we get a mike wilson view of this at morgan stanley.n to chairman powell in front of the senate inking committee at -- banking committee at 10:00 a.m. this is bloomberg. ♪ lisa: keeping you up-to-date with news from around the world with the first word. president biden will propose raising taxes on wealthy americans to help a medicare funding crisis. this plan would boost medicare taxes from 3.8% to 5% on certain kinds of income above $400,000. it would allow the government new power to negotiate drug rises for medicare. bloomberg has learned more job cuts are on the way at meta platforms. the parent of facebook will cut thousands of employees as soon this week, that follows a 13% reduction in november. meta has seen a slowdown in advertising revenue and has shifted focus to a virtual reality platform called the metaverse pitch china shaking up oversight of its technology sector in the wake of a tech at a with the u.s. a national bureau will manage and police data resources while the language china's digital planning. the ministry of sc

. >> balancing after that s&p 500 was so significant in some circles including mike wilson's over at morgan stanley who said they survived a critical point last week that suggests this bare market rally is not ready to end just yet. there was a feel last week that, uh-oh, you know, when we got a touch below the 200-day moving average that anything was possible you had notes come out and say, we're going back to the october lows we're going to retest that this was nothing more than hope and a dream and a prayer, and it's all going to reverse itselves mike wilson says, i don't know that bounce was pretty good from a technical perspective and maybe it portends we're not done with this move just higher. >> and i mean, that's probably a very short-term view, right? that mike's talking about because we have a couple of things, namely inflation numbers and that's ahead of us, and it could upset that narrative, but what i would look at, scott, is something that sarat said about earnings, we're done here with s&p 500 earnings, and if you look at the disappointment if you will, it came through

equity strategies, mike wilson. our guest is anita cooped up. good morning.nita: i would take some parts of it, but not all of it. definitely earnings decline is not over. i think that is priced into equities at this point, because if you are looking at the u.s. s&p 500, our own prediction was still positive on earnings, we were at a 0% earnings growth. i think this higher trajectory is worrying everybody, and mike was right last year. he is right this year to, in terms of volatility. how much more of a downside we have, not sure. dani: in the same framework, in terms of higher yields, that was the story, higher yields meant lower prices in bonds and equities. at some point, we are starting to see it now may be, does that grip that bonds have on equities, is it finally starting to break? anita: i think, yes, it is starting to break. we are seeing more of downside in bonds and equities. i think at this point, the higher yields will stop impacting bonds quicker than equities. that is our view. we are a bit underweight equities at this way. properties have not f

people telling me, oh yeah, it's the mike wilson algorithm. >> this is absurd. mean, we have a real market, okay, with real stocks, of real companies, and they are being revalued i know waiting, forget that. they're being revalued every six or seven minutes, and i think that's so treacherous that you just have to let it play its course you can't make -- honestly, i was going back and forth with target on how great target was, only to see target go down, because target, the stock, has absolutely nothing to do with target, the company. i mean, that's amazing to me how is that possible >> we're going to dive into a bunch of the other retail names with their reports and guidance. it's not all good, to be sure. >> oh, no, there are ones that aren't the hate on for dollar tree versus the ross stores, which i thought was terrible, and everybody loved it at one point, they said -- someone asked about stealing they said, we have guards in front of the stores. like, you know, yeah we got guards. oh, good tj doesn't have -- we've got guards is that -- that's where we are r

>> well, that's mike wilson's call from morgan stanley. he's been making it for months now. again, i think that what's -- >> eventually he might be right. >> we have seen earnings estimates come down. they come down quarter by quarter, you know, and over the last year or so we never really had that blood letting for 2023 where you take down the out year. you get expectations low enough. we haven't had that yet. one of the things i think is interesting when you think about a lot of the major tech companies, consensus estimates has earnings up high single-digits for 2023. this is a much higher rate environment than we were in for all of 2022. growth is likely to be slower. we have geopolitical headwinds. we still have2íqd inflation reas at very high levels historically even though they've come down a bit. all of those things are going to be headwinds to earnings. at some point it's my view in the next few months or so, we're going to have major tech companies likely guide down. they've been cutting jobs, cutting costs, which is capex and that sort of thing. sooner or later the

i guess mike wilson. we just had mike wilson on i don't know this might be the bane of being good at something. you get really fine about your calls. mike wilson thinks it is possible of 3,200 in the cards for the s&p because of earnings problem from higher interest rates. >> he has been negative for a while. >> he still is now he is saying that the short-term outlook rally has room to run before headwinds increase >> why >> now he is talking about 2.5% higher than friday's close at 4,150. >> on a technical momentum >> the near-term rally may have room to run. despite that, we believe -- i think there is an at this point in here. we believe it does not refute the very poor risk/reward offered by many stocks given valuations and earnings forecast that remain too high in our view he expect margins to pivot >> maybe you will see something. >> there is support last week this suggest the bear market rally is not ready to end yet. that is mike wilson. >>> time for the squawk planner. on wednesday, adp and then

mike wilson warns of elevated risk in markets. we discussed with greg boutle bnp paribas of. -- greg boutle of bnp paribas. the semiconductor index is down. first citizens stepping in for svb. yields higher, risk off going through the bitcoin, below 27,000 u.s. dollars this is a week where we are antsy, waiting for the amount of fed speak to come. this chart tells the story of the yields moving in relation to s&p futures. we thought we would get a bullish tilt. that is the macro picture with movers. >> a tech company working with nonprofits. the stock up nearly 12%. it rejected an unsolicited takeover bid from clear lake capitol for $71 a share. they said it is too low and shareholders agree. guggenheim raise the price target from nine dollars to $12. . a good day for snap. the story of the day is what is going on in the banks. first citizens will buy svb. lots in the deal for citizens in particular, one of the top 15 largest u.s. banks. stock is up 48%. that is spring a relief rally for first republic. shares higher by 16% at the

mike wilson warns growth equities face pressure ahead. ed: more job cuts at meta.he facebook parent planning to lay off thousands this week. more on our bloomberg exclusive ahead. caroline: china shakes up oversight of its vast tech arena. xi jinping focuses on fending off u.s. sanctions and achieving self-sufficiency. all of that and more coming up. there is a lot to digest in the macro part of these markets today. it was one of a prospective coming from jerome powell, coming out fighting. maybe the federal reserve is not done tackling inflation. big tech on deck. all of this worry around what the federal reserve will do affected european trading. we are off by 1.3%. i am looking at this inversion. this is the two year bond yield. the cost of borrowing at the two yield -- year is higher than the 10 by a full percentage point. -104 basis points. this signals the worry the market has about a recession to come. let's look at the u.s. dollar strength we saw on the back of the hawkish tone. bitcoin under pressure too. chair powell having fighting words for crypto. ed:

mike wilson of morgan stanley soon.loomberg. ♪ >> inflation is coming down, but we do not think it is going to come down as fast as markets are pricing in. >> i think it has another leg up. >> we are not anticipating that the fed is going to cut rates. >> they are still fighting inflation. >> powell is saying, we can't really give you forward guidance at the moment. >> this is "bloomberg surveillance." tom: good morning on a monday after a historic week. jon ferro is not here today. he is on a serious assignment for three days. i think it is looking into my new beard and all that. people are saying, should i keep the beard? on radio, it is a thoughtful process. i heard all around the world anecdotes about what you two were doing, the special broadcast on sunday, the fed show, the exhausting week that it was. why should it continue this week? lisa: i think everyone is a little tired. you were missed. right now, what we're are looking at is exhaustion taking over a market with no new information. the fact there was no new

so mike wilson and credit to him, i think he needs to define what bounce is.oint of interest, what happened this weekend, exactly the same thing that happened in 2008 and same weekend which was bear stearns and we had intervention then. guess what happened? we had a 14 1/2% rally from that week into mid-may. then things rolled over. so i think we all need to be kind of open-minded here in terms of how things can play out. i just know in the here and now we're extremely oversold. so we're definitely i think setting up for a bounce. obviously we'll have to see the data tomorrow with cpi, then the fed meeting next week. charles: bottom line, no matter what be nimble either way. sven, thank you very much. appreciate it. >> thanks, charles, take care. charles: coming up my takeaway i, how i used to adore venture capitalists particularly tom perkins. why i don't as much anymore. we have danielle shay to look for ways to make us money. she has been sizzling hot more than a month. stay tuned. she will be right here after the break. ♪. people remember ads with a catchy

you are listening to mike wilson of morgan stanley. he was speaking about the economy broadly.ur stock at the top of this hour is meta-with thousands of layoffs possibly as early as this week. ed ludlow broke the story and joins us now. this was supposed to be the year of efficiency for meta-platforms according to mark zuckerberg area it follows a 13% layoff and december. ed: according to our sources, the pitch for efficiency goes deep. these are new layoffs of 11,000 that came to the end of laster and are separate from the flattening that meta-has been going through, but tickly middle management. sources tell us and staff are drawing up lists and those could be converted to actual layoffs and one reason it could come quickly is because mark zuckerberg is due to go on parental leave. he is expecting his third child with his wife. what we are hearing from one source is that there is pressure on drawing up those lists. jon: helpful context, when people see the bottom line focus at meta-, they think about the challenges in the advertising market but you have been zeroing in on the

. >> widely followed strategist mike wilson from morgan stanley out with a new note in which he saysg in other directions. now the question is now that the stocks and home builders have protected the index for now, can you get the oversold regional banks that have been so weak to perk up a little bit. maybe it's a lot to ask but that's the kind of choreography. last year of course both lost big. year to date, we're almost a quarter of the way through the year and we're basically up 3%. there's not a lot in terms of rebalancing as the total stock market versus the total bond market. look how much it gave up since the high. it's a little bit of a delicate balance but we've got rescues and not further failures. that's always at least a net positive. >> just to clarify what mike wilson was talking about, he's saying we could be seeing the end of the bear market but he's saying don't buy, it's going to be too soon and it's going to be a painful and vicious start, the start of the beginning of the end. >> you need the end of the bear market before you get the beginning of the bull. his poi

morgan stanley cio mike wilson, back in october, said the macro is not going to drive trade, earningsill. that switch still has not kicked in. that brings us to exactly what we are going to get any four hours from now. the major rate decision from the federal reserve. are they going to pause or hike? that seems to be the question. >> personally, i would like them to pause. i would like them to see what has been happening in the banking sector. everything that is happen this week and last week. we need a little breather to figure out what is going on in the markets. they can pause. they have another chance to hike six weeks from now. it's not like they pause and are never allowed to hike. jon: obviously, we are going to see a lot of views leading into that decision for the fed. the banking sector is going to be watching very closely because we are trying to determine the sensitivity of that sector right now. that brings us to our stock of the hour. we just showed you that 50% plus advance for first republic. those shooters shaking off the record low we saw on monday, as the lender look

stifel basically with some shade toward mike wilson, saying, "others are calling it a bull trap.hey can call it a bear market rally, a bear trap or call it a banana, we are follow ignoring potential six-month rallies. >> he's basically been saying this he saw the possibility to have exactly this type of cyclical-led relief rally of sorts. strong seasonals helping that out gets you into april. 4,300 from here, what are we talking, 7% up it's not nothing, but it might be something where i think everybody seems to feel as if maybe the market's not going to really run away from you, even if you think the low is in, and even if you think that we're going to somehow make our peace with what the fed has to do because the economy's stronger than we expected everyone's made uneasy by the shape of the yield curve everybody's made uneasy by how the leading indicators are still, you know, completely in the pre-recession zone so, you have to believe that there's something atypical to some degree about the sequencing of this cycle to say, don't worry about that stuff we're fine it's up and awa

that was mike wilson from morgan stanley earlier this morning.e's growth investment fund has named a new leader. one of the only women to name -- to lead a major venture firm. i asked you this and i will ask you again, were your peers surprised by this appointment given your history at this firm? guest: i've been investing for 10 years, so i have a number of amazing colleagues and peers in the industry. it's been amazing to see the support and outreach today. i don't not they were surprised, but they were certainly supportive. >> we can get into the portfolio some of the investments you've made. this is an interesting firm. a lot of capital to play with. would you say that in your new position of leadership, will you change the investment strategy from where it has been? >> we will keep the link on the success we have had. we are focused on investing in generational growth technology companies. really amazing founders, amazing companies operating in big markets. we make very concentrated bets. we do a lot of work to find and develop investment th

>> that is what mike wilson is saying. what he is focusing on is that falling credit availability.e says u.s. stocks will remain at an unattractive level for some time until we see that equity risk premium start to rise to the 400 mark. he says the collapse of sp -- svb credit suisse is exactly how the bear market ends because what he says happens is an unforeseen catalyst. that really focuses investors to look at what has been staring them in the face all along. they have been tracking the treasury yield curve inversion. >> the real trouble starts at the bond market says the fed will be cutting here. the bond market is seeing some sort of recession. >> treasury yield curve inversion, we are currently just around that 50 mark in negative territory for the two year yield. in the meantime, he is suggesting that investors stay invested in those more defensive areas of the market. >> you know people are getting worried. he was so bullish in terms of his attitude last year. he is now sounding the alarm. this first quarter will really mark the high point for stocks and 2020. that is the

kathleen: mike wilson speaking with lisa on of it. coming up, how the banking turmoil in the u.s. europe is testing the most bullish emerging-market cases. this is bloomberg. ♪ did you ever stress about us having three kids? no, that was always part of the plan. three kids?! this was never part of the plan! these kids order the lobster mac 'n cheese! what if she wants to play golf? we're going to have to outlaw golf. absolutely no golf in this house! not under my roof! since we started working with empower, all of our financial questions have been answered, so we don't have to worry. so you never- nope. always part of the plan. join 17 million people and take control of your financial future to empower what's next. start today at empower.com haidi: the mexican peso has become a casualty of recent global want to lead tied to u.s. regional banks. let's bring in michael awoke. -- michael o'boyle. we've looked at the myriad ways we've seen inking troubles derail, so it is the connection to the super peso? >> the peso is one of the most liquid emerging-market assets in the world. it tr

had calls on how resilient stocks are in the face of stretched valuations, that is the call from mike wilson at morgan stanley saying the forecast is overly optimistic. and kolanovic saying it is probably as good as it gets for these equity markets. what do you make of the recent comments on where stocks go from here? >> from those comments alone, you can see there has been a lot of confusion over where stocks will go next. a lot of it is absolutely right, -- alana fitch is absolutely right, the start of the year was easy for equities. we were subscribing to this narrative of a no landing scenario, where inflation remains under control and growth is not slowing down enough. very different picture now. evaluations really have to make a lot of adjustments especially because last earnings season we saw a lot of optimism from companies declaring pricing power and optimism over the reopening in china. very different story now because the focus is on financial stability. with recession risks coming back to the fore, so a lot has to happen in the valuation space. tom: on this debate, we have jeffre

i know mike wilson at morgan stanley is now conceding that within his bearish call there will be near-termsuggests it will be more than near-term. but at least we have the s&p 500 higher. as for credit suisse, not so much. credit suisse having a rough time now we have the news that davis -- david harris associates is out. this is incredible to see and continually get a stream of bears news on credit suisse. guy: you watch watch more painful chart, take a look at what is happening to credit suisse compared to the other european banks. that is pain. let's get details on what is happening with credit suisse. is the biggest story here actually that david haro held onto this for way too long? it has taken him such a long time to sell. i appreciate he was the last old --bull left. >> he even admitted that to us in august and did an interview with us, essentially saying they have stuck with credit suisse through the crisis and that would perhaps be a better time to sell and stay on for another decade. he has been vocal in the last six months to a year about his dissatisfaction on credit suisse. h

equity markets, we will hear from mike wilson, their top equity strategist later this hour.ns set to become one of the top 15 u.s. banks following the acquisition of silicon valley bank. more details on that in just a moment. this is bloomberg. ♪ ♪ the new chase ink business premier card is made for people like sam who make...? ...everyday products... ...designed smarter. like a smart coffee grinder - that orders fresh beans for you. oh, genius! for more breakthroughs like that... ...i need a breakthrough card... like ours! with 2.5% cash back on purchases of $5,000 or more... plus unlimited 2% cash back on all other purchases! and with greater spending potential, sam can keep making smart ideas... ...a brilliant reality! the new ink business premier card from chase for business. make more of what's yours. >> united states regulators have accused binance and its ceo of breaking derivatives roles as an allegation that the ceo called unexpected and disappointing. we have the data now and this follows a lot of regulatory pressure from other jurisdictions. >> it has really been

tom: mike wilson on what he thinks is the start of a vicious end to the bear market in u.s. stocks.ershing square's bill ackman's is the fed should not raise its benchmark rate this week, citing major shocks to the global banking system including the closure of three u.s. lenders. meanwhile, tesla ceo elon musk has suggested the fed should cut rates by 50 basis points tomorrow in response to ackman's post. joining us now is sunaina sinha haldea, global head of private capital advisory at raymond james financial. thank you for joining us. has the financial condition tightening given the fed the space deposit this meeting and consider cuts later in the year? sunaina: it has certainly given the fed a reason to pause. do they pause is another question altogether. 1970's dies hard in the memory of fed officials. they do not want entrenchment of the prices, and also a double bump in inflation. i think you get both. you get a 25 basis point increase and you get a strong signal that what they did with silicon valley bank, signature bank is just the start of what they could do. they have the

. >>> elsewhere, morgan stanley chief investment officer mike wilson has his picks on cnbc pro. >>> ukcery inflation came in higher than ever in march. prices rose 17.5% on average on the year. the reading follows similar data from the british retail consortium which put it at 15%. the highest in yearly 18 years. >>> a 3.4% increase in retail revenue for okado. the british group has seen an increase in customers, but average basket value remains flat. the company maintains guidance adding it expects a positive ebita this year. after trading positive, the stock is now down 1%. >>> the ceo will leave his role after 10 years at the end of june. it will be the eighth female ceo of the ftse 100 company. >>> coming up on "street signs," could commercial real estate be the next sector hit by the the next sector hit by the banking when we started our business we were paying an arm and a leg for postage. i remember setting up shipstation. one or two clicks and everything was up and running. i was printing out labels and saving money. shipstation saves us so much time. it makes it really easy an

mike wilson at morgan stanley saying the risk of a credit crunch has increased materially. when we look at the bloomberg financial index it's tightened and took a sharp dive titer after the collapse of the silicon valley bank and the downfall of the other banks surrounding it. the big question is maybe they don't know about the lag effects of this turmoil in might look to keep their options as open as possible. francine: thank you so much valerie. if you look at european banks, what a whirlwind they've had. tom: gains yesterday across the sector. today coming off a bit. across the sector down around 6/10 of a percent. here's all the individual names. ubs hosted a decent session maybe the fact you've taken out this tailwind in terms of the risks around credit suisse. and you posted a decent session for ubs. deutsche bank just off, hsbc gaining. there's more stability in this banking sector and the question is whether that maintains, regulators will be wanting that. you had the news maybe u.s. authorities were looking to guarantee those deposits and then you have the news fro

mike wilson of morgan stanley saying the credit crunch risk has increased materially. lastly, from apollo, claiming the recent disruption equates to 150 basis points of a fed hike. let's look at the bloomberg financial conditions index on what has been priced in since the banking upheaval started. you can see a sharp contraction that felt with the collapse of silicon valley bank and conditions continue to tighten as the regional banking sector came under a big spotlight. the other thing is, perhaps the fed won't be in a rush to pivot. maybe they learn from the mistake of january that they were too optimistic about disinflation and will perhaps keep their options as wide as possible. dani: a lot of options to be had, it feels like a lose lose situation. we learned moments ago that ubs will be offering to buy back some of its bail and note. that's its euro denominated senior unsecured notes do march 2028. these are the bonds that have been under scrutiny after credit suisse saw those wiped out as a part of the deal. bloomberg has learned that ubs wants to cherry pick top

this is what mike wilson at morgan stanley would describe as the bear market rally.inks it has further to run and then pain will be felt in the medium term. dax up .1% aired broader benchmark is 464 just a gain of .1%. thanks gaining .3% as they move higher. healthcare in the green. it is very modest. about half of the sectors in the red led by technology down by .5 percent. francine? francine: jamie dimon says russia's war in ukraine is among his top concerns. he said is up to governments to consider their security priorities and policies. >> the thing i worry most about is ukraine. it is oil and gas. the leadership of the world and our relationship with china. that is much more serious than the economic vibrations we all have to deal with on a day-to-day basis. >> on the ukraine question that we talked about a year ago shortly after the war started, do you think now a year in that the west has become a nord to the idea of a calm but on this scale and does that worry you? >> it looks like people are used to it but that is a mistake. i read report that if a war goes

dani: when it comes to top risks, mike wilson at morgan stanley is talking about the risk of a creditbank of america's leases -- latest investor survey they say the systematic credit event is a top risk market. our folks worry about access to capita? richard: some are improbably certain smaller indentations are. many people got their balance sheets in good shape when interest rates were low. people are not entering this with really thin uncapitalized balance sheets. most are in good shape in larger places. i am not hearing a major concern about capital, and i have app -- optimistic in the fed was right to say barring what just happened, some tightening of credit the equivalent of one or two rate increases they might have needed to do on inflation. people have talked about it being the equivalent of 1.5 point increase in the fed's fund rate. i don't think we are seeing signs of that. no one knows for sure but that's not where i would be. dani: you started out mentioning that one of the top risks is ai. when chatgpt went live, the story blew up. everyone was concerned about it. what doe

mike wilson warns of elevated risk in markets. we discussed with greg boutle bnp paribas of.

mike wilson of morgan stanley called for a 20% decline in the first quarter many we haven't seen thatontinues to be about the fed. and it will be about the nonfarm payrolls number this friday, cpi next week. the stock market is a liquidity junkie. earnings matter but not as much as the fed and liquidity. earnings were down nearly 5% in the first quarter. the market still went up because the beginning of the year there was an expectation that the fed would actually start to cut be by the end of the year. now that's been dampened down certainly by his testimony. cheryl: the expectation was the last hike we would see would be june now all bets are off basically. you mentioned the february jobs report out tomorrow, we're getting claims today. 205,000 is now the estimate for the february jobs, 3.4% unemployment rate. job openings fell. this is jolts. to 10.8 million yesterday. i guess that's better than 11 plus million. your thoughts? >> yeah, we're seeing the number of job quits coming down a little bit but there's still 1.9 jobs out there for every job seeker. that's the problem for the

mike wilson a couple weeks ago, that tactical bull call was because we held the 200 day and bounced from it. all these different things happened, yet we're right back to where we started from, and that's fascinating to me. as much as you think the bank problems are over, i don't necessarily think they are. so, getting back to the fed conversation, what could they possibly say tomorrow? i think they have to do something, something in the form of 25. if they do nothing, as much as people would like to think that'sbullish, if they are scared, they being the fed, then you should be scared, as well. >> or maybe nothing would be viewed as off to the races? i mean, we are in this place where we recouped all the losses from this bank meltdown in terms of the s&p 500 and we've lowered the rate by a full percentage point. i mean -- maybe this was a sweet spot, michael? >> well, i think the market would be misguided if that's the opinion that they go with, if the felt pauses. if they pause, it's for bad reasons. it's because they expect some sort of financial instability and that's not good for ris

you have to listen to morgan stanley because they had the number one strategist last year, mike wilsonbear market in 2022 and he says with all of the banking stress and the collapses we're seeing we might be near the end of the bear market. now there's still a ways to go. earnings will disappoint or earnings estimates need to be cut but he recommends right now actually getting and buying into these defensive low beta sectors so i'd imagine oil and defense be in there as well, and he does caution against buying the mega cap tech names like microsoft and apple which has been seen as a safe haven play now, i mean if you look at the stocks on these technology stocks, the only green you're seeing are in these technology names. last week, despite the collapse of silicon valley bank, we had the best week for the nasdaq 100 since november last year, so all of a sudden, these companies that have a large balance sheet, that have guaranteed earnings and profits are now a safety play. stuart: i'm trying to characterize the banking crisis. can i say that as of this monday morning, at this moment, i

this is a level that precipitated that mike wilson call the next day saying,xdu■ w should bounce nowwe're right back to it. a lot of noise along the !u■i]w but here we are. you make your decisions based on this. submite1 the market'slp expensive at these levels and if it's gotten a little more expensive. >>> let's bring in michael schumacher, wells fargo heade1 ¿e((árjtrategy what was your main takeaway from the felt today? >> yeah, the fed's trying to spin the dubbish hike. really difficult to do. so, the market is trying tolp figure out how to calibu>áe all thesexd things. higher inflation but coming down, credit conditions tightening, which are already much tighter over the last few months, so future tightening is on tap, and tie it into where the fedfá goes not so much toda but over the next 6w3 to 12 months. so, i think the dubbish hike narrative is probably not going to stick as much as the fed might like. >> whatq is yourout look for th economy, given the expected ongoing tightening in credit and also the variable lag effects of what the fed has already done? i mean, we could

markets that are here and now and right now things look okay and i'm thinking most specifically about mike wilson who has been bearish who is saying right now you can trade what do you think? >> look, i think that, you know, i think we're sort of stuck in purgatory. a lot put bets on last year and the pause was essentially pretraded back this january but i think investors have their own idea of where earnings growth is going to come in and ready to look forward to 2024 but i think we don't have enough information about 2024 yet from markets to really shift there so i think we're being pulled into the 2023 recession, fed, inflation that are tiff some days we get a little more push towards the 2024 recovery and i think we're stuck and why markets are turning around and chopping right now. >> it's karen. we were talking on the desk about whether it matters what the fed says is it other things that will drive the market what's your opinion? anything that you can say to move the market? >> you know, as an equities strategist i don't feel like i'm necessarily going to get anything substantially new ove

views in the e the 200-day moving average, all this stuff gets it back to where we were the day mike wilson put that tactical call on. i asked that question for a specific reason. if we're through this and effectively qt is still on the table and the fed has saved air quotes the banks, then we're right back to where we were with the problems i've been pointing out for the entire time. inflation is still a problem the fed is still hiking rates. there is still this lag effect and on top of that now, banks earnings power, regardless of where rates are going to go, are going to be diminished given all this stuff i get why it's bullish in the short-term, but nothing's changed in the long-term. >> you know what was really bullish in terms of moves today? tech the big tech comeback. the flight to faang picking up like nvidia and microsoft posting outsized game. the federa there is no alternative trade. carter, i know you're going to have some sort of pithy remark that knocks down this whole tech trade. i'm going go first to you. >> well, it's a defensive thing. if you're very worried about a cycli

reversed and had a three -day move where finally some of the bears felt bad about themselves and then mike wilson comes out what, yesterday saying hey, maybe we can go to 41.50 in the s&p cash and he is the biggest bear out there and all of a sudden yes the market reverses and then today, you get a very hawkish powell that then triggers us below yesterday 's low so at least we had downside follow through but how could you get really bearish right here because all of a sudden what happens on friday, you get a weaker than expected jobs report and they gap them up and keep doing this direction. >> i don't know the expectation s are already pretty weak. it's 203,000 jobs at the rate of 3.4% but remember we came in with that blowout 517,000. i'm thinking there's going to be a revision to january. i hope i'm wrong, but i think that's a possibility. that would certainly turn the market around because that would force jay powell and the fed to maybe cool their jets just a little bit, so we'll see. so john, let's talk about meta really quick. i mentioned that as we were introducing both of you. so they've

to catch up with mike wilson of morgan stanley.side on the s&p. we are lower today, down .4% on the s&p. and that the bond market, your tenure is north of 4%. briefly this morning, -- the whole curve, north of 4%. tom: if i am able -- a bull, i am rereading michael wilson this morning. this is an original screen on a standard deviation. you mentioned the present change mr. wilson is looking at. it is not that i am gloomy, i am sober about where we are. jonathan: we had a years and two months. january was a completely different story. this process, yields down the bit, equity off to the races. february starts, blowout payrolls report. in a month, that is almost 100 basis point move in a single month. tom: the movements are there means after talking to garvey, we can talk to someone who is an expert of movements. carl riccadonna is the chief u.s. economist of the beaker above. he understands tilted tea with aerospace engineering from a small school in new jersey. you are like kashkari, some of the same curricula. none of us have seen

picking up on what mike wilson was saying, yes there is significantly more downside to come for somets of the market particularly tech stocks but it brings this chart back into focus because morgan stanley has been very much focused on the equity risk premium. it has been deteriorating. that really does play to this risk reward for being invested in u.s. stocks versus treasuries and that has only been heightened by the fed comments that have just been out jay powell sank the hats needs to be raised even higher and faster and previously expected especially given the economic strength we are continuing to see. the question is whether to stay invested in stocks or park your money in short-term treasuries. it seems to favor in terms of those notes. let's change now because it does play out across the market landscape. we see australia looking lower as is new zealand. singapore futures for the nikkei just online contracting .4%. also keeping and happening in china. but we heard the comments from china's new foreign minister warning that tensions going between the u.s. and china -- >> in r

haidi: that was morgan stanley's cio mike wilson saying bond markets are pricing in a recession but equitytors are not so convinced. they are thinking the backstopping of bank posits by the fed could be something that would lead to another form of qe in the markets. whether this represents a buying opportunity for stocks, like wilson also not convinced. he has focusing on the u.s. equity risk premium. the s&p 500 current earnings yield minus --. we are back around the 230 level. he says until we get to 400 it is not going to be a buying opportunity. where he says investors should be focusing their attention closely to is deteriorating credit conditions. that is restrictive. it is something that is weighing on the growth outlook. whether or not market participants thank earnings estimates are still too high, he says we have not had enough of profit forecast cuts coming through yet and that will happen from analysts as the earnings season approaches. in terms of where he is recommending to buy, he says stay defensive and steer clear of the i.t. or growth stocks. we are seeing the i.t. index

our earnings estimate, $195 eps, from my colleague mike wilson, that is below current consensus thats to 20. -- 220. we have upside to earnings estimates in our coverage. david: what is the eps growth? jonathan: for asia, we think we may get cumulatively this year and next year, 15% positive eps growth in u.s. dollars, above consensus. haslinda: i am wondering, jonathan, the risk out there, what is it for you? jonathan: we have not touched much on geopolitics. it's always there. we are nearer of multi-world dynamics, very complicated geopolitical the nymex. that can -- a geopolitical dynamics. that can affect discount rates. we are confident in the earnings recovery story but valuation that investors put in it is affected by geopolitics. haslinda: of course, the upside to the dollar if that scenario were to play out how might that way, or shape your projections? jonathan: the dollar is tremendously important. it got to a 40 year high at the end of the third quarter in real terms. it fell very sharply until early february when it regained about one third of those losses. broadly we th

shery: you mentioned mike wilson from morgan stanley saying how equities have to be driven by valuations in order to go higher. we need to see rates all income of the dollar also weakening. the repricing of expectation for fed rate hikes. we had more signals today from data that inflation is pretty persistent. we're talking about the prices paid component of the pmi rising again for february. we saw u.s. stocks and bonds all falling not a lot of movement in the future session as trading get started across asia. we are also seeing not a lot of movement when it comes to wti prices. there was broader risk off but at the same time a smaller than expected gain in u.s. crude supplies hi. we had also seen the record exports. haidi: let's talk more about what is moving the markets. kathleen hays joins us also our executive editor paul dobson. we continue to hear the consistency from the fed leaning into the narrative that more needs to be done to fight inflation. >> consistency is definitely the word. fed officials whether they're going to do 25 or 50 whatever they're saying about the size or sp

. >> if mike wilson is right and the bond market is figuring something out, he believes equities willnd that was it. i still think there's probably potentially things to work through, but the nominal growth story is different and it can go away in a hurry and employment is not a leading signal but so far things have remained intact. you have to make assumptions about what the credit contraction means, either pro or or con, behind that. >> couple thousand points. >> kind of amazing. that's piled on so much market cap that it's obscured the weakness elsewhere. it's gotten expensive again. the premium of the nasdaq 100 to the s&p is right back to where it was november of 2021. that was the peak in the nasdaq. so now we're back to having that argument, you know, microsoft and amazon, are they really staples? what are they. and alphabet certainly. there's been a little more of a back and forth in that group today. it's not the story of why we're up, at least this morning. >> interesting. the tech story and sort of how regulation fits into all of that which we've talked about off and on the

. >> mike wilson is already ther so you're in good company, at least. art, thanks. we'll talk soon.easure, thank you. >>> bearish art. big tech scaling back their ai ethics teams, as a group of industry titans including elon musk have a new warning for owowarchers. sl dn. we're going to discuss with one of the authors behind that letter next. stay with us - psst! susan! with paycom, employees do their own payroll. - what's paycom? a magic payroll genie? - it's a payroll app. - payroll is way too complicated for the average person. - paycom guides them through it. missing or duplicate punches, pending expenses, unapproved pto, on and on. - why would employees wanna do all that? - this could be a stretch, but i think it's 'cause they wanna get paid correctly. i like getting paid correctly. what do you see on the horizon? uncertainty? or opportunity. whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined risk management are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-te

morgan stanley's mike wilson says it's not qe, they will get the loans back we are seeing the fed balances bullish for stocks. >> i don't think so it's qe. you have to think about, for example, if jpmorgan has a flow of deposits on its books, going to use that money to be -- require reserves for loans i don't know the extent to which jpmorgan will think of that as permanent. also these loans, looked like if you do a real wonky analysis of the balance sheet, looked like most of the money taken out of those funds was short term you wouldn't do that if you thought you were going to use it for lending. i don't think it creates new money in the economy it does boost the reserves at the federal reserve, but that money can relatively quickly go away once financial stability is restored. >> steve, thank you. steve liesman joining us. >> it's interesting the qe question sara, because on one hand you look at the aggregate size of the balance sheet it went up, but it's collateralized lending. different than the fed bidding outright for bonds. >> pay it back. >> they will you have to pledge longer te

tom: that is mike wilson of morgan stanley, sharp yesterday on the back and forth.hink it's important in the models of the last 10 days, spx 4004, down 32,600. the nasdaq somewhere near 13,000. the vix was around 30 and it hasn't come into bull market levels. it's a good take over the last 15 days. lisa: people took a look at the banking crisis that did happen and that seems to have subsided and they said it will cause the fed to cut rates but the economy is still doing well so risk on. tom: we will have to see. to me, it's a mystery off of economic data. lisa: the question is whether we have gotten past the banking crisis. we are not going to be in washington dc at these hearings going on today and they will have a hearing with a number of different dignitaries and officials including michael barr who is the head take a listen to what he said. how much can they draw a distinction between these as specific events having to do with bad management versus broader stress that could be born out through less lending and potentially additional failures? tom: the challenge

we have had people saying morgan stanley's mike wilson said the vix is the end stage of the bear market which could be ugly in terms of volatility. i don't know what brings that on. probably nothing pleasant. >> i think if you are a day trader or an amateur day trader, i would say the last couple days have been tough. you look at futures in the green yesterday on tech. the market opened and everybody transitioned back to banks. now they feel appeasement there. i think volatility is the key word in the short-term. in the long term, and becky makes a great point. a lot of us don't believe p what we're being told and that goes back to transitory and how long we held on to stocks and really got hurt. rates went very high and very quickly. if the fed does more and we are uncomfortable with that and it leads to a small recession, he is toward the end of the cycle. he is toward the end of the cycle. at some point, you have to be in the market. time in the market, not timing the market. that is what it comes down to. this is a good spot to think about that on the pull back days to drip in and d

but as mike wilson aptly highlighted in the last week or so, you are starting to see long and variable lisa a: how has worldview changed over the past week in terms of risk aversion? how much more inclined to be in cash on the heels of the financial systems distressed? dan: not much. you nailed it earlier in terms of the environment. this is not a credit crunch and not a financial contagion repeat of 2008. ironically, some big banks are already reporting inflows of deposits. the system will hold. we do not see the draconian outcome. we are still sticking to the flame work -- the framework we have been talking about this year which is favoring credit over equities. equities being more defensive oriented, quality oriented, dividend oriented. the looking outside the u.s. into international ideas which have still trended higher relative. lisa a: michael earlier this week was almost john -- bob michele earlier this week was on with john. there are many more shoes to drop. i'm curious where you think we are in terms of people getting wary of the growth prospects and read through to equity va

coming up at 3:30 p.m., mike wilson, the chief equity strategist at morgan stanley.ur 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 and the other goals along the way wealth plan can help get you there. j.p. morgan wealth management. your supply chain and ryder makes sure you're ever delivering with freight brokerage to transportation management, truckload capacity and dedicated trucks and drivers. when people come, they say they've tried lots of diets, nothing's worked truckload capacity and 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

here's your lineup, mike wilson and morgan stanley, do not miss at 9:30 eastern about the opening bellzer of city, and also lineup. tom: good equity. can i defend mr. sullivan? 30 one billion revenues, wealth management 17 billion revenues. platform solutions, 2 billion revenues. it is tiny. jonathan: we have discussed that. futures rolling over, just about unchanged on the s&p 500. 60 minutes from the opening bell. ♪ ♪ portunity. whatever you see, at pgim we can help you rise to the challenges of today, when active investing and disciplined risk management are needed most. drawing on deep expertise across the world's public and private markets in pursuit of long-term returns... pgim. our investments shape tomorrow today. tom: bloomberg surveillance, lisa abramowicz and tom, and most interesting day. mr. farrow -- mr. jonathan ferro getting ready. getting ready to explain the challenges of the equity market. red and green again in shock over german inflation. you have heard michael schumacher and others talk, it has been absolutely extraordinary. lisa taddeo speaking to the bonus broke

and that means the fed is probably going to have to be back at some point later in the year >> mike wilsonad been thinking, maybe he got it wrong until we saw things start to shake up like this, but you've still got the s&p at 3855 is where it closed yet, below 4,000, but still sort of hanging in there it sounds to me, jason, like you're just kind of uncomfortable with stocks at these levels, still. >> yeah, i think at 18 times earnings, again, it's really hard to square that with a 6% inflation rate even though it might be closer to 4 towards the end of the year, just historically, that's a very hard thing to make the case for and generally speaking, randy quarles has talked about the idea that the soft landing is really for fairy tales it's something that has happened, 1994 is a good example, but it's rare to have this kind of tightening without economic dislocation >> joe, let's go back to just how concerned you are about inflation right now. how sticky this is >> if you have a recession, jason admitted it, that you have an index-leading indicator shrinking 6% annualized. by the way bef

right tackle mike mcglinchey mcglinchey signed a 5 year 87.5 million dollar contract with the denver broncos. 50 of that is guaranteed. so he will be tasked with protecting russell wilson. so no more jimmy g no more. mike mcglinchey and also jimmie ward signed with the texans that just happened about 15 minutes ago. he's reuniting with head coach demeco ryans out there in houston. all right. finally, some baseball cactus league action. the giants taking on the padres top of the 3rd tied it to austin win. that coming back deep to center solo blast. now top of the 6 just with a 2 run lead. one offered casey schmitt. he lines one into the gap in right center run coming on in to score schmidt with a stand-up rbi triple that has the lead to 3 in the giants. they go on to win this one. 11 to 9 aye's also beat the rockies today. 87. and i need to catch my breath. all of that news in the nfl. we didn't hear from anybody but just crazy day one. when 49 is getting javan hargrave, they saw how eagles beat them up so bad they had to go pouch, one of their players >> jimmy g, you know, it's only with the jimmy g guy. i like i like i can see why he drew some ire from fans just becau

sport wilson present she does exactly mike in kyiv, thank you.ain and melting snow are triggering flooding and mudslides across california. the worst is not over he gets. more storms are on the way bring the full forecast is next on fox news light with arthel and eric. right? uhh...nope. intuit quickbooks helps you manage your payroll taxes, cheers! with 100% accurate tax calculations guaranteed. age is just a number, and mine's unlisted. try boost® high protein with 20 grams of protein for muscle health versus 16 grams in ensure® high protein. boost® high protein. now available in cinnabon® bakery-inspired flavor. learn more at boost.com/tv my name is brian delallo. i teach ap and honors economics in pittsburgh, pennsylvania. financial well-being to me is knowing that i can be free to do the things that i love to do. i hope when i retire someday, they say, that guy made this place a special place to come to school and gave as much as he could to help the community. -oh, hi! -you're in a hurry. i'm off to america's best i heard what you said abou