manus: floating 6% rates, do you think there is a risk as ray dalio says?lair: the forward curves would not indicate it is expected. when i moved to the u.k. in 2005, the rates were 5% going to 6% so it could happen. dani: are you hiring more restructuring experts in your business? blair: we have always had that as part of our team in europe. we have 15 dedicated to monitoring the portfolio. we have three senior-level restructuring experts. we have always had at the cornerstone of our strategy capital preservation. when you are lending to middle sized companies, things can happen even in good environments. strong defense is a part of our strategy. dani: you are cautiously optimistic for ares, but the future of covid was this hunger of deals. people doing light lending where they had less protections. are you fearful for the industry and as a whole? blair: we did see this trend coming into 2022. by our estimates, the european direct lending market went to light. that means you only have rights when the company has liquidity issue. those aren't loans that we

ray dalio warns of another crunch in equity. priced for a hard landing. short and yields jump but stocks recover after their global selloff. the eu unveiled its price plan of a price cap. inflation is set to accelerate even more. francine: the futures are fluctuating a bit, but it is all about data. from the u.s., especially and -- on what the fed does next. tom: the u.s. 10 soft or than expected, giving some relief to investors in terms of the gains off wall street. francine, you are saying we have the university of michigan survey out on friday and retail sales out of the u.s. as well to round out the picture. give us a better understanding of where the fed may go. that is priced in fully now. gains in the u.k., ftse 100 up. the cac is up now -- down, i should say. the dax is range bound at this point looking for traction in the market and they are looking for catalysts from some inflation of -- officials that inflation will be with us for longer. the debate is how long the ecb goes. we have new lines crossing in terms of the merge with ethereum. this i

ray dalio is trying to make the math work. he did a piece that a lot of people have read and he came out and said the federal funds rate 4.5 percent, stocks lower by 20%. that's a pretty clear relationship and he went on to say that it would bring down private set -- private sector credit growth. basically taking us to what we are trying to figure out. trying to answer the question the market is grappling with right now. distilling it down into those terms, does for .5% crash stocks? that's incredibly simplistic but maybe it's a good starting point for getting a handle on what's happening here. let's start with 4.5 and then talk about the market reaction. dealing with the reaction in equities, let's start here at the beginning of that question. 4.5%. how likely is it in how quickly could we get there? >> that's the target and we think we will get there by march of next year. only another six months or so before we get there. obviously all the things that you just talked about there, that's everything the fed is trying to do, r

do you get the sense that we will see rates at what ray dalio of bridgewater predicted at 4, 4.5%? >> that would be a really bad outcome for many. i think this is a doom scenario if it's going to happen. it means that inflation is much more persistent than anybody expected. it means that it's much more of a global phenomenon and frankly with a pace that the fed is raising interest rates and the policy works with the lag. we haven't really fully seen the effects of the existing hike so far. if they need to go that far up, that means that, you know, the downside can be really, really low. liz: with all the assets that you look at over at goldman sachs, can you tell me what looks most vulnerable that you would just stay away from? >> credit looks vulnerable at this point, especially high yields. liz: so corporate bonds. >> yes, i would stay away or reduce my exposure the same with em. em can be very vulnerable because of the strength of the dollar. liz: emerging markets. >> yes, these are some of the arareas that we prefer to be underweight. we're also very careful about europe. we th

ray dalio is not alone in this dire prediction.rom a lot of people that by the end of this year and into 2023 and throughout 2023 we are going to have a serious recession. and we are going to see unemployment levels rise. here's the problem. the federal reserve is trying to slam on the brakes in terms of growth. the economy was doing very well in 2020 of, 2019, before covid hit. then as growth continued to go higher, the federal reserve started seeing inflation. they said it was transitory. temporary. it wasn't at all. so today we're looking at 40-year high inflation and the federal reserve's efforts to stop all the growth, get their arms around inflation while also slowing the economy down. the problem is, it's been very aggressive. it's raising interest rates by 75 basis points, some expect one full point of a raise when the fed meets this tuesday and wednesday. when we she those kind of interest rate hikes, it slams on growth and creates demand destruction. in housing, the housing market has completely slowed down. why? because

ray dalio, bridgewater guy, says higher interest rates to quash inflation could tank stocks 20%. elon musk and cathie wood are warning of deflation and barry sternlic on "squawk box" today said ceo confidence is miserable and the economy is breaking hard >> now that inflation arrived and actually it's headed down, they are raising rates too aggressively this will be the fifth rate rise this year. >> so is the fed being too aggressive, and is a hard landing maybe a very hard landing ahead? joining us now, rubilo faruqi, and peter boockvar, cnbc contributor. do you agree with what some of these business leaders are saying in that being as aggressive as it is, the fed is courting a recession and maybe a serious one? >> the fed -- good afternoon the fed is in a tough spot right now. you are seeing slowing momentum in the economy, but inflation is too high, and the message is really on inflation and inflation expectations so what we saw in the cpi data, we didn't really see any -- we saw an improvement on the headline, but we didn't see knan improvement on the core februarys. what we'

ray dray dalio was tweeting abot this. he tweeted the panicked selling that you're seeing that is leading to the plunge of u.k. bonds, currency and financial assets is due to the recognition that the big supply of debt that will have to be sold by the government is much too much for the demand. brian, ray dalio was really trashing the officials in britain for coming out with this economic plan. a lot of people said it is right to come out with tax cuts but you take a look at what the bank of england is trying to do to get their arms around inflation, it conflicts with what prime minister trust is trying to do. >> well, look, i'm a fan of what she's trying to do. i understand it's created turmoil in markets. let's face it, england needs a growth plan. hasn't had one from conservative liberal governments forever. she's saying the only way to the get out of the debt problem is to grow. good for her. the problem is she's got a bunch of officials around her including bank of england, in the united states fed officials that that

like ray dalio jamie dimon are talking about a long deep recession next year, rabbani says tougher than we've seen, fourth quarter begins next week. >> going to be miserable, and people are going feedback miserable feeling so i think taking frustrations out in november on the democrats again, the only team in charge of everything so there is demo one else to blame. you know the biden thing is sad but will reminds me of old carole burnett show tim conway oldest man bumbling was funny on carol burnett not funny when leader of the world nobody is paying attention to him there is no way running for the secretary term, once the republicans take over the house and maybe the senate, the investigations begin, his agenda stops, and he is going to have to declare early whether running or not he won't. and are there not going to let him democrats will never let him run, you know, he is going to be lame-duck very early maybe it is best, nothing happens in washington. and we kind of move on with our lives. maria: we will take a short break when we come back stocks plummeting british up and down near

rate increases and how that impacks the economy and that's why you hear people like you name it, ray dalio, ken griffin go down the line and they believe the recession comes in full force after the new year, sometime maybe later this year but definitely in 2023 when those rate hikes kick in. again, corporate america is preparing for this. it's not just pepsico, that's just the one i found today. but read how tech has been cutting back, wall street put all the workers on notice there's likely to be cutbacks there because of deal flows slowing down amid high interest rates and this is what happen when is you raise rates. it's very hard to fight the fed on the way up and on the way down. that's why the markets are selling off. actually the markets are off their lows. liz: their lows but we got first time jobless claim numbers that were so low. is this the number you want to see come down. fewer people standing on the unemployment lines. so job growth is still very, very robust. >> or are they dropping out of the work force? liz: there's a lot of jobs being created and ford got 500 in kentucky

you have the likes of ray dalio and jeffrey gundlach talking about the 20% drop.ggests that from a different perspective. finally, from a fundamental standpoint, we have the various yield curves. it is not as inverted as it was a week few weeks ago -- not as inverted as it has been a few weeks ago, this is one of the big warning signs of a recession , whether it is nine months, 12 months out or 18 months out. . now, the preannouncement from fedex, along with ge and mcdonald's, alcoa, it feels as though there is a global slowdown. i will not be surprised if this is the recession that everyone has been talking about, if it comes sooner rather than later. guy: will we get a signal on that from the fed next week? we will see. abigail doolittle, thank you so much. let's talk the geopolitical narrative this week. ukrainian forces continue their counteroffensive operations in the country's feast, this increasing pressure -- on the country's east, increasing pressure on russia. ursula von der leyen telling allies they should not hold back on sending weapons to ukrainian f

maria: well, i mean, it's a good point because they've got so many leaders, ceos, ray dalio, you've gotoriel rabini, others saying we're going to see a severe recession in 2023 as a result of the aggressive rate hikes. will the fed blink do you think or are we going to see a severe recession next year. >> i think you are going to see a recession. the question is just how severe it might be. we go back historically, there has never been an episode where we had inflation running faster than 7% without having to pay the price of a recession. we had that news from fed ex on shrinking shipment volumes and that is very much in line with the many reports we are getting from corporate america that say oh, yeah, corporate earnings and corporate revenues are doing just fine. but that is because price hikes. that is inflation is compensating for a drop in sales volume. you can only get away with that trick for so long. maria: yeah. and we are looking at demand destruction in a number of areas, mike. home goods retailers taking a hit as the slowdown in the housing market gets worse. mortgage rates

maria: yeah, and we are looking at dire predictions people like ray dalio and other hedge fund managers an economic hurricane, how do you prepare and what are you expecting in 2023, certainly feels like there's serious curve balls coming at us? >> we have the change direction. if you keep going the wrong direction inevitable you will get where you're going and, you know, we have to get labor efficiency back up and supply chain fixed but we also have to deal with some other causes of inflation including reliance on foreign oil when there's a shortage globally that we could -- that we could fill at least in the interim basis and that includes many of our allies like germany and so on who for a long time were telling us to get off oil and now they are burning coal because they don't have enough oil. maria: great point. i remember president trump telling germany and angela merkel, don't rely on russia, don't rely on goose from russia and obviously they did and now they are hurting as a result. i want to get your take on the california politics going on in your state. going to begin sending

predictions from so many people whether it's jamie dimon and the economic hurricane that's coming or ray dalioecession that is already here, larry sommers same thing, we keep hearing all about this that it's going to start turning ugly in the fourth quarter. fourth quarter begins next week and look at the depanned he destruction we've seen -- demand destruction we've seen in a number of industries. we have a big week of housing tdata, the kaye schiller index, the 30 year mortgage hit the highest level since august of 2007. what are you expecting in terms of the macro story and does it begin in the upcome coulding fourth quarter, this economic sharp weakness. >> the at the end of the day,t of the viewer's biggest asset is their home and you see the neighbor slash 50, 100,000 off their home. i'm hearing from realtors that used to have 30, 40 people showing up at a showing, and now it's two or three people showing up. that has a big impact. the people won't get appliances or upgrade their kitchen or put a deck on, you start feeling it right there. it's the on t sit of wealth -- opposite of wealth

the camp that we will see a dire decline in the recession that is long and deep in the way that ray daliorry summers and jamie dimon seem to be predicting? >> i'm hopeful it will be deep and long and if you look at the bond markets projection of inflation expectation they have inflation going down over the next few years which would mean the fed could ease up my hope we have a mild recession but we should probably plan for the worst. maria: how do you plan for the worst, what you doing in terms of preparation let me get your thoughts on that in terms of preparing for the curveballs that are no doubt coming about us. >> i think unfortunately a soft landing is optimistic. i wish it was going to be true, and worried terms of having a recession, the fact that it's likely to be accompanied by liquidity and some kind of financial crisis as a previous speaker highlighted the wild swings in currencies putting pressure on all kinds of financial system. i think the correction is likely to be pretty significant and depending on whether we get a financial crisis alongside it could be longer short. th

contrarians sometimes are right at the moment, but they become the majority in short order, and as ray dalio was saying with us a couple of weeks ago, sometimes the consensus is right if it eventually moves toward where the contrarian was in the beginning. so if that doesn't confuse you enough, depress you enough, do consider what republicans have put together. he was their own plan for america, by america to help america, and a lot of it is all pegged to the midterm elections but 46 days away. alexandria hoff joining us right now in pennsylvania with what they're planning to do. >> reporter: hi, neil, good to be with you. yeah, we're about 25 miles south of pittsburgh, and this is where republicans pitched their new direction. they're really trying to prove to americans that certain issues that leader mccarthy says democrats have created could be reversed. and goal number one is to rein in that spending. >> this is what we'll do. but on that very first day that we're sworn in, you'll see that it all changes. because on our very first bill, we're going to repeal 87,000 irs agents. >> reporte

ray dalio on the wires saying right now, whatever happens though, u.s.f the table is set. we'll have more after this. ♪ retirement but i'm as busy as ever. careful now. nice! you got it. and thanks to voya, i'm confident about my future. oh dad, the twins are now... ...vegan. i know, i got 'em some of those plant burgers. nice! nice! yeah. voya provides guidance for the right investments and helps me be prepared for unexpected events. they make me feel like i've got it all under control. because i do. ok, that was awesome. voya. be confident to and through retirement. new projects means new project managers. you need to hire. i need indeed. indeed you do. when you sponsor a job, you immediately get your shortlist of quality candidates, whose resumes on indeed match your job criteria. visit indeed.com/hire and get started today. this is what real food looks like fresh real meat and veggies. the food dogs where built to eat. the farmer's dog is changing the way we feed our pets. visit tryfarmersdog.com to see your dogs personalized meal plan. ♪ choosing mi

range that you're looking at, i mean whether it's the scott ninard call of 20% down mid-october, ray dalio talking about a 20% impact if interest rates continue to go up in the conversation i had with him out in huntington beach largely because of the fed it's easy to say range bound, but a 20% decline from here is not range bound. >> scott, if we're just seeing the -- >> jenny go ahead and then josh. >> we've been talking about magnitudes all year. so their magnitude is greater than mine. you know i'm a kind of twisted person when it comes to bear markets and investing, so i kind of hope they're right because if the market's down 20%, as a professional investor i know that down 20% is an ephemeral moment in time and what does that do for me that puts things on sale i heard a great quote this week that's on old shelby davis quote, supposedly. so hopefully it's right. it said people make money in a bear market, they just don't know it at the time. if their magnitude of range is greater, fine. just know if we're down 20% we won't be down 20% forever. >> even the ones, josh, suggest could go

that's the level "which people like ray dalio say you got a 20% correction it's scary. jackie: that's why we saw that sell-off last week to the extent that we did. neil: jackie great job thank you as always. i don't want to add to the worries but we could have a government shutdown. that used to be a big deal because they were so rare, but well, they aren't so rare. chad pergram on how they are still hoping to avoid that. chad what's happening? reporter: neil, the house and senate don't agree on much, except now, delay everything. the only thing congress must do this fall is fund government. the deadline is october 1. >> as all of us know on september 30, at midnight, the government's ability to fund and operate goes out of authorization. therefore it's necessary for us to take action before september 30 and we may do that next week. reporter: republicans want lawmakers to pass bill toss address inflation but that's not on the table. congress is in session but don't expect much to happen until later next week. >> we're well-aware of the deadline hopefully we can get som

kayley: seems that some of the millionaires have caught the gloom bug, maybe from you, ray dalio sayinggo to 4.5% to 6% and he did the math and said that would equate to about a 20% plunge in equity prices because he said the high rates will bring down credit rough and spending. in the private sector and the economy overall. eerily similar warning that we got from jeff dunlop. he's worried about the fed overdoing it and damaging the economy. we could see stocks dropping again by mid-october. it's pretty aligned their, tom. a lot of bearishness out there. the guide here is the performance of the s&p 500 sessions in the past. oxford economics took a look at that. that is in line with other sessions. 34%, severe downturns as an example. it's more for that. jonathan: kailey leinz -- tom: kailey leinz, thank you. getting away from the fancy people, it can't be found. the dow is down. we were good three hours ago. lisa: i do want to bring breaking news, roger federer, that tennis champion, saying this season will be his last. he had been writing a memo, a letter to his tennis family and beyon