♪ >> i don't think we are heading into a higher for longer environment but i think we are heading into a normal for longer

environment. >> where we are is the new eaglewood librium just a new equilibrium. >> the higher for longer will stay there. >> we understand we establish price stability as key. they are not giving up the 2% inflation target. >> the economy is doing fine and i think the economy is on its way to 2% by the end of the year. >> this is bloomberg surveillance. jonathan: the third hour of bloomberg surveillance begins right now, live from new york city, there are many ways to get a read on the u.s. economy. you could ask the ceo of the biggest bank in america, jamie dimon, francine lacqua will do that in 10 minutes time. you can look for the data at 8:30 a.m. eastern time in the jobless claims come of the estimate is 220 or look to a large retailer like walmart in the premarket posited by more than 5% after a beat on the top and bottom line. lisa: there is a cohesive thread coming together and it's not

clean and neat and dramatic. it is a slow softening. it's clear with walmarts extreme beat on the heels of higher income customers looking to get discounts in an inflationary environment. annmarie: bloomberg intelligence are writing that this appeal that walmart has even for the higher end wealthy and the consumer coming in, wanting to discount because inflation is biting. how long will that last for that company specifically. it tells us in the hard data from walmart that the consumer sentiment is starting to resonate. people are concerned about inflation. jonathan: a welcome calling for an unwelcome deterioration and what is the distinction between the two? lisa: a welcome cooling is something that keeps inflation in check will not necessarily causing jobless claims to rise that much which is why 8:30 a.m. will be important in an unwelcome cooling is something that happens and it is usually it is not a clean and steady per

trajectory. it's not a linear progression. it usually comes suddenly and there is a jump up and unemployment. that's what some paper are calling including citigroup. jonathan: 8:30 a.m. eastern time. all-time highs at the close wednesday on the s&p 500 and the nasdaq 100 for the first time since march. we are up by zero point 05% on the s&p 500 and yields are unchanged on the bond market. coming up this hour, john hancock investments as the s&p had to new record high in the jp morgan ceo jamie dimon live from paris with francine lacqua and michelle meyer reacting to jobless claims data. we begin with the big issue -- good news is good news. the cpi print sends stocks above 5300 for the first time ever but met miss can says this --

met joins us now for more. walk me through the regime you think we are in. >> we still think we are in a bad news/good news regime and its one that's challenging for asset allocated because treasury bonds are acting like small cap crypto stocks. i did not see this coming. this is relatively new to the cycle. i'm looking at the cfa books in the intelligent investor and other finance books and i was wondering where they were on that. this is a challenging market and one we think will be a bit counterintuitive. we think it's a phase and we like the treasury part, the high-level test a higher quality bond part of the market in the rally then we are seeing in the junk rally. it plays into the strength of the lower quality market. markets in general are sunning themselves on soft landing island and we think this is a great time to do some risk. jonathan: you don't want to take

in the sun and take a rest? >> and have a cocktail? no, we think it's a bit of a welcome gift. the bar is lower right now for q1 for all these economic data points. the cpi report on inflation and the concern last year was relatively high. you are getting comps on lower data but the last year data was much higher. from here on out, inflation felt meaning lee from last year. the bar will be harder to beat, it's similar with earnings growth, the bar in q1 is lower and it goes up from here. the estimate from the street is about 9% and from there it goes all the way to double digit earnings growth by the end of the year. 13% earnings growth the next year and we 21 times on the s&p. that's as good as it gets being priced in. right now, we're looking for

income as a return driver and alternatives of the dollar could be a great diversifier for portfolios. also thinking about defense more broadly. jonathan: bonds and stocks have rally then you alluded to the bonds but on stocks, what would you trim? are we trimming what's happening in small caps? are we trimming what's happening with big tech over the last five days? where would you trim? >> we would start with the russell 2000. the russell 2000 right now, we hear a lot of fundamentals about small caps being cheap and we agree with that. but nearly 40% of the russell 2000 companies don't make money, they are not profitable. what's been driving small caps lately are crypto minors and mean stocks. if you have a fundamental thesis on the russell 2000 that it street or there is another micro thesis, what is driving it is a lot of speculation. if you want to go along

speculation, that's a great way to do it but that's the place we would trim first. internationally, economies have been improving and we've been warming up to that, europe in particular but we think this china trade may also be starting to get stretched and overbought. a lot of headlines and everyday you get a new one out of china. for us, the fundamentals are still not strong enough to support it. lisa: you are not in the camp of buying european bonds to diversify away from the u.s. and align yourself more closely to the easing cycle? you're not leaning into that? >> it's what we are looking at and duration is a tailwind, i get it. congrats to those that grab that what we are seeing is just a massive yield disadvantage. we are thinking about bonds is a longer-term investment for clients. there was a point where we were up almost 6% yields on mild credit bias in portfolios.

newness will bonds we like but what we are seeing is the yield advantage is so amazing in the united states. i'm really getting excited about the yield area. lisa: it's inspiring. keep going. you say you paint the picture that we are in now and we are coming off a mini cycle of its own that started in november with the pivot from fed chair powell. how much is that a way to look at this and i think it's a good point that essentially, the problem of rate cuts and fueled risk assets to fuel economic growth and inflation to keep things chugging along the, longer than people expected. is that how you view things? >> exactly and it's about context. six month ago, the fed was talking about rate cuts. the bond market said sure. we will double that, we will up the ante if you will and they said six cuts will be priced in. pricing in six cuts -- can you

imagine if the fed had said we would cut six times? of course we will get re-acceleration of growth and inflation. that was six months ago and the fed has to deal with that. they have to peel that back. but that's what a mini cycle look like. you saw a lot of economic activity in november around the inflation pressures and it has re-accelerated and now the rates have come up and we look at housing. housing is a critical part of this whole economic equation in the housing builder sentiment index they came out yesterday ticked down for the first time in six months. if housing is starting to slow, that's a good indicator this mini cycle might be slowing. go back to the small caps in the lower profitable companies, they will not like it. right now they are loving the risk on move but we think the fundamentals will deteriorate

underneath the hood. jonathan: we appreciate the update. looking ahead to more economic data in about 21 minutes with jobless claims in america. up next, a conversation of the morning, the jpmorgan chase ceo jamie dimon live from paris with francine lacqua, that conversation is around the corner. ♪

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♪ jonathan: live from new york city, welcome to the program, equity futures on the s&p 500 are just about positive with economic data, jobless claims around the corner. it's time for the conversation of the morning. francine lacqua sitting around with the jpmorgan chase chairman and ceo jamie dimon. good morning. francine: good morning. it's my highlight of the day, jamie dimon had a lot to talk about. thank you so much for hosting us at your global market conference.

what is market turbulence looking at now? are the markets getting ahead of themselves? >> i wouldn't call it turbulence, we have good healthy markets for quite a while. they are kinda predicting a soft landing and you see that in credit spreads which are kind of low and the market is kind of wide open. that's all good. there is a lot of times in history where that was true in the next year it wasn't true so we will see. i don't pay as much attention to monthly numbers as people do. francine: what do you think the future is for inflation? >> i'm worried about it because we have big fiscal deficits in the underlying inflation may not go away the people expect. i look at the future, the green economy, the remote ovation of the world, the infrastructure, the restructure in trade, fiscal deficits, i think there a lot of inflationary forces in front of

us that may keep things higher than people expect. the surprise would be rates are higher in inflation is a little higher and maybe slow growth. also geopolitics as a another issue. that could be determinative and what the economy does next year and we will just not know. francine: do you think it's 50-50 whether the fed cuts or hikes? >> i really don't pay that much attention to that. the fed will have to follow the data and i don't know what the data will say. they are doing the right thing and being patient now. they will not know for a couple of months. francine: but no big correction? that means you are not worried about it? >> i am i said stocks are high and rates are staying high. whatever the world's pricing in for a soft landing, i think the chances of something going wrong is higher than people think. francine: in the u.s.? >> in the u.s. but also global.

francine: what does that mean for markets? >> maybe nothing. credit spreads will cap out. francine: why is the market not pricing that in? >> it's happy talk. it comes from low rates and several banks are reducing rates may be geopolitical things disseminate and got don't cause problems. the future is not predictable like that. i'm a student of history and i watch these inflection points and i go back. i go back to the booming markets of 1972 and the collapse of 74. the collapse of 82, the 87 market crash, 1990 real estate crash and almost all of them were not predicted the year before. i look at these factors that drive these things which are not known. as a company, we prepare for all these things. francine: what do you see is the main stress right now?

if it's geopolitics, it's not priced in. is it distressed or something going on you worry about? is it multiple factors? >> geopolitics could create the main stress we are worried about in terms of oil and gas prices. there are alliances in trade but i think the surprise would be higher rates because inflation doesn't go down. maybe inflation goes up next year. inflation may be in the cards nothing to do with what we see today. that is to me the surprise. if you have higher rates and god for bid stagflation, you will see stress in real estate and leverage companies and private credit, things like that. francine: so it's unpredictable to the new normal? >> i think it's been the norm my whole life. francine: not worse now? >> no. francine: what happens between china and the u.s. and what does that mean for you in china? >> the geopolitical situation is

tense between ukraine and russia and iran and the terrorist activities in israel. north korea, we've never had nuclear blackmail before and this has expected our relationship with china. it's hard to have a great relationship with china. we aren't different sides in ukraine and put taiwan aside, having said that, i think if the right thing for america to fully and deeply engaged with china competitively. every nation will do what it's them -- what's in its own interest. we should define social america properly. there is unfair trade and negotiate that or do it ever you can do but engagement is what you need to do. china is not a natural enemy of the united states, they have their own problems so to me, we can work together as best we can and then we have common interests, climate, anti-nuclear proliferation, anti-terrorism. francine: how does that work for a bank working in china? >> you have to be cautious. you look at china from a risk

reward basis, it used to be good and now it's not so good anymore. i've got that number but 1500 multinationals in china, they are not leaving china. we are much more cognizant of things being higher in hong kong is in that book as well. i look at china and hong kong as one from a risk standpoint. francine: what does a trump administration mean for the u.s. economy? >> i don't know. francine: because it's unpredictable or it's too soon to figure out the policies? >> if you look at history, who was elected president may 9 may affect next year is we are a big tanker and that will happen. the more important thing is what we do in the geopolitical situation and being clear that american leadership is needed to keep the world safe for democracy and that means economic alliances which can boost trade. i think we should spend more

time in trade and it means nato and it means russia should not win in ukraine because if they do, i think it could tear asunder this western world. francine: you've ruled out the treasury secretary so what would it take you to get into politics? >> i love my job. i'm not sure i want to do something like that. francine: even if you've got the call? would be hard to say no? >> i don't know, probably yes. i love my job and i have no intention of leaving it. francine: we are in france at a global market conference so what you expect from causal three -- from basel three? >> president macron has done an outstanding job. he wants to grow his economy and is much more innovation. basel three, we've been clear that we thought it was excessive. not well thought through and i would like to know what the endgame is, what are they trying to a compass with private credit

? 80% of money let the system and the government is having a bailout system for companies because banks don't have the ability to provide liquidity and top markets? they are looking at it. i trust jay powell to look at and analyze what they need to do. it may end up in a lawsuit or something like that. the amazing thing is that the endgame in america is 30% more capital than a european bank. why are we arguing about international deals when we don't do them? the regulator should ask the question, what do you want? how do you want the system to work? do you want public or private credit? just dictate it. if you don't want levers lending, just dictate it. we are guardians of the financial system. we bank and 100 competent -- countries and we are underground

in 60 countries. we support middle-market companies, do they want that or not? francine: do they know are they still trying to figure it out? >> i don't think it's quite clear from any announcement they've done. you guys write about it. there was no detailed analysis about cost-benefit and what they are trying to accomplish and what the outcome will be. francine: that's why we are asking you. talk to me about friends. you are positive on president macron? if he relaxes labor laws, would you hire more in this country? >> he did relax labor laws. francine: what if he relax more? >> possibly. i've got -- i see $800 million a day and when you have more money, you tend to hire more and that's been true for us since i've been a jp morgan. i'm confident with the people

and you have a hiring capability in france and you tend to do more things there. my view is that we will do more things here. the regulation they put in place, the labor flexibility they put in place, those things make a difference. it will not just lift up jp morgan here but we pay a lot of taxes here which helps lift up all citizens. i don't think president macron did that jp morgan. he knows his country needs to grow and bring innovation and that's a you build a better country. francine: you have the largest wealth fund in the world. americans seem to work harder, is that fair? >> i hate total statements like that. a lot of europeans work hard. when you see the thing about work hours, it's somewhat true. americans are hard-working but i see that here, too. the innovation people here work

as hard as the united states. francine: in terms of headcount in the u.k. come it's of the highest it's ever been and you are giving -- you recently met with possibly the next prime minister in the u.k., what do >> >> you think? i like the fact that both the conservatives in the labor governments are talking about pro-business, simpler regulations, getting more innovation in the country and becoming competitive and we all need -- we all had too much debt but growth is the best anecdote -- antidote for anything. having a growth strategy is good for the country and good for the lower income people in this training stuff is probably the most important. get training and jobs in the first job is the first rung of the ladder and create dignity and household formation. i think countries have to do more of that. if they don't, you will have a tough time. francine: do you think the u.k. economy will change under labor? >> i don't know yet but i was

happy with what they were talking about. we had rachel reeve come to her conference and they are talking from a playbook about growth with simpler regulations and more capital formation, less taxation because that's the way to help the whole country and the citizens. that's what we want them to be doing. francine: when we talk around india, does it counterbalance china for world growth? >> i think india has done a very good job. when you look at india, it should have a very bright future. i'm not saying it's a counter to china but a bright future. i think we should be reaching out to india. they are not aligned because where they are in the world between russia and china but they are a democracy, natural friend of america and the western world. we should all be helping them and they've made a lot of changes there. infrastructure, transfer payments, payments that will be

good for that country. francine: what does that mean for jp morgan? >> we are not quite there francine: will you be there in the future? >> we have 60,000 employees there with campuses and we are spending their and we are there big time. francine: you've had a number of high-profile departure so how does that change the business and how you run things going forward? >> not at all. francine: nothing? if you bought anything, what would you buy? >> that's different. we cannot buy banks, you know that. francine: you can buy a european bank. >> i wouldn't even try. i think the regulators in america and here would hate it. even if they said do it, i would be in courts and things for a year-and-a-half. i would rather just add clients in this country and bankers and technology and branches which is

a better way for us to grow. francine: if you could buy anything >> i can't tell you. we are not looking at any major acquisitions. we are adding -- we have investor day next week and we have retail and wholesale branches and we're in almost all the major cities. we are adding commercial banking all over europe and asia. we are adding technology around payments and even the blockchain to move data and maybe move money one day. we are constantly investing and had 2000 people in ai and machine learning on our way to 800. francine: in five years, how much bigger and different will it be? >> i will speak to an avatar. francine: do you think about technology a lot? >> all the time. it's been true my whole life. when we have a management meeting, the technology geyser at the table.

ai, cloud, more analytics, how do you things better and faster for clients? a huge amount of digital services, automating for the better. francine: i guess that will change the heart of banking. does that mean you will see more winners and losers because of technology? >> technology is always changing. the heart of banking is moving money and holding money, that won't change. you have to do that according to rules and regulations by country. what will changes how you deliver. you go on your phone now and you can move money and buy stocks but that wasn't true 20 years ago. everything you do will change with the technology but the stuff like moving money and budgeting and trading money, making investments etc. the core won't change. regulations may change that as well. francine: what a trump be more favorable to banks when it comes to regulation? >> i don't know.

i am unhappy with the amount of rules and regulations coming out today. i don't know what a second administration would do. i am hopeful they focus on growth which is good for the citizens and good for the country. i would help anyone i can to do that for my country. i think francine: in terms of service? >> in terms of helping as a bank. francine: it's good to get that clear. jamie dimon, thank you for joining us. the jp morgan chief executive officer and with that, i will send it back to you in new york. jonathan: a fantastic 15 minutes with the brilliant francine lacqua breaking down the markets and everything else. what you heard there is it was not an economist giving you a base case. it was a chief executive talk about a very wide range of outcomes that he needs to manage wherever they fall. lisa: his range of outcomes still has skewed to the idea of

yields going higher and inflation remain sticky. not a base case and is not calling for yields to go to 6%. how do businesses hedge against the possibility at a time where they have to be prepared for risks that are maybe a little bit more tricky now. jonathan: also a lot in there about foreign policy and international risks. annmarie: interesting what he had to say about the u.s. and china working together. that's the opposite of what we've seen or potentially will see whether his trump or biden here. this morning, the wall street journal talked about the homeland security and how they are a number of chinese companies do to forced labor. whether it's export controls or tariffs or sanctions, there is a lot of daylight between this relationship. he says they are not necessarily natural enemies. jonathan: if you missed that conversation, it will be on the bloomberg terminal at bloomberg.com.

francine sitting down with jamie dimon. in 50 seconds, we will get jobless claims. we will bring of the economic data and equity futures are just about positive by 0.1% after closing at all-time highs in yesterday's session. the nasdaq is on a five-day winning streak there wednesday, up by 0.15% this morning. we talked about the levels of the bond market over the last month. the two-year is back down to the four-point 70's. up about two basis points on the 10 year. life in the 4.70 was only a few weeks ago we are back down to 4.30. lisa: we got the lowest inflation of the year we can see disinflation back on track and we hear from a host of fed speakers. jonathan: let's get to the economic data. jobless claims in america, last week a minute 231. it was the wrong kind of upside surprise and right now, down to abou 222.

it's down from the previous week up to 31. if we get a revision, i will bring it to you. equity futures are positive still bike .2% on the s&p 500. in the bond market, look at the front end of the curve with the two-year just about unchanged. if you are concerned about maybe a continued break out on jobless claims, you don't see this morning. lisa: it doesn't seem this is a labor market that's seeing massive fissures. constance hunter made a good point where she said we are seeing the end of labor hoarding. there seems to be a change in the dynamics and maybe something more normal. it's not necessarily whole shelves shifting but there is a creep higher in the sense that remember when jobless claims came in below expectations? it was expected to be lower and it came in a little bit higher. jonathan: we've had some head fakes where you break out of 200 and come back to 200 again. is that the head fake or the

real deal or was q1 the head fake? what are we going back to this summer? where will we be next week or the week after that? this narrative keeps changing day to day. lisa: it's so confusing because there are different populations, different labor markets that are overlapping. there are different consumers. we talked about the k-shape recovery. it's different for the lower tier. at one point is there consistency in the reeds across the data that we could get a narrative that sticks? jonathan: the highlight of economic information is job information, 220. michelle meyer is with us and collin martin is with us. what did you make of the economic data? what do we take away this week? >> it shows the economy is evolving as it should be as the business cycle matures.

jobless claims are still very low, little to no evidence of challenges in the labor market. if you look at the six-month moving average for job creation, we are running about 215,000 jobs for more -- per month and you have support of the labor market. on the inflation side, i think you are seeing potentially some moderation, certainly on the good side, less on the services side but it's part of what you would be expecting to see as this cycle evolves where the goods economy is overinflated and now it's correcting. the services economy is still seeing a lot of momentum and strength. jonathan: what piece of the data puzzle did we not touch on, retail sales? >> i don't think it's that important on a month-to-month basis. it follows strong retail numbers earlier in the quarter. if you look at the trend for consumer spending to start this year, it's been strong. it was a critical part to the

upside beat to q1 gdp. if you look at real consumer spending in q2, running at 2.5 percent on an annualized basis, that's still a consumer actively persists abating in the economy. lisa: do you agree this is a shifting economy where it should be but not the severally falling off a cliff? >> i think so, we see things slowing but it's cooling but not cool we don't expect dings to fall off a cliff. i think it's a step in the right direction but we want to look at the actual numbers. cpi, we will focus more on pce but with cpi at 3.6% year-over-year is still a little too high. 0.3% was an improvement from the first quarter but that's still elevated on an annualized basis. lisa: we talked about how no one shifted their views after yesterday's data. everyone is entrenched with whether we've nailed the soft landing. it seems like the market is weighing in it's basically

celebrating the victory of the soft landing. would you say let's celebrate? >> we are not so ready just yet. we try not get too tied up with every data point because we have a long-term view. it's a step in the right direction and we have not changed our views. coming into the year, we expected three cuts and we shifted it to one or two. yesterday's report was good news that's not getting us back to three cuts a we are comfortable with 1-2. jonathan: what's the first date for a cut? >> july seems to early. jonathan: we get another cpi print in middle of june, same day as the june meeting. back end of july, you get a fed meeting so is july too soon? >> the fed has made it clear they are monitoring the data and looking at financial conditions and they want to understand the evolution of the economy. they are not talking about cutting interest rates because there is a significant problem in the economy. they are talking about normalizing monetary policy. i think that's an important

distinction when you think about the triggers to get them to start shifting the interest rate environment. jonathan: they are talking about normalizing without talking about what normal might be? >> that's fair. i think they don't know what the variables are. it seems like the commentary that they are probably higher than they had previously thought. we will probably be in a higher for longer rate environment with maybe sticky inflation and higher potential growth rates at least for now. that will influence how they think about the timing of the cycle. lisa: you put out data that was fascinating, 50 .9 million americans travel in the first quarters and cruise lines are going bananas. you people in incredible amounts on experiences and going jet skiing and going bungee jumping. how much does a fed cutting rates now basically give a gift to people invested in the market

and can really benefit from the upswing and not fight the inflation that's causing people at walmart to be selective? >> what's happening in the travel economy is super meaningful. the stats you just reference in the report we put out, it's huge. this is a sector that is seeing extraordinary growth in terms of the number of people traveling. the different death -- destinations they are embracing. the intention they have in terms of choosing where they are going based on what they see for currencies and affordability and for new and interesting places to visit they haven't been. there is a lot of demand out there to have these types of experiences and travel is the number one experience. the fact that you are seeing this type of growth tells us the consumer has purchasing power. the consumer is still active in the labor market is still very much supportive in that regard. for the fed, they have to look at the big picture and look at total spending.

they need to try to understand what's happening in terms of the moving parts within that. lisa: if i take a look at the hotel that costs me $200 two years ago and i'm now looking at $400 with fewer services, how is this not inflationary given the fact that people are willing to spend who are in a cohort who have money to spend at a time when there's an increasing cohort of people struggling under inflation? >> that's a sticking point but what does the outlook look like going forward? will there be a reacceleration? the idea of excess savings, we can put that behind us. it's not something i think about but i think -- but i look at the labor market which is strong but cooling and wages are still growing. until we see more of a sharp fall of, we will probably continue to see spending remain i. we are seeing some worrying signs. on the consumer credit side, we're starting to see things get turned up a little -- a little bit and credit is slowing down a little bit.

if we are using more and more credit in a high rate environment, we think over time that should slow things down. jonathan: what i don't like and hotels is when they say they are going green so they will not do the laundry unless you want a clean towel. that's what annoys me. you spend a significant amount of money at a decent hotel and they want to pressure you to this moral conundrum to have a clean towel. you want to save the planet with your clean towel. lisa: there are 15 towels underneath the sink, do you use every one of them? >> jonathan: sometimes i use a lot of towels. i want a clean towel. two showers a day, why not? lisa: why not five? jonathan: what a conundrum, clean towels, save the planet. let's talk about economic data. delinquencies, is that normalizing or is that something to worry about? what's happening around people struggling with debt? >> the new york fed survey came

out this week which is the most comprehensive measure of what's happening in household balance sheets, you have seen continued move up in delinquency rates just above where they were prior to the pandemic. is still part of this normalization process. it's partly a function of the fact that interest rates are higher which is part of what the fed was intending to do. by increasing interest rates in an economy where the economy was hot, the goal was to cool down the economy and prevent inflation from becoming unhinged and make sure we can continue to see the economy grow closer to trend for a longer. of time. i think it's part of what's playing out in a high rate environment. jonathan: we were all seduced by this idea because this is the outcome we want. we want inflation back down to 2% without the pain. it feels like so far we've got to about three without the pain

so can we get back down to 2 without the pain? >> i think we are on path to do that but do we have to be right at 2%? will they feel they've achieved what needs to be achieved and feel as though we've reached equilibrium? the fed and central banks talk about this range around the target. for a certain time, post financial crisis, inflation was below target. that led to this discussion about asymmetry and now inflation is running a bit above. as long as there is a belief that long-term inflation expectations are well anchored which they would rely on surveys for, i think as long as we are in that range of 2% inflation, i think that is probably quite acceptable. lisa: david kelly talked about this yesterday as far as looking at what canada is doing. do you think they should be targeting a range and not be obsessed with the 2%? >> they don't need to see 2%.

they say they want to see it moving down that way but they don't need to wait for a magic number before they start to cut. we think that will probably come soon but i want to go back to what is normal? in this environment, given the economy has been resilient and things are going pretty well, when they start to cut, is likely not because they need to save the economy. it's more bringing it down so real rates don't get too restrictive. what we are trying to figure out is what is that ultimate landing place? that has implications for all parts of the yield curve? lisa: neel kashkari said maybe they are not restrictive enough and we should put two feet on the pedal in terms of the brakes. do you think they are not restrictive enough and they might just want to hold even through the year and not wait until 2025? >> it's possible but i don't agree with him. he's in the minority and it seems there is enough officials out there jay powell included that's restrictive enough. there is a difference between

fed policy and actual financial conditions. when we continued see stocks rising credit spreads low, from a wealth of fact, maybe things aren't as tight as some would think. lisa: this is the psychology portion of the thursday morning show. it's therapy thursday as people tried to grapple with getting too sanguine on the soft landing. we hear an angst about being with this consensus. do you feel that with your colleagues that people feel things are ok but they feel reluctant to say it because it feels wrong to lean in to the consensus? >> we've been pretty optimistic for a while and pretty comfortable. i think people are careful because this is a very different business cycle. it was a business cycle that was spurred by one of the largest external shocks we have seen in a very long time which was the pandemic. so much as transformed in the economy since then. i think people are trying to

figure out how much are cyclical or structural changes and where do we settle? we go back to the conversation about the trend variables. i think examining the real-time data has very much led us in the belief that it's an economy that still has room to grow and we feel comfortable with that. lisa: from your perspective, you still like to ration and you have an opportunity to keep going which feels comfortable if you look at history and you think we are going back down. do you still have that conviction? is it ever difficult >> >> to stick with it? we still have that conviction and i've had it for a while. we are probably 12 five in 18 months. if you are an investor, you still have the opportunity. we are not at the highs of this year but we still have that conviction because we don't expect yields to rise much further from here. to get the tenure to get back to the 5% level, we think we need to see reacceleration growth. the expectations for fed policy

to shift from not just higher for longer or cuts but to a hike and we just don't see that happening. lisa: what happens to the idea of the industrial policy being inflationary, the idea that tariffs would be inflationary and people spending their baby boomer money would be inflationary? what happened to that that suddenly is forgotten or dismissed by a new era? >> things are going well so maybe it's just the psychology aspect. if you see your balance is going up and if you can handle that and if you locked in a low mortgage rate, things are probably looking good. we are still holding the line that we think over time, we will see long and variable lags and the longer the fed holds of these rates, it should slow things down. we are looking at how this impacts the credit markets especially where we can see some cracks is maybe in the junk part of the market. higher for longer should affect them more because they are

sensitive to higher rates. annmarie: erase about the bigger issues impacting inflation, i think they are all impacting inflation. >> it's difficult to understand exactly why we are at this stickier inflation environment. in the pandemic, supply chains were distorted and you had a big cost push and goods prices were set fire. and they are starting to correct but if you look at the level of a lot of goods prices, it still significantly above where it was prior to the pandemic. does that still the pandemic hangover or is it some of the factors you suggest which are longer-term in nature? it goes back to the idea of will we have stickier inflation? will we have higher for longer interest rates? jonathan: this is what jamie dimon was talking about 20 minutes ago. we will leave it there. michelle meyer alongside collin martin, thank you both. welcome to the program, moments ago, we had jobless claims come in at 222 and the estimate was

220 in the previous week was revised 232 so a little bit lower on the week. equity futures are just about positive by 0.1% on the s&p 500. the opening bell is about 44 minutes away. yields are climbing higher a little bit in the bond market. the two year is just below 4.76. the 10 year yield is just about unchanged at 4.34. the euro-dollar, the dollar got slammed yesterday but taking that back a little this morning. $1.08 a negative on the currency pair by 0.2%. calling about cooling but not cold in the u.s. economy is finally slowing down and consumer spending on goods declining looking for the first rate cut to come in july. lisa: we are all sunning and the glory of a soft landing son and that seems to be were everyone is at.

basically threading the needle perfectly as everyone dances on the head of a pin. jonathan: he called it a soft landing island. bra baited me with them hotel point. o she knew i would bite. let's can update on stories elsewhere. here is your bloomberg brief. dani: bridgewater founder ray dalio said he's concerned about u.s. markets and the growing geopolitical tension. he said rising u.s. debt levels could impact the treasury market in that the risk of another international conflict would reduce foreign demand for treasuries. the billionaire said that while the best parts of the u.s. are still the best parts for the world and capitalism and innovation, investors should look to move some of their money elsewhere. senator bob menendez is blaming his wife for gold bar buying. the new jersey politicians currently on trial for corruption. press occurs alleged he is at the center of a multifaceted scheme that involves bribery and

acting as a foreign agent. the senator's defense attorney pushback on claims he took those gold bars and cash and a luxury car from two businessmen in exchange for favors. he told jurors the gold in was given to his wife without the senators knowledge. netflix will be airing to nfl games on christmas day. it's the streaming giants push into sports. the company signed a three-year deal with the league which will see at least one christmas game on netflix in 2025 and 2026. it also adds another platform you need to watch the nfl games. they are set to stream the season across netflix espn plus, peacock, amazon prime and youtube's sunday ticket. that's your bloomberg brief. jonathan: thank you. we've got many things to say about this but here's another point -- if you don't know where to find the sport, it's not good for the sport. i see this and other sports as well and i've settled down withfutbol in this country but

when it went to peacock, where are they? when you have to sit there to find again, that's not good for the sport. lisa: if you were a kiddo get your television from youtube and you can find it there, you will not be a fan for those teams. jonathan: it's not good for the sport of all especially when the nfl is doing well at the moment. lisa: they need to capitalize on it, get taylor in and do a special and netflix. jonathan: that's what we like. that annoys a lot of people. there are two can't the don't care and other really do. lisa: ray dalio is a swiftly. jonathan: mohamed el-erian, too. is that what ray thinks? annmarie: she can bring a lot of people together. he said -- she said she would be around it if she has the right people around her. jonathan: what is this about pop stars uniting the country? not good. coming up, you're watching bloomberg surveillance.

♪ i can't believe you corporate types are still calling each other rock stars. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises). hand over the air guitar. i've got another one.

jonathan: thank you for the support. you and i share the same problems. airports and where to watch football and i emphasize just empathize with oh till issues as well. thank you for the other people that reached out in the last 10 minutes, all three of you. equities now are just about unchanged on the sb 500 with yields higher i a single basis point. on our radar in about 40 minutes away, the opening bell and the data dependent fed. >> we are not so ready just yet. we try not to get too tied up with this because we have a

long-term view when we provide guidance. it's a step in the right direction it would not change their views. yesterday's report was good news but that's not getting us back to the three cut area so we are comfortable now. jonathan: for the next 24 hours, materials reporting at the closing bell and the fed speak lineup is staggering. in boeing is holding its annual shareholder meeting at 11 a.m. tomorrow. if the regulator can't regulate boeing, can the shareholder? we will find out in about 24 hours. lisa: just the idea of soft landing, that seems to be the takeaway. nothing has changed from the economic data this week so it goes until next wednesday with nvidia reporting earnings that becomes the next big stopping point at a time when people are looking at the shifting sands of technological shifts that might create something new that the economic data hasn't. this economy keeps chugging

along. annmarie: there is lots of concerns around the economic data and a people are picking up the phones. is it coming out on time, the revisions? look at ppi and the revisions and how strong they were. if you look at what corporate's are saying, walmart this money was great. this is one of the biggest company's in the united states showing the higher and consumers looking for deals. inflation is biting everyone across the board. that for me was the big point. jonathan: what to we think of jamie dimon, what was your big takeaway? lisa: he is the ultimate politician even though he doesn't want to be in politics. he said he is not interested but at a certain point, the corporate executives to me are becoming the new ambassadors for the united states and away many politicians are not. i find that the most interesting in these international comments from these chief executives. annmarie: we saw that in davos with him and volodymyr zelenskyy behind the scenes. if he was a politician, what job would he apply for?

francine asked about treasury secretary. i was there last week and his name was brought up again as a potential treasury secretary but then he talks about nuclear blackmail and china not being in natural enemy. i thought he was going to the diss with just the state department or defense secretary. jonathan: take your pick. lisa: this is somebody who can have that birdseye view and will have that. there is this issue of who is going to fill the white house. the corridor between washington, d.c. and new york has gotten very busy. you can feel it is people jonathan: i'm not sure it's wall street, it's the court downtown. they come up to kiss the ring. absolutely. coming up tomorrow, here is your lineup -- all of that and more from new york city, thank you for choosing bloomberg tv.

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>> live from new york city, i am matt miller. a slew of economic data doing nothing for markets. it very little movement after we get an all-time record on the s&p yesterday. the countdown to the open starts right now. coming up, stocks at record highs with fed speak in focus, a mixed bag of economic data doing little to