we will talk with bill dudley. we'll talk inflation and the fed.right back. >> announcer: "squawk box" is sponsored by bit wise, the world's leader in crypto index funds. this thing, it's making me get an ice bath again. what do you mean? these straps are mind-blowing! they collect hundreds of data points like hrv and rem sleep, so you know all you need for recovery. and you are? i'm an investor...in invesco qqq, a fund that gives me access to... nasdaq 100 innovations like... wearable training optimization tech. uh, how long are you... i'm done. i'm okay. this is xfinity rewards. our way of showing our appreciation. with rewards of all shapes and sizes. [ cheers ] are we actually going? yes!! and once in a lifetime moments. two tickets to nascar! yes! find rewards like these and so many more in the xfinity app. >>> welcome back, everybody. the irs plans to use about half of its new $80 billion in funding to hire more agents and crack down on tax cheats here to break down who they are looking for and who could be the top targets, robert frank. he's

we just got this from bill dudley, publishing on bloomberg opinion. "investors have become strangely optimistic that the federal reserve won't have to tighten monetary policy much further. this wishful thinking is both unfounded and counterproductive." tom: it is a short, sharp note. a particularly good summary for those who disagree with dr. dudley. there's a whole school of thought out there that this is a fed that can thread the needle. he says there's no threading of the needle. this is what they have to do. inflation is the priority. jonathan: looking forward to catching up with bill later this week. it's catchup with ben laidler. best month of gains we had in the s&p going back to 2020. is this the real deal? ben: we have seen a classic climbing the wall of worry. we got super bearish. everyone was freaking out about an earnings collapse. guess what? it hasn't happened. that's not to say it is not going to happen. we are still in this race between a peak in inflation and what will probably be a recession. i do think the bottom is in. i think the

in this from bill dudley.estors have become strangely optimistic the federal reserve for not have to tight monetary policy much further. he goes on to say this wishful thinking is unfounded and counterproductive. tom: i am sorry. i am speechless after headline i just saw. you have to help me translate this. jonathan: i have not seen it. tom: pepsico to take 8.5% stake in celsius for $550 million? is it that a crypto company? jonathan: it is a fitness drink maker? lisa: it is a competitor of tang. tom: they could have bought tang. i just thought of crypto. jonathan: is that what you wanted to cover it? you thought it was crypto. tom: they will now -- they will no doubt do a better job than i did. i just went down in flames. jonathan: he tried to drag me down with you. tom: we tried to get bramo involved. stephen links profit into our economy like no one i have ever met. stephen, you are the guy i want to talk to. late in the earnings surprise and a six-week bull market with chairman powell's economy. take the p

yesterday you had former fed president bill dudley writing an op-ed saying powell blew it last year atu think he needs to show up in a football helmet and shoulder pads to show he means business? >> it really turns my stomach that the fed discourse has come down to that kind of imagery, right? that's what it's about. nobody is putting forward a coherent explanation for why we have the inflation we have or what we can do about it. we're all just supposed to be tough guys where your favorite central banking linebacker was the great paul volcker, right? in the late '70s and early '80s. the guy was 6-6, right? he was a superhero, not even a person, so we have to be more like him. we have to be willing to put millions of people out of work because inflation is completely unacceptable to working people, so we have to make sure that working people aren't working. what? what kind of logic is that? why don't we ask ourselves what did paul volcker know, what did he think? he was an economist. he wasn't a lawyer like jay powell. and what he knew was that inflation comes when you expand the money

alix: what you feel about bill dudley writing this? what will be the ramification of that?> i think we will see the change in risk appetite. a lot of eyes are on the surgeon mean stocks and the equity rally, wondering if this risk appetite is sustainable. i think a lot of white equities have rallied is because we have seen deals go lower, more for fear of demand destruction. this averse risk appetite we think is unsustainable is -- especially as people wake up. the fed probably has more to go and they are not probably going to cut rates quickly next year. i am more conservative in the near-term. guy: do you take a signal from what's happening in mean stocks right now? >> i think it's more a reaction to what has happened in the ok markets. a lot of people a look at this and say stocks will go higher but we have to disagree. i think it was a reaction to equities moving higher because of a discounting principal that came in lower. that encouragement or risk appetite is a reflection of what we have with the lower cpi but for it to be sustained in the main driver behind markets,

we heard from bill dudley who said, the markets are not helping the fed and he thinks the terminal rate is closer to 4%. now let me tell you, we went from that june fed meeting where we were around 360 or 370 by the middle part of next year but we are already down to 320 and the market does not expect anything of the fed from december through the middle of next year. weaker data out of china. there is a sense that we do need to see more weakness out of the economy to really put the fed on pause. i don't think the fed will pause at all. i would be pretty scared if they did. >> you are comparing it to, the blue dress in the gold dress thing. two people say one thing and it was completely different. i feel like that is exactly what jerome powell was. so, you've been arguing that we need to see the recession and better off getting it done and getting it done quickly? >> yes. i think they are nowhere near done and i believe that inflation has peaked. however, inflation needs to come down so dramatically that i think the fed has no choice. absolutely no choice, given that they have said that

speculation the fed may pipit is overdone according to bill dudley.ereign bond script is what you must focus on. aussie rates down. u.s. treasury yields careening towards the line of 2.5%. "bloomberg markets europe" is up next. ♪ when people come, they say they've tried lots of diets, nothing's worked or they've lost the same 10, 20, 50 pounds over and over again. they need a real solution. i've always fought with 5-10 pounds all the time. eating all these different things and nothing's ever working. i've done the diets, all the diets. before golo, i was barely eating but the weight wasn't going anywhere. the secret to losing weight and keeping it off is managing insulin and glucose. golo takes a systematic approach to eating that focuses on optimizing insulin levels. we tackle the cause of weight gain, not just the symptom. when you have good metabolic health, weight loss is easy. i always thought it would be so difficult to lose weight, but with golo, it wasn't. the weight just fell off. i have people come up to me all the time and ask me, "does it

you had a former fed official bill dudley warning almost certainly there will be a full re recession,rom the white house view after the numbers, is that easing fears in your forecast that the economy will or has entered recession? >> well, certainly something out there today we're hearing, if we're in a recession, companies would be laying people off rather than hiring them. we saw people hiring not at record numbers, but big numbers. i think a lot of companies are still growing, still adding people on. we have seen all the jobs that were lost prepandemic recovered from the pandemic. we saw the unemployment rate 3.5% today. the day before the pandemic was 3.6%. we're seeing lower numbers there. we're seeing people go back to work. in certain areas we're seeing education, local education numbers going higher, retail up, and manufacturing quite honestly is probably for me one of the most exciting biggest surprises we have because we have seen not just that industry recover since the pandemic, but we have seen that go beyond that and then now with the chips bill, the president will sign

we had bill dudley from the new york fed, he was on yesterday saying that he thinks the equity marketave to do a lot more tightening. you're going to pick the other side of that tricky thing to fight the fed. >> it is, but, yeah, i'm going to pick the other side of that i think that we will have maybe 100 basis points left, i mean, perhaps 50, 25, 25 i think you hoolook at forward-looking sensitive prices they not going up. the only thing going up is going to be wages in certain sectors take a look at the housing industry, which was a major, major inflationary force in the last two years the nahb index which was report add reported a few days ago has had the biggest drop in its history. only march 2020 to april 2020 it we have a bigger drop. if you go on the ground with real estate brokers, they say prices are softening everywhere. and, and remember housing is 40% of the core index. now, will you see that in the official statistics? no because of the way the government does official statistics, they put it in very lag. so you're going to see housing prices continue to rise, rise, rise

economics reporter steve liesman who had a very interesting interview today with former fed governor bill dudley who says the market is misunderstanding what the fed is trying to do, and i remember back to the bloomberg opinion piece that he had, i forgot when, two months ago, two and a half months ago, steve, when you said the by-product of what the fed is trying to do will be high unemployment, asset prices coming down, and the markets right now don't seem to want to believe that. >> yeah, that's pretty much a good summary, melissa of what the former new york fed president is saying. he's basically saying two things the market has the outlook for the fed wrong and the fed has the outlook for the economy wrong. the extent to which these are related is an interesting question if you look at the rate outlook, you can see that the market has priced in the fed cutting rates towards the end of 2022. we've talked about this a lot. it remains in there as a forecast we've had several fed officials come on and say, you know what that's not the case. we're more likely to go up, even further than the mark

it's not just the stock market or bond markets, the feds fund >> bill dudley, right, he says wishful thinking won't help the fed beat inflation. his idea is the market's exuberance stems in part from pole's latest news conference fueling speculation of a quote, up quote foist smaller interest rate increases with some even arguing that the fed has done enough already don't be confident about such an outcome. the whole conversation about this rall from here whether it's a bear bounce or something more comes down to that point, whether the market got it right or got it wrong. >> yeah. >> or is getting it wrong because the fed is still going to raise rates by the way, powell said a lot what have they have done so far hasn't even filtered through the system yet let it the filter through and see what happens to demand, see what happens to the economy. >> i agree with that i think it's the wrong reason to step out now and be buying the market because you think there's going to be a pivot on the part of the federal reserve, that's wrong. the federal reserve has to got inflation. they have to

bills. in dudley, estate agents say with so few homes coming up, it's tempting for tenants to offer more thanem, so i do try and sympathise a little bit, but at the same time they shouldn't be offering £100 more or £50 more if they cannot meet that requirement. but then if they don't, they're going to miss out on that property. so it's a hard situation. that's the conundrum that io faced when she got her flat. did you find that lots of people were looking round every flat that you were looking at? exactly. sometimes you just have to probably offer more or offer to pay upfront or something just to get it. but for some, moving back home does have a silver lining. i like living with my mum, so yeah, i'll stay there as long as i can. - yeah, my washing's all done, food cooked. it's all good! colletta smith, bbc news, in salford. cricket, and it's day three of the first test between england and south africa at lord's. it is 326 all out. it leaves south africa in pretty strong position as england try to cap up. 0ur sports correspondent, joe wilson, is watching. right here this morning, there was no

bills. in dudley, estate agents say with so few homes coming up, it is tempting for tenants to offer more thane listed rice. g; :: to offer more than the listed . rice. ,': ii ., to offer more than the listed rice. g; :: ., , price. under 30 are struggling at the moment. _ price. under 30 are struggling at the moment. i _ price. under 30 are struggling at the moment. i can - price. under 30 are struggling at the moment. i can relate i price. under 30 are struggling| at the moment. i can relate to them. i do try and simplify it a little bit but at the same time they should be offering £100 more, £50 more if! time they should be offering £100 more, £50 more if i cannot meet the environment, but if they don't, they will miss out on the property. it is a hard situation. on the property. it is a hard situation-— situation. that is the conundrum - situation. that is the conundrum that - situation. that is the conundrum that my l situation. that is the . conundrum that my face situation. that is the - conundrum that my face when situation. that is the _ conundrum that my face when she got her flat. w

by the way, the fed itself has criticized itself over its actions s bill dudley, new york fed presidentits eggs in the transitory basket last year he no longer thinking that's the indicate when you look back at the performance, you don't have to say there's mistake. that's sort of acknowledged. how do you make it better? >> that's a question we'll be looking at for a long time here at the at the. i think one of the areas that we saw in the pandemic is looking at realtime data, soft data is as important as the hard data. i think reemphasizing, particularly what the reserve banks bring to the table, in terms of our contact and what we are hearing is critically important to policy. >> what i see, when i look back at the track record, larry summers, jason fumplen and others saying this was not transitory, yet the fed votes unanimously to -- what about group think? is that a problem at the fed >> it's a human problem, let's start with that. it's a human problem you know, i think, for example, for myself, i started to hear very early in my fall in the contacts that this doesn't feel transitor

think this further contraction, i think one of the other great interviews on your channel today was bill dudleys unequivocally stated that they're going to have -- the fed is going to have to tighten things up and we're going to have to see some pull back in employment, and that's going to cause pain and i think that will help this rally roll over. >> art, thank you, as always >> my pleasure, david. thank you. >> much appreciated. >>> we have some sad news to get to this morning in the world of finance. the former co-ceo at deutsche bank has died after a long battle with cancel jane most recently worked at many facilities. anshu jain was 59 years old. - in the last two years, we quadrupled our team and the pace we're growing, i couldn't keep up without ziprecruiter. they do the legwork and they get my job posting in front of the right candidates. i love invite to apply. i instantly see great candidates and i can invite them to apply. we have hired across all departments, engineering, marketing, hardware, field techs. you can basically tell ziprecruiter who you need, when you need it, and they d

bill dudley's over there, no kashkari is over there.ll of these presidents are uniquely different. this is an aerospace guide. this is not a phd economist hedging and all of that. he says what he wants. jonathan: he tells what he thinks. futures are back, up .9% on the s&p 500. i don't think he will give you the commentary on single day market moves. lisa: beyond. jonathan: he was lower about four basis points, 6% on the 10 year. elon musk sending and notice of termination of the merger agreement with twitter. the new letter highlighting additional reasons to terminate the merger agreement according to the filing. look at the stock price move, twitter down by about 2.6%. $39 in the premarket, 54.20 was the price and we are no where near. lisa: people expected this. it shows whether or not there will be a billion-dollar breakup fee that needs to be paid and what the damages to twitter in the meantime. a lot of people quitting or getting pushed out. tom: the market down about 2%. -- jonathan: the market down about 2%. tom: we covered that

bill dudley invented economics, we are thrilled he could join us today. be so strident about raising interest rates? >> that is not getting the job done. with inflation, the expectations will become unanchored, and the federal reserve will have to do more. we ran this experiment in the 1970's for the policy was tightened, and they had a recession. inflation came down, but it was not enough to everyone thought inflation was higher, until paul volcker came in, and they had to do a lot? >> the john taylor of stanford, he did on the need to be responsible and get back to 2%. the work of 2008 and 2009, and in england, they agreed with adam posing, sitting in the chair, saying that 3%, eating a public reason that we must get back to 2%. x if we get back to 3%, we are hanging out at 3%, and the next thing is that we take inflation back up again. you ratify a higher inflation floor, he gets expectations and it gets into wages and we are off the races. that is the problem. >> you knew you were going to 2%, there was no problem. if you are a 3%, the next move is up

bills. in dudley, estate agents say with so few homes coming up, it's tempting for tenants to offer more thann relate to them, so i do try and sympathise a little bit, but at the same time they shouldn't be offering £100 more or £50 more if they cannot meet that requirement. but then if they don't, they're going to miss out on that property. so it's a hard situation. that's the conundrum that io faced when she got her flat. did you find that lots of people were looking round every flat that you were looking at? exactly. sometimes you just have to probably offer more or offer to pay upfront or something just to get it. but for some, moving back home does have a silver lining. i like living with my mum, so yeah, i'll stay there as long as i can. yeah, my washing's all done, food cooked. it's all good! colletta smith, bbc news, in salford. with me now is sophie delamothe, policy & public affairs manager at generation rent. how worried should be about these figures, spending 30% of their income on their rent? taste figures, spending 30% of their income on their rent? we should be extremely worrie

scared people s jay powell said that, it's going to have consequences >> all of it, that's what bill dudley said in that bloomberg opinion piece months ago what the fed is doing will have consequences, one of the consequences, lower asset prices across the board. >> lower asset prices, lower home prices. this is what i started complaining about, that bad policy has bought a recession for all of us. none of us want one, none of us want higher interest rates we'd all like to be able to borrow things at less money. if you're starting a business, everything we'd like to do entails a strong economy and a good labor market and higher wages for everybody. because of all these crappy policies throwing money around, now we're all -- we all -- a recession now. thank you, sir, may i have another. that's what they're deliberately trying to do that's thono way to run an kpli. >> it's hard in a pandemic situation to say you know what, we're not going to do the stimulus, that will inflate every asset under the sun. >> it's like saying, yeah, we know that maybe 30 -- no, maybe 70% gets to where we want it

bills. in dudley, estate agents say with so few homes coming up, it's tempting for tenants to offer more than under 30s are struggling at the moment. i can relate to them, so i do try and sympathise a little bit, but at the same time they shouldn't be offering £100 more or £50 more if they cannot meet that requirement. but then if they don't, they're going to miss out on that property. so it's a hard situation. that's the conundrum that io faced when she got her flat. did you find that lots of people were looking round every flat that you were looking at? exactly. sometimes you just have to probably offer more or offer to pay upfront or something just to get it. but for some, moving back home does have a silver lining. i like living with my mum, so yeah, i'll stay there as long as i can. yeah, my washing's all done, food cooked. it's all good! colletta smith, bbc news, in salford. the last time you went to the cinema? i the last time you went to the cinema? , . , �* cinema? i went very recently. and that is a problem. _ cinema? i went very recently. and that is a problem. a _ cinema? i went v