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tv   Bloomberg Markets European Close  Bloomberg  November 22, 2021 11:00am-12:00pm EST

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the countdown to the close starts right now. >> the countdown is on in europe. this is "bloomberg markets: european close," with guy johnson and alix steel. ♪ guy: 29 minutes to go until the end of trading in europe. we are seeing weakness in the currency market. the dollar is on the front foot. the euro trading with a $1.12 handle. equities are bid, but i would argue rather than the fed news, it is m&a news. the telecom sector leading the charge on the back of the kkr news surrounding telecom italia. the stoxx 600 up by 0.2%. we are also seeing crude plumbing as well. we are back nearly $80, $79.73,
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up by 1%. 30 minutes to go to the european close. we will count you down to that important moment. alix: here in the u.s., you are now having s&p energy sector the outperformer. second to that is financials, up by about 1.6%. you remove lael brainard from running for the fed chair of supervision, plus you have higher yield, so a nice double whammy when it comes to financials. the two-year yield popping by five basis points. it is the belly and the front end getting hit the hardest. the dollar, you mentioned it, up by 0.3%. the bloomberg dollar index, it feels look at very typical we might see the taper pushed forward potentially. you have another rate hike being priced in for november of 2022. rates, dollar, equities reacting in kind. guy: let's carry on the conversation surrounding this important moment in terms of the leadership shift at the fed. let's bring in bloomberg's
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international economic sin policy correspondent, michael mckee. peter orszag describes this as the dream team. it took along time to get to the dream team. now that we are here, what changes? michael: not a whole lot, which is pretty much what joe biden wants. this is best described as a dog bites man nomination. no real surprise, other than brainerd did not end up with the supervisory role. but you've got the current fed chairman who has won widespread praise for his reaction to the pandemic, and a governor who is seen as basically having the same monetary policy views as the chair who is being elevated, so it gives wall street, the word that is going to be overused as much as transitory, it gives wall street continuity, and there's going to be happiness in that there's not going to be any surprises coming next year in the making of monetary policy.
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alix: mike, thanks a lot. to bring in another voice here. peter praet is the former ecb chief economist get if you have a renomination, you have that consistency. you also elevate lael brainard to the fed chair chariot -- fed chair. what is your reaction on this what do you thing it means for monetary policy? peter: the first thing is that the religion ships between the ecb are excellent. it is a relatively long tradition between the two institutions. of course, the change that you have with the vice president come with lael brainard, she is ver well known in europe. she participates in a number of international meetings. i have only met her several times, many times in the framework of the oecd, for
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example. so i think we have someone as a vice president knowing europe very well, and i think the team with jay powell, with lael brainard as vice president, i think it is very good news for europe. i would not exaggerate, it is not a brutal transition i think. the relationships are really excellent, and i would say this is good news for the continuity of what we have seen before. guy: there was a focus within the president's statement that i think is worth dwelling on, and that was inflation, then the labor market. clearly, the focused in the united states has shifted to inflation fighting. what can we take away from this new team in terms of where you think the trajectory is for monetary policy in the united states? some are arguing that we need accelerated taper and earlier rate hikes.
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what are your thoughts on what is happening in the u.s.? peter: i am in the camp saying the fed will have to accelerate the taper. we will see for the rates. for me, it looks obvious that the tapering will have to come sooner, and then probably also the rate hikes. personal relationships between the fed leadership in the ecb is quite important because europe is in a different situation from the u.s., although inflation has picked up. i think the situation is quite different. so you are a delicate moment because the u.s. is going to accelerated tightening of policy, whereas in europe, it will lag in terms of policy movements. so you never know how financial markets react, so the personal relationships you have between the two institutions are extremely important. it is not just to say you have an institutional relationship in meetings and all that, but they trust you have in your
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counterparties is extremely important. i think we have precisely that with jay powell and lael brainard. i think it is good news for europe, but the previous team was pretty good. alix: do your point, how long do you think in ecb and a fed can diverge? peter: that is a very good question. we have a new wave of infections in europe, and it is really worrisome. when we look at the figures, people we know just having mild symptoms of covid, but it has a big impact because the number of cases, especially in austria, belgium, netherlands, the number is high, so it will delay probably the next move in monetary policy. so probably you will have a divergence in the coming months, increased divergence in the coming months between the u.s. and europe.
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markets have understood that since a few weeks already, so i think it is very important in terms of communication for both institutions that they understand very well the different relative situations, and communication will be extremely important for markets. so what will be the difference remains to be seen, but some of the exceptional measures in europe will be terminated in march of next year, so two months from now. but in these three months, a lot can happen. i think we are going to see all these messages in the u.s., and probably, because of the covid infection rate you see now, we will probably get some dovish signals in europe. so financial markets may be quite volatile. guy: we've got a significant cheaper euro. using the ecb will welcome that? you talk about -- do you think
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the ecb will welcome that? you talk about the end of pepp. i wonder if what we are seeing with covid cases now, if that will mean the reforms to the other programs are more likely to have a dovish tilt to them, i.e. more of what happened with pepp, transferring back into those other programs. peter: it is clear the ecb will try to keep maximum optionality, but i think the base case is, as a christine lagarde has been saying recently, is basically to implement the strategy review. that means you want to make sure you are reading core inflation expectations at a high level. europe has been quite different from the u.s. because we started in europe with too low in place and for too long, while u.s. was not that far away from its objectives. so i think the monetary bias will still remain on the dovish side in europe for a while, but
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this does not exclude the fact that some of the exceptional measures will be terminated in march. but the ecb will certainly want to avoid any cliff effect from the move of policy. so the covid infections are going to influence the economy, but not as dramatically as before. but still, it will have an impact. in relative terms with the united states, there's probably a difference in the coming months that will lead to some volatility between the two regions, and it is very important in this sort of circumstance to have good communication channels between the two institutions. guy: what about within the ecb? the bundesbank morning we could see a spike in inflation up to around 6%. inflation is not welcome in germany. there is an expectation that maybe inflation in germany stays at 3% plus for a long time. what kind of tension is that
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going to create within the governing council? peter: i think the governing council is more uncertain than it was a time ago because the high figure you mission, especially in germany, but in a few other countries, are probably going to last until the middle of next year. even if you believe inflation is going to go down in the second half of next year, it is clear that during this 67 month period, there will be high pressure on governing council members to tighten. i think they are going to resist that broadly, but it is an element indeed, and the communication sometimes shows that there's divergent views within the governing council. but i think the view that has been expressed by christine lagarde a few days ago is going to dominate. that means you start from a position which is very different from the u.s., with too long a time, and really, you have to seize this opportunity to
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re-anchor inflation expectations. there are risks related to that strategy. >> guy: peter, always great to talk to you on these big days. thank you for taking time to join us. your bright -- peter praet, former ecb chief economist. protests erupting in europe this weekend is new covid restrictions are put in place. emma hodcroft will be joining us, an epidemiologist. judy dembski will speak to us about how governments are handling this -- judy dempsey will speak to us about how governments are handling this situation. this is bloomberg. tuation. this is bloomberg.
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guy: protests over the weekend across europe, some of them violent, some of them peaceful, but the message clear. the anti-lockdown protesters have basically had enough, as we see the re-imposition of lockdowns in many places. in the u.k. which has been suffering hi cases throughout the winter, prime minster boris johnson reiterating that there is no need for a shut down here. pm johnson: at the moment, we see nothing in the data that says we need to move from plan a plan b, or any other plan. so that is where we are at present. the best single thing you can all do is get your booster. guy: the prime minister speaking a little bit earlier on. joining us now is emma hod
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croft, university of bern molecular epidemiologist. we are starting to see physical lockdowns put back in place. where do the numbers go next, do you think? emma: it was almost two weeks ago we last spoke, and it is incredible what has changed since then. we have seen cases really skyrocket and so countries across europe, and governments scrambling to figure out whether they should do something now or wait, and what that should be. i do think this is a worrying trend. we are still very early into the long period that is winter, people being inside more, keeping windows closed, and we are already seeing a sharp spike. right now i think the question for many governments is what are we going to do, if anything. i think we have to be really cautious here. we have christmas coming up. that is a big holiday in europe and north america, and a lot of people are going to want to make up for family and friends they did not see last year. can we keep christmas safe if we
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take earlier action now? if we delay, where will that leave us by the middle and end of december? alix: what is the right action to prevent that happening? will lockdowns make a material difference right now? will compulsory vaccines make a material difference right now? emma: for different countries, we are in different states. some countries like the u.k. have essentially no restrictions left. some countries like austria are heading into a pretty harsh lockdown. one thing i think governments should be keeping in mind is to let the science guide them. we know that it is definitely airborne. we know outdoor activities are probably not as risky, especially if you can keep people spaced apart and wearing masks. we know that schools are high-priority. we don't want to be shutting those down. so i think then we have to explore what can we do. asking people to work from home if at all possible, asking people to make sure they've got vaccinations, reintroducing masking in public spaces if it is not already there, and continuing to drive to get your
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vaccine. guy: have we now put ourselves in a position where the virus is running too fast for a vaccination program to catch up? emma: it is certainly one of the problems with vaccines that if you haven't had your first dose, you won't benefit from full protection for a few weeks. with the way cases arising right now, that is still worth doing because any production is better than none, and i don't think we will be out of the woods in just a few weeks, so this is something you will benefit from even if you don't have protection until a month or two months from now. but i do think we also have to be focusing on shorter-term strategies. what can we do to bring some of these case numbers there almost vertical lines now in some countries, what can we do to get these to level off? trying to maintain the least disruption to our society and economy, but also making sure we aren't setting ourselves up by delaying for even more disruptions later. alix: on that point, we know
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that if you have already had your full vaccination, immunity does wayne. what is the booster take up right now? emma: the availability is really variable between countries. some, like the u.k. and the usa, it is now available to anyone. if it has been more than six months six your breath -- months since your vaccination, please go get it. it pushes the protection backup to those high 90's numbers that we want to see. for other countries, there is still some disparity in who can get boosters. some have approved it, but it is only available to select groups. in sum, they are still weighing whether this is a strategy they want to go down. for most people, it is also important to remember that if you had your second vaccine within two, 3, 4 months ago, you are probably still ok. it is the longer-term six months and onward that it is really worth getting that booster shot. guy: you talked about christmas.
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the mingling we will see over the festive period where do you think we are on track for now in terms of the numbers we are looking to see over the next six to eight weeks? emma: if we don't do anything now, i think we are heading in many european countries into a really worrying situation. deaths and hospitalizations always lag after cases, so we can look at austria. their hospitals are totally overwhelmed right now. but these are people that probably got infected three or four weeks ago. case numbers are still skyhigh, and the people infected today that will be in hospital won't be there for three or four more weeks, so we have to be thinking ahead. if you wait until your hospitals are overwhelmed to act, you're going to have a long period of hospitals being overwhelmed before you can put in action to turn that around, see you have to watch those trajectories early. consider whether there is something you can do now to ensure you don't get into that position in the first place. alix: thanks so much. we love the perspective.
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emma hodcroft, molecular epidemiologist. words are hard. guy: at least it is not an anesthesiologist. alix: i cannot say anesthesiologist. did i just get it right? guy: i think so. alix:alix: the first time ever. angela merkel says germany's covid surge is the worst since the pendant started. >> probably by the end of winter, almost everyone in germany, and might be cynical to say, will be either vaccinated, cured, or dead. but that really is the case. this is very possible with the extremely infectious delta variant. alix: pretty stark warning there. joining us now, judy dempsey, carnegie nonresident senior fellow. it seems like the argument now
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is whether to make vaccinations compulsory. what you think that argument is? judy: the argument is wavering. certainly they do not want to be authoritarian about this. the new coalition about to meet on the new government in the coming days, one of the partners , the liberal democrats, are very against a compulsory element. but i think it is creeping in if you look at some of the numbers of the states, particularly saxony. there were 1200 patients in hospital in intensive care. out of that number, only 63 were vaccinated. we are talking about some of these eastern german states where the population is so -- where the vaccination level is so low. guy: do you think the transition of power has meant that the government has been slow to react? do you think the transition of power has put germany at a disadvantage? judy: i don't think so.
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there's no doubt that the outgoing government is a bit slow on the uptake, and what jen spohn -- what jens spahn had to say, the health minister, was only echoing another said, and was really the quality slow uptake by the government. the figures are actually quite alarming. i am surprised how slow the outgoing government is and the incoming coalition, clearly they don't have the mandate to do everything they want to do, but there's a real sense of urgency now. casualties are rising. intensive beds, there's very few left. especially in states like brandenburg, saxony, and other states, it is very critical. interestingly, during the first wave of covid, the italians sent patients to germany, and now germany is sending some of their patients down to italy because
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there aren't enough intensive care beds. alix: who is going to wind up leading the government and be the key officials within power in germany? are they going to inspire the same kind of confidence that angela merkel did at the beginning of covid? judy: they have to. this is critical. it is about the economy, about confidence. it is about opposition to covid, vaccinations. the new government has to really hit the ground running, and the biggest agenda is curbing this virus, and above all, getting people vaccinated. this demands a huge vaccination program, a huge effort to get some 12 million that haven't been vaccinated in -- haven't been vaccinated yet, and we are not talking about
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children. they have to be brought on board. guy: just looking ahead, germany faces a number of different challenges right now for the new administration coming in. i am looking forward to seeing what the finance minister is going to do with them. we need to control the virus. but the bundesbank today warning that germany could see 6% plus inflation over the next few months, and that it is going to rest at a relatively elevated level. what is the debate in germany right now about that? germany in the past, high inflation, we have seen it. the country has any allergic reaction when inflation starts to spike. what do you think the reaction is going to look like this time? judy: i think the reaction is pretty critical at the moment. i was at the gas pumps today, and i was paying nearly 1.80 four a liter of gas. people are very worried about it. it hasn't got to the public
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complaint level, but for high prices feeding into all element of domestic prices, it is going to be a big issue, and this is going to be a big issue to tackle if people -- if the population are going to get very heavy bills before christmas, and this is the last thing the new coalition once, and the last thing that people want is a christmas present. alix: quickly, do you think there is going to be the will for more fiscal and budgetary help if we do have to go for regional downs? judy: i think there has to be, yes. the small businesses are really suffering. hotels, retailers and so on, there has to be some kind of prolonged assistance perhaps for this. there's no doubt about this. i have known so many small companies who are just folding at the moment, just waiting for positive signs to get on their feet and start running again. they can't do that at the moment. guy: judy, thanks very much for
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your analysis today. lots of ground cover. thank you very much, indeed. equity markets are about to shut up shop in europe. we have, news with telecom italia. we have the fed news and the real meant of jay powell. we've the covid news to factor in as well. all of that coming together in terms of the european equity markets. ftse 100 up by 0.6%. we are seeing miners on the front foot. the tax is a little flat, but in aggregate, stoxx 600 creeping up a little bit. we will deal with the details, talk about some of the individual names, coming up next. the european close is up shortly. ♪
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guy: wrapping up the monday session in europe.
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counting you down through the close into the auction. the ftse on the front foot. the miners are leading europe, not the bold miners, the integrated miners, as a result london is getting a lift. the dax is down. the telecom italia story has lifted the telecom sector across europe. some of the stay-at-home stocks, despite what is happening with covid, fading. delivery hero a big day friday. fading that move today. the cac 40 flat. austria bouncing back after friday. let's talk about what we are seeing with the session. clearly watching events in the united states with the fed. we have that move, not to session highs but beginning to fade. the stoxx 600 unchanged. 486 is where bill wrap up the
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day. in terms of the sectors, there is the mining sector, basic resources up 1.58%, then the telecom sector. we will talk about that in more detail. the cars are moving higher. bmw catching a reasonable bid. technology, travel and leisure, real estate, that is where the weaknesses coming through. erickson one of the factors behind the telecom move. being seen as being expensive and as a result of which it is taking a bit of a knock. marks & spencer, we come onto the m&a story. pieces in the paper in the u.k. about an apollo bid. the u.k. grocery sector firmly in focus. the real news is the potential private of telecom italia by
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kkr, the stock really responding. up 30%. emily: let's get more on telecom italia. bloomberg's malan bureau chief is with us now. it is over 10 billion euros. is that enough to get it done? ? >> that is a good question. there is an agreement over the price of the stock. today as you saw the shares did not get there. they fell short. the share rose 30% during the day. telecom italia's biggest investor is proposing the deal last night, the french company
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-- how surprise it is. guy: how you think mario draghi views this deal? >> the first response from the government was quite positive. the statement last night was quite positive. we hurt italy they boost telecom italia amid the bid. it looks like it would be a government to legislate telecom italia and be spun up from the service company thanks to the deal. alix: why does kkr want this company? >> because -- there are one billion euros of investment from the european to transfer the telecom italia grid and a chance to transfer the network to an infrastructure company so
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it would have high-yield and stable revenue and profits. guy: we know what the board thinks? has there been any discussion with the board in terms of what comes next? i know they're looking for due diligence. kkr knows this company well. >> kkr is the only other investor in the secondary network of telecom italia. the board met yesterday to receive the offer. we know the board will meet again on friday. this board is due to the fact that vivendi is seeking to oust the ceo. there is a bit of turmoil. i cannot tell you if the board will support the bid. we will also have to see if the telecom italia deal will relieve the pressure from vivendi.
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guy: always a pleasure. thank you very much indeed. much more to come in this narrative. a look at where european stocks are wrapping up the day. these are the final numbers. the dax tipping, the cac 40 fairly flat. london outperforming as a result. alix: coming up, we will go back to the fed story, jay powell nominated for a second term. we will speak to libby cantrill on how this went down and where this leaves president biden. this is bloomberg. ♪
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guy: we finally got a decision. it has taken a long time to get here, but president biden has made a decision re-nominating jay powell for a second four year term, elevating lael brainard to the vice chair position. libby cantrill, pimco head of public policy says the president's pick was the path of least resistance for the white house. path of least resistance. does that make it the right decision? libby: for president biden, absolutely. jay powell will easily get confirmed, has deep connections on both sides of the aisle. confirmed as fed chair in 2018 by a vote of 84 senators, unprecedented in this environment. given that jay powell was originally a president obama pick as fed governor, this stood
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-- this should assuage both sides. this was the path of least resistance. this is what the market was expecting. somebody who is very credible on both sides of the aisle. alix: how does this help or hurt or hurt her change the dynamic for president biden it is human infrastructure bill? libby: this clears the dax. -- this clears the decks. it was speculated governor brainard was also considered for the fed chair. all those she was easily confirmed -- although she was easily confirmed in 28 teen, it looks like she would have an uphill battle for fed chair. in many ways, these two, jay powell as number one and lael brainard as number two clears the decks in terms of fed
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personnel and allows the white house to focus on the bill back better agenda and the debt ceiling and the government funding bill. this will be a busy month of december for washington and given, choosing powell at the path of least resistance. it easy is the way for those issues. -- it eases the way for those issues. alix: why did it -- guy: why did it take so long and what role did senator manchin play in this? libby: there was a lot of mystery and intrigue, many rumors and lots of speculation. the reality is this white house has been busy with many other things. the bill back better bill, which has been negotiated in public over the last eight months. also the bipartisan infrastructure framework, as well as other personnel selection, as well as foreign policy issues. in some ways this is just
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indicative of the fact they had a full plate, but also it is representative of the fact progressives and moderate democrats do not necessarily see i to i on all of these personnel choices. clearly there were progressive democrats pushing against a jay powell renomination. in some ways this is assuaging both sides, keeping jay powell as number one, honoring the norm in the 1980's of fed -- of presidents renominating the existing fed chair and also assuaging progressives by putting lael brainard in the number two spot. alix: the path of least resistance for the fed has been prioritizing unemployment over inflation. then there was up all that said two thirds of americans disapproved of the president's handling of inflation and respondents thought everything they buy is costing more. does this shakeup go anywhere
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towards putting inflation ahead of unemployment? libby: clearly inflation, if not an economic issue is becoming a political issue. i think the white house is very well aware of that. powell and brainard have both been very clear that while they are focused on the maximum employment part of their mandate come inflation is also going to be important. i do not think we should think they are necessarily over prioritizing employment. guy: something is just happened which speaks to this narrative. bloomberg is reporting the u.s. is poised to release oil from the strategic reserve in conjunction with other nations. what is your reaction to that? does that speak of panic within the administration, they have to do something so this is what they will do? how worried is the administration about the inflation story? libby: this is a recognition
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this is a political issue, maybe not an economic issue for the white house. objectively, releasing oil will have an incremental impact, if any, may be moving in conjunction with other countries will have a more significant one. it will likely be marginal but it does speak to the fact this white house is focused on an asian and there are very -- on inflation and there are very few levers. the spr may be re-advising some of the tariffs, maybe trying to address supply chain issues. the reality is economically we have limited ability to impact inflation outside of who sits on the fed. alix: goldman saying the market has priced 100 million barrels of oil to be released. last question. does president biden run again
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in 2024? libby: election season already. who knows. all indications are he is likely going to run again. even though this feels right around the corner, we are still three years out from the general election. a lot can happen between now and then. we should take him at his word, that he is likely to run again, but a lot can happen between now and then. alix: libby cantrill of pimco, thank you. later this afternoon president biden will deliver remarks on federal reserve nominees. jay powell and lael brainard will also speak. coming up, u.s. equities advancing off the highs of the session. a selloff in the bond market. more on the market reaction, next. this is bloomberg. ♪
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alix: we are two hours plus into the trade in the u.s.. financials and energy outperforming. we are watching oil after a report we might see spr release from the u.s. as well as other countries as early as tomorrow. also seeing a strong selloff in the bundle -- in the belly of the bond market. mary phillips, dimensional portfolio management deputy head joins us now. we get the headlines that continuity is the name of the game. fed chair jay powell, vice chair lael brainard, also a lot out of d.c. does this change how you look at the fed and markets at all? mary: for dimensional it does not. we will see consistency is great. the markets have appreciated this. the fed is one of millions of data points.
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that information we will incorporate and keep doing what we are doing. guy: if we are going to see a more hawkish fed, a faster taper , rate hikes coming through earlier, you think the markets have got that already? it is priced into the bond market. is it priced into equities? mary: it has to be priced into equities as soon as it happens. sometimes there is uncertainty but all of that information still gets into the price. what we like to focus on is as things are moving around, a stock shoots up, that is something we will taken a short-term information and investors can think of that using momentum. momentum is a short-term driver, and that is a place you are taking that short-term information, that market movement we know is out there. it is not something you want to build your portfolio around. alix: how you wind up using momentum? bank of america had a note that
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said "the mother of all bubbles is in crypto and tech remains of fantail." how do you take on momentum and not the risk? mary: momentum is a short-term driver. you can use it in making decisions day-to-day. let's see we have a value stock, it has gone up, time to sell. if the stock is doing great, hold onto it for a little bit longer. that is how we will take that short-term information into account. the same is true on the downside. if the stock is falling. that is how we get short-term information as opposed to a standalone strategy. a lot of folks focus on it as dedicated. it is too expensive. doubt be like getting rid of all of your clothes season and buying a new wardrobe. very expensive and you better look good after it, which we
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have not seen from momentum funds. guy: we get a rejigger of the momentum trackers later. a lot of people view momentum as the antithesis of value. the yen and yang of the investing world. why is that wrong? mary: that is wrong. they do have a dance, but it is wrong because value and momentum can overlap quite a bit. momentum stocks, we had news out about energy this morning. you'll see energy stocks changing because of that. that can relate to the price of the stocks. that will be value. a better complement to value stocks is thinking about profitability. something like that will offset for sure value exposure in a much more productive way. momentum should be the excess. it should be something like the living room -- value will be
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your foundation, profitability will be a framework. look for things that make sense and long-term. alix: the nasdaq now rolling over, losing some steam. i want to reference the bank of america note. it was interesting in terms of how they categorized last few years. 2022 is a growth stock, 2021 was inflation shock. do you agree and what does that highlight in terms of interesting investment opportunities? mary: anything is our guest for 2022 coming up. what we think of is broadly diversified portfolio, be ready for that information, it could be a rate check, but you do not have to be subject the that in your investments. we will focus on your portfolio, but if there is a rate shock it is ok, you still have good
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experience as an investor. you do not need to be positioning yourself to do so. guy: people often talk about europe being value. you mentioned telecom italia. often at the moment it feels like it is based around value stocks. when you think about portfolios, when you think about what you are doing, united states, europe , how do we think differently about those markets? mary: it is interesting because if you look at the research, one of the great things behind it is you contested all over the world. if we look at value versus profitability and momentum, they work in europe, they work in the u.s.. by being in all of those markets it is helpful because if they are working in one place they will not be working somewhere else. i know europe has had headwinds, it has lagged the u.s. for quite some time. if you got the diversification
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there is some kind of rate shock , that could work out because you have the diversification and exposure and you don't have to be subject to trying to fit which one will work out. guy: great to speak to you. mary phillips, dimensional portfolio management. interesting stuff. it looks like tomorrow will be an exciting day. we will have more of the fed later on stop waiting for the president to speak at 1:20. his next roll of the dice appears to be spr release. alix: we are learning their subordinated spr release, you have been mentioned the opec-plus contingents, now you have a cartel of consumers. having this release is something we have not yet seen. the u.s. has been releasing oil from the reserves, so it is not just that. does the coronation have a desired effect or is the verbal intervention enough. we have had a nice rollover for
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oil. guy: this at the margin will throw things off a little bit. it feels like it is only at the margin. it almost feels like this is for political purposes rather than economic impact. alix: guy: guy: yes -- alix: yes. what is the sustained economic impact? goldman sachs says it has already priced in the eight dollar decline we have seen. if you look at oil price now you are looking at a severe demand shock. i do not think we will see that extreme of a move. guy: that will be fascinating to watch. with inflation such an important political factor in d.c. right now, maybe being seen to do something is important. maybe you do not get that big a reaction in the price, but the consumer can say the president is on our side, which is
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ultimately what he is looking for. what comes in the next 24 hours? pandemic darling zoom out with earnings. u.s. trade representative katherine tai is in india. alix: tomorrow is bmi day and will get data from france, u.k., germany, the eurozone. earnings trickling out, dollar tree and the gap. interesting to see how that moves. coming up, two our special radio and tv simulcast of balance of power as we await president biden to announce his renomination of jay powell. paul krugman will be joining david westin. this is bloomberg. ♪
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>> from the world of politics to the world of business, this is "balance of power" with david
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westin. david: from bloomberg's world headquarters in new york to our tv and radio audiences worldwide, welcome to "balance of power." our two our program today is given over to the story of president biden's fed nomination. will be joined by paul krugman, larry summers, douglas holtz-eakin. to set it up we turn to michael mckee. finally we have the answer. i'm not sure if it is a shocking answer. what we make of it? michael: not a shocking answer. this returns to the dog bites man way of appointing fed officials. the current chairman is reappointed, even by a president of the other party. it is because joe biden

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