taylor: jim caron over at morgan stanley says fair value on the 10 year in this case is 1.70%. do you agree, and what is the past to 1.70%? lee: i think that is high. i thing we have to have a discussion at some point about the mutual rate. the fed has it at 2.5 percent. that is way too high. if we look at where are we in terms of the labor market, in terms of demographics, where are we in terms of productivity, i would argue probably fair value is a little bit lower. not massively so, but i would probably put it 1.5% rather than 1.7%. we drift up to it in the next 12 months or so, as qe gradually gathers momentum. no dramatic big rise for me. tom: thank you so much. wonderful way to start this hour. lisa ridge with state street, head of -- leaf average -- lee ferridge with state street, their global macro advisor. you get really lucky, and this is where you make your luck. we are like, ok, g to go banana is going to show up. she's going to have a paper. i'm sorry, it is the paper of this symposium. lisa: the idea of trying to link the interconnectedness of monetary and fiscal

a witness says a caron went over the tracks as the games were coming down and the train approached. officials same the driver was a 19-year-old woman. she was taken to the hospital with criticism george. the oakley union elementary school district says the boy who was kimed was a student at delta vista medical school. larry: in the south bay businesses and homes having evacwaited because of a gas leak in san jose. not far from downtown. a third party. contract iran hit an eight-inch natural gas lionel and there -- evacuations within a 900-foot radius, more than 300 addresses. it's estimated that gals line will not be cammed until midnight. >> is fight made progress against the firearm burning in ed ed dado counsel. the edge of the fire is less atlanta 15 miles swept of the lake. the entire that has burned 1 is 26,000 acres, destroying 637 structures and currently 11% contained. larry: and because of the fires there, many visitors are canceling their upcoming visits. clearly not a good development, especially heading into a crucial labor day hole lame. laura anthony has our story. >>

it was jim caron at morgan stanley saying that if you taper, you are reducing the availability to reach the 2.5% terminal rate, and, therefore, you will fall on slower growth. is that the way we should think about these moves? ida: i am not sure that is necessarily how we should inc. about this at the moment. i think two things happened, and the market is pricing this. one is you saw significant buying of tips today in a liquid market. that has meant inflation expectations have gone up when you look at tips break even, up four or five basis points today. part of that is this lower forever fed we are likely to have. we thought we would that the hint of a dovish taper and jay powell gave us that. keep in mind, we have not yet tapered. the way i look at the way yields have developed the last year is that we basically got the first half of the taper tantrum in january and february this year when yields went from 70 basis points to 150 basis points, and now we are consolidating a little bit below that. once the federal reserve starts to taper, that means there is going to be less demand for

but caron continues to deny any role in the strike on the, and the mercer street which kill 2 people. the u. k. government has also condemned the attack. the full report is a program coming out next, following the investigations into last year's bay roots port explosion. the the the, i all i the i was in the i me 6 o 8 p. m. august for 2020. there's been a large explosion in lebanon's capital bay. ruth, within the last hour, the not only heard it's adrian celebrities, capital me. some reports are suggesting that it happens as they vote for me. i was love at 1st away. the glass broke everywhere. d the, with so much is destroyed. the biggest point is in the heart of the capital, along a busy highway and close to densely populated neighborhoods. the without warning, what is the largest non nuclear blast in history kills more than $200.00 people, injures thousands and leaves hundreds of thousands homeless. ah, authority saith the blast was caused by highly exclusive material stored at a warehouse in the in that highly exclusive material was ammonium nitrate at the time authorities problem

he made the comments while condemning reports that have claimed caron was behind tuesdays hijacking up an oil tanker of the coastal feed to our of emeralds. meanwhile, the tank itself name yeah, felt princess is now reported to be out of danger. you came maritime authority, says the hijackers have left the vessel. the distress call came in on tuesday to 8 to 9 arm to sailors board. at the tanka, so far, there's still no information on the identities. what were the motives of the perpetrators of following the incident on tuesday? some u. k. major outlets were quick to accuse iran, citing an unnamed security souls all lot just by no evidence being presented. so far, international fast commentator jonathan johnson still told me though, that is too early to jump to conclusions. i just like it front line between iran and the states supported by the rest are very suspicious. and iran and is scared of homers around the nor. and since or tank is of often been years just towards the 3rd season in stopping searching the war through some kind of attack. i mean, john, is that just hydrogen thing?

jim caron, thank you so much of morgan stanley. quite good on both sides of the bond markets as well. lisa: what have you been doing this summer? lobster rolls, scallops? tom: i grew up on fish sticks. i grew up in the midwest where fresh fish was a once a year occurrence. lisa: fish sticks and tank. -- tang. tom: unfortunately, that is true. [laughter] mike mckee has a great lineup of people to really add perspective on the challenges the chairman has. lisa: we have heard increasing drumbeat that the fed will taper quickly. yesterday, a representative of bridgewater talking about that. i wonder if that is lower yields ahead. tom: futures up 15. the vix, 17.77. stay with us. this is bloomberg. ♪ >> with the first word news, i'm ritika gupta. president biden is telling terrorists the u.s. will hunt them down. this is after a bombing outside of the kabul airport killed service members and dozens of others. islamic state claimed response ability for the tack. -- for the attack. protections for millions of people are ending as they fel

i think jim caron nailed it earlier, when he said that if they announce a faster taper eventually, thatill actually meet to lower long-term yields. this is what a lot of other people are saying. tom: it gets out to the terminal yield. to the mathiness of that, there's the four ideas that make up the yield, and to me, the immovable force is the microeconomics, the liquidity wall, which means price up, yield down. taylor: except that in the credit market, it is going the other way. we just came off of seven straight weeks of rising high-yield credit spreads. that is the longest streak since 2013. interestingly enough, in the afternoon, guests have been coming on and saying it is a buying opportunity. you do wonder when some of the economics fold through with an investment grade, within the high-yield, and the squishing this with spreads -- the squishiness with spreads rising. tom: we go to abramowitz on high-yield. this is your yield house -- your wheelhouse. is rates right -- is rigs right -- is riggs right? lisa: yes, executor right. tom: so junk oil paper goes price down, yield up. is

which could potentially be an intelligence failure that we need to dig into, their capability to sin caronizeis lay down arms and blend in or, you know, fight to the death. and some, many of these guys, unfortunately, are choosing the former. grefe griff when you say intelligencing failures, are you talking about our assessment of the readiness of the afghan security forces? >> no, i mean our failure to understand the capability of the taliban. and joe biden has to own this. just a month ago, i think it was july, he said that the afghans are not going to fall apart. and that's assumed based on an assessment of the capabilities of the taliban. so either, a, he wasn't listening to the intelligence community, or the intelligence community failed to paint the pictureover the capabilities -- picture of the capabilities of the taliban of. we need an oversight committee to find out what's going on on. why are we surprised with the speed, and this is quoting kirby yesterday in his press conference, why are we surprised with the speed of the taliban's assault on the country? this should not shock the