jeff gundlach says that is not true.going to expand the buffalo art museum without making it bigger. he with us is bonnie wongtrakool. what do you think of mnuchin standing by? we are inwould say the mnuchin camp, but not that you would see that much wage inflation because. of the fiscal stimulus you have the demographic problems, you have the forces of technology, and you cannot discount the employer pricing power over wages. there is industry concentration. fiveross markets, the top companies basically generate half of the revenue. against that you don't have the level of unionization we had in previous years in america. the idea that there is going to be a rapid increase in wage inflation beyond what we are seeing, which is rather low, is one we looked out. weould --is one that would doubt. i would add that the fed looks at wage inflation not core inflation. they would be happy to see both, but to the extent that we had wage inflation, core inflation could remain contained. we have seen that in the past. even in the m

to keep them common on an even keel and get the view -- and that's not the same as someone like jeff gundlach, or people trying to make decisions on whether to alkaa allocate assets. maybe the most interesting question on the fixed-income side is what's my bigger risk? is it duration or credit risk? meaning, am i more worried about being beyond three or four years in duration across my bond holdings, or more worried about do evident too much high-yield debt right now and, again, i don't think that i know the definitive answer, but i do think the question people should be focused on if we're having this debate about overheating the economy or recession, how far away is it? unclear, i think anyone who says they know is kidding themselves. >> he says it's still going to work, you know, may counter -- intuitively, and i think it would work >> i think there's a play on sensitivity, and whether it's in the bond mark or stock market, do you want to be in places that are less interest rates sensitive or more? or you want to steer clear of the reits, and want to steer clear, i think the bottom line, w

we got some insight from jeff gundlach. check out these tweets, i'll run it for both of them., policies will raise wages without inflation. yeah, sure, and we are going to expand the buffalo art museum without making it bigger. then he said if inflation is no up with wages, if inflation goes up, it is not good for bond owners. can you get the wage growth without inflation? >> you need productivity, that has been talked about a lot. so hope springs eternal. but i'm not sure there's a lot of credibility coming out of the administration on the policies and what they will do. is it inflationary, disinflationary, progrowth, low growth, it is really hard. ♪ ♪ shery: welcome back to "bloomberg best." i'm shery ahn. the past two weeks have given the fomc a lot to chew on with a january surprising inflation spike, rising bond yields and turbulence in the stock market. this week, our bloomberg international and economics policy correspondent michael mckee sat down for an exclusive interview with the minneapolis fed president, neel kashkari, who says he does not think that one month of d

what's going on >> 70% chance of a recession before 2020 and then today on the half time report, jeff gundlachogether with the uncharted waters of quantitative tightening which will start being a real effect. there hasn't been much yet, but as we get further along, there could be as much as $50 billion a month rolling off the treasury's balance sheet that together with quarterly rate hikes, i think, certainly has a cocktail with a potential to lead to a recession sooner than a lot of people are talking about two years from now i don't see in the months ahead, but i certainly believe we can have a recession in a year's time >> we are way overdue in the business cycle for a recession what do you think about what they're saying here? >> you know, people are terrible at predicting when recession will come. >> that would be correct >> i think for most investors, they shouldn't be trying to time when a recession will happen or when it's not going to happen. i think the most that you can do is look at the overall picture of the economy and where you think valuation should be. that's where probably, a

we like this chart because it makes reference to what jeff gundlach said. as soon as the u.s. 10-year then it starts hurting equities significantly. william: my colleague david said puts things at the technical .305.at i suspect that we will touch that little. but there has been such a dramatic change in sentiment, particularly in the euro area, which we can get to the rollover the data can i think the market is beginning to run out of steam. i suspect we will not go through this -- i'm certain to hear the 4% conversations coming out now. past the we will get .305 level. francine: are you shaking your head because you are not expecting 4%? bob: i'm expecting 4% a year from now. a looks very extended to the downside. it looks like positions are step -- are stressed. feels like the back of from september has gone about a hundred basis points. it has gone far enough. it is time for a bit of consolidation. francine: are you expect in that delete to more volatility in the market? bob: i think things stabilize. as we get into the back half of 2018 and you have ba