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tv   Bloomberg Surveillance  Bloomberg  October 13, 2021 7:00am-8:00am EDT

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>> it's a difficult to navigate at the moment because you have this stagflation narrative. >> households are still flush with cash, and businesses are flush with cash. >> there's sentiments, lower retail sales, very much feeding into why inflation will eventually come off. >> if your question is simply is growth going to slow next year, the answer is a resounding yes. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. jonathan: earnings season is underway. from new york city, for our audience worldwide, good morning. this is "bloomberg surveillance ," live on tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. your equity market positive five
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on the s&p, up a little more than 0.1%. jp morgan first out of the gate. tom: i think it is being underplayed. everyone looks at the stock price and says so what. they are doing fine. i thought dames diamond -- i thought james dimon's opening salvo, forget the gloom. jonathan: if you had a headline, things are improving. lisa: however, there is another headline underneath some of the numbers, and that is lending. average lending going up, being driven by the corporations, not consumers. you are still not skin consumer loan growth. to me, that indicates this question mark around how much resilience there will be. jonathan: the equity market not doing much of the back of this. equity futures on the s&p advancing five points, up a little more than 0.1%.
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8:30 eastern time with cpi in america. going into that, yields lower by a basis point or two to 1.56 12%. let's check in with bloomberg's sonali basak. year-over-year, the comps really quite tough. just run through the numbers. sonali: it sets the bar for the rest of the banks. we know jp morgan is the leader in the fixed income business. let's move over to equities, a place where jp morgan -- where jp morgan has been nipping at morgan stanley's heels. you are seeing jp morgan pull in more equities revenue than analysts even expected at goldman sachs and morgan stanley. again, it sets the bar very high for the other two large investment thanks. lisa: what about -- investment banks. lisa: what about the real
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economy? consumers still are not borrowing. how big a concern is this? sonali: a huge concern. the card business is what we have been looking out for, but average loans are up 5%. on the headline, that is a great number compared to last quarter, where you saw it flat. but it is coming from the commercial businesses rather than auto loans, home loans, and cards. so people are waiting for 2020 to for that to really turn around. -- for 2022 for that to turn around. but how much do higher rates get anyway? tom: it is original territory, buried in this are charge-offs that were have as much is the gloom, and the reserve release was nothing short of lights out, and mr. dimon releases that. fortress jp morgan is intact, isn't it?
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sonali: it is intact, but the question now is whether they can make money. they are showing those gains in investment banking, though trading is starting to moderate in their biggest business. you have lending as well. where do they start to get ned interest income from? what does it look like at bank of america tomorrow? those are the questions we look to. they are creeping up just a little bit, eight had higher than wall street -- a little bit, a tad higher than wall street expected. their return on equity, you and i love to watch it, they blew through the roof at the end of the day, even with higher expenses and some of those revenue lines moderating. jonathan: sonali, thank you. at stock is positive about 0.3%. tom: they lead the single line of the earnings presentation.
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they minted $11.7 billion in 90 days. jonathan: that's not bad, is it? i think they are doing ok. tom: the media loses scale of the massive size of this. i would use the cfa term, they are ginormously profitable. jonathan: that story has been appreciated somewhat coming into these numbers. we are up on the kbw bank index. let's get to jim paulsen, leutho ld group chief investment strategy -- investment strategist. what is your playbook for the next couple of weeks? jim: if you look at hours worked, hours worked were 5% annualized in the quarter. that is 6% to 7% real gdp growth
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in the quarter. so i think we are going to find out the companies still see a lot of topline growth. they are controlling their expenses. i think they have incredible pricing flexibility on topline in general, even though some costs are going up. there topline pricing is up to the task. so i don't really expect to see much margin erosion. i think we will have pretty decent overall earnings season again. more importantly, i think we are going to be listening to commentary from some of the ceos as to what they say about what their thought is on transitory inflation or not. that is going to be a big item, and how long they can fight off some of the cost pressure margin erosion. jonathan: let's talk about some of that. hopefully hear from jamie dimon a little later this morgan. let's start with apple. nike set the tone coming into earnings season with these numbers that spelled out great demand and a problem to mediate with supply.
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it seems according to our reporting at bloomberg that apple is likely to slash its production targets for 2021 by as many as 10 million units. they can't find the chips. when you see weakness off the back of that, you've got to make a quick alkylation. is it quick calculation -- quick calculation. is it profit lost or profit deferred? james: i think it is profit deferred. that would be my best guess. i think this recovery, there is so much growing into itself because of what has happened. we are going to have labor growing into jobs, supply growing into demand, inflation that normally shows up later in a recovery, we are getting a blast of it early and it probably moderates later. to the extent that we have supply disruptions holding back both now, i think that is true, but i think there's every case that that means there's going to be a boost to growth next year
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when the supply restrictions in and production is lifted. when you are looking at maybe fourth-quarter, maybe next year gets a little stronger. lisa: this is a really crucial point, and just to dovetail the idea of supply chain disruptions with the bank earnings, how much are banks a bellwether on the broader economy this time around versus being a reprieve from some of the supply chain disruptions that don't affect the banks to the same degree? james: is a very good point. they are an industry outside of that realm. they've got their own issues, though. they are going to have steepening yield curves, which is already going on, and it got trading activity which i think stays pretty strong, and deal activity which stays pretty strong. the key i think is when does lending pick up for the consumer. i think you have to run down there deposit balances.
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consumers are sitting with 17.5 trillion dollars of deposit balances, up from $13 trillion at the end of 2019. corporations got net cash flow to gdp at 13.5%, almost at a record high. it was only 14%, that was the only time it has been higher. so we've got to run down their savings, there deposit balances before they want to step up and use credit cards and borrow again. but the capacity of the household sector, because their debt to income ratios are now as low as they have been since 1995 , because the liquidity is so strong, there's a ton of capacity to borrow again which we haven't had for decades. and then of course, the banks have a lot of lending capacity. that could be an issue for 2023 and beyond where people start using debt again. tom: you've got to come back on thursday, friday, monday. that's the most intelligent comments i've heard on the
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breadth of liquidity in america in six months. with that said, have we lost perspective of what a boom economy is? we are addicted to 10% boom, now i for percent or 5%. i would say that is a boom economy. maybe we come down a little bit, but have we simply lost perspective on what normal is? james: i think there's a really good point about that. the real issue for me as an investor in equities is do we fall back to 2.25% real gdp growth in this recovery, or is there going to be a sustainable premium growth rate that is left in this recovery in the balance? ? if it is, and i think it is, i think it is closer to 3% or 3.25%. that is going to feel like booming growth compared to what we have done for two decades in this country. think we are already seeing some of the impact of that. we are going to slow down this
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year to 6%, next year may be 4.5%. but those rates are still something we haven't seen in decades. you can see the animal spirits it starts to create in companies and consumers, in laborers and investors forget i think they will be even more of that if we moderate inflation, if that story turns out to be transitory. covid gets behind us a little bit, inflation fear gets behind us a little bit, and you are left with a premium growth rate that we haven't had. i still think there's some pretty good forward future for us, both as a business and as an investor. jonathan: that will help the equity bulls sleep well at night. you, sir. from the optimism of jim paulsen to the optimism of jamie dimon, good growth seems to be the line here. jp morgan first out of the gate for earnings season on wall street. jp morgan up 0.8% in the
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premarket. equity futures up almost 0.1 percent. from new york city, this is bloomberg. ♪ leigh-ann: with the first word news, i'm leigh-ann gerrans. on capitol hill, the house has improved a short-term increase of the government debt limit. lawmakers are sending the legislation to president biden just days before the treasury was at risk of running out of borrowing authority. still, there is lightly to be another partisan confrontation over spending and debt in less than two months. president biden turns his focus to supply chain transportation bottlenecks today. he will meet with corporate executives, labor leaders, and port officials. the president will highlight what they have done to ease distribution backlogs. meanwhile, the congested port of los angeles will announce a 24 hours a day, seven days a week effort to combat the squeeze on goods. the european union law for a new round of concessions to the u.k. over northern ireland in the
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latest brexit negotiations. the eu will propose cutting as much as 50% of the customs checks in northern ireland and up to 80% of the checks on food imports. the northern ireland protocol keeps the area in the eu single market, unlike the rest of the u.k. warnings that the world is in investing enough for future energy needs. the agency says investments in green energy is falling short of what is needed to keep the planet from warming up. at the same time, the iea says spending on fossil fuels is lower than needed if demand growth for oil, natural gas, and coal does continue. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm leigh-ann gerrans. this is bloomberg. ♪
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>> hopefully it will straighten out over the next six months. the cost of transport is going up and the lack of drivers, if you ask our commercial clients and transportation clients, it is not just the tips not getting in. it is also getting those trucks and moving forward. jonathan: from new york city this morning, good morning. your equity market positive seven, a little more than 0.1% on the s&p. call it 0.2% higher. in the bond market, yields unchanged
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tom: we had brian moynihan at the top of the block, now we are talking james dimon, so i did those two names. jonathan: i know what you mean. then on to goldman on friday.
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tom, if you keep going out, i imagine you will be down in washington. tom: this applies to all of the bloomberg offices worldwide. right now, jack fitzpatrick with us. it is really special to have him here today because of the dissidents -- the distance from lexington, kentucky to louisville, kentucky. jack fitzpatrick joins us on his kentucky. john yarmuth, out. democratic congressman. five have retired. five are doing other things as well. is this speaker pelosi and senator schumer's worst nightmare? jack: i don't know if it is their worst nightmare, but it is part of the expectation that democrats are getting everything done that they can get this is a last hurrah for a member who was first elected in 2006. if they can get the infrastructure bill done and the major reconciliation bill done, there's not that much left to do for someone like john yarmuth.
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part of that is the expectation that democrats, if they don't lose the house or senate, they will lose one of the two, and this is the last chance for major legislative victory. tom: out of yale university, he was a republican who became a democrat. is what we are looking for in your world that the democrats, the moderate democrats are going to become republicans? jack: this is a strange one because john yarmuth was always a fairly liberal republican, even early in his time and politics. he was thought by someone he first ran to be too progressive for the seat. he ran when he unseated a republican. the idea that mitch mcconnell has is that someone like joe manchin, a real centrist democrat, may some --may someday want to join the republicans. but i would not look at this as that major shift. lisa: with the backdrop of bank earnings, we have to dovetail
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the conversation about randy quarles into this, the idea that he will be stepping down as vice chair of supervision at the federal reserve. the expectation is when he is replaced, he will be replaced with someone who is a lot harsher on banks, perhaps a lael brainard. what is the pressure like in washington to make that kind of change and exert more control, perhaps more constraints around wall street? jack: there is clearly the pressure there. the question is, does that win over the progressive members like elizabeth warren who have gone beyond that and said that there should be a change at the top with jerome powell? i don't think this is necessarily enough and wins over the furthest left members of the senate, but it still raises the question about the votes for powell being re-upped. is it everything they wanted to see? probably not.
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lisa: what exactly are they pointing to that they would like to see change about? this isn't an issue about the change being riskier than they have in the past. no one is really accusing them of being on the brink of failure or anything close. we are talking about them being fortresses of cash. what is the main issue aggressive's are trying to push? jack: one of the criticisms of the progressive position. the criticism is that it is not the central monetary role of the federal reserve, so it is the smaller stuff on the periphery in a regulatory sense that is the focus for someone like senator warren. jonathan: jack, thank you. jack fitzpatrick down in d.c., thank you so much.
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just getting some numbers on headcount out of jp morgan. bloomberg putting together a couple of stories. consumer banking increased its workforce 3% in the last year and added more than 1000 employees at jp morgan in the third quarter alone. corporate and investment banking units saw headcount increase out of 2000 employees in the third quarter alone. that is a big effort taking place. lisa: that is massive. when we talk about cost increases, this is where it is coming from. they are adding staff and hiring a lot more, in terms of what the salaries are. how much is this a more permanent shift into a higher headcount for trading that has been more of a transitory business because it has its ups and downs? tom: i don't buy the gloom. on going to go to deutsche bank. they got out of commodities, no they have to get back into
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commodities. jonathan: where is the gloom, tom? lisa: i just spoke. tom: i just inc. the media is like, oh i just think the media is like, oh and g -- like, omg, transitory inflation. it is very optimistic about solid growth forward. jonathan: companies doing business. let's be clear, one of the highlights of this report, investment banking fees. companies are getting to work. tom: tangible equity was 22%. i have never framed that in my mind ever. jonathan: it is not bad, is it? when have we ever called you gloomy, tom? tom: i'm not gloomy. jonathan: i don't think lisa is living this morning either. lisa: honestly, i am looking at this headcount and thinking we always see the cycles, when the economy is good and banking is good. then we see the contractions down. jonathan: by definition, that is
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the cycle, isn't it? [laughter] lisa: whatever. moving on jonathan: your equity market -- moving on. jonathan: your equity market up 0.2% on the s&p 500. tom: i think jp morgan should be cautious. jonathan: from new york city this morning, good morning. cpi in america, one hour in four minutes away. this is bloomberg. ♪
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jonathan: live from new york city come on tv and radio, this is "bloomberg surveillance." equity futures, positive 0.2%. the nasdaq, positive 0.4%. the opening bell two hours away. two stocks to look at in the premarket, the likes of apple and jp morgan. romaine will give you the detail in just a moment. here's the top line. companies are still doing business. advisory fees at jp morgan up more than 50% year-over-year. companies are getting to work. ipo's, m&a, that stock it's ok. apple, i have to say, that stock is ok, too. we are down by 0.6%. i mentioned this a little bit
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earlier in the program. . . it is worth repeating. have the story, and then you have the stock reacting to the story. let's start with the former. out of taiwan, talking up a cut of production targets at apple because they can't access the chips. the stock is down by 10% from the september 7 highs coming into today. you start to wonder how well this market is set up for that, given that we've got the news that is clearly hitting apple, and here is your response. we are down 0.5%. tom: the other news is the iphone 13 is selling like hot cakes. bloomberg intelligence leading on that. they predict iphone sales are up 6.5% above consensus, and it dovetails into jp morgan. there's all these narratives, all these worries, and the fact is lisa and her family lined up outside t-mobile.
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lisa: no production. jonathan: if you ask the equity bowls, it is demand -- equity bulls, it is profit deferred, not profit lost. the supply-side story as well, this is how the bond market is set up going into it. to's, tens, 30's, curve flatter. down a basis point on tens and up a basis point on twos. let's just focus on the simple part of this. belonging to the yield curve is the hopes and dreams of what we can achieve in the economy. the front end is whether the federal reserve decides to kill little not. may be those hopes and dreams going too far. talking about inflation and the sensitivity of the federal reserve to that inflation. the two-year is starting to respond to that. that is the federal reserve. in terms of some people in this market thinking about the federal reserve cutting off those hopes and dreams of
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growth, this happens on the curve. tom: 57 minutes away to inflation. there's a time zone difference between new york and washington, i'm sorry. jonathan: sure. tom: 57 minutes away to inflation, the published inflation is going to be omg, we are all going to die. the adults are watching cleveland, dallas, some of the atlanta statistics. they are watching core cpi to come back down to where it was. the gloom crew doesn't believe that. jonathan: what direction has it been heading in recently? tom: it is a little bit elevated, yes. it is a little bit elevated, no question about it. jonathan: we can talk about it later. tens, 1.5682%. let's get you some movers and a deep dive on this jp morgan numbers and say good morning to romaine.
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romaine: overall a decent quarter, and revenue that beat by a mile. some of that came because of the additional release of those reserves. in the fic business, about a 20% drop, but still relatively in line with that investment fees. it is pretty much what is keeping the stock afloat, up about 0.3% in the premarket. we should point out the leverage ratios also look good. the slr right around 5.5%. it's a relatively healthy numbers across the board, pretty much would you would expect out of jamie dimon and jp morgan. the question as always is whether or not that is going to be enough for investors. i am sure they will find some way to pick this apart, but right now, the stock basically unchanged in the premarket. blackrock is higher by about 1.6%, despite a pretty big miss with regards to net inflows. a lot of that was a big decline in fixed income flows. they did make up for some of that with regards to retail. the etf business now at $3
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trillion in assets, and overall, the company has about 9.5 trillion dollars under assets. still pretty healthy and on the way to that $10 trillion target. some earnings that aren't related to the banks, delta airlines. they beat on revenue, as well as eps, and loan factors were higher for the third quarter. did did give a fourth-quarter outlook. unfortunately, they are still at about 80% capacity relative to 2019. a lot of people looking at that metric. the company also say in fuel costs and wage costs will be a huge factor for fourth-quarter. it will be interesting to see what the say on the conference call. apple was the big news last night. apple shares still under pressure, down about 0.5%. you're talking about 10 million iphones shaved off of what was supposed to be a 90 million forecast. skyworks and a lot of these suppliers, these are taking it hard. skyworks was guided down by baird prior to the
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announcement. of course, the apple announcement not helping matters. keep an ion this space. it will be all the talk today, that along with the banks. tom: romaine bostick, thank you so much. right now, this headline too important from mr. putin. russia ready to supply as much gas as europe needs. just in time for the meetings here in washington, jon. jonathan: the governor of the central bank, we heard it this morning. there's two ways of looking at this. good news in the short term. the second way of looking at this, chancellor merkel is exiting germany, leaving germany and europe far more dependent on european energy. that is the issue. president putin still holds the card. he has the political leverage because of this relationship with european gas. the previous administration was really on germany's case about it in a big way. tom: intraday brent crude down
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on support, $82.70 of there'll. right -- $82.70 a barrel. right now, seema shah with us of principal global investors, their chief strategist. the gloom crew, what do they get wrong? seema: i think they are really concerned about supply shortages, but i think the market has priced that in, and now it is about looking for the companies -- well, looking away from the company's which are particularly vulnerable. think there's a lot of consent about -- a lot of consensus about growth. it should be enough to carry us through. for risk assets, it is still a supportive environment. tom: when i look at the supportive environment here, and we saw the supportive environment from jp morgan, what will you look at for u.s. forward tone that will lead to support?
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what do you want to hear on those endless conference calls? seema: for the banks, it is going to be a little bit different because they are going to be less vulnerable to some of the supply bottlenecks we have been worried about. what we want to see from them is how do they see the consumer panning out. the good thing for the consumer is a little bit of a negative for banks, so that is something we need to watch. for earnings seasons, we want to know what their guidance is on profit margins. do we still need concern about wage and pressures, or is a something they can write through? do they feel like they have enough pricing power to pass this on to consumers? those of the nuances we should be watching for. we are expecting a pretty solid earnings season, and going into 2021, it is just a slightly more challenging environment, but still pretty solid. lisa: the idea that apple reportedly was going to cut production significantly because of the chip shortage, that it has not rippled through markets more, does that indicate to you that we have already priced in
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all of the potential supply chain disruptions, and that from here you only have upside in terms of those pressures facing certain companies? seema: i think there's definitely an element of that. the market has known so much about the supply chain issues. they have known it is going to last until 2022. they have adjusted expectations. we all hate the word transitory, but maybe some of these are likely to be transitory. we should see them picking up some of those gains again once the supply shortages are finished. lisa: so are you against big tech at this point because you see the pressure upward and yields, and the idea that you will continue to see further correction there? or do you think it is time to go back because they have suffered the most over the past month and a half? seema: we are still supportive of mega cap tech. the reason is it has been a slightly challenging environment, but we do think that is near the top. don't see that much additional
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movement from here on which is going to be particularly steep or disruptive. for big cap tech, yes, there are supply chain shortages which will impact them, but the overall longer-term demand is still really strong. the environment is getting slightly more challenging. this is a time when you want balance sheets, you want the big profit margins. the companies that have the power to deal with some of those margin pressures which are going to be facing the economy in the next year or so. jonathan: seema shah of principal global investors. let's take a look at apple in the premarket once more. we want to get back to that question lisa asked, i thing it's got to be one of the questions of this morning. apple is only negative by 0.5%. we are down to $140.74. we had a big move lower off of the recent high, about 10% coming into this wednesday. here's the news, it is heading apple as well. we are hearing that from the reporting out of taiwan, and learning that they are not
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immune to this. my understanding, what should it be? that this is profits deferred and not profits lost, or that this is a broader story for the equity market? we are learning something from the way this market is was bonded to the story. some indication that maybe we are past the worst of this for this market. lisa: either that, or people are just high on hope. is this is reality, that basically this is all priced in because apple was thought to be able to deal with supply chain disruptions much more than other companies in chip shortages, simply because they haven't cripple pipelines and a robust business? -- they have incredible pipelines and a robust business? jonathan: not everyone is bullish. bank of america saying people push out upgrades to the next iphone, so there are some cautious voices out there. but it is interesting. a focus for us this morning, that is for sure. up seven on the s&p, advancing a little more than 0.2%.
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this is bloomberg. ♪ leigh-ann: with the first word news, i'm leigh-ann gerrans. congressional democrats are still divided over how to slice up president biden's economic agenda. they were -- they will come together over a texans blending -- tax and spending plan, but they can't agree on which part of the agenda to keep and how long to pay them for. next month, the u.s. will relax coronavirus restrictions at its land borders with canada and mexico. that will allow for the resumption of non-essential travel like tourism. the move comes after the white house said it would start allowing airline passengers from a wide range of countries into the u.s. with proof of vaccination and a coronavirus test. vladimir putin says russia is ready to supply as much natural gas as europe needs. speaking at an energy forum in moscow, the russian leader said
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it was very important to stabilize the market. europe faces a gas crisis ahead of winter due to a surge in prices and a drop in reserves. netflix's south korean show "squid game" has become the biggest series launch ever. the series has attracted 111 million views since it was released on september 17. that is overnight looks -- that is over netflix's previous top show, "bridgerton." global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm leigh-ann gerrans. this is bloomberg. ♪
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>> many supply shocks manifesting themselves make for a more persistent and stubborn inflation outlook. central banks are in a tough position in which they don't want to derail what could be still a fairly uncertain recovery. jonathan: that is the theme i want to pick up on right now. that was coming reinhardt, the world bank -- carmen reinhart, the world bank chief economist. your equity market up eight points, 0.2%. but it is the move in the bond market i want to sit on for a moment. yields at the long end up a basis point. this is in america. in the u.k., a bigger move at the long end. these curves are getting flatter. reviewed comes in and the u.k.
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to 1.37% per tends at about 1.1%. yields in about half a basis point. pretty much anchored on twos after an elevated move of the back of a conversation about higher interest rates in the u.k. are the central bank's about to step in because of the price pressure? maybe temper the recovery a little bit. we have seen the movie the u.k., and we have seen the move in treasuries more recently. it is recent stuff, but i think it is worth focusing on. tom: it is worth focusing on, and what is so important is institutions to the rescue, as we just saw with mr. putin talking about gas in europe. what is important to me is the asymmetry of the united states with jp morgan and what we are seeing in europe over any number of things, including energy. the distinctions to get to these banks between ecb and fed at the meetings here in washington has never been wider. jonathan: jp morgan and the premarket positive 0.6%,
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rallying into the numbers and doing ok coming out of them, up 0.6%. tom: i want to point out carmen reinhart, you just heard from, is a little bit front and center here in washington at these meetings. she has taken an elevated responsibility at the world bank because the two word phrase here is data integrity. the uproar at the world bank, they need data integrity, and the imf is trying to reaffirm data integrity. jonathan: those reports need some credibility. they've got to redo some of them. tom: they've got to rebuild it. there's no way better to do that. this time is different. you do it with carmen reinhart. for bank earnings, you bring in alison williams, bloomberg intelligence senior bank analyst. i want you to explain what fortress jp morgan looks like. these are ratios you and i never studied. we never framed 22 percent tangible equity.
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the profitability seems overwhelming. can it indoor -- can it endure? alison: some of it can. the big surprises we got this quarter are similar to the drivers of positive surprises in recent quarters, and that is the investment bank and the reserve releases. the reserve releases or something that really helped the bottom line this year, hurt the bottom line last year. that is something that is not sustainable. the global investment bank continues to surprise to the upside this quarter. it is really equities, trading revenue growth, very strong. advisory fees, a new record. so those are key positives. they really set the bar ahead of goldman and morgan stanley tomorrow. but net interest income, that is the key metric that investors are focusing on this quarter. jp morgan came bang in line, which is a bit neutral, but what
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investors are going to be digging into our what are the prospects for loan growth that can give us a lift when forward. i would say there is enough there to feed the optimism, but nothing over the top, so signs of green shoots is what we are hearing from jp morgan. we've heard that from wells fargo, so some positives there, but i think it needs to be little bit better. lisa: broadly, this is being taken as a positive for the economic story, as well as for other banks, and yet the advisory fees, the idea that they had a record, could this be taking some of the market share away from the likes of morgan stanley? or is the market right to shrug this off and say it is basically a green like for advisory businesses all across the street? alison: for m&a, it is definitely the latter. i think it is going to be a great quarter for all of the banks. the equity trading side of things i think is where you might be seeing a little bit more market shift, but equity advisory fees, and we saw this
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from jeffries earlier this month, this quarter, any record. jp morgan, triple what we were a year ago. that is not that impressive, given it was a weak year, but we do think the fundamentals are there for jp morgan and for the banks broadly to continue this sort of record-setting m&a pace. jonathan: for people in the audience who aren't familiar with the way these earnings are delivered on the front page, you get jamie dimon's comments down the right side of that page. at the bottom there is this comment here. "this quarter we became the first bank to have branches and all of the lower 48 states." we know there has been a big push to expand from the likes of jp morgan and others. what is the effort here, what is behind it, and how important is it? alison: it is important, and it is a multiyear effort taking place at jp morgan get similarly
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at bank of america. -- at jp morgan, similar at bank of america. they are rounding out their footprint, if you will. while there is a lot of focus for banks on technology in the digital side of things, that has really been a boon to the bottom line, and increasingly focusing on the op line -- on the top line. they are building branches in new markets, and the banks come the global banks, the biggest banks are winning share where they want. within this comes back to the level of -- we think this comes back to the level of technology that helps them be more efficient broadly, as well as seeking out these new markets. jonathan: thank you, as always, alison williams. a whole host of banks reporting earnings tomorrow, then onto to goldman on friday. i think that final point is pretty important. we are not retrenching here. we are writing to the business. that gets lost. you talk about how big things
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are. things are getting bigger. tom: things are getting bigger. scale is picking up. i noticed the retail effort in the united kingdom is one example of that. is it optimism? i'm not sure. i don't see a tentative strategy at jp morgan. jonathan: things are getting better, they are getting bigger. on radio, on tv, this is bloomberg. ♪ >> i'm jim imagine with an exclusive -- i'm jamie mcgill with an exclusive bnp paribas update. shelby rogers came through a three set thriller against u.s. open finalist layla fernandez on stadium one. after being outplayed in the opener, the american leveled it at 1-1 before clinching the victory in the deciding breaker to reach the quarterfinals for the first time in her career. earlier, jessica pagula
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dispatched the number four seed svitolina. and alexander zverev took care of business against andy murray in the battle of the heavy hitters come of the german fleming his first win over the scot on his way to the round of 16. tennis channel's exclusive daily live coverage hits the air at 1:00 p.m. eastern.
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>> inflation that normally shows up later in a recovery, we are getting a blast of it early. >> you do have the sort of stagflation narrative. >> right now we are seeing narratives that are completely new to us. >> markets could be a little more fragile on disappointing news. >>'s growth going to slow next year? the answer to that is a resounding yes. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa

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