fdic former chair, volcker alliance founding director, sheila bair. author of financial literacy books, chart come and bill the -- thanks for coming on the show. start with the gdpreport. just your thoughts, the true health and direction of this economy right now. >> yeah. it is slowing significantly. i think, i've been wanting to -- methodology of this approach is what paul volcker did. they're being too aggressive on the short-term interest rate hikes and not focusing as much as they should on long-term rates. i think we're slowing. that is good in a way because we want prices to come down but are we doing this too fast. are we doing it in the right way? charles: right. >> i think it is reducing the changes of a soft landing given the current -- fed is employing. charles: i want to go through that you tweeted a after the decision yesterday you admired their courages not necessarily the methods. >> into. charles: you were impressed by powell, he was able to make this unanimous. a lot of people thought that was pretty intriguing. i want to start with

larry, let's talk about this, reagan and volcker, how did reagan and volcker stop what was going on inconomy when we were in dire straits back in the early '80s? >> two things. one when you deny something that is so apparent to everybody else in the country who has to buy groceries, who has to buy energy, who has to pay rent, who has to go out to take a vacation, if you deny prices are skyrocketing, you lose all credibility, all believability. that is one of the reasons why biden's polls have crashed. with reagan and volcker, they took tough medicine, okay? reagan said to volcker you do what you have to do and volcker, you know, chopped down the money supply and boosted the value of the dollar and meanwhile reagan took very constructive actions. this is what's missing, liz, reagan cut taxes and reagan deregulated. by the way one of his first actions when he was inaugurated decontrolled the price of oil. he ended the carter price controls and guess what? oil went down, not up. so what biden won't do is take the tough actions, particularly on the physical side and coming back to your ear

, more or less, paraphrasing you're no paul volcker. it felt like it stung a lot. he mentioned volcker's name a lot since then and committed to be volckeresque, if you will. >> the patron saint of aggressive fed policy. you have to remember, a lot of us weren't alive back then, i was, but i was a kid, but i do remember the gas lines. i do remember the depth of the recession. that's where the rust belt came from. the giant manufacturing heart of america went from that to people sleeping in their cars because the fed had to tighten so aggressively. this fed doesn't want to do that. charles: right. >> and the way you avoid that pain is by killing inflation early. the longer you wait the worst the cure. charles: but did they wait too long anyway? in other words, sticking with the transitory narrative, did they miss their opportunity not to make a mistake or as harsh as they want to? >> yeah, look, normally, when i say normally, anytime in the last 35 years you start to see signs of a recession and the fed's manuel says at that point you go

or as paul volcker cap the policy -- whereas paul volcker kept the policy rate up. because he no -- and chair powell does -- that expectations were the key. we have new legions of people in the public that believe the inflation rate could accelerate. so the federal reserve needs to be conscious of that. in other words, only boomers like me thought the acceleration could accelerate before this recent episode. now millennials, gen x, gen y, are believers. therefore the federal reserve in 2023 ought to be cautious about cutting the policy rate and declaring victory on inflation when it moves down. it will be vulgar -- paul volcker-esque. kailey: lisa mentioned it is the best month for the s&p 500 one back to november 2020. it is also the best for bonds going back to 2020. how long can they keep moving in the same direction? tony: as i mentioned, if you think of valuation metrics and the possibility of recession and things of that sort, perhaps for the bond market yields moving toward the lower end of the range, so in the three components, the term premium, the policy r

jimmy carter had support in paul volcker. he helped the economy and got inflation under control and also contributed to jimmy carter's defeat. >> it's a great point. you're correct about that i was thinking about richard nixon and arthur burns and others pressuring back then. and i think the point is that the president has consistently leaned in to the fed as the first and foremost inflation fighter. so simple answer to your question, their pivot is welcomed and a solution to the president. >> neil: and the fed missed it on the severity of the inflation like your boss. they called it transitory. it is what it is. but what can you do now? is it all up to the fed? >> let's talk about what we can do and what we are doing. no, it's not all up to the fed. they obviously are implementing their interest rate tools. we have a lot we can do and are doing. one thing that is not in today's report is the decline in prices at the pump. they're down 40 cents off of their peak from mid june to today. you don't see that in the june report. t

so you had that double whammy of deregulation, but these big tax cuts and volcker right now, our backdrop is we're about to get tax increases from the biden administration, and you still have this inflation. i'm curious how that comes together i think the big difference, that starting multiple of 8 and cutting taxes is a big difference between now and then. >> yeah, but between '82 and '87, earnings actually declined. the p\e multiple went from to nearly 25. and ten-year was around 10%. and so you had a risk-free rate arguing that the p\e should hav stays in the teens the multiple went from 3 to 25 i think when we think about markets embracing the risk, the stock market is going to find p\e. confidence through six months have been dealing with negative gdp, a supply chain that's been ferocious, strong dollar that's the achievement these are better businesses. >> rob, with i think you've gota question >> yeah, happy client of tom tom, if we get to 4,800 by year end, as you're saying, that would put us in 19.6 times forward earnings can the market sustain that valuation with the fed going b

my question for the market is simple, scorching hot cpi, does that deliver an absolute volcker esque scorched earth policy of 100 basis points? and the two's tens invert, the deepest since the dotcom bubble. what does that inversion mean. we have seen it cool down to 50 basis points in inversion. crude oil is up. this oil market is screamingly tight, however gas season in america is crumbling, down 14% last week. we made it through parity and the eu expected to cut their growth forecast to 1.4%, does that add to narrative on the downside for europe? dani: i saw some data that gas demand in the u.s. was sinking lower than the pandemic. it wasn't the pandemic keeping people inside, it is high prices. let's get to some of our reporters around the world. and a karen in hong kong with the latest on inflation, garfield reynolds will take us through the euro parity bridge. manus: annabelle droulers is in hong kong, she will look at these out of season moves from central banks around the world. after a four decade high, the red-hot u.s. inflation print raises the prospect of a 100 basis poin

that is when paul volcker was hiking rates hard because inflation was so hard. even the core cpi, the monthly basis going up. three components i think are most in focus, because you look at energy, you look at food prices, you look at rents, you look at mortgage payments and how they translate into an equivalent of rent, and then you see some pressures. let's look at another set of numbers, because fuels were up 19%. half of the rise was due to gasoline prices. groceries up 10.4% on the month. those rent payments were up the most since 1986, equivalent rents the most in 32 years. home prices have risen, so all these things are getting higher. is there some relief? we did see gas prices come down 4% by the middle of this month, but we see new and used car prices continuing to rise. services prices, goods prices, appliances and cars, they have not cooled off very much. services, plane tickets, they were up the most in 21 years in this report. no relief there either, so that is why this is such an issue. it is not just high, it is not getting lower, and there is st

. >> neil: i can remember the days of paul volcker wheres that was routine. >> and there was 350 basis points in the 80s which was astounding to me. >> neil: we can't remember but i'm old enough to remember. thanks, susan. the federal reserve meets at the end of this month. again, the guys that bet on the street now are saying possibly a full percentage point hike and in september, yet another such hike, another 1%. and by the way, that is doing little right now to calm the inflationary beast out of control and doesn't lydia hu know it following it in new york. lydia? >> yes, neil. even beyond the much discussed price increases in energy, shelter and food, the average american consumer is getting pummeled with increases on prices from seems like every corner. we take maybe an example of the average american returning to the office in this post pandemic world. it's going to cost him, take a look at this, if we wants a new suit, it will cost him about 25% more now than a year ago. laundry and dry cleaning services, that is up 10%. and if he's going to take public transit, to get from the

we need a paul volcker. i don't think jerome powell is a paul volcker.in to fix this. they, inflation is insidious. if you don't stop it, we will get worse and worse economic problems down the road. every project that the government does will go overbudget. consumers will find their living standards eroded. charles: right. >> we have to fix inflation but in order do that we have to take some pain and the question is, is the world willing to take pain today? and the world i see doesn't want to take much pain at all. it is way easier to cut rates than it is to raise them. charles: by the way that is for everything. we don't want any physical pain, emotional pain, we just don't want it. if we can get a pill, fine. >> right. charles: we talk about things that are happening. we try to find solutions on the show. you mentioned four things, inflation, government debt, fuel, supply chains including labor which were destroyed by lockdowns, fiscal policy being a disaster. is there a way to get all of those things fixed? >> you know, charles, unfortunately part of

to the extent he can he wants to be as tough as paul volcker was on inflation. actually think unlike prior midterm cycles or any political cycle i think he will press forward into the midterms not appear if he is trying to curry favor with one party or another. which is not how the federal reserve usually operates. charles: right. phil, you've been writing, jim, you think he has no choice but to go strong, go hard on this? >> i agree with danielle. he has got a credibility problem. they used the word transitory last year. that turned out to be terribly wrong. they have to rein in inflation. the only tool they have is to raise interest rates. i agree with you we could see 3%, high threes in six months, but on longer term interest rates they may be closer to peaking out. we may get the situation with lower higher rates which is inverted yield curve. charles: that changes the conversation from inflation to recession? >> right. >> inverted yield curve has a good track of predicting recession. charles: five and 30, some odd combination? >> three month. charles: okay.

charles: you need a 1-2 punch, paul volcker stamping out inflation, ronald reagan comes in and you'vere you following? >> we are following what's going on with the gop and a massive crackdown, whether it is the regulatory state or in congress against anything china use, you pick your term, the chinese through social media apps or apps, trading apps are stealing information from us consumers and giving them to china for espionage purposes. we've done that, and pressuring apple and google, and he wants the sec security and exchange commission to go after two companies, lulu and web bull, chinese trading apps. on the same suspicions they are using us data and giving it to the chinese government. whether this goes anywhere i can't tell you. gary gensler rarely registers anything the gop says when it is in the minority but the gop gets in the majority this will get interesting because they will have hearings with gary gensler on his whole agenda including what he's doing to crackdown on us information by chinese firms but also look for google and apple to come under pressure because these

the un, who's work for good terrace for decades volcker turk is probably the front runner for the job. to other candidates, the former norwegian prime minister, ernest soleberg, and cornwall kang, who was foreign minister of south korea, have higher public profiles, but they're also known to favor quiet diplomacy. over public advocacy time is running short. the next high commissioner is supposed to be appointed by the secretary general approved here in the general assembly, and then take up their post by the 1st of september. leading human rights groups are unhappy. they've offered their input to the office of the secretary general. but so far they say they've been rebuffed james bayes al jazeera at the united nations. no rare bengal tiger card has been born at cuba national zoo in havana flush. a cab hasn't been named yet and is being cared for in the zooms, artificial breeding department. only about 2 and a half 1000 bengal tigers. i thought to be left in the wild lottery fever as gripping the u. s. where the mega millions jackpot has grown to a whopping $1200000000.00. long queues

where we have to make a distinction between non-monetary and monetary inflation what you as paul volcker who in the early 1980s headed up the federal reserve and to kill the terrible inflation at a very high cost that had been inflicting us in the seventies because in the 70s, they'd fight. it not fully kill it then would come back worse than before. so we went through a very grim period in the early 80s to finally stop it once and for all and he rolls we did an interview with him a couple of years ago and he four years ago and he would roll his eyes at the idea that 2% inflation is good in terms of the stability of the dollar you want you don't want inflation or deflation you want inflation. now, this is a very subtle point you may get prices going up because of supply and demand. for example a hotel room in cambodia a very poor country is going to be a lot cheaper than a hotel room stay in singapore very prosperous country when a country becomes more prosperous. and people's salaries are going up in real terms. they not only start to buy more things, but they're going to want more serv

s. diplomat say, an official little known outside the un who's worked for guitarists for decades. volcker turk is probably the front runner for the job to other candidates, the former which in prime minister earns soleberg and cornwall kang, who was foreign minister of south korea, have higher public profiles, but they're also known to have a quiet diplomacy. over public advocacy. time is running short, the next high commissioner is supposed to be appointed by the secretary general approved here in the general assembly. and then take up that post by the 1st of september. leading human rights groups are unhappy. they've offered the input to the office of the secretary general, but so far they say they've been rebuffed. james bayes al jazeera at the united nations still had yet all now does in 911 families and survivors and protests as a saudi back to golf tournament. teeth are at donald trump's new jersey cause loss and indigenous rebellion and south with the leadership. and she lays young president ah, the journey has begun the faithful world copies on its way to catherine book, your trav

know, one thing in another i was able to publish a number of major major books by people like paul volcker the great fed chair earning jordan the great civil rights leader george soros who obviously doesn't do it for the money. i was able to find the wesley clarke when he came back after having won the war in kosovo was able to agree with me on a contract without having to pay ridiculous amounts of money. so there was a way to do it, but you had to have an approach that i was able to take because of my experience and most people choose or can't do that. and so what happens is they go into an auction. they meet with the public figure. sometimes that public figure doesn't even show up for the meeting. and there's an auction and then they write i have somebody write the book for me. it's just you know, it's not a good process in my view, but that's the process. so peter austenos, let's go back to your work with presidents. did you make money on the art of the deal? and what were you what were you dealing? what were you dealing with president trump? oh god the art of the deal. is a remote is t

say, an official little known outside the un who's worked for guitarists for decades. volcker turk is probably the front runner for the job to other candidates, the former norwegian prime minister erna soleberg, and cornwall kang, who was foreign minister of south korea, have higher public profiles. but they're also known to have a quiet diplomacy. over public advocacy. time is running short, the next time commissioner is supposed to be appointed by the secretary general approved here in the general assembly. and then take up the post by the 1st of september. leading human rights groups are unhappy. they've offered the input to the office of the secretary general, but so far they say they've been rebuffed. james bayes al jazeera at the united nations process apologized a former anyway, students of canada's residential school for what he said was the evil committed against them. many were forced from their families stripped of their culture and faced abuse of bands of catholic priests. the head of the catholic church are so forgiveness, while in canada as far northern territory, have n

for decades. volcker turk is probably the front runner for the job to other candidates, the former norwegian prime minister ern soleberg and cornwall kang, who was foreign minister of south korea, have higher public profiles, but they're also known to favor quiet diplomacy. over public advocacy. time is running short. the next high commissioner is supposed to be appointed by the secretary general approved here in the general assembly, and then take up their post by the 1st of september. leading human rights groups are unhappy. they've offered their input to the office of the secretary general, but so far they say they've been rebuffed. james bayes al jazeera at the united nations chinese, a congress has extended a state of emergency in arrow county region. armed indigenous groups there have declared war against the state and big business that demanding the restoration of their ancestral lands and self determination, where it's a stern test for president gabrielle arch, just months in his 1st term. well, our latin america editor issue newman reports from santiago, michigan. this is the afterm

it's diplomat say an official little known outside the un who's work for good terrace for decades. volcker turk is probably the front runner for the job to other candidates, the former norwegian prime minister, ernest soleberg and cornwall kang, who was foreign minister of south korea, have higher public profiles, but they're also known to have a quiet diplomacy. over public advocacy. time is running short. the next high commissioner is supposed to be appointed by the secretary general approved here in the general assembly. and then take up the post by the 1st of september. leading human rights groups are unhappy. they've offered the input to the office of the secretary general, but so far they say they've been rebuffed. james bayes al jazeera at the united nations. members of congress in washington, a mounting pressure on the united arab emirates, to release an american civil rights lawyer who represented murdered journalist, jamal, because shoji they held a press conference, this wasted your attention to the case i seem to for was detained to by a board on july 14, the you a says go for

know, one thing in another i was able to publish a number of major major books by people like paul volcker great fed chair earning jordan the great civil rights leader george soros who obviously doesn't do it for the money. i was able to find the wesley clarke when he came back after having won the war in kosovo was able to agree with me on a contract without having to pay ridiculous amounts of money. so there was a way to do it, but you had to have an approach that i was able to take because of my experience and most people choose or can't do that. and so what happens is they go into an auction. they meet with the public figure. sometimes that public figure doesn't even show up for the meeting. and there's an auction and then they write i have somebody write the book for me. it's just you know, it's not a good process in my view, but that's the process. so peter austenos, let's go back to your work with presidents. did you make money on the art of the deal? and what were you what were you dealing? what were you dealing with president trump? oh god the art of the deal. is a remote is truly

s. diplomat say, an official little known outside the un who's worked for guitarists for decades. volcker turk is probably the front runner for the job to other candidates, the former, which in prime minister earns soleberg and cornwall kang, who was foreign minister of south korea, have higher public profiles, but they're also known to favor quiet diplomacy. over public advocacy time is running short. the next time commissioner is supposed to be appointed by the secretary general approved here in the general assembly. and then take up the post by the 1st of september. leading human rights groups are unhappy. they've offered the input to the office of the secretary general, but so far they say they've been rebuffed james bayes al jazeera at the united nations. now rad bengal tiger calm has been born at cuba, national due in havana because haven't been named yet, is being cared for in the zooms, artificial breathing department only about 2 and a half 1000 bengal tiger left in the y.

. >> we are not looking at the volcker recession. >> this is bloomberg surveillance with tom keene, jonathan ferro, lisa abramowicz. jonathan: good morning, good morning. this is bloomberg on this payrolls friday. along sign tom keene it, we are together with kailey leinz. the market is down 0.2% on the s&p. we have to begin with the shocking news out of japan. tom: that is not what this is about, this is domestic sadness of japan. this is a hugely domestic story of mr. shen say abe -- shinzo abe. he was shot. this was sudden animated. he died very rapidly. jonathan: the suspect used what appeared to be homemade weapon. it goes without saying that these killings are incredibly rare in japan. this kind of gun violence is truly shocking. the team is breaking down the data. in japan it, then all of japan, 10 gun related incidents. 10. that's the number for last year. tom: that is the society. i'm going to say the assassination of public figures in former prime minister's is common. out of world war i, i should say out of the japanese war, it has been all too common. i don't think people are sho

the fed, that is the highest and most aggressive hiking we have seen since the 1980's under paul volcker. let's see how things are playing out across the assets space. the tech enthusiasm filtering through. the consumer sentiment survey out yesterday, coming in at the lowest level since february 2021 , but some companies suggesting for future is still holding up. futures up by 1.3% on nasdaq. we continue to watch the interest rate hike. again of .3% on the euro-dollar. inversion, about 3% on the two's, 2.80 on the tens. brent at 100 and four dollars, the gasoline when it comes to oil. the troubled lender credit suisse posted a much greater loss than expected. the bank says it is conducting a quote comprehensive strategic review and has named its asset management head as the new ceo, replacing thomas gottstein. >> thomas and i came to the conclusion that it is better to have new leadership. the company was under fire and he is a ceo was under fire, he did a great job but decided to step down. tom: let's get more on the swiss story. we are joined from zurich by manus cranny. how much of a

things are moving, two back-to-back 75 basis point rate hikes is something we have not seen since the volcker we would have to go back to the 1980's. tom: it is not a measure time. the only thing that is measured is the stock market reaction after people calm down once earnings come out. lisa: as you say, a movable feat. tom: spx up 1%. down lagging a little bit. dow futures up 166. stay with us. this is bloomberg. ♪ jonathan: equity futures are up 10%. stocks right now. >> everything that you need to get set for the start of u.s. trading. this is bloomberg the open with jonathan ferro. jonathan: we begin

see where volcker shifted in october and the market definitely anticipated that. >> it was amazing.e new york post" recognized it i had been a summer associate. i said wow, i think the bell just rung. i don't think this is a bell rung moment. i don't. i think you have to see more things roll over, everything go -- all the plastics have to roll over. they've been a problem because america runs kind of on plastic. we need to see food come down. i personally wish that the antitrust, terrific guy cantor, after he's finished killing this spirit deal, he has to go after and find out where the corners on the market are for imported food we only have three shipping companies that bring in food they're international shipping companies. i think they signal each other -- >> there's places why you agree with the president the collaboration on shipping ocean freight. >> absolutely. it's demonstrable. ask anybody who is in that business of importing and they will tell you i'm not going to mention their names, but they all work together quite well, i think. >> well, proctor, to your point about th

or they will act boldly like paul volcker. which do you think they will do?: today, i think chair powell will try to thread the new between the two but ultimately lean toward a slightly more hawkish, ultimately because it is too soon for them to tilt the message in a way that would be interpreted as dovish, provide relief to financial markets. but i do think it is coming. lisa: do you think it's realistic to price in rate cuts as soon as next year? bob: the market is pricing in 75 today and then another 100 by the end of the year, then 50 to 60 basis point rate hikes later in 2023. i think that is way too clever to think that we will go to 3.5, and then be at slightly below three by the end of the year. it is much more likely i that we don't get to 3.5 and the fed stops sooner, but doesn't have to cut, or they have to go beyond 3.5 because inflation proves wildly more persistent. the current curvature -- we like that trait, we are taking the other side of it. lisa: which means you are going short duration and into the short end. how is that playing out in ter

is it the 1980s with volcker we don't have to go to 17% it will not stop at 2%. >> greg hayes.nk you. guys, we'll be here all day long he will have at low of o lot ofs and well as more dom, back to you. >> greg hayes, thank you phil lebeau, thank you enjoy the air show. >>> still on deck, the major energy market risks. my next guest says this could push crude to $200 a barrel. a shocking number. we'll have that story enwh "worldwide exchange" is back after this dad, we got this. we got this. we got this. we got this. life is for living. we got this. let's partner for all of it. edward jones 80% of couples sleep too hot or too cold. because quality sleep is vital, the sleep number 360 smart bed is temperature balancing, let's partner for all of it. so you both stay cool. our smart sleepers get 28 minutes more restful sleep per night. save 40% on the sleep number 360 special edition smart bed queen now only $1,499. another busy day? of course - you're a cio in 2022. but you're ready. because you've got the next generation in global secure networking from comcast business. with fu

federal reserve meeting where it looks like we are issue in for 75 and we have backed off a double paul volckere. anna: with the fed meeting this week, investors are pricing in an interest rate hike of at least 75 basis points. how high will the fed go? and with a recession, will the fed keep raising rates? here is how investors responded to the latest survey. >> we think the dollar can still rise further. the dxy will rise 112. >> the fact that the ecb is going to be increasing their interest rate and shoring up the euro. >> in some ways our expectations call for the leveling off of the dollar relative to other global currencies. >> i don't think there are expectations among fed fund futures that the policy rate will rise by more than 75 basis points. >> the broader dollar may be reaching its peak year. >> there are some things on the horizon which would -- which could cause the dollar to pull back. >> there is a possibility that the euro-dollar could fall back towards record lows. anna: mixed views. joining us now is garfield reynolds who has been thinking about this extensively. let's deal w

. >> we are not looking at the volcker recession.

you said at this point, we should bring back paul volcker. i think you are seeing the fed move quite aggressively. in my opinion, appropriately. clearly trying to frontload a lot of moves, policy moves to try and deal with inflation. we at goldman sachs are impressed with what they are doing. we expect for them to continue to be aggressive in combating inflation. so far, so good. annmarie: combating inflation means potentially facing a recession. right now, the data shows a potential technical recession in the united states. how to say small business plan for that -- how does a small business plan for that? jessica: where larger corporations may be hiring at a slower pace, those are people that are now able to -- where, given the chance, they will go to a large corporation and build opportunity there. we are looking out --, one of the reasons we are here is able to talk to elected officials, congressional representatives tomorrow during our advocacy day and talk to them about what our needs and stressed to them our legislative priorities whic

step back and look at the feds attempts to hit inflation hard, i wouldn't say necessarily like paul volckerback in the early 80s but maybe close. i mean, expectations are that we're going to see another three -quarter point hike later this month. are you in that camp? how high do you suspect the federal funds rate or the bank lending rate will go? >> so i'm in the camp which is i think the consensus camp at least at the moment. i think that interest rates at 3.5, between 3.5 and 4% will be more than enough to contain inflation. it's a delayed process. we all remember the montra that monetary policy acts with long and variable lags. again it's a process that should have started last fall. neil: but that process you're saying 3.5-4% be about double than we have now, a little more than double, would that be by the end of the year, or how do you see it? >> no. i think by the spring of next year. neil: got it. you get to the terminal rate for the fed. they will proceed solidly, but deliberately and they will also be conscience of the fact that their actions will be having effects that have signi

that we're having now or have been a seismic change you can see what happened as a result of paul volckerhave been talking to my friends it is a political earthquake that is coming along i hope works out very much in our favor. but you are right it is tight. maria: then, in terms of the second half of the year and beyond, art, people are wondering when fed stops raising rates and starts cutting rates i can't believe this conversation has taken place, but this is what is going on on wall street art, how long will this experiment last? we haven't mentioned $2 fact fed has nine trillion-dollar balance sheet to unwind as well. >> we've got lots of problems we can talk about maria. the fed should not be setting interest rates, fed should follow interest rates, markets should set interest rates, markets should set prices, markets should set quantity tuesday fed should follow not lead the whole hubris of perception of power people have, they think they can sit there in washington with credentials chatting with staff, they think they can control the economy. they can't. they should get damn hands

i hope we don't do the paul volcker thing and go from 6% to 18%.would do is in. neil: keep us posted, trying to make a living and it is difficult. what you do affects what we enjoy, what we eat and what we share and the move forward. you are the breadbasket. best of luck to both of you. we have a lot more coming up including hard times for a lot of other folks including growing number of americans who are hitting up their social security earlier than you would think because they need the dough after this. ♪♪ i got some of my gold before i came to this country. i got some of my gold before you passed the bread. encourage one another... i can buy gold for this?! you can buy gold for this. and talk about life's wins and misses. responsibly sourced like my gold but not responsibly cooked. because at the end of the day, nothing keeps it all together quite like - gold. visit invest.gold to see how gold is everyone's asset. at st. jude, the mission is just something that everyone can truly get behind. look at our little st. jude pin there on the fridge! w

tom keene, if you compare this to the volcker area, the inversion was over 200 basis points. is this a repeat? andrew: sure. it is certainly headed in the wrong direction. as an economist, we focus more on the three month, 10 year inversion. that is not inverted yet because the fed has more wood to chop. they still have more room to go in terms of rate hikes. we are keeping a close eye on that. to come attends, as you mentioned, it was far more inverted in the years passed or decades past rather so keeping an eye on that but we want to see how long that persists. we have done a little work on that and it tends to show you need to cede twos intends persist for about two to three weeks on a negative territory for it to be a strong signal. even then, you are talking about a recession within the next six to 12 months, not necessarily tomorrow. kriti: let's talk about the economic signal. you have a housing market that is being powered by more than 2700 journalists and analysts in over 120 countries. -- you have a housing market seeing boom after boom, a labor market extreme he, a

right now he should be writing about comparing volcker to powell and vice versa.is not part -- paul volker, right? jeffrey: he was a great central banker in an age of monetary mystique, and age in which central banks elaborately cultivated obscurity and a distance from the public, they did not want to be in the headlines, they wanted to choose when they would be in the headlines, we are in a different day and age. getting inflation down reveals the value of managing expectations and the value to that of being transparent and communicating about what they are about and trying to do. jay powell strikes me as better suited for the age of transparency and in terms of personal demeanor. one thing that paul volker had was the backing of the political establishment in washington and new york. they were able to take the pain and cultivate an appreciation of the pain needed to withstand in order to get inflation down. i think jay powell seems to have abundant political connections, and abundant skill in managing the fed's political connections. so he seems pretty well-suit

paul volcker took interest rates over 20% to stop the back of inflation in 81 and 82. it's doable. it's painful. in an election year when you want to get re-elected. that's not our problem. the fact of the matter is, we need to figure a way out to snap the back of inflation. inflation is destructive. look at companies like venezuela, argentina, brazil. get rampant inflation, you have social unrest. the poor people that work the hardest, the people that have the least are the ones that get punished the most. >> neil: ken, if you hard to start home depot -- sorry to jump in on you -- could you start it in in environment today? >> no, for one reason. besides what we're talking about today. we based our company on making sure that the work people with us, not for us, with us. we couldn't give out stock options. we couldn't start home depot today. the essence of what we are, all of those people that work in our store own stock. they own a piece of the company. why are they passionate? it's their business. it's apart from inflation. the issue is there's plenty of capital around. they're

in 1982 the stock market was almost three months ahead of the fed before volcker declared an end to anti-inflation measures even if we see that last month, june was the high water mark, it's unlikely we'll get a fed pivot anytime soon and they've signaled they're willing to let the economy fall into recession as we deal with it it doesn't mean it will come down to 2% anytime soon. fed hiking is not as problematic as the fed having upside risk, hawkish risk we see much more measured and, look, if fed funds get to neutral and the fed wants to push above it, that's most of the market is stock market history. equally important we have to keep in mind that it's only been achieved 30% of the time it just needs us to get away from these are pretty ugly numbers, these are terrible. the fed doesn't have to change to raise forward expectations. still 2.8% it's not like the fed has to crush the economy. it has to manage expectations. >> well, we have that qt wild card they're going to start tightening and that's another, i think, headwind. alli, the final word on the strategy if you are feeling more cautious

that's what alan greenspan would talk about and paul volcker. i don't know. i don't recall him saying anything and the run-away government spending. >> neil: you were fair criticizing both sides there. there's steve moore's christmas party invite. we'll keep -- kidding, kidding. all right. i want to thank you very much. by the way, as many were wrapping up there, we're learning that spirit airlines has terminated a merger agreement with frontier. spirit was going to take to it their shareholders. in the end they decided to junk it. that deal as it was originally intended between spirit and frontier to shore up airlines so they could deal more in unison with what is separately and individually -- they've had a time dealing with it. it's put off. more details. we'll see what their options are or they don't fall on anyone and take their chances. meantime, we're also getting word that meta, the parent of facebook, if you will, has a big earnings miss and a steeper than expected revenue drop. that is really pounding the stock in after hours trading. last time i lo

volcker with the economics and council on foreign relations and columnist sebastian malaby sebastian,are the cryptos to create services that matter in the real xhirs an-- ra economy, and why don't the nfts count in. >> the whole point about investing in the future, especially early stage tech, is that a lot of bets go wrong, right? i mean in, a parallel business like venture capital, one in ten bets going right is okay because the ones that do go right, go right big time, and they make more than 10x their value so the first thing to say, is you know, i'm not here predicting that it's going to work for sure. i'm saying it has a chance of working, and in a bet on a future technology like crypto, saying it's got a chance of working is good enough to be long you shouldn't be, i mean, 40% as the family office you were just talking about was going for. that's extremely he have betting. i would in the recommend that, but i think that in a diversified portfolio of bets upon the future which is some about clean tech and some about biotech and some are by software, having a bet on crypto is com

we are not looking at the volcker recession of the early 1980's or the great recession.ll be hard for them to substantially slow the economy. typically, when the unemployment rate rises like that, you are in a recession. tom: want to get a quote on the 10 year yield. we wander that. does someone fancy like you look at jobless claims? >> i think the jobless claims are not that helpful, i think. part of it is that a lot of the flow early on comes from firms stopping to hire. the first thing we are going to see if the labor market is cool, firms are going to reduce their hiring. jonathan: job openings. >> job openings should go down and we know the fed is counting on that. eventually, firms do start to laugh workers and the claims numbers will go up. you know, we've seen a little bit of an increase, but i don't put too much weight on that. jonathan: 235, a bit of perspective, 235 historically,, tom not even population adjusted. tom: you adjust for population. what's your favorite chart for right now? what's the chart that tells the best story? >> i have to side with yelling

paul paul volcker only got inflation down to 4%.en the conditions we have, for example, with automobiles and semiconductors, housing is a third of the cpi and so forth, i don't think we're going to get done below 4% very realistically. so if that starts to become a focus and they take their foot off the brake and let the economy go, we might accomplish a soft landing which i define as one negative quarter of growth or two with very modest negative quarters, you know, not really very deep and then we rebound. not a usual deep recession. unemployment in, say, 5%. that's not terrible. charles: so right now we see the 5-year break-evens, they're tumbling. copper is in freefall. container freight shipping costs are rapidly coming down. can we now put the peak inflation debate argument to bed? >> i think we're at a plateau because so much of the inflation right now is autos, housing, food and energy. and all of those have supply-side problems that are independent of the cost of shipping. my feeling is the greatest problem that we have is

for example, paul volcker, and he came into office,'s formula was to raise interest rates until the economyeels over and inflation falls. it has not feel, if not quite as bad as that. even after several increases, the federal funds interest rates are still low. there is talk they will raise it three quarters of a percentage point. some people think they will raise it a full percentage point. the rate will still be below 3%, which is below the rate of inflation. everything we know tells us the rate has to get above the rate of inflation to start slowing the economy down. judy: is it clear which is worse, rising, rising inflation, or a recession? is it clear that a recession is to be avoided at all top -- at all cost or higher inflation is to be avoided? greg: neither is very pleasant. american people have been through a lot of both in the last few years and they don't want either. from the federal reserve's point of view, the traces not flation or recession. it is deal with inflation now, even if it involves a recession, or deal with it later when inflation is higher and more entrenched, in

burns' blew it and he never fixed it until we have to get big paul volcker to fix the problem and thehis tune and i think appropriately so, and they raised rates with the plots and the markets expect because they have to get credibility that they really are going to control inflation, and i think they have also indicated that the primary mission is to get the fed to control even if there is a recession and that's exactly what they have to do and they made a mission to avoid that if they had performed better starting about a year ago, but you know, it's not an easy job to figure this out it's not easy to get it right. you do the best you can, but it's in the fed's thinking and policy framework, and it's about that issue, and it's really unfortunate and they're doing the right thing. >> i would love to talk about the fed's forecasting acumen or lack thereof and maybe we'll have time for that, but let me come to the more immediate question which is how long do you think it will take before inflation is, quote, unquote, under control and at what level is those under control imply is it 2%

why the dollars are not going as far as they should be and suddenly the speculations as paul volcker pointed out it seems to be a way to get ahead. it's debilitating in society and leads to social problems and the countries that repeatedly devalue their money are more violent inth societies. they have more crime. pointing to brazil in the last couple of years they tried to stabilize but it's been notorious for decades. look at the crime, terrible. so you get less social trust, more lawlessness, unstable money. there is a book written about the german hyperinflation in the early 20s which made possible the riself of adolf hitler when they completely destroyed their currency. a book called when money dies pointed out that before that hyperinflation germany was probably the most law-abiding country on earth. everyone obeyed the rules and then went to hyperinflation and suddenly that went by the boards because you were a sucker because you were going to lose. you had more lawlessness and people cheating, people most looking to the future justst living for the moment. it was debilitating