tv Bloomberg Surveillance Bloomberg December 23, 2021 8:00am-9:00am EST
>> this cycle easily carries into the middle of this decade. >> i think we are late cycle at this juncture in the market. >> it has to be profitable growth. >> risks are definitely going to be the did -- going to be to the downside. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. kailey: good morning on tv and radio. this is "bloomberg surveillance ." kailey leinz, damian sassower, and guy johnson in for tom keene my jonathan ferro, and lisa abramowicz -- tom keene,
jonathan ferro, and lisa abramowicz. a lot of traders probably off, too. guy: like volume headed into christmas. -- light volume headed into christmas. my house is currently dominated by movies that seem to involve reindeer, reindeer getting lost, that sort of thing. let's talk a little bit about where we are going. the equity markets at the moment of got a lot of challenges as we go into 2022, but i have to say, i keep reading everything will day sell side reports that tell me next year is going to be good. you look at the lineup of threats to that, there are some significant ones going into next year. kailey: the consensus seems to be dead returns are not going to be a stellar as they had been. still, it is going to be a year in which you can mix a money. damian: for me, it is going to be about the second half of
2022. there's no question the comps on growth are going to accelerate. is it going to be margins, topline revenues? that remains to be seen. kailey: before we can get to the new year, we've got to finish up when he 21 when it comes to trading. we have about an hour and a half until one of those trading days opens in the u.s. futures are in positive territory. we are up nearly 0.4% of my spitting distance from all-time highs. we are getting a little bit of movement in fx. we are still sitting right around the one dollar 13 since level, where we are seeing it to basis point move upward in the 10 year yield, firmly below 1.50% still, which is not where anyone really thought we would be at this point in the year. the bdi crude sitting around the highest level in a month. supply and demand picture may be looking a little bit better, so
we are looking at a $73 handle on wti. let's bring in sam stovall, chief investment strategist at cvr -- at cfra. what is the biggest underappreciated risk that you see? sam: i think a lot of the risks are certainly appreciated. i think the big focus is going to be on interest rates. it is going to be sort of a second half year when we really do get the cpi readings. we think we are going to be peeking out in the first quarter , in january on a year-over-year basis at 6.9%. come december, our belief is we are likely to see it cut more than in half, so down to about 3.1%. so should we end up needing only one or two rate hikes rather than the three that are built into the market, i think that could end up being a positive catalyst. guy: let's talk about that a
little bit more. history would dictate that economies slow down when central banks start tightening. if we only get to hikes next year, how does that change the growth outlook in the united states? sam: we are already forecasting gdp growth will be about 4.8% in 2022 versus a 5.5% that we saw. as before hundred earnings growth and about 7.5% versus the 44% we saw for 2021 versus the 14% we saw for this year. the real question is what will it do to valuations as we head towards a 2% yield on the 10 year note.
history says we are likely to see a pe ratio between 18 and 19, not the current 21 and 22. damian: march 1991, the west village, new york university stern school of business, you were a lecturer and gave a clinic on sector rotation in u.s. equities. i actually showed up to class that day. as you mention margins, this gap between price to sales and price-to-earnings in the u.s., what is going to give here, the margins are the top line? sam: i think we will probably see, just as we are looking for a narrowing of the yield curve, i think we probably do and up seeing profit margins narrow, but then as inflation starts to cool, i think investors breathe a sigh of relief. we have been reading about many of the consumer staples companies because their raw
material costs have been rising. so we could end up seeing not only a reduction in earnings themselves, but also a narrowing of the profit margins. and kailey: the ability kailey: -- kailey: and the ability for companies to be able to pass on those costs. at what point would you become concerned as we see saving rates drawn down about consumption? sam: i think consumers, because they have been hearing about it, they have been seeing it on their own, they are fully aware that prices are on the rise, and frequently what happens is people end up moving forward whatever purchases they are lightly to do for the year, at least on discretionary items because they don't want to wait only to have those items cost more. when it comes to staples type items, they are just resigned to the fact that their favorite brand of cereal is going to cost more, or maybe they end up substituting for more generic
brands. so consumers are not going to be zombies walking in the dark. they are going to be trying to be active about how they can make adjustments to save money. guy: bring this all together. are we late cycle? is 2022 late cycle? sam: we are beginning the third year of this bull market. it is likely to be a challenging year, the sophomore slump of a presidential cycle typically sees 41% more volatility on average than the other three years. also, the third year of the gold market posts the weakest increase in 4.4% versus a more than 17% gain for the other years of bull markets. so i would tend to say probably we are in midcycle at this point, but i still think we could end up with a good year, not a great year in 2022. damian: the s&p is up 25%
year-to-date, and many would think that would lead to a less rosy update -- less rosy outlook going forward. the markets do pretty well, of something around 10.4% going back to world war ii. can weeks but more of same as we look ahead? sam: you probably got an a in that class because you were those numbers exactly. [laughter] this is a top 20 year in terms of your to date price change, and historically that has led to eight and .4% rise in the subsequent year with a batting average, a frequency of advanced that is at 80% versus the more normal 74%. so the implication, but not to guarantee, is that next year could be better simply based on this year. but we also have some favorable tailwinds. we had more than twice the number of all-time highs this year than the long-term average,
so that typically bodes well for the year ahead. damian: i continue to stalk you. thank you so much. it wasn't a four point, but it was pretty close -- a4.0 -- a 4.0, but it was pretty close. [laughter] kailey: we appreciate having you here. happy holidays to you and yours. i do not buy for a second that you are not an excellent student. clearly you have a really good memory. damian: well, they were pretty good, so we will to sleep at that. kailey: it runs in the family. guy has no input whatsoever. guy: i am trying to think of mean jokes for damian, but kailey has picked him up so much now that it is maybe a little mean to knock them down now.
if you were getting great scores, were you having fun? damian: i was always having fun. i continue to have fun. work hard, play hard. i usually come in with a director on my head monday morning. guy: he's fessing up to everything. kailey leinz i'm sure is in beckley well behaved on a monday morning. kailey: i think we should get this back on track and get back to the markets. we're looking at something of a santa claus rally. on the stoxx 600 in europe right now, it is some thing like 44% lower than the 20 day average. there's not a lot of people on the desk today. guy: nobody is here. london has been empty for a while, and that is probably more to do with covid, but this is certainly very quiet at the moment. i think people are working from home today. but you've got to take it where you can get it. at least we are positive. we are picking up.
what i think is interesting about what is happening in the markets right now is that travel and leisure stocks are the outperformer's. that basically fits with the narrative that may be omicron is not going to be that bad. maybe it is going to happen relook with you. as a result of which, you want to price for a solid spread. if we can out of omicron really strongly, is that going to be something that is only going to further encourage central bank to tighten and tighten harder? kailey: at what point does good news become bad news? coming up on this program, we will talk to simeon siegel, managing director at bmo capital markets. we will talk maybe about what the halliday shopping season looks like. you have one day left to buy presents if you haven't done so already. this is bloomberg. ♪ ritika: with the first word news, ritika gupta. russian president vladimir putin is urging the u.s. to move quickly to meet russian demand
for security guarantees area speaking there is -- during his annual news conference, putin said he expects talks with the u.s. to produce quick results. >> we did not come to the border of the united states or the united kingdom. they came to our house, to our border, and now they are saying we want ukraine to be part of us as well. anyone there and he's from a? no, you are owing guarantees to us. ritika: they made no mention of the threat of military action as earlier this week, but said the kremlin will do what it needs to ensure russia's security. german health officials say they expect a surge in coronavirus cases around new year's, and the country is warning people will likely need a fourth vaccine shot to maintain the best immune
response against covid-19. the government is urging germans to limit contact over the holiday period. the chinese city of xi'an has imposed a lockdown on its 13 million residents after testing discovered 100 when he seven covid infections. residents have been told to stay in their homes, and one person can go out every other day for necessities. 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 ritika gupta. this is bloomberg. ♪
hearing from brian nick. i think we had a little bit of trouble with that sound. what we heard earlier this week is that he does expect the curve to start steepening more materially. that has not been what we have gotten as the market looks at the fed and says is the central bank going to make a policy mistake. guy: this is a huge challenge for equities, isn't it? you think about what is happening here. the tolerance, i would have thought, at the moment for equities in terms of the way they are viewing the central bank story is conditioned by that incredibly flat curve. that is got to be the huge fear. how much can the fed actually raise without having a meaningful impact? where is the point at which we get a policy mistake? i don't think we know the answer to these questions yet. i keep coming back to the answer i am trying to figure out at the moment. can the fed tamp down inflation? i know inflation is going to come down because of the base effect, but can the fed deal with the inflation narrative without stalling growth?
i think this is something we will try to work our way through next year. but we are miles away from the answer. damian: i'm asking a very similar question. the fed has never hiked rates before and left policy rates in negative territory on an inflation-adjusted until the real policy rate goes positive. this time, look where we are. it is anyone's guess as to where they go and where they stop. kailey: we are self of 1.50%. that is about 50 basis points shy of where the consensus was coming into this year. yields remaining firmly lower. also moving higher come of the santa claus rally is here. volume is light, but that is what we are looking at. guy brought up an interesting point. when we think about the monetary policy reaction function, the fed can't address supply chain issues. it can't print ships. what it can do is affect demand.
let's talk more about consumption and demand with simeon siegel, managing director at bmo capital markets. he does a great job of covering capital. do you see any signs that consumer tolerance for higher prices is fading? simeon: good morning. i thing it is a great question. i think that starting in 2008, the consumer knew that they were allowed to pick whatever price they wanted, and all of a sudden, at the end of 2020, they lost that power. they did not lose that power because retailers planned it. they lost that power because there was no inventory. now i think the question is do these retailers come into these brands learn from the fact that when there was scarcity, there were higher prices? or do they pull back the idea of cell more that any cost -- of sell more at any cost? we are essentially going back to the fact that if people have, if
companies have people things want -- if companies have things people want to buy, we will start seeing winners and losers emerge. in the past several years, it has been rising and fading tides . i think it is a big question and it will be more company specific than macro. guy: just staying broad for the moment if we can, january, february, march, are we going to see all of the containers that are setting off long beach right now hitting the ports, hitting warehouses? inventory starts to build, and some of these read taylor's -- these retailers are going to have to unload it at a discount? simeon: it is already happening. i think the interesting dynamic was last year's supply chain shut down. this year, supply chains slows down. this was less than issue of creating. it was more an issue of transportation. for the most part, to your point, we have had containers
sitting even further out than we can see them. so there is product moving. it is just moving really slowly. i guarantee you all those red sweaters that don't get to the floors until february are going to be discounted. but i think there's going to be plenty of product that is going to sell out more than full price before it can hit the shelf. so i think what we are seeing, and the next few months, we will have a reverting to a normal since of retail. the first six months of 2021 where the best opportunity you could have, perhaps ever, to be a retailer because pent-up demand gave you desire to spend. so i think it is going to be much harder, but i don't think that means that universally there aren't going to be retailers that structurally improve the elasticity of demand. but without a doubt, i totally
agree with you, there will be promotions. damian: retail has absolutely smashed since mid-november, something like up 35% year to date. do using that carries over into the new year -- do you think that carries over into the new year? simeon: i think there was retail trading that basically became an etf. you just bought the cluster or sold the cluster. . i think that changes next year. kailey: could you get a little bit more specific? who is going to be the winner in this environment? simeon: on their last earnings call, i asked the outgoing ceo of capri, what are you going to do when promotions come back? he very aware early responded, first of all, they are already back, and we are not going to purchase paid. you want easy companies that are willing to hold the line. capri i think is a very strong
indicator of a company telling us they are aware that there's external benefit, and when that abates, they will not simply given. victories secret, they brought inventory down 50%. they cut inventory and half before we even heard the word supply chain. so it is finding these companies that raise pricing power as opposed to simply saw higher prices. i think under armour has been doing a nice job. there are very strong examples of brands that took this extra benefit and really turned it to their advantage, and saw higher prices because there were less promotions. when promotions come back, they will have to chase them. kailey: maybe those discounts are finally coming for the american consumer. thank you so much for joining us from bmo. when we talk about the retailers, the supply side issues include the supply chain and all of the ships stuck outside of ports, but it is also
a labor problem. that is one that is growing, here in the u.s., given the coronavirus. guy: and are you, as a result of that, going to see more automation? i was at a highly automated warehouse the other day. i think you will see much more of that happening. it is harder to do with apparel, but we will definitely continue this trend towards e-commerce. it is going to mean the kit you put in those warehouses is more important. the whole story around retail at the moment is not just selling people stuff. it is if they return it, what you do with it? how do you manage inventory? how do you manage it effectively? that is going to be one thing that separates the retail winners and losers. kailey: definitely a differentiating factor. we will talk about how all of this translates into the consumer. we will get personal income and spending data, as well as the core inflator. we will discuss that with matt
kailey: seconds away from a data drop. futures are in positive territory. dancing around for 700 -- dancing around 4700 on the s&p. 10-year gilts moving up -- 10 year yield moving up. initial jobless claims right as expected on the weekly number, 205,000 filing for initial jobless claims. on continuing claims right in line, higher at 1.80 6 million. as for the other metrics, personal income and spending in line with estimates, up .4%, up .6% on the spending metric. we are talking about higher inflation, but this american consumer is still out there.
when it comes to the pce deflator number, we are right in line on the month on month. on the year, the are over your number 5.7%. guy: let's break it altogether. you also have the durable goods numbers -- let's bring it all together. you also have durable goods numbers strong. inflation is high, the consumer is spending but maybe the indication is that will be a struggle. the industrial sector is solid. that fits with the narrative we are hearing elsewhere. consumer hanging in there. matt was eddie -- matt luzetti joining us now. what can you take into the numbers as you think about the trajectory we are on.
is this going to be an industrial storied here? give us your take. matt: i would focus on two things. what is inflation. it will remain the story of 2022, the core pce was right in line with our expectations. that is the highest year-over-year since the late 1980's. that is in line with expectations. putting in line how high inflation is and why the fed will be tightening policy. the second is consumer spending. we sell real consumer spending flat. this is before omicron, it is before the child tax credit may hit incomes in january if that is not reduced. we see a consumer that has looked more fragile. consumer sentiment has dipped. from a growth perspective that does raise downside risk on the consumer. >> look at the grow rate, 4.7%.
that is the highest since 1982. what is your position on inflation into the new year? should we expect inflation to accelerate and then come off in the second half of the year? what do you think? matthew: i think in the near term it will get worse. there are corporate's item, used cars, we will probably see upward pressure in the near term. in addition to that, housing costs in terms of rent will continue to pick up. in the near term it does get worse. it will come down later this year. we have core pce inflation around 2.8% at the end of next year. that is still 70 to 80 basis points above the fed target and the reason we expect to raise rates three times next year. damian: housing prices and the supply bottlenecks, those are
the two big factors that will drive inflation in the new year. what you think? matthew: the key story is about the labor market and how covid tends to impact that. what we have seen during the delta wave and previous waves as it tends to shrink the labor force and labor force participation declines. it tends to do that for those impacted by childcare, whether it is schooling or childcare needs for younger children. in the next few months, the labor force remains constrained in the labor market will uptight. wages will continue to accelerate. that will feed into inflationary pressures. as we get further out, i optimistic the labor force will come back. you look at primates participation, it rose 90 basis
-- you look at prime age participation, it rose 90 basis points last year. i'm optimistic for the second half of next year and further out. in the near term it is likely to remain constrained given omicron and the pandemic. kailey: i wonder how the buildup of savings plays in. the fact that the consumer has a strong balance sheet has allowed the consumer to keep pace and the wage growth is not where it might need to be in order for consumption to be that strong. as the consumer starts to draw down on those savings from is it going to take a complete removal of that buffer to drive people back to the labor force? matthew: sure. we have excess savings around $2.4 trillion since the pandemic hit. the key point is that is heavily skewed towards the upper part of the income distribution.
we have a large portion of the population of the income distribution that does not have excess savings built up and therefore i do not think that is a contributing force on the labor force. what it does tell us is there are a number of factors that the consumer does have a strong balance sheet, excess savings is one of them. service ratios are quite low. net worth is elevated. households are dealing with a number of shots in the near term. this obviously is one. sentiment has been hit in income will be hit if we do not have the child tax credit renewed. kailey: the reason we talk about such a high savings rate is because we saw unprecedented fiscal stimulus. when we think about build back better and the child tax credit, if that does not happen, what are the growth implications of that? matthew: we assume it will be renewed year. if it were not renewed that would reduce our growth forecast
by 30 to 50 basis points. they would grow to something closer to 3% growth. it is material for the consumer, but not something that moves us from high-growth to well above trend to something that makes the labor market begin to contract. i do not think it has as big implications for fed policy. the labor market should continue to improve. it is a material impact on growth outlook. guy: you're talking about three, possibly four rate hikes from the fed. recessions are normally caused by the fed raising rates, it is either higher rates or higher energy prices. we could have both next year. how would you handicap the risk of recession in the united states 2022 to 2023? matthew: you have very interesting divergences between recession indicators.
there consumer indicators we focus on closely. the gaps between expectations and current conditions and current conditions and different surveys. those look like recession risks are elevated, 50% over the next year. on the other hand, there remain pretty steep and suggest recession risks are muted around 20%. the biggest risk is the fed, the fed has to respond more aggressively to inflation and that does trigger the next downturn. that is not our base case, we think they raise rates three to four times and inflation comes down a supply bottlenecks begin to work themselves out. the key risk's baby supply bottlenecks do not work themselves out for inflation expectation pick up or a wage price spiral begins to on anchor inflation and that become self-fulfilling. it is very different environment
than where we were pre-covid when inflation was quite low in the labor market had room to tighten. today inflation is well above target. there is a great risk that they have to move more aggressively and that does raise recession risks. probably not 2022 but 2023 and 2024. damian: i want to pick up on what kailey was alluding to. we had nathan sheets on yesterday and he talked about the immense fiscal hurdle the u.s. is facing in the first half of this year. $2.7 trillion of fiscal stimulus last year. how will this economy manage without that? that is equivalent of 13% of gdp. that is a big number that is not coming anytime soon. matthew: what the traditional fiscal impulse measures miss is a lot of the stimulus last year was savings.
we note the excess savings households had. i think the typical fiscal impulse measures are very elevated last year and very negative over the next year to overstate the case. we think there'll be a lot more smoothing of the fiscal impulse. it does highlight the challenge. we have had an economy that has been significantly supported by massive fiscal stimulus in a fed policy that has been accommodative. in 2022 we will see reversal of both of those things. we think the economy can weather that and see growth levels on trend, but it is an open question. the key question for growth and the outlook remains can the fed land this plane in a soft landing way in an environment where inflation is at the highest level since the 1980's. kailey: great stuff. matthew luzzetti of deutsche
bank. the hot take from ira jersey, he says real spending at zero could create issues for some at the vet. -- at the fed. they want to fight inflation but of real growth is negative will they want to? guy: it a massive challenge. inflation is out of control, you look at the mandate, they need to do something about that. the question is how hard can they step on it? matthew: the one thing ira -- damian: one thing ira points out is -- the excess reserves in the market or at $1 trillion. kailey: excellent point. futures are in positive territory. we are off session highs. we will talk more about the pandemic with jodi getz of emory university, next. this is bloomberg. ritika: exxon mobil is working
to extinguish a fire at its facility in texas. the fourth largest refinery in the united states. the fire broke out around 1:00 a.m. local time. exxon mobil says monitoring at the site have shown no adverse impact so far. larry summers's warning of a testing period for the u.s. economy in the coming years with the risk of recession followed by stagnation. in an interview with bloomberg economics, larry summers said the fed has been late on inflation and delayed action could tip the economy into a slump. the e.u. is urging negotiators to speed up their efforts to resolve a standoff between iran and the u.s. when they meet on december 27. next round of talks aimed at reviving the 2015 nuclear deal. the eu chief negotiator tweeted it is important to pick up the pace on key outstanding issues. the u.s. exited the packed in
2018 and re-imposed sanctions on iran. the supreme court says it will hold a special session in two weeks to weigh challenges to two bided administration policies covering vaccine requirements for millions of workers. the high court says it will hear arguments in the cases january 7 amid rising coronavirus cases in an extraordinarily fast timeline will the court had not been scheduled to hear cases again until january 10. global news 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. i am ritika gupta. this is bloomberg. ♪
day of travel. travel is avoidable or someone in your party is unvaccinated, is elderly or immunocompromised -- kailey: johns hopkins associate professor of emergency medicine speaking with us earlier this week as we face of any questions about this pandemic. we have encouraging data when it comes to hospitalizations and boosters, but to have a booster you have to get vaccinated. that is a big gap in the pandemic era. let's bring in jodi getz, vice chair emory university department of epidemiology. as we talk about these different forces, what in your mind is most critical to focus on? jodi: getting everyone boosted, and if you've not gotten vaccinated we want everyone to get a vaccine and one in the mrna series. then if you've been vaccinated,
six months after the vaccinated you want people to get boosted. we also layer a couple of things on that because omicron is so transmissible. wearing a very good mask in public is important, as is insuring your in ventilated spaces, and i do not think we have been talking about testing, although that conversation has been increasing. knowing when to test and what kind of test to use is very important. guy: let's talk about that. there is a new antiviral drug we have from pfizer. you need to take it early, therefore you need to test in order to know when to take it. how should we be sequencing testing? in the u.k. we have many flow tests. i have a box at home of 20 or 30 of them. they give them out at schools. you use the lateral flow, you get a positive, then you get the pcr tests which allows reporting around that.
how should we be thinking about testing and how that fits in with using these antivirals? jodie: right now with omicron spread across the united states, we want to be talking about how to use a rapid antigen test at home and recognize what it does and does not do. it does not give you free range for a week if you have one negative, but it does make you feel comfortable you are not going to be infectious if you're getting together for dinner with someone in their home. that window of time you can use a rapid antigen is appropriate for holiday gatherings if you test before you go. if you will get together with friends the next day you need another test. access to rapid antigen and using them appropriately is not something we have done well in the united states. damian: -- guy: in terms of using antivirals, how should
they slot in? this new drug, you need to take it within the first four days of being hit with omicron. how do we make sure we use it properly? it is an expensive drug. $600 or $700. how do we make sure we are spending that money effectively? jodie: i think it is going to be may be $530 in united states. it has a window as well. the best use of this new drug is going to be to use it in the first three to five days of testing positive. we also want to be using this, it works the best for people who are at risk for severe complications for covid-19. the majority would have a high sensitivity to wanting to test,
but folks living with underlying conditions or have things like diabetes and obesity, things we know complicate covid-19, that is where we will see it work the best and where we see the best data. damian: we spend so much time harping on the bad news related to the coronavirus, but there has been progress on the medical front. we mentioned the pfizer oral pill, but also the u.s. army walter reed institute announced they have made progress in terms of a virus that not only affects covid but any sars related theme. my question is what advances in epidemiology have you most excited as we turn to 2022? jodie: it has been a long two years. what we have seen as people are paying attention to public health and we do not normally lead with a lot of conversations about people knowing what epidemiologists. that has changed.
the passion of our students and what they are seeing as they learn about public health during this pandemic, i think it will change the way public health moves forward. we are focusing on good communication and talking about inequities. covid-19 has consistently taken advantage of inequities in health care and access, and we need to be talking about that to be willing to do something about it. the fact is one of the silver linings of covid-19 is making us talk about it and making us safer. damian: i have also heard omicron doubles the risk of being infected on a plane. a lot of people are traveling. tom keene is in a private jet to come pick me up so i will be in a plane with a lot of other people. how concerned should travelers be? jodie: omicron is much more transmissible than what we saw with delta and we thought delta was a whammy.
omicron, when it is in a space everyone there is much more likely to get. airplanes have been a safe way to travel based on the way air circulation -- we are not seeing a lot of transmission from the actual airplane. it is more what you are doing to get onto that plane that has been a risk. we are working with something so much more transmissible. every place you are with other people is a bigger risk than it was with delta. kailey: a lot of impact people are factoring into the equation when deciding what to do. thank you to dr. jodie guest from emory university. volume is light but it does look like the equity rally will roll-on. guy: absolutely. very light volume. we got beaten up on monday, we have clawed our way back ever since. keep an eye on what is happening with the dollar. the pound is catching a bid but
the euro is starting to fade. the energy store in europe is what i keep coming back to. fascinating to see how the high energy prices will impact the economic trajectory next year in europe. damian: jon ferro was right. everyone has left for holiday. kriti gupta keeps minding us with all of the data. yields are not moving. i guess it is time to wash, rinse, repeat, look for people to put on the reopening trade. kailey: i think we'll have to give one up for damian sassower crushing his bloomberg surveillance anchoring debut. color meet impressed. guy: i am very impressed. i did not have any doubt whatsoever damian sassower would be able to deliver. he is just getting ready. he is going down to florida, thinking about that warm weather. that is in my near future as well. kailey: you and me both.
the open starts right now. >> everything you need to get set for the start of u.s. trading. this is "bloomberg: the open" with jonathan ferro. caroline: we begin with the big issue. >> the omicron variant. >> the emma corrin. in the rearview mitt -- the omicron variant in the rearview mirror. >> much more transmissible. >> already discounted in terms of the market. >> i would be cautious. >> i am quite comfortable with what we are seeing on omicron. >> some of the vaccines are proving