♪ sonali: welcome to "bloomberg markets." nvidia the last of the magnificent seven companies to report. the dow at 40,000 holding on. we also have the s&p 500 up .3%, passed 5300. the nasdaq up .6%. the philadelphia semiconductor index up 2% ahead of the nvidia

earnings this week. of course, the dow jones flirting with the 40,000 level. down but pretty much flat on the day. we will keep an eye on that throughout the day. we have yields to keep an eye on. above 482 start the week to move about one basis point. bitcoin on the rise. we have some risk appetite today. gold spa still holding on with a bid of about 1.5%. we have some movers under the surface. shares soaring after announcing a treatment with the same active ingredient as another weight loss drug for $199 a month that undercuts big pharma by as much as 85%. dozens of other telehealth, but

companies have been trying to tap into the weight loss drugs. we are looking at grayscale investments because michael sonnenshein is stepping down and peter mintzberg from global sucks --global -- goldman sachs will be taking over. feet yet has seen billions in outflows since the launch of the queen etf's. back to the fed, the higher for longer narrative, he had this to say this morning with michael mckee. >> the numbers the first part of the year really bumpy and suggest inflation will come down slower than i think many expected. rather than focus on numbers of cuts, the issue right now is when we are going to be certain inflation is on the path to 2%. i think it will take a while before we know for sure. >> what tells you that you might

get one or no cuts this year? what do you see in the economy? >> we do a lot of talking to business leaders. they are all telling us things are slowing down very slowly coming off of high record profits and revenue. there will be continued momentum in the economy for that is going to take a while to play through. pricing power is weakening. they do know the expansion in large growth is not on the table. that says it is going to slow down. it will get there but it will only be eventual. >> is it likely inflation does not go down or could go up again? >> anything could happen. my outlook is that inflation will continue to fall this year and ends in 2025. i think it will take a while to

get it all at 2% but i think we will get there. the unexpected can always happen. we have seen that the last three or four years where the pandemic was not expected, a war in europe was not expected. they do send ripple through the entire economy. if that happens, we will have to be ready and despond as appropriate. >> one of the themes of this conference is what happens next. what happens next? you are higher for longer now. something you will be higher forever, that we are not going back to low interest rates. >> let me say this. i hope we do not go back to zero because that means something will have happened requires us to go to maximum support for the economy and that would not be ideal for anybody. i think it is likely to be higher than what people have known over the last akayed, maybe back to where we were in the 1990's and 2000's.

we will have to see. the message people should have is going back to zero means something bad happened in the economy. we want to avoid that as much as possible. >> what do you say to people who want to move or buy a new car? hold on, wait? how long do these industries have that they can hold out until you decide what you want to do next? >> i don't think anyone is waiting for us on the business side. you see producers and auto dealers are adding incentives for people to buy their cars. we talked to major sellers of cards. they are trying to move volume. think for consumers, shop around. it is back to where we used to be and how the economy used to work. you have to go find where there are opportunities. they are out there. people need to live their lives.

sonali: michael mckee joins me live from the atlanta fed financial markets conference. you have a ton of fed speakers hitting the conference. one of the opinions you are hearing? michael: i wish i had some diversions but they are all singing from the same hymnbook. there not a lot they would do in the near future because they are not convinced they need to do anything. we heard from the vice chairman for supervision. most of his talk was on bank regulation but he did talk about monetary policy and say we will need to allow our restrictive policies some further time to continue its work. think we are in a good position to hold steady and closely watched how conditions evolve. the vice chair for monetary policy was not here but said much the same thing, that our policy rate is in restrictive

territory as we continue to see the labor market come into better balance and inflation decline although nowhere here as quickly as i would have liked, which is almost the same thing as raphael bostic told us today. i think the markets are going to have to take all of this on board and push the rate cut bets out which they have done, until maybe december, and wait to see if there is data that justifies coming in for sooner and deeper rate cuts. sonali: interesting. it looks like there is a coin toss idea when it comes to the september cuts. figure point, pushing out -- to your point, pushing out expectations broadly. if you do have stocks near all-time highs. you do have financial conditions fairly loose. is there any debate around whether we are at restrictive territory or not? michael: there is a debate about restrictive territory. we were talking about it in the meeting this morning. the financial conditions index

is generally referring to asset prices. asset prices have benefited as conditions have gotten looser. as conditions get looser, the asset prices also rise. it is sort of circular. when you look at what people are paying in interest rates for mortgages or automobiles and even on credit cards, that is tight. they are still restrictive. there are two different things going on which is why we see a slowdown, a stop in home prices and a slowdown in other areas but not in asset prices. investors want to keep bidding them up prince and holly: thank you so much for your time. we miss you in new york, but he is down in atlanta. do not miss his conversation with loretta mester later this afternoon on bloomberg. traders are searching for evidence the appetite for ai chips remains strong.

nvidia reports earnings this week. bloomberg will speak to the ceo in just over an our. details about that interview, next. this is bloomberg. ♪ are now being analyzed and restored using the power of dell ai. ♪ should i? normally i'd hold. but... taking the gains is smart here, right? feel more confident with stock ratings from j.p. morgan analysts in the chase app. when you've got a decision to make... the answer is j.p. morgan wealth management. how am i going to find a doctor when i'm hallucinating?

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♪ sonali: this is "bloomberg markets." time for the stock of the hour. stakes are high with stocks near record levels when nvidia reports wednesday. ed ludlow will sit down with the ceo's of nvidia, dell, and service now about the future of tech and ai at the dell world conference. ed ludlow joins us from las

vegas to talk about the interview and the future of ai and what will drive nvidia higher. start with why these three are getting together at this point in time, how they are banding together to drive that future. ed: certainly an interesting moment for dell to be back among the biggest names of technology. the story with generative ai has been straightforward. it is nvidia selling high-performance cpus going to data centers operated by a small number of companies. the question is when we move beyond that. that is when dell comes in. dell did well in the pandemic. it is in the next phase of growth where it sells two places nvidia does not. it has established sales channels they never had to worry

about. combining forces, that is the question one might pose to them, does it go to something much more broad across enterprise is? sonali: we are starting this segment talking about nvidia earnings. that is a big moment for the market. we have seen big names already take profits in the stock. it raises the question how nvidia will set the bar higher for investors. how is that weighing on the minds of executives today? ed: it is a macrolevel event, frankly. there is a brilliant piece on the terminal this morning about growth on the s&p 500 with and without it. nvidia is a big driver of eps in the quarter. technology is an interesting place for the market to be. the h 100 has driven accelerator sales. they will do $40 billion of ai

accelerator revenue this year probably. you have black wealth later. there was concern that in the middle part of the year, there might be a pocket where they are having customers stop ordering h100 because they are waiting for the next generation of chips to come through. others say that will not be the case. nvidia is the only store in town. expect topline growth and everyone does well in the market. sonali: what are you looking for from your big interview soon? ed: i think it is interesting there are three american ceo's, not three sat next to each other historically. why now? how companies at that scale do business has changed. the service now software ceo used to have a direct

relationship with jensen huang, the chipmaker. sonali: ed ludlow, enjoy it. it looks like a party put the big party is in the interview shortly. we will turn to another big event, jamie dimon speaking at j.p. morgan investor day. it was a lot of talk about ai, succession, and buybacks. there was something daniel said this morning, one of his top deputies, the risk at the tail are substantial. jamie dimon's weather forecast, what does it look like? >> is very pessimistic. he kept using that word when asked about his outlook. this is a global outlook, not just about the u.s. economy. he cites inflation, quantitative tightening, and the geopolitical

tensions he thinks are not going to subside within the next few years pretty has also cited consumers and small businesses are seeing they are running out of excess cash that was built up during the pandemic. this is across the major wall street banks, specifically the big consumer banks. this was a very pessimistic outlook. it just means for them, when asked about buybacks, they kept reiterating this is not the time that we are going to buy back our stock, even though it is hitting record highs. sonali: at the same time, you have the general pessimism, some caution baked in, but you also have them talking about areas of investment where they want to double down in this environment while saying 17% returns on equity the more normal way to look at things moving forward. where are those investment opportunities?

>> ai across the board. they say it is touching every part of the bank and every job at the bank. jamie dimon says he believes every job will be transformed, either eliminated or jobs added. it will be a transformation that takes time no doubt. they talked a lot about the investments they are making. have every person at the bank go through a formal training process to understand how ai can apply to their own job. it will change based on a job that might be dealing with the consumer or and investment banking client. you are going to eliminate mundane tasks that might save time and money. sonali: he was asked about succession. j.p. morgan's own plans for the future leadership. what did he say? >> he has always talked about this five-year plan. he was explicit today saying it is no longer five years. sonali: is the first time he

said that. >> it is. does he mean it will be more than five years? i think it is the opposite. below five years, whether that is 4.5 or two, we do not know. what he really talked about is the people behind him. he emphasized how the bank have been setting up a number of executives to potentially take over, so it is something they have continued to plan for and think about. it is just a matter of when that is executed. sonali: who are the executives on display today that hints to the future? >> you saw barry talk today, jenn. you had both women that were moved into different positions or titles and what they were responsible for have been changed in recent months. i think those two are often cited. you never know. i feel like every five years,

you hear no matter what the bank is, any kind of shuffling, when people are named to senior roles, those are likely going to be the people in the spotlight. sonali: j.p. morgan writing the ai music. thank you for keeping an eye on what has been a long and exciting investor day at j.p. morgan. we will be back with more coverage. stick with us through the break. this is bloomberg. ♪

sonali: highflying wall street arbitrager has died at 87 years old. david westin his here to discuss his legacy. david: i did not know him personally although my law firm represented him. i remember when our partners were summoned to new york to meet with him clandestinely in his apartment. it was a big thing at the time. he was really an inside trader as it turns out. the law had not been enforced much before ivan boesky but it was with him. he ended up pleading guilty. he was sentenced to three years but only served two. he also paid a $100 million fine. he agreed to turn state's evidence on other people, particularly michael milken.

he was an important force in michael having to plead guilty. sonali: the idea he helped the government out at the end of the day. david: in order to get a reduced sentence. in the 1980's, it was a go-go time on wall street. there were a lot of hostile takeovers, a lot of leveraged buyouts going on. there was a lot of money to be made. some people, including ivan boesky by his own admission, had advance notice. there was one hostile deal where it was said he made $100 billion on that deal alone. this is the 1980's when $100 billion was worth something. sonali: i love that your law firm was working alongside this. david: it was a big thing at the time. i remember when they got

summoned to new york on a big hush-hush case. they were literally closeted with ivan boesky after a long week and figure out how bad it was and if you would have to plead guilty. he accepted the recommendation he plead guilty and got a reduced sentence. sonali: it was such a go-go time back then. were some of the lines blurred until ivan boesky came to the surface? david: they got clarified a lot. you mentioned gordon gekko. he was one of the bases for the character. in part because he had given a commencement address at a law school in california in which he said greed is healthy and makes you feel good. sonali: back from the go-go era of the 1980's, what has changed the most? how will he be remembered? david: he will be remembered for being one of the people that made a lot of money and went to jail for it. i think the michael bell can affect -- michael milken effect

was the main thing. there are still some shenanigans that go on. it is a much different world. i suspect technology has made it more possible for the sec to track insider trading creek they can watch trades carefully. we have seen that at a lower level where they will say, how could they have known to buy or sell at that time? i think technology may have changed that business quite a bit. sonali: we are hitting more record-breaking fines and what color particularly -- white collar, particularly crypto. we are looking at the s&p 500 still above 5300. the nasdaq 100 still on the rise but now up less than 1%. we are looking at the two-year yield still at the 483 level.

the conference with the atlanta fed is going on. more interviews throughout the rest of the day. i am sonali basak. that does it for "bloomberg markets." stick with us through the close. this is bloomberg. ♪

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>> from the world of politics to the world of business, this is "balance of power."