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tv   Bloomberg Markets  Bloomberg  November 30, 2021 1:00pm-2:00pm EST

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will be cured by the vaccine. boosters will be available for everyone who -- who needs it. >> the target is to offer a booster for everyone eligible by the end of january. mark: the european union has reported at least 44 confirmed cases of the omicron variant in 11 countries, all of the people infected are asymptomatic or showing only mild symptoms. amazon is accused of underreporting covid cases contracted at work, labor group is calling on the federal government to investigate, saying it provided misleading or grossly incomplete data about the number of covid-19 infections potentially spreading in its facilities. of the almost 20,000 employees, the company say contracted the virus last year, amazon
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maintains only 27 potentially caught it at work. china says it's determined to hold a successful winter olympics games in 60 five days even after the world health organization warned that covid cases may surge to severe consequences. china is often counted its success fighting the pandemic well criticizing nations including the united states for their fatalities. in new york, ghislaine's kicked off. prosecutors say maxwell and epstein were partners in crime. the british socialite is facing multiple charges including conspiracy to commit sex trafficking which carries a maximum penalty of 40 years in prison. global news, 24 hours a day, on air and on bloomberg take
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powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton, this is bloomberg. ♪ matt: i am matt miller and welcome to bloomberg markets. from around the world, powell rattles the market, the fed chair adds to virus worries sparking a sea of red, setting the bar to the lowest since march, down by 10 basis points. we will keep you updated as the vix approaches 30. plus we will talk about the timing of rate heights -- rate hikes and breakdown powell and dr. fauci confirms there are 226
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omicron cases in 20 countries as of today that we know of. we will take a look at the spread of the new variant and talk about whether or not vaccines can protect against it stop let's take a quick look at what's going on in markets. we can take a longer look because it's extremely interesting that after powell commented about tapering and its verdict drop, we are now seeing the s&p 500 trading below its close friday. so much for yesterday's rebound. the dow jones industrial average is down more than 600 points today. the u.s. 10 year yield is down as investors seek the perceived safety of government bonds. this is interesting because the markets are pricing in rate hikes sooner than they previously thought but nonetheless, they are buying the 10 year. this is the covid concern you see. the dollar index is not a safe
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haven today. it was on friday and was up again friday as well. the u.s. dollar is still down as investors by other currencies, notably the yen and the euro and the pound. nymex crude continues its drop now with a $65 handle and brent crude is down with a 70 handle so oil prices have moved dramatically over the past few sessions because of this worry about the spread of omicron. let's turn to a bloomberg scoop about meta, formerly known as facebook. david marcus is leaving the company. joining us is the reporter behind this scoop. what do we know about the fate of the currency. does this mean those plans will take longer to execute? >> remember that dm is no longer
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controlled by facebook so the idea it was created and incubated internally and is now run by an independent entity. the fact that david marcus is leaving meta does not necessarily mean that the currency is more or less likely to launch. he is on the board of dm and it will be interesting to see if he stays there or facebook will replace him. it has had a huge issue launching with a ton of red tape and because it's no longer controlled exclusively by dm, i don't know if the marcus departure makes a huge difference in terms of whether that currency will launch. matt: what do we know about why he is leaving and where he is going? >> he's leaving at the end of the year. he says it's because he wants to start something new. he is an entrepreneur and an angel investor. he is very into building and
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growing startups and that's one of the reasons why he took on the dm project inside meta a few years ago. he said it felt like a startup under the safety umbrella of a big company. we don't know what he will do but he's interested in the financial services space, the idea of sending money with bitcoin and crypto so i wouldn't be surprised if he shows up doing some type of financial startup of some kind but we know he wants to go into something new probably next year. matt: congratulations on the story and thank you for joining us. let's turn back to the markets right now. on capitol hill, the fed chair's remarks shook up markets. joining us is the fs investments chief. he repeated the fed chair that they are going to consider moving the taper up and tapering
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faster. that sparked the markets to move ahead their expectations for rate hikes. how do you see this? >> this is something that has been on the radar and circulating for some time stop that was prior to the new omicron variant. this idea that it's happening so high and so fast and they cannot raise rates until they've wound down quantitative easing, they need to get that out of the way faster to allow them selves more flexibility. powell saying this really shows that he is considering wanting the flexibility to be more agile and faster to respond. i think that part is really an issue. the fed is really saying they want to raise rates sooner than even later. matt: is it time to get hawkish as we learn of the new variant that could potentially spread faster than other variance?
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it's possible that the vaccines we have are not as effective against omicron? isn't it the time for central banks to be dovish again? >> i think the timing is a little awkward. wanting to have greater flexibility is one thing. from the financial condition standpoint, considering the taper could be long overdue given that markets have been so strong for so long, you could argue that they are hind the curve on that part of the policy transition toward a rate hike. certainly, the notion that you would want to signal rate heights are moving them up at the same time you have this looming uncertainty on the growth front is problematic. they want to allow themselves room to maneuver not just signal that rate heights are on autopilot when we are getting a
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piece of uncertainty about growth. matt: it's got to make trader jobs harder. at the same time we see the dow dropped 600 points in the s&p down below friday's close, you would expect them to be running for cover of treasuries, but if they are going to bring rate hikes forward in a knee-jerk reaction to sell treasuries and why isn't the dollar rallying if we are so freaked out? >> those are two separate things. one of them is the idea that when the fed starts raising rates, long-term interest rates go up. when the fed usually starts to raise rates, long-term rates usually stay where they are or fall. it's the short part of the curve that moves but not long-term. separately from that, this news right now is hitting everybody
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across the globe in the same way. as far as the dollar having a big run up over the past month but i don't see today's move is being a real shift in the fact that the dollar is going to be a pervasive trend over the next few months. matt: we have seen big moves in the bloomberg dollar index that's why i'm less surprised when i see gold trading over $17. the dow jones is down 640 points. we are seeing a drop of 1.8 percent and the s&p 500 is down one and three quarters percent at 45.73. where you see these markets going longer term? i heard one senator say he expects rates to be at 3.5% in 18 months. what does that do to stocks?
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>> i think that is further than most people in the market expect. for equities, that would be big particular given the fact that so many of these large-cap growth equities are a sickly trading like long-term zero-coupon bonds with higher interest rates. that scenario would affect the valuation. more likely is the fed will proceed i think they will proceed with a little bit more caution than the markets have priced in. powell dropped the word transitory today. i think everybody is interpreting that as a hawkish piece of news. for me, it's expresses the fact that the fed needs to be more nuanced when it talks about an asian step we've been throwing around the trend story word and nobody has a timeline and nobody
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has any idea about that. powell is trying to get more sophisticated in saying some of these acute inflation pressures might resolve but some of them could cause disruption along the supply chain. it's better to be obvious than being more nuanced. matt: transitory is a comment on thesis that a measurement of time. jerome powell scenes is sick of that word is everyone else's. the omicron variant is the big question here. what is your take on this or how do you see your colleagues reading the danger of the possibility of a renewed lockdown. in berlin, the government is working on another lockdown. >> i think that is the real
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issue. all along with the worry about inflation and we were focused on that and considering what the fed does, everyone is taking strong growth for granted. even though we had growth in china slowing, signs that europe was already slowing and now we've got possibilities of new lockdowns and finally, we have a pretty big speedbump in the u.s. and the third quarter. growth assumptions need to be hedged carefully. that is one reason long-term rates are low and as we see the omicron uncertainty hovering over consumers at the same time that a lot of the pandemic is being tamped down, it will make for rougher growth in the first quarter. after the shot -- holiday shopping spree, it could be different next year. matt: thank you so much for spending some time with us.
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we are looking right now at eight vix that has risen to 28 and change, a 22% rise in the vix today, not as much as we saw friday in terms of the drama but still, big jump in volatility, helping equity all until it is catch-up to rates. you saw the rates a moment ago with a 10 year yield at one spot. coming up, the modernity ceos his current vaccines will be less effective at fighting the omicron variant. there is a lot of talk about the efficacy of vaccines, about how fast this variance spreads and whether or not it's more fatal or even more mild than previous variance. we will discuss the latest on the new variant, this is bloomberg. ♪
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matt: this is bloomberg markets. the world health organization warned that the omicron variant could fuel a fresh surgeon covert infections with severe consequences. omicron has reached at least 15 locations and probably more. joining us now is their bloomberg health reporter to talk about what we know so far and what we are hearing. there are some scientists telling us that so far, the infection seems milder than those previous variance. the cases are in younger people, possibly vaccinated people, it's early days to steal a british
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phrase we are all using. what do we know about omicron? >> we actually don't know a lot about this new variant. we know there are lots of mutations, about 50 total and over 30 of the crucial spike protein which is the protein that you see in the diagram of the virus affecting the cell so that has raised concerns that a variant could affect the immune system and evade vaccine detection more than previous variance. scientists have not had time to do any of the test in the laboratory. it would give them a more accurate picture of how this variant can prevent vaccine-induced antibodies. in the next few weeks, it will give us a much better sense of what this can or cannot do and
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until we have that data, people are just guessing. unfortunately, we will have to sit tight until some of the data comes in to get a sense of what this does and doesn't do. matt: the modernity cofounder and others in pharma are showing some concern about whether or not there vaccines are effective against this variant. at the same time, they assure us that these mrna vaccines, the chief medical officer of modernity set over the weekend, that they can be quickly adapted to new variance. should we rest assured that within two or three months, we have affected vaccines again? >> mrna is suitable to adapt to vaccines pretty quickly. if something new is needed which
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we don't know but having something available in three months is what they are looking at. you can think of this as an update about the flu vaccine which is updated every year. mrna can update faster. they are starting to update the vaccine. they might not need to do it but they will try. pfizer said it's not clear we will need to update the vaccine. what is clear is we continue to see these variants which means we will probably have to update the vaccines eventually and therefore that stuff matt: thank you so much for joining us.
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still ahead, a group of vigilantes are working hard to weed out fraud in the crypto market, we will have that story next, this is bloomberg. ♪
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matt: this is bloomberg markets. we are seeing markets dropping rapidly after jay powell gave some testimony in front of congress. the dow jones is down about 600 points, the s&p 500 down one point 75%. levels on equity indexes are lower than the lows friday. we are in the midst of a selloff . the vix is back up above 28. we are going to get into a more fun story about the fast-moving
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world of crypto. a team is trying to weed out fraudsters and there are plenty of scams to hunt in the $100 billion market. we just heard from senator warren and others in its largely unregulated. we are joined by our reporter covering crypto. what is going on here? is it the wild west and you've got a posse looking for bad guys? >> yeah, this posse met online. anyone can basically create their own token and that's given way for a lot of scammers to come into the space this year and steal money from investors. investors were investing in a particular coin and they got scammed and after a certain amount of time and no action
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taken by regulators, they decided to take matters into their own hands. now they have members of their team across states but also some in europe and they identify coins they think are false -- faulty and they try to expose them. matt: i love the layout of the story. who are these rug seekers and why are they doing this, because they got scammed once? >> what these men and women were able to do was to find a process in which to expose these scammers. it's not that hard if you do it once or twice. they go through the different coin source codes and scammers copy and paste the same source code for every scam. once they identify that, they infiltrate these groups where
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creators of coins talk to investors. their mission there is to expose them by asking questions like why haven't you disclose your identity or why haven't you locked in the liquidity which means you can pull out the money investors have poured in it any time. the reaction they get from the creators of these coins will serve as a gauge of this is a real coin or scammer then they go onto twitter and they give you a warning. that's the satisfaction they get after they are victims of these scams. it's getting these people out into the open to prevent other investors from being scammed. matt: thank you so much. this is bloomberg. ♪
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mark: this is bloomberg's first word news. germany has taken a step closer to making covid-19 vaccines compulsory as the incoming chancellor put support behind
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that move, part of a tougher line by european leaders as the pandemic spirals out of control. the chancellor called for a parliamentary vote on this before the end of the year. the european medicines agency says choosing expedited procedures to approve new versions of the vaccine should the current ones prove insufficient to fight it. >> vaccines are and remain the key and we have four authorized vaccines and for more currently under review. we know that viruses mutate and we are prepared stop since february last year, we put in place guidance to allow companies to fast-track their adaptations to the vaccine. mark: data is expected from key companies such as pfizer in the next few weeks and modernity top executives reiterated that the omicron variant's many mutations
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suggests new vaccines will be needed. a french far right pundit declared his candidacy against president emmanuel macron saying he wants to save france from decadents and minorities that oppress the majority. he has been sliding in the polls the last two weeks after a series of missteps including giving the finger to a woman in marseille. barbados cut ties with its colonial past and queen elizabeth officially becoming a republic for the first time. several leading dignitaries attended the ceremony that included fireworks and celebration in the streets. the push to become a republic started more than two decades ago and last month, the islands parliament elected its first ever resident in a two thirds majority vote. global news, 24 hours a day, on air and on bloomberg take, part
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-- powered by 2700 journalists and analysts in over 120 countries. this is bloomberg. matt: welcome both are bloomberg and bnn bloomberg audiences. here are the top stories we are following. powell rattles markets, the fed chair sparked a sea of red and the stock market, sending the indices lower by 10 basis points. we will keep you up-to-date on all the action. plus, the omicron variant poses a big risk to the economy and we will discuss how the efficacy of vaccines could affect the fed outlook with the barclays head
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of macro research and as the variant underscores the need for vaccines, possibly new ones, possibly not and we will speak to the coo of red to discuss the company's efforts to make sure everyone is able to get a shot who wants one and hopefully some people who don't should get one as well. all that and more is coming up but let's check what's going on in the markets. the s&p 500 is down 1.6% as the dow falls 680 points. canada is down more than 2% step the nasdaq which had been gaining this morning as other equity indexes fell is now down as well, 1.6%. the 10 year yield is dropping. people are buying bonds but the yield is falling, now below 145.
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the vix is rising to more than 28 and we see markets really moving on not so much the omicron variant has fed chair howells testimony. you may have expected him to come in and be dovish considering the possible risk posed by this new covid variant. nonetheless, his tone sounded rather hawkish. he wants to get on with the inflation discussion and we are looking at all of the market action. >> it's a double whammy for risk assets. you have the omicron variant and specifically executives from adjourn is saying we have the capacity to build a vaccine that caters to this but not so much are we worried about the
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efficacy of the current vaccines and how long it will take to turn this around. and at executives concerned about the timeline. on top of that, you have the fed starting to say we are looking at tapering bond purchases just a little bit faster. they have been very clear about tightening and tapering and separating the two but for the markets, is one in the same because after tapering, it's been more speedy and you will potentially get that rate lift when the market is addicted to extremely lower rates. matt: even if the market is pricing in sooner hikes than previously anticipated, they are buying bonds right now. there is a little bit of a freak out tray going on but you don't see it happening in the dollar or bold. >> it's in the commodity story. it comes down to the growth concerns. this is the long and of the bond
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market that's getting a low. you really want to keep in mind that a lot of the cross as said correlations are disconnected because any risk off environment like friday, the dollar should be getting a strong bump but it's not showing any momentum in any direction. matt: to be fair, the. -- the bloomberg dollar index is pretty punchy already. it's amazing to see not just the moves in nymex below $65 per barrel but brent crude is down to 68 right now. they are really taking ahead and investors are buying the euro even as germany heads toward a locked down. there is so much action today and we are at levels on equity indexes that are below friday's close. >> is this a buying mentality or
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a pulled back as we know we've been famous for. some are seeing a drop. you are starting to see equity volatility catch up with the bond volatility and the equity volatility that has been in play before this new variant was first discovered. matt: even i was surprised listening to jay powell's testimony and it didn't sound like jay powell much of the time and that's what has caught the market slightly off guard. coming up, we will get more reaction to the fed chair powell's remarks and we will cover the markets wall to wall
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program. we speak with the head of macro research at barclays next. this is bloomberg. ♪
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>> the economy is very strong and inflationary pressures are high and it is therefore appropriate my view to wrap up the taper of air asset purchases which we announced at the november meeting, perhaps a few months sooner. amand welcome back to bloomberg markets. jay powell causing a lot of controversy for the markets.
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is there overreaction happening? what powell went on to say is yes, we see in elation and will stop saying transitory but we need new jobs data and there is a variant of foot. >> i think this was a significant change in tone and i would argue that it started mid last week when a fairly noted changed her tune. the most interesting part after that is the testimony moved trade past that. this is a change in tone and i don't think it's wait and see. the fed is putting this front and center. he said he needs to ensure price
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stability for expansion. amanda: therefore, where would you put in the risk of the new variant? the fed may be playing catch up to what the market already thought which is that inflation is here and it's taking hold and transitory is a meaningless term. if the fed is changing its tune, is it doing it in time for the variant to derail all economic growth? >> we look at it on three metrics. the first is transmissibility, the second is severe disease outcome and the third is vaccine evasion. it is early yet but what we can see right now is that this variant is acting similar to most late cycle variance which means it is highly transmissible and vaccine efficacy might be less than we have seen.
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the severe disease out come so far at least seems to be pretty low. matt: i thought the market when we came back on monday buy the heck out of that dip clearly it's early days and we take everything with a grain of salt. it seems to be fairly mild. you've got this super dovish fed which doesn't know what raising rates means. all of a sudden, that change. jay powell sounded positively hawkish today. isn't that was freaking out investors?
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>> keep in mind that the way the bond markets have reacted all year is the fed got inflation wrong. hard core inflation became two point 4% and then 3.4% stop the way that markets responded to that is by saying the euro central bank will have to hike much sooner but the endpoint, the end of 2024 in the markets mind, is still very low. the reason why the tenure treasury is a standardbearer for fixed income is still stuck at 1.5%. it's because markets believe this is a quick hike in the cycle but also pretty darn shallow. amanda: i would like to bet you that these markets are positive
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territory by the end of today. to my ear, jay powell did not say anything he hasn't already said stop he said the taper might end a couple of months sooner but he already said june . matt: it was his tone. amanda: he is not adding anything the market hasn't priced in. to me, it says this is being priced in. maybe people are selling because they are higher valued and they don't go up forever. >> it was largely priced in four days ago. it was just before thanksgiving, the chances of a may hike were 75%. they are lower than that now become a -- because of omicron. he said a few months earlier and
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that means at least three months earlier. he is probably looking at finishing in march. that means 90 become 60 becomes 30. they have the option to hike is in early q2 next year. matt: what do you think about the terminal rate? one member of the senate said he thinks the 10 year could be 3.5% in three months. the senate is probably the worst body to look to for financial forecasting, even worse than the fed, but do you think this fed could hike to 2% at the end of this cycle? >> i don't think we go above 2.5% stop we will be closer to 2%.
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if in the strongest inflation environment the world has seen, the bond market doesn't expect the terminal rate to go above 1.5% stop when everything else is the same, the base price increasing should decelerate. i don't think the bonds will change their minds if the rate changes. amanda: we appreciate your time today. coming up, the center of some of the market turmoil is the omicron variant, highlighting the importance globally of vaccine equity and we will discuss that coming up next with the president of organization read who ensures what countries have access to the vaccine.
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amanda: this is bloomberg markets. we are keeping our eye on stocks today. we are seeing traders boosting their wagers on interest rate hikes. to what extent was this priced in. the north american markets, toronto is doing the worst because it's laden with cyclical things in the commodity space. how much of this is hairtrigger traders and investors because the market is priced so high? matt: it's also a market that's producing superfast margins in terms of corporate earnings. we have to remember the under pending's -- the underpinnings are stronger.
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i love listening to powell's testimony even though i had one eyeball on the dow jones industrial average while i was listening. i thought he sounded like a different fed chair. he seems to have changed his tone and turned the corner, turned the page, however you want to call it. i think the market is just a little freaked out by the fact that they thought they had this support, not just a plunge protection team, but basically a jack. it doesn't seem to be there at the moment. amanda: i guess we will see if the markets bounce back. i think by the end of the session or by tomorrow this is over because this -- even if you get to a 2% rate hike in a couple of months, that's incredibly low. we have to keep our eye on is
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the variant that is the underpinning that started all of this last friday. it raises a question about vaccine equity, access to vaccines. one organization is turning its attention to the distribution of vaccines. thanks for being with us. this had been a subject before. there are no borders on a virus. do you think there will be a change in the sense of stepping out -- stepping up efforts to share vaccines? >> thank you so much for having me. there is a lot of issues that need to be resolved. vaccine equity is at the top of the list. we know how to do this and when
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-- read has been fighting aids for 15 years and there are many lessons we can learn. one of the important lessons is avoiding complacency. we've been hearing about covid and it has sucked the oxygen out of the room especially when you think about the fight against hiv aids which is not over. the covid fight has been stepped up in the issue is that there will continue to be a variant until we have an equitable response. testing to vaccines and treatment and that was -- and that's what red is here to do. matt: are you for a zero covid policy? it doesn't seem like it's possible with the kind of virus that covid is. >> i like to leave the policy to the guys and girls in d.c. we are here to get companies
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engaged in the fight stop we know how to do this and we know that companies understand the importance, or i hope they do, if nothing else but self-interest. watching the clip of where the market will go when a variant comes in, that will not change so for companies out there, we've got to think about a global, equitable response if we are ever going to have covid behind us in the same way we are trying to get hiv behind us. amanda: are you optimistic that this change is that? we might need to tweak vaccines. >> let's get those vaccines where they are needed most. we are seeing than less than 10% of the continent of africa is vaccinated. meanwhile, we are doing boosters in the states so we need to make sure we are getting vaccines where they are needed the most
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but read is out there talking about it and helping ensure people understand the importance of vaccine equity and giving people opportunities to engage. that's what our campaign is all about. we are excited about getting banks on board. it's allowing people to turn their credit card reward points into cash donations that can be used to get those vaccines where they are needed most. matt: thank you so much for joining us. i am matt miller as we watch markets come down, this is bloomberg. ♪
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mark: i am mark crumpton with first word news. mark meadows agreed to sit for closed-door questioning by a
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house committee investigating a january 6 attack at the capitol. meadows is among those instructed by mr. trump's lawyers to defy congressional subpoenas. he has already turned over some records and engaged with the committee through his lawyer, forestalling any potential contempt of congress action. the european union has recorded at least 44 confirmed cases of the omicron variant in 11 countries. all people affected are asymptom atic or showing mild symptoms. oxford says there is no proof that it will defeat the vaccine but the vaccine will struggle against it. the variant could fuel a fresh surge in infections with severe consequences. the united nations says hunger in latin america and the cariha


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