i think we need the approval of the treasury secretary realistically, we work with treasury and and we're constrained for very specific circumstances, unusual and exigent circumstances. there are a number of tests in the law, and i think it's an arrangement that works. >> thank you. you know, recently, federal reserve governor michelle bowman gave a speech in which she discussed the evolution enhancement of bank supervision, particularly during the covid pandemic. and in that speech, she stated that the fed avoided overreacting and instead approached supervision anymore measured way that allow banks the flexibility to work with their customers. there are a range of topics she's addressed and others have with bank regulation, and just will share this from her paper. she says the goal of this initiative is to ensure our supervisory approaches accommodate a much broader range of activities, while ensuring we don't create an unlevel playing field with unfair advantage or unfair disadvantages for some types of firms versus others. and for that reason, i'm working on a bill that would study the

what does the treasury secretary and the fed chief think of that? the shutdown and the biden plan, they will want to know what the plans are and who supports what, and how far would powell go to support via adminstration in getting these things passed? the topic is supposed to be the pandemic relief programs. i'm not sure we will get much air for that. alix: thanks a lot, bloomberg's michael mckee. all of that can to beating to what is happening in the bond market. joining us now, ira jersey, bloomberg intelligence u.s. rates strategist. the debate is playing out in the race market. ready land -- where do you land? ira: i am in the stagflation camp, at least modest stagflation. so basically, we are going to have taper, but the federal reserve is going to let inflation probably run a bit hotter than we are used to expecting them to be. i think that might be a topic for discussion with powell today, although i think the politics around the stock trading and stuff by some fed presidents will probably take a lot of the questions like mike mckee just men

you begin exercising treasury off authority to take -- exercising treasury's authority to take extraordinaryres back in august, correct? sec. yellen: yes, the debt limit extension expired on august 1, and we began using extraordinary measures to remain under the debt ceiling. rep. mchenry: but those extraordinary measures are just a band-aid for a period of time, right? sec. yellen: as i indicated, we expect them to be exhausted on october 18. rep. mchenry: and it would be a disaster if we did not. sec. yellen: it would be a catastrophe of congress failed to raise the debt ceiling. rep. mchenry: so here's the deal for republicans. democrats control the house and the senate and the white house. since january 20, the approach of this congress is that they do not remain republican votes -- they do not need re-public and votes to do anything. that has been the approach. now they want political cover in the midst of this massive amount of new spending that republicans raise the debt ceiling. that is really the request. here is my question of you, secretary yellen. for the seat you sit in, do you

one .1% on the 10 year treasury.ing is we will reach about 168 year-end and next year meander higher in 10 year yields. i think we will see more curve steepening this year and the front and is still pretty peg but 2022 is when we see flattening of the year curve -- of the yield curve when the front and starts to meander up. lisa: does the u.s. treasury market have to rely more on domestic buyers is global central banks move toward hawkish rhetoric? >> i think a little bit. the foreigners now only on about 30% of the treasury market. they had own 45% six years ago. it has been domestic investors that have been absorbing most of the additional treasury supply over the past half decade. in august, we saw a massive jump in demand for 10 year treasuries from arner's and that bid went away this past month and it was domestic investment funds that bridge that gap and those were the biggest buyers ever in the 10 year reopening last week. lisa: ira jersey, thank you so much as always. we don't have enough time and kaylee was

. >> treasury secretary janet young told center as the treasury department will likely exhaust all of its tools to avoid a default of the government's obligations if congress does not raise the debt limit by october 18. her announcement came as a banking committing oversight city the covid-19 economic loss she joined at the hearing by chairman jerome powell this runs two and half hours. >> will come to order. this hearing is in a hybrid format or witnesses are in person members have the option to appear either in person or virtually. for those joining remotely if your minors once you start speaking there will be a slight edge late before you are displayed on the screen. to minimize background noise please click the mute button until it's your turn to speak or ask questions. you shall all have one box on your screen labeled clock will show you how much time is remaining. you will hear a bell ring and 3d and the time is expired will move onto the next senator. speaking orders as usual that's by seniority of the members of checked and before the gavel came down at 10:00 a.m. either virtu

day two on the hill for both treasury secretary yellen and fed chairman powell. going to be back in two minutes. working at recology is more than a job for jesus. it's a family tradition. jesus took over his dad's roue when he retired after 47 year. now he's showing a new generation what recology is all about. as an employee-owned company, recology provides good-paying local jobs for san franciscans. we're proud to have built the city's recycling system from the ground up, helping to make san francisco the greenest big city in america. let's keep making a differene together. >>> it is time for our etf spotlight. dom chu is taking a look at bed, bath & beyond. not great day for that stock. >> absolutely not. as you guys have been discussing right now, the disappointing results from the profit side of things, revenue side of things, cut to their forecast, all causing that huge plunge in the shares right now down about 25% on much heavier than average volume. perhaps no surprise there. but that 25% plunge is having reverberations in the etf market there are a lot of

now we are going to be talking about people having to comb through treasury set -- treasury securitieso see which ones are going to be effected by a shortage of cash at any moment. it is not the way we want the world's reserve currency to behave. alix: the federal reserve repo usage raised to a record, to that point. joe minarik of the economic development. thank you. here is an interesting one. senator elizabeth warren introduces a rank modernization act. the bill to restrict harmful consolidation of thanks. the king for more detail onto one at -- onto what that means, but senator warren pounding on banks, continuous warning of consolidation and that harmful consolidation of angst. still ahead, let's drill down into one of the stocks moving. bed, bath & beyond down 20%. is it an ominous sign or an idiosyncratic issue? we will break that down for you. this is bloomberg. ♪ alix: this is bloomberg markets. time now for the stock of the hour. bed, bath & beyond, sales falling short today as the ceo cites cost problems as the reason. dave wilson is looking at those issues. dave: like a who

secretary yellen, i see the same thing happening at treasury. i have raised this from the date of your confirmation proceedings to most recently. i am really chagrined that i have to be forced to consider not voting for nominees because it's the only way to get the attention of these agencies. but if you are sitting as one of the few hispanic american senators and seeing what is coming forth from this administration, especially in these two sectors, it's abort. what are we going to do about it? >> let me start briefly by agreeing if you look at successful organizations in the united states, private and public, you will almost always see a successful approach to diversity. a focus on diversity from the top. i think it starts with making diversity a high priority. chairman powell: if you talk to people in leadership, all the divisions, will you see they talk about diversity. they focus on diversity in hiring. senator menendez: it's a dismal failure. i hear high priority, but the proof is in the pudding. it's just not there. i don't know how higher

secretary some of our concerns about treasury default.and ranking member were around in 2011 when our nation got close to that default. madam secretary, i worry about some of my colleagues concerned, right fully, about additional spending but if we were to go into a default basis, wouldn't that be expected that that would cause a lack of faith on the americans which would in all likelihood result in a spike and is my math correct if there were a 100 basis point increase in interest rates, 1% increase when we are looking at $27 trillion debt, you are looking at more than a $200 billion a year mandatory interest payments because of that spike in interest rates comes before payment of social security, military and any other priorities if you extrapolate that, wouldn't that be close to an additional $2 trillion is there anything faulty with that analogy or math >> i don't believe there is anything -- i don't believe there is anything at all faulty about the image. i think there is no question but if congress were to fame to raise the debt lim

treasury issuance will still be robust. wondering where the demand will come from. we have heard the fed talking about tapering asset purchases, on the other yields are not that attractive, in his opinion. tom: let's expand on that. not as attractive as the chinese sovereign. what are the flows looking like into the u.s. treasury market? >> that is exactly right. one of the reasons u.s. yields have gone down over the years is definitely foreign demand. the question for people in his camp is that if you think u.s. inflation is going to pick up and monetary conditions can only tighten, this is not a good time to add to treasury purchases. anna: he is also concerned about supply. governments or central banks may stop buying quite as much treasury debt as they are the moment, when supply might increase and governments need to borrow to find some of the stimulus that they have been doing. on the other side, there plenty of investors that argue that the delta variant is still there and making people nervous. there are lots of str

might go about strategically defaulting on treasuries that were on the balance sheet.e time jay powell was part of an emergency october 2013 fomc meeting and powell commented he would see such a move as the fed helping facilitate a default on treasuries as being "loath some." i am right there with him. that would be a terrible position for the fed because that would make monetary part of politics and that is prohibited in an institution that is, by design, independent. matt: let's talk about the dots. do you see any movement? do you think what most people are going to pay attention to today? danielle: i do. it is that lucky number seven and if we see it move up to eight or nine, especially given the construct of the open market committee is changing so much in january, you have three hawks coming in in addition to a known -- christopher waller is on the federal reserve board. you have four known dissents in 2020. if we see the number of individuals increased to seven, 8, 9 or 10 advocating for that taper in 2022, that changes how the market perceives the fed despite wh

what is foreign countries by us treasury. so there it goes. they don't buy corporate spock's work or not. so this is an explanation of how the us use the international monetary fun to control and the operation other countries and make better countries. it can be one u. s. foreign policy. it, it shows how the world back out against other countries independent and their own, who had to rely on us agriculture. showed us control world, great organization was designed to break in the foreign markets. and especially united states had essentially set out during world war 2 story england arrival, imperialist power and taken over the british empire. why basically using that leverage over like later years. ridge again. we just heard reports recently that the u. s. upon evacuating capital. busy left behind, $85000000000.00 worth of the us taxpayer weapons put this into context for us because it sounds like what you're talking about here. since 1971. what america went off the gold standard. you wrote the yearbook and super imperialism in 1972. you're talk

treasury rates.hat can mean higher interest rates over the coming months and years even if we got into a situation where the u.s. was not paying all of its bills. host: shai akabas here to talk about issues of economic matters and deadlines to watch out for. (202) 748-8000 from eastern and central time zones. (202) 748-8001 for mountain and pacific time zones. you can text us to (202) 748-8002. mr. akabas, we saw a letter go from the treasury department, speaker pelosi, when it comes to the matter, and it reflects some of what you said about the debt being reinstated, those extraordinary measures, and also adding that the treasury department is not able to provide a specific estimate of how long it will last. then saying, the likely outcome of cash and extraordinary measures being exhausted in the month of october. that was a portion of the letter, and we saw a response from pete -- speaker pelosi last week. i want to play that for you and then get your response. [video clip] >> the constitution says

treasury publishes the report, not hud. we consulted. >> judgment time has expired the program overseen by the treasury when she's before us and these -- >> i've raised the question. >> the chairman has since recognized for five minutes. >> secretary fudge. honored to have you here, broke to say the words sec. fudge and i can think of -- it's so appropriate that you are a sole witness for this hearing and i can think of no better use of the committees time thing to hear directly and solely from you at this hearing. the first question is something i would like you to respond for the record, our colleague has a naomi safe parking act and i want to think the chairwoman for noticing that bill for this hearing that focuses on those sleeping in their cars. vehicular homeless and i hope you would respond for the record as to whether we can do more to help people who are sleeping in their cars. and happens especially in southern california particularly you and your staff could look at the naomi schwartz safe parking program act. i

what is foreign countries by us treasury. so there it goes. they don't buy corporate stocks work or not. so this is an explanation of how the us use the international monetary fun to control. and the operation other countries and make better countries, it can be one u. s. foreign policy. it's shown how the world back out against other countries independent and their own food had to rely on us agriculture. showed us control of the world. great organization was designed to break or, and markets and especially united states had, eventually set out during world war 2 story england and a rival imperialist power and taken over the british empire by basically using that leverage over like later years. ridge again. we just heard reports recently that the u. s. upon evacuating capital. busy left behind, $85000000000.00 worth of the us taxpayer weapons put this into context for us because it sounds like what you're talking about here. since 1971. what america went off the gold standard. you wrote the yearbook and super imperialism in 1972. you're talkin

i think we need the approval of the treasury secretary. we are constrained for certain circumstances. the number of tests in the law. i think it's an arrangement that works. >> thank you. recently, the federal reserve governor gave a speech in which she described the enhancement of bank supervision precisely during the pandemic and she described that the fed overreacted and allowed banks the flexibility to work their customers. she has addressed a range of topics with bank regulation. let me share this from her paper. the goal of this initiative is to ensure our supervisory approach accommodating a broader range of activity while ensuring we don't create an unlevel playing field with unfair advantages or unfair disadvantages for some types of firms versus others. for that reason, i am working on a belt that would study the evolution of consumer finance and the viability of updating our prudential regulatory structure group consolidation of bank supervisors. through some level of supervision the fed does, could either of you give us their n

all of this is pushing treasury yields higher. tom: when you are on the gulfstream flying at 32,000 feet looking at the yield markets, what is the 10 year yield where you signal shift or trip points ? jim: think we are past that. i think it is around 140. the fact that we are back above 140 is telling us the correction lower in yields is over with. we have to think about yields progressing back toward the march 31 highs come around 175, even up to 1.8%, and it's even possible you could pass to percent by the end of this year, beginning of next year. it will be hard to get above 2% and stay there, that is the trajectory we are on and the fact that many people have squared up most of their positions, i would say the market is not overly short and technicals suggesting you could get a push higher. i think we have tripped that switch and that we are in the mode to getting towards higher yield and all the supply coming. lisa: you talked a lot higher oil prices and supply chain disruptions. are these events inflationary or disinflationa

hyper, i propagated treasury moment. alrighty. so i guess before we talk about the hyper hypothesis, treasury mom and you've got to just do a 32nd recap to the audience about what a reverse repo is. well, you have a market that makes it possible it's of the market itself. and financial derivatives is expanded through repose and swaps. it's basically a way of, let's say, spreading risk over a wider, wider band of investors. and each one has its own needs as far as what they're looking for, and a yield curve and the market in swaps. and repos allow some flexibility in that way . let me mention that the, the latest commentary was written by a guest, a fellow named sean brown, who's a san francisco friend of mine from the hedge fund world. and what he's saying, and we've seen this in the markets that the supposedly blueish blue chip collateral you can hold as us treasury's, but there is a shortage of them, really. and it's one reason why anybody bedding that some ramp inflation is going to push bon prices down yields up. it's not happ

would i not be staying around for that much longer. >> brian, where do you stand on treasuries what do you think the chart tells us about the economy, if anything >> that's the trillion dollar question it's hard to read too much into the bond market because it's so manipulated by the federal reserve. i don't mean that as a slight, it's just a fact they're buying bonds. for me, i'm short ten-year notes so i think yields are going higher i think we're going to get that breakout, primarily because the fed just told you hey, hey, by the way, we're going to stop buying bonds in a little bit there are ten-year from buyers overseas but that could easily reverse if you get any type of inflation scare, which i think we're getting once again we probably reached kind of the peak of the deflation scare, and with the supply chain issues, things will start to ramp back up that's my call on it i could be wrong carter has been 100% right i'm just hoping this one time maybe he's wrong. >> how are you trading treasuries, nadine, if you are >> we have been. we have been pretty much trading with chop a

anna: where do you think we are in the treasury conversation? we have seen may be a push higher after the jobs report. is that what you are attributing it to, or something else? we are at levels we have seen since july. we are now up at the 137 level. what is this telling you? mark: it is a confusing message. we talked at the end of last week about how going into the jobs report, this was a market that looked like it wanted to see a steeper curve, like there were long and yields that wanted to go higher, and that is what we have seen, even that we did not necessarily get the print that facilitated that. how do you explain that? it is unlikely that it is because the job print was that bad. we are not going to swing that much over one jobs print. we are also not creating a negative or panicky picture. at the moment, there was a bunch of supply at the start of the week that has now passed through . maybe we pause again at this level. i would say that the underlying buyers -- the underlying bias in the coming weeks is for the curve to steepen furthe

the 10 year treasury yield is now above 1.52%. this following a mixed day on wall street with the dow jones finishing in the green and the nasdaq and s&p 500 dragged down by losses in big tech with european markets pointing to the downside. in asia overnight, a mixed story with the hang seng the best performer, up better than 1%. "mornings with maria" live right now. ♪♪ maria: good morning. some stories we are watching right now senate republicans blocking the measure to fund the government and raise the debt ceiling. funding expires at midnight on thursday night. treasury secretary janet yellen warning the u.s. could default on its bills as early as next month. republican lawmakers telling democrats as the party in power they should take care of the debt limit themselves since they want to spend trillions with no input from republicans. >> we will see. to see if democrats want to govern or at the prospect of a government shutdown to the list of inflation, afghanistan, the border and all the other national crises that is a direct

the, the way the us government funded is through the issuance of treasury bonds. and they pay the interest on those bonds by collecting taxes who owns most of those bonds, if not virtually all those bonds, the top 110th of one percent. so the government simply becomes a pastor mechanism for people to pay money from their pockets through something called taxes that are just a fig leaf that hides the transmission mechanism of your money through the government, into those who own these bonds. and because they own so many of these bonds, the interest rates available are quite low for them to go out and borrow and to speculate. and oh, guess what? whenever they make a mistake speculating, they get bailed out again and again and again. so it's, it's deflationary in the sense that society in america is collapsing. we haven't seen a society collapse on this scale since the soviet union collapsed. and this is exactly what we're seeing in america right now. right. and the inevitable doom loop, and maybe this is just something that has to happen throughout history. why we ha

and haidi, we have heard treasury secretary janet engel giving this deadline when the treasury will run out of cash and that seems to be october 18 which is sooner than analysts had expected. this of course after republicans blocked that democratic move in the senate to raise the federal debt limit and also keep the government funded. haidi: we've been at this precipice before, shery. this is like ok, it will work itself out because we know the u.s. always pays its debts but very interesting that janet yellen really flagging the potential harm to the u.s. dollar reserve and haven status if this was to worsen. also of course watching evergrande and that's playing to the fed's story as well. because we've heard the federal reserve officials have been questioning the heads of big wall street banks, big u.s. banks, to really get to the bottom of any exposure, if any, of course, that they have to the chinese property market. and this evergrande story because shery, not just about the debt that we know is coming due. -the-also the -- it's also the unlisted debt. bloomberg scoop really talking

they are the muni bonds, treasury bonds, all that sort of stuff. they own all of that. so the government and the bottom. 99 percent. oh that the top point one percent. all this money and they're paying more and more of their income to them. and they're gaining more buying more assets. but also that capital that's going from the bottom to them is obviously a sucking sound causing deflation for the vast majority. not for that top point one percent, which is enjoying a very high inflation rates in their assets are right. the, the way the us government funded is through the issuance of treasury bonds and they pay the interest on those bonds by collecting taxes. who owns most of those bonds, if not virtually all those bonds, the top 110th of one percent. so the government simply becomes a pastor mechanism for people to pay money from their pockets through something called taxes that are just a fig leaf that hides the transmission mechanism of your money through the government, into those who own these bonds. and because they own so many of these bonds, the interest rates ava

treasuries come into or three basis points. that's the market salary. we will stay on top of this on bloomberg tv and on bloomberg radio. saturday evening, i'm minding my own business and i get a message about the u.s. open winner and i start watching this interview with her. she is asked to name her three dream dinner guests. take a listen to at the u.s. open winner had to say paid -- say. >> daniel raqqa auto, michael jordan and the third would probably be tom keene from bloomberg. i did my a levels in economics, i was having to keep up to speed with the latest news and he made it in a way using analogies that were relatable and quite funny and very understandable. jonathan: i already knew, watched bloomberg surveillance and if you are watching, good morning. i have to say i'm disappointed. the other issue i have is she understands you? [laughter] tom: i am reading in on tennis like nobody. what i can do, my hockey coach look to the tennis coach and the tennis coach said don't give up the day job. jonathan: she is very welcome on this program whenever

treasury roles, pra statue and treasury requirements have significant accountability on these administrators. verbal assurances from the treasury will not have federal agency oversight and federal or state or local audits. state and local officials are all mine in this moment emergency and we are acting to work denounced urgency and accountability. we support provisions to provide safe harbor and they would not be subject to liability provided in good faith. third is between current and common demand. we are committed to helping as many as possible. we understand the urgency. economic recovery and clear demand for the program suggest er eight will come even more needed in the months ahead and indications utility renames substantial and utility rent from 10 million to 30 million and we support chairwoman mars to proposal an extended time period during which an individual household may receive assistance up to 24 months. the administration has accurately said pra requires a new national infrastructural rental assistance that you and o answer any questions. thank you and next we will go -- reco

democratic treasury secretary today. republican treasury secretary tomorrow. that would be the responsible approach and end this game once and for all. with that i yield back. the speaker pro tempore: the gentleman from massachusetts reserves. the gentleman from texas is recognized. the gentleman reserves. the gentleman from massachusetts is recognized. >> thank you, madam speaker. let me recognize again the very capable gentleman from pennsylvania, champion of all things philadelphiaian as well as quite knowledgeable about the debt ceil, mr. evans, for two minutes. the speaker pro tempore: the gentleman is recognized for two minutes. mr. evans: thank you, mr. chairman. mr. speaker, i proudly rise in strong support of this bill. we have to pay our bills. and uphold the full faith and credit of the united states. my constituents in philadelphia don't get a choice. they have to pay their bills. congress must do the same. we are working together to finalize legislation to advance the building back agenda that we share with president biden. as we do that, we must

it is not oversight of hud and united states treasury. and for the record, madam chair, i wanted to note i do not expect secretary fudge to be accountable for secretary yellen. i do not expect her to answer or speak for her, nor did i expect secretary carson to speak for secretary mnuchin and i know he couldn't. he could barely defend why he took 16.4% of hud's budget before he got started. i'd like to remind my colleagues that she has only been in this position for about six months. so, let me educate my colleagues in those listening. she has cris crossed the united states for housing. she came to the state of ohio and met with a bipartisan team of housing experts. let me also say to allocate 100% of the rental housing funds to state and local government, we should be saying thank you. in my district alone, having them receive the money -- now, that part, my colleagues got correct. we should be applauding her for getting all the dollars there. for rental assistance. now, it went to the state and local governments to do that. let me share

i put a very low probability on the treasury not servicing the debt. however, this time, because the budget process is so dysfunctional in so many ways, different factions of congress are trying to attach to the debt ceiling bill different legislation that is now pending in the house and senate, it is a complete mess. we should not discount smooth sailing. i think they will eventually come up with something that really reflects just how dysfunctional congress is, and that is a warning in and of itself. mike: the last time we saw that, 2011, when the s&p gave the usa downgrade for its political function, not because they thought the u.s. would default. the biggest question is, how do democrats proceed now? we may find out this afternoon but republicans are demanding they separate the bill that would fund the government from the debt ceiling, and put the debt ceiling into the reconciliation bill. procedurally, that would take some weeks, which is mine janet yellen came up with that date today to give democrats a good idea of how fast they have to move on

i've spoken directly with the deputy secretary of treasury. the law is clear and unequivocal and because of the political agenda of the biden white house, because of president biden's desire to surrender to vladimir putin and give him a multibillion-dollar pipeline, weakening america, weakening europe and giving vast resources to europe to hold them to blackmail, treasury is refusing to follow the law. nevertheless, i have been willing to offer a compromise. i've placed holds on nominees to the state department and some of the nominees to the treasury department and i offered a compromise, to lift the holds on this nominee and other nominees to the treasury department and also to lift the holds on career nominees to state if either the biden administration follows the law in caatsa and imposed sanctions, that's option a, that would be the best option, or if option b, if they decide for whatever political reason they believe surrendering to putin is a good idea, notwithstanding america's national security interest, there's a second option i off

treasury secretary renewing her call for a higher u.s.ebt ceiling, warning of economic catastrophe if congress fails to act. >> and the moment of truth approaches for china. the properties facing a key -- as bond and loan deadlines loom. we are seeing u.s. futures under a little bit of pressure after the s&p 500 fell below the 50 day moving average which was already a key support level. in fact, we also have the nasdaq 100 seeing it against drop since may. global equities also seeing a second weekly drop. we had wti extending losses at the moment after losing rounds in the friday session. we had a stronger dollar, but also russia plans to boost oil sales, pressuring the market. of course, it is the relative. about 3% of this past week already, we continue to see concerns with commodities prices superhigh. that will be felt when we do have the meeting. this chart on the bloomberg showing how many rate hikes have been priced in. 17 basis points for next year, which would be under wonderful hike. -- under one full hike. the fed expected to d

the 10-year treasury yield always a focus ahead of a fed decision currently 1.31%. despite everything that's going on, those yields have been holding pretty steady in a fairly tight range even with the evergrande situation in china. maybe that tells you about risk appetite or risk aversion. it doesn't seem to be moving a lot given the fed and what's happening this afternoon as for places that we've seen some real slugging off, check out expedia, booking holdings and american airlines. these stocks have shrugged off all of the evergrande issues travel companies have been up on the week and not felt any pain from that so watch those travel stocks one more to watch today, a massive slide on a relative basis on a mega cap stock we all care about facebook shares off 4% right now. now they're only up about 25% year to date this after the company tells us that they may be underreporting some of the results in its advertising business tied to iphones. why, kelly because anyone with an iphone knows now apple asks you whether or not you want the apps to track your traffic acr

we saw the speed of the treasury yields tightening, and now we've seen treasury yields actually grown quite fast. this is one factor. inflation worries and also the rising treasury yields, and also even though covid impact is subsiding, china growth concerns continue to be worrying some sectors. especially with the new scaring customers about supply chain disruptions and inflation expectations going forward. yvonne: i'm wondering at what point do you think we will see foreign investors like japan start to look at this and start buying on these levels? we've seen that before, but i'm guessing seeing the equity market, that this time it could be different? >> right now, the concerns on the equity side, they are worried compared to february when people were slightly more optimistic over covid. now that covid seems to be subsiding, hopefully it will get better. going forward i think equity will remain choppy, but as you've been mentioning stagflation, the absolute growth levels remain quite decent. yes, it has been coming down with the different roles and also different growth expectation

it starts to snowball which is how the yields move or treasury prices move?they snowball on themselves and go up from here, what happens to the stock market? >> tech is underperforming, a little more downside but i think financial energies will outperform. i've been on your show, looking at the back half of the year, i love the way they are setting up so they are outperforming and more stock pick or market. microsoft, google, alphabet, protecting downside is something to think about. stuart: thanks for joining us, appreciate it. this is how the market is likely to open, down 140 for the dow, the nasdaq down 200 points. president biden claims his $3 trillion spending package will add $0 to the national debt, watch this again. >> it is 0 price tag, pay for everything we spend. stuart: larry kudlow will try to do the math. millions of people are subject to vaccine mandates, my next guest is not too happy with that. the freedom from mandates bill will tell us all about it after this. ♪♪ ip will be one of partnership and trust. i am a fiduciary, not just some of t

we set up a war room and treasury. -- in treasury. >> so treasury became its own source of intel. >> of course. >> got defense intelligence but treasury else's own source of intel on the terrorist? >> of course, we are depending on the intelligence agencies. i think the coordination of the cooperation of the state and defense department was key. we didn't have enough of that. we had a little poster in treasury and it said we are at war. are you doing all you can? we were trying to work as much as we could. there were many meetings in the situation room and i made the comment about economics. the secretary of state were defense said there goes taylor again, sorry about the economics. it was hard to get it in. the international support was huge. we spent a lot of time on the phone, first with the g7 and then it spread out. i never experienced such cooperation. everybody was our friend. it didn't last as long as i would like but everybody was our friend and that made it possible to do things we couldn't have done otherwise. hey u.n. security council helped, condi helped. the other thing

we set up a war room and treasury. -- in treasury. >> so treasury became its own source of intel. >> of course. >> got defense intelligence but treasury else's own source of intel on the terrorist? >> of course, we are depending on the intelligence agencies. i think the coordination of the cooperation of the state and defense department was key. we didn't have enough of that. we had a little poster in treasury and it said we are at war. are you doing all you can? we were trying to work as much as we could. there were many meetings in the situation room and i made the comment about economics. the secretary of state were defense said there goes taylor again, sorry about the economics. it was hard to get it in. the international support was huge. we spent a lot of time on the phone, first with the g7 and then it spread out. i never experienced such cooperation. everybody was our friend. it didn't last as long as i would like but everybody was our friend and that made it possible to do things we couldn't have done otherwise. hey u.n. security council helped, condi helped. the other thing

treasury and economic policy reporter chris condon.apan -- who will replace yoshihide suga as prime minister. the race is considered the most wide-open leadership contest in a decade. so, this comes to a head today. can we draw conclusions as to all of the horsetrading has been going? >> different from a year ago when suga was a shoe in. shinzo abe stepped down because of illness. he took over, but it only lasted a year. this time it is more open. there are four main candidates, but two frontrunners, including the administer of reform, the defense minister and former foreign minister who has wide public support. he is also said to be a favorite of the business community. he is the youngest of the bunch of 58 fluid english speaker, georgetown graduate but his biggest competition is keisha -- a bit more of a party stalwart. he has wider support among the older more established ldp leaders. and then there is the wildcard, backed by shinzo abe, considered more of a conservative nationalist and proponent of continuity. i can also mention th

treasury secretary janet yellen is kwrwarning against th.his is what she said to the senate banking committee. >> this would be a manufactured crisis we imposed on this country which has been going through a difficult period, is on the road to recovery and it would be a self-inflicted wound of enormous proportions. >> treasury secretary janet yellen warning against this. the markets tanked yesterday. they have had a terrible month in part, and there's a lot 06 other things, in part because they are looking at washington, like, you guys are juggling flaming swords here. this is not a good idea. >> you know, the market hates uncertainty. and right now what the market sees is we are putting ourselves against the precipice of what treasury secretary yellen rightly suggests is not just catastrophe, but a self-imposed recession. the juggernaut we're facing right now is we have the delta variant, combined with monetary policy, which is starting to slow, which means the federal reserve bank, which has been buying a lot of bonds in the marketplace, w

treasurys flat for that time. sovereign bond market in one of my mind one of the most attractive developed bond markets out there. you have basically uncorrelated assets, pretty diversified and carry rich. ashley: on a day like today, what do you tell your clients? i'm sure you're getting calls. you see all the red. is there something that we've talked about much-needed for this market shaken out a little bit? we've gone so far for so long what are you telling your clients? >> actually the chinese markets were one of the pockets of strength overnight. if you look at the price behavior in asia and europe, china was one of the only centers that was actually in the green this morning. and a lot of this because we think a lot of the bad news has been already priced in. what we're doing is looking forward what will happen over the next three months. ashley: very good. you got a lot in a short amount of time. thank you so much for joining us this afternoon on a down day for sure on the markets. [closing bell rings] when

than a traditional treasury. >> interesting >> it seems bizarre to me to see what happened yesterday, that after a strong 30-year treasury, 30-year yields dropped sharply but tip yields dropped even sharper. how can that happen? usually if there's a big demand for inflation protection, you see yields rising. and yet i think it's just a matter of too many -- too much cash being just shoved into this system between the stimulus payments and the fed and the ecb. you know, it's forcing everything up regardless but there are some serious inflation pressures out there. >> yeah, and i think, you know, to your point, the idea this concept of too much cash is showing up in a lot of different corners of the market in interesting ways let's go through some of the other plays. to reiterate the passive aggressive idea is to stay with the markets broadly speaking but have these areas that are not as correlated with the markets normally so, that's where tips would come in for you you like the silver etfs you think this should be a crypto hedge you hacked the etf vault private debt and real estate,

treasury secretary janet yellen also joined the democratic leaders. this is 25 minutes. >> good morning, everyone. we welcome our newcomers here, some of us regulars. i will answer questions you may have, but first i want to acknowledge the special guest we have. as you know, we are moving toward closing discussions we have had on the legislation to honor the president of the united states vision for our country. to build back better. you probably have an announcement or shortly will that the budget committee is going to be marking up the bill to that and, a very important part of all of this is how we want to build back better in a way that is physically sound. this morning -- fiscally sound. it was a great honor for me to welcome the secretary of the treasury, a person i have long admired and to have the benefit of her wisdom and judgment in the discussions that we had and leadership are and i -- leader schumer and i. >> first i would note before, just telling you exactly what happened that brooklyn is two thirds of this party. >> the secretary has

jonathan: you have a treasury market called on? what is it? george: the treasury market have been forecasting this through the summer. do we start to price in the actual rate moves higher? i cannot see it manifesting itself in this environment. there is not enough good news to push things higher. jonathan: coming up next on the program, the auction block. from new york, this is bloomberg. ♪ jonathan: i'm jonathan ferro. this is bloomberg real yield. time for the auction block. we kick things off in europe with a sizable offering from the eu. market wide sales surging beyond 60 billion euros. in the u.s., high-grade offerings. jp morgan's and the big banks leading the sales. the junk bond market remaining. sales at 400 billion. the main story for me this week has got to be out of china. take a listen to what the chief economist from milken have to say. >> but we are seeing with the potential collapse is the question facing policymakers in beijing is, is ever grand systemic, too big to fail? but we will see is the potential for beijing to step i