wicked defensive? michael: because i tend to be more cautious, i would definitely have more cash on hand. for investors who have to be invested, i see this as 2000 and 2002. the past 15 years, the russell 1000 has outperformed. value has outperformed by about 18% this year. that's how i would look at it. if you need t

bill dudley, mohamed el-erian, plenty of others think the fed is going too soft on the markets, that he needs to be clear that there is going to have to be pain. who has got it right? the bank of england or the fed? marcus: neither. demand destruction is something they're talking about, because they feel they can only control the demand side of the economy. the supply-side, which can do something to help, is out of their control. there are huge energy prices and supply-side logistics nightmares. the point is they can do things smartly in combination with governments, and that is more my point is. bank of england, less than. they were trying to send a clear message that the orchid is pricing too many rate hikes. but why did they not just say that? all of their forecasts. what they were really trying to say is they cannot forecast with the government may or may not do to boost spending or reverse tightening. maybe this is what is going to happen. if we do keep raising interest rates to how high the market expects and nothing comes from the government, then we will have a likely recessi

is that where bill dudley is? jonathan: he might be there on the fed funds rate. mohamed el-erian is not. he thinks that push comes to shove, they choose to support growth over curtailing inflation. maybe that is the choice they have to make further down the line. on the yield curve, morgan stanley, their view is that the front end, upward pressure from the federal reserve. on the long end, a range bound 10 year perhaps contained by growth risks from abroad. how the long end evolves has been uncertain for me. i was surprised last month and yields started breaking out on the long end on the 10 year, and that steepness returned. tom: we see the steepness, the real yield with a magical move to positive as well. it just sets up a jumble for may. lisa: at a time when people see the risks of inflation and recession as so massive and looming in the view. the idea of frontloading, i wonder when we get the shock. have we already seen it in terms of some of the equity valuations, or is it yet to be seen? this is one of the biggest this agreements with the likes of morgan st

fed will go full on the whole year their goal is going to be, as former new york fed president bill dudley said, if the stock market doesn't go down, the fed will lower it was the title of his op-ed last month and i think that that's exactly the way the fed is looking at this right now if we don't see serious signs of inflation slowing, they're out for the stock market they have been all year. and i don't think that's going to change, because i don't think we're going to see enough signs of inflation slowing. >> i mean i don't know if they're out for the stock market per se but it certainly is a side effect that they're willing to risk in their fight against inflation. jim, i'm wondering, it sounds like you don't think that we have seen any sort of a bottoming. for all the optimists out there, your message is we haven't been even close to capitulation if you take a look at the vix, we've got not very close to even the 52-week high on the vix, which is 38. >> yeah. the fed uses a euphemism and call it tightening financial conditions but that's exactly what they mean by it they mean that the

so you've got people like bill dudley, the former head of the new york fed. to fall. there isn't going to be the same juice, if you will, to keep the market going, which is why we're off another 300 points today and it's not over yet. and there will be no more new jobs or fewer new jobs and possibly job losses. >> richard, the president referenced, the big board down 330 points after a 1,000 drop yesterday. >> we're not done yet, believe me. >> the president referenced inflation in touting the job numbers today. he said there's more work to do. what more work can the administration do on inflation? >> well, there he is up the proverbial without a paddle, because he can't do much. first of all, as the economy goes towards recession, you ain't going to get another stimulus package in any shape or form or anything significant. there's just not the money there or the appetite. secondly, this is a fed matter now and the fed is only concerned -- as she said, the fed is concerned with the other side. the fed is going to do whatever it takes. unfortunately for presid

even a former dad like bill dudley formerly the new york fed has now turned very hawkish.hind the curve, et cetera. i will say this, the faster that they act, the more aggressively that they act now, tomorrow and this year, the faster they will curb inflation. the faster that they curb inflation, the better off the economy is going to be in the medium and longer run, people forget nixon and the crazy world of monetary theory. price stability is absolutely essential to economic growth as low on employment. the faster the fed can get it back, the price stability, the faster the economy is going to recover. it is a tall order. inflation rate is somewhere around 8%. the target is to. you tell me, it is not going to be easy. >> the era of free money is running over, we have a question, how expensive money is going to get and what timeframe and what that does to the economy. i think it be hard to avoid some kind of recession. i want to talk to you about the amazon warehouse in staten island voting against unionization accommodation it's come up bernie sanders and aoc. you got to

bill? yes. with jasmine olympus, then i think we should be a problem with the health issue up with mom dudley. when you go, when you go from here, the average table gardens have long been turned into mine fields and 7 years of civil war. the basement is where they mostly live now, and they are well aware that any time they venture outside, it could end in injury or death. ah, yes i really what backing you got it? ah, we can air pollution in your apartment. a l m. yes. there with mm. this with what's acceptable, and that's also send me a thumbs with a peek with them to see that you know what they bo boyd a lot. but what i guess what if what you do it. but that was just up with you when you were cut off with us. sure, sure, sure. i got the villages who ended up living on the front line. don't want to leave their homes go. sure. yeah, sure. if i could h ah, ah, since the break away, but don't, that's people's republic. one has been ranging and don't buy ukrainian artillery. it's been shilling civilian, townsend, mining, villages or more. very well believe deal with one of your company a little ab