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tv   Bloomberg Markets Americas  Bloomberg  January 10, 2022 10:00am-11:00am EST

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johnson. ♪ alix: it is 30 minutes into the u.s. trading day on this monday, january 10. here are the top market stories. goldman sachs sees the fed moving four times this year as the hawkish predictions mount and push the yield to prepend met highs. tech -- to pre-pandemic highs. tech's terrible, no good monday. risk on assets getting trashed -- getting crushed. novak djokovic gets the green light to compete in the australian open. we will talk to an all-star lineup of drugmakers to get their take on covid treatments and shots. we will talk to the moderna ceo, roche ceo, and merck ceo all in the next two hours. if you are long tech, it is a no
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good monday for you. guy: plenty of people out there expecting we would start to get a bounce in tech. that is not happening. i think is down to these calls we are getting. jan hatzius at goldman sachs, we will talk about that. bill dudley as well earlier on talking about the fact that we have a long way to go in terms of what the fed has got to do, and for a monday morning, that is spooking things. alix: we were below the 100 day on friday. we have gone below that for the nasdaq 100, but we are not seeing that this time. i wonder how much technical selling pressure we are seeing as we had to the next moving average. guy: absolutely. the bmo ceo talking about the fact -- alix: are you a little ok -- are you ok? you are a little for clamped. guy: not covid. let's be clear about that. there's lots to talk about, so i need to maintain the voice. alix: let's have guy take a
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swallow and we will go to one of the top stories, and that is goldman's call, saying they see four hikes this year. they rode in a nude over the weekend that we are pulling forward our runoff forecasts -- they wrote in a note over the weekend that we are pulling forward our runoff forecasts. we no longer think the start of runoff will substitute for quarterly rate hikes. we continue to see hikes in march, june, and september, and we have now added a hike in december. >> i think they should go faster than what is priced into the market. obviously it is going to depend a bit on how the economy people's, but my best guess is they need to do at least 45 rate hikes this year -- at least four or five rate hikes this year. alix: that is our question of the day for market participants. does the fed hike four times this year? katrina dudley, franklin mutual
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strategist and portfolio manager, joins us now. just the fed hike four times? katrina: i think it depends on if we get another variant. the fed is obviously very far behind the inflation curve in terms of rate hikes. so i think consensus is now trending towards four, on the more hawkish tone. the dovish side will be if omicron and another variant continue to derail the economy. in particular it is derailing the return of workers because obviously those poor and teen requirements may go into the office and back into the factories -- those quarantine requirements may go back into the office and back into the factories. guy: is that negative anyway for stocks? if it is not a growth drag and it potentially pushes up inflation, that is going to mean the fed is really in a quandary
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and potentially has to act even faster further down the road. none of that sounds like a particularly good outcome. katrina: i think we are in such a different environment. we are looking at a fed that needs to hike rates at a point in time where our debt levels are a very high percentage of gdp. we are well over that 100%, so we are not used to being in this situation. previously when we have looked at rate hikes, we have seen the fed hike rates. obviously you have the impact in terms of the flows through the budget. we tighten some of our federal budget mechanisms, and that slightly alleviated inflation, but i am not necessarily sure we are going to get that this time given the high level of debt to gdp, but also just given the mood in washington and their willingness to just keep spending and spending, and a lot of that spending is inflationary. we have talked a lot about supply-side inflation, and that is what we have seen previously.
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we are now starting to see the services inflation, and coming on the heels of that services inflation which is very much wage driven, it is going to be the inflation driven by owner occupied rents. it has got to flow through the owner occupied rents, so i think we are going to see inflation for longer here. i don't necessarily think it stays at the very high levels, but i don't see anything under 2% for a long time. alix: where do you hide out in that scenario? katrina: i think there's some places where the adjustment has already taken place. have a look at the nasdaq, for example. it is not just this year where we've had a lot of carnage. his four out of 10 stocks in the nasdaq down over 50% from the two week high. but the areas we like are areas where you are seeing things like chemicals and cyclical companies, we think they've got a very good tailwind.
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obviously we have been talking about fed spending, but there is still a lot of spending to come in 2022, and we think that will drive higher earnings, so a special comment -- a special chemical company we think has a low valuation, that is what you need to look for in this type of market. guy: in this type of market, at what point do you start thinking about buying bonds? they have not been a buy for quite some time. if we get to 2% on the u.s. 10 year, is that a buy? there's a lot of discussion about the pace of rate hikes here, but there seems to be a lot of confusion still about where the terminal rate is. how far does the fedco? -- does the fed go? katrina: i think they will be much slower them anticipate because of this tension we have given levels of government debt. at the moment, if you are buying some of these notes, you're
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getting negative real yields, so basically you are not even covering your rising costs. that is a very different set up in the equity markets, where obviously you have that degree of inflation protection, so i am somewhat cautious about entering into the bond market, and particularly into the longer end of the bond market, until we piece -- until we see something of rates in the 3%, 4% range which is a step up from where we are. alix: so opposite question, at what point do you buy technology? katrina: i think there are pockets of technology where you have had competitive threats, and those combined with the valuation risks we have seen from rising rates or the expectation of rising rates has caused these stocks to sell off. for example, we like the payments space. it is an area of people have not got very concerned about competition. we have done our homework. we think that there is a real
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opportunity there. in terms of going into the tech, i look to see real earnings. i like to see real cash flows. so i am not going to be in that space for some time. guy: having a tough day in london today, i can tell you that. thank you very much indeed, katrina dudley of franklin mutual advisors. thank you very much, indeed. as katrina was talking about, but has happened with omicron absolutely front and center in terms of market debate right now, in terms of the direction the fed is going to take or the speed the fed is going to move at. biofarma heavy hitters joining this program. we will be joined by stephane bancel, moderna ceo, and bill anderson of roche pharma. this is bloomberg. ♪
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♪ guy: live from london, i'm guy johnson. alix steel is in new york. this is "bloomberg markets." moderna says it has signed vaccine purchase agreement worth $18.5 billion for this year. joining us is stephane bancel, moderna ceo. happy new year. thank you for your time today. we always greatly appreciate it. the big question that everybody is trying to figure out right now is what are we going to be doing throughout this year in terms of providing protection against omicron or whatever comes next. you are already talking about a
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fourth shot that is going to be specifically tailored to omicron. talk me through how that is going to work this year. when you going to start production? when are we going to start seeing it in people's arms? how do using this year is going to work in terms of the variants we are going to see? stephane: thank you so much for having me, and happy. i would say first let's focus on what should be done right now, and that is to get the data coming out of the u.k. as well as the u.s. with omicron. if you do not have your brewster, get one today. the data is very clear, people with three vaccinations are less lifted to get hospitalization and get deaths. so the current vaccine works very well. singapore announced last week they look at the moderna vaccine and the moderna vaccine provided best protection, which we are
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very proud about. for the next of the year, we need to wait for data to be able to announce what will be the 2022 booster strategy. we are moving very aggressively. we believe in a couple of weeks in a clinic, with an omicron specific booster, we have already considered the alpha and the beta and the delta booster. we will look at combinations as well because we are trying to protect people against omicron. [indiscernible] in terms of virulence, a more violent -- a more verlander -- a
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more virulent strain would be a concern. we have new capacity coming online in q1 -- for boosters for 2022. alix: when you wind up looking at the next booster we are going to have to get, is it going to be a catchall kind of booster? it feels like there's two stories out there. stephane: i think it is too early to tell. it is highly possible that omicron takes the pandemic into an endemic setting, which means the people at risk will need to be vaccinated or boosted to stay healthy and to stay away from hospitals. that is what you see with flu, with rsv. that new booster for 2022 will
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not be in any mutation booster because the virus is not there yet, but we are really looking at the data and we believe the omicron vaccine will be in that booster. we think it has to be. so we need something else that teaches the human body a mutation that is not an omicron, but that is very possible in delta. we will know in a few weeks when we get the data, with a mix-and-match of the blood sample from different vaccines. guy: sir andrew pollard, the head of the u.k. committee on vaccination and immunization, was interviewed recently and said the following. "we can't vaccinate the planet every four or six months. it is not sustainable or
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affordable." what do you say to that? stephane: as we mount more and more of an immune response, every time you get a booster you improve your immune a spot -- your immune response. they are boosting the antibodies, teaching new tricks to their immune system, but i think we might end up in a world where it might be where people get an annual booster. what we do for moderna to begin more affordable is we are working on a vaccine using mrna to combine flu and covid into one booster that people like high-risk medical workers, immunocompromised, people with cancer, they can have one in the winter and don't get sick. alix: when do we get data on that?
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stephane: we have data on flu already, or flu vaccine phase i, the best vaccine that is already on the market today, and we have several ideas on how to keep improving vaccine efficacy. fall 2023 would be the earliest. guy: what is happening with transmission at the moment, and one impact -- and what impact are the vaccines having on transmission, particularly omicron? there's a huge debate about vaccine mandates, particularly in the united states. the argument surrounding those mandates is that it reduces transmission, that it helps society at large. do using the current round of vaccines are delivering that when it comes to omicron? stephane: it is very clear from the data, and i think the data out of the u.k. is the most telling because you were ahead of the u.s. in terms of omicron, the efficacy against infection
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person-to-person is lower with omicron then delta or alpha or even beta. what is very important for society is that the protection against hospitalization is still very high. if you look at the data, it is mostly unvaccinated people that are hospitalized and are dying right now from covid. there's good protection of transmission, but it be waiting over time because of that genetic drift, which is why having a more i'd acted used are for 2020 to -- a more adapted booster for 2022i think is the right answer. alix: if i look at the stock, you are down 58% from the high we saw last year. i am wondering how you interpret the share price fall. are we looking at a situation where there is lack of confidence in moderna and its
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vaccine? what is the readthrough for you, and how do we tweak it for the next phase of the pandemic? stephane: i think what we are focused on is driving sales and driving the company. if you look at a review of q4 earnings, we will get them in a few weeks, but already we have 70.5 billion dollars sales for the first quarter -- we have $17.5 billion sales for the first quarter. that is not bad. we have still a lot of these questions on going, so i would expect that those numbers are going to go up. people are thinking the pandemic is going to go away and they won't have any more sales, and i think this is the place where people are not understanding that the endemic setting is going to be here forever. this virus is not leaving the planet. mrna vaccines are the solution,
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and the real world evidence is showing that the moderna vaccine has very strong protection and duration of protection. and then it is about 40 products in the pipeline, so if you years horizon, i think they are going to be really happy running stock at this level. guy: there has been such a focus on what you have been doing in terms of the vaccine. using people are understood -- do you think people are understanding and appreciating what you are doing elsewhere? do you think there has been, to a certain extent, a refocusing of attention within your business, within the health care sector, on the pandemic for obvious reasons? do you think 2022, 2023 is when we start catching up in other areas of therapeutics? stephane: very much so. when i talk to investors, the only questions i get are around
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omicron and covid, for most investors. thankfully, we are very high quality, long-term investors. as you know, this is a very long term driven investor, and they ask about covid, rightly so, but -- [indiscernible] -- that includes flu and covid and all of those things in the market. what could be the price of such a product in a normal setting where they are willing to pay for value, not below pandemic price? in the u.s., it is cheaper to buy a mood or in a vaccine then a covid test. how any covid -- a moderna vaccine that i covid test? how any covid tests have you done so far?
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alix: for me, not for guy. they are free. we are just about 45 minutes into trading, so we want to get a check here because it is a real bloodbath when it comes to tech. nasdaq 100 off by almost 2.5%. the moving average, about 200 points away from that, but we are below the 100 day and picking up steam to the downside, which usually rebounds off of that, but we haven't yet today. s&p also down almost 2%, and you are seeing all of the sectors now in the red. financials tried to make a bid for it, but that did not work. the worst performing stock on the s&p's take-two after making a solid bid for zynga. why? the yield. 1.48% is where we print on the 10-year. biotech got really beaten up last week, one of the worst starts of the year and quite a long time. i want to take a look at the tech titans 30 from the dow jones.
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it is pretty much flat. roche is about 6% of this index. you have to wonder where you go for safety. many people wind up looking at health care is of those spots if you are going to be developed to you are seeing in a growthy, techy names. guy: it is amazing to see what has happened in terms of the dispersion we are getting. let's carry on the conversation about what is happening within the pharma space. this week is going to be dominated by all kinds of pieces of news, but the j.p. morgan health care conference is going to provide us with a lot of guidance as to what this year is going to look like. william anderson, roche pharmaceuticals ceo, joining us now from that virtual jp morgan health care conference. roche pharma is part of the parent company roche's switzerland. it has 100,000 employees globally. it is a big part of what we are talking about here. welcome to the show. thank you very much for your time. we really appreciate it.
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i want to pick up from where we were talking with stephane bancel just a few moment's ago. where does growth come for your business in 2022? bill: thanks very much for having me on the show. we are really excited about 2022. roche is the largest r&d investor in the world in life sciences, with over $13 billion annual investment in r&d. we really see growth from a number of sources. we are continuing to fight the pandemic, alongside our colleagues from across the industry. we have delivered over 21 testing solutions from roche diagnostics. we have delivered two of the three leading therapeutics. we are fighting covid in hospitalized patients, as well as outpatients. when we look at growth in 2022, our big sources are going to be more from our ongoing pipeline of cancer medicines and medicines for other serious diseases. alix: a lot to unpack there.
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let's start with covid testing for a moment. that was all the rage for the last three weeks. how do we get tests into the hands of people in the u.s.? give us a sense of how the covid testing business is doing and how you think distribution and manufacturing is going to take ways over the next year. william: certainly omicron has presented an unprecedented challenge from a demand standpoint, but i think when you look at what the industry has done to ramp up the volumes, it is extraordinary. before the pandemic, there were some millions of these sorts of test performed each year in the world, and now we are talking about billions, so this caleb has been tremendous, and i am really proud of the heroes we have a manufacturing and engineering who have been responsible for this. i think the peak with omicron is probably happening, and i think
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we should be in a better position in the world should be in a better position with tests as we hope forward -- as we move forward, but the volumes today are so extraordinary, i just don't think there's any scenario in which we could have produced enough. guy: do you think we move away from pcr to more lateral flows? this is an engineering question more than anything else, but given but the volume -- but given the volume we have, they need to test quickly and accurately so we can deliver therapeutics early on and make sure we treat people correctly, using we find ourselves in a situation where lateral flows become the go to rather than relying on pcr? william: i think in terms of volumes, we can expect to see a lot more rabid antigen tests. this is available for people to do themselves instead of having to go in and see a doctor at a
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health care facility. so i think that will be the mainstay. the gold standard in terms of efficacy will remain pcr. for example, our test that was just recently approved relative to bcr had 90 7% sensitivity and 100% selectivity, so we are talking pretty high standards for a self test as well, and we are pleased to be able to deliver tens of millions of these tests even in january and the u.s., having just been approved. alix: there's been questions as if rapid tests at home are sensitive enough for omicron to catch it. guy and i had this conversation on radio, about how the u.k. does nasal and throat swabbing together. we only do nasal here in the u.s. i wanted to get your perspective on that, if we need different kinds of testing to encapsulate some of these variants. william: i think the data is still coming in on that. i think it would be very hard to make a call. certainly, the more intrusive the test is, the harder it is to
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get people to comply and to do it because of there's always a trade-off in terms of convenience and catching 100% of cases, but that is something we will have to continue to navigate. guy: let's turn back to what is happening in terms of other drugs and therapies you produce. we are seeing the health care system once again not being overwhelmed, but being close to overwhelmed by what is happening with omicron. there are tens of thousands of people on either side of the atlantic currently. that is just what we are focusing on in this conversation, but globally the numbers are even bigger. do you think we are in a situation where that is once again distracting the health care industry from dealing with other areas, all of the other areas that so dominated prior to the pandemic the health care setting? what are you seeing in terms of demand for hospitals for other
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drugs and therapies? william: i think you make a really important point, and we certainly saw this early in the pandemic. we saw a disruption even of cancer care. we are seeing that the world is being affected certainly by omicron, but there is still a lot going forward. it is not only care for covid that is happening. i also think it is important to note the time factor because in south africa, from the time that there was no omicron to the peak was only a few weeks, and within a couple more weeks, it had come off the peak but something like 60% or 70% lower. i think we can expect that what we are experiencing today won't be what we are experiencing even into her three weeks, so i think based on that, there should be a lower impact on other care areas. alix: let's get more specific and talk about roche's alzheimer drug.
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biogen's foray into this was very controversial, now are they -- now there are questions they pushed it too far, too fast, and they won't get the take-up they are expecting, insurers won't touch it with a 10 foot pole. for your alzheimer's drug development, how will you do things differently to avoid what happened with biogen? william: i think it is really important that the alzheimer's community has very clear answers on efficacy and safety. we have the largest phase three development program in the world. we have two large phase 3 studies that are also the longest. we should have definitive answers for physicians, for people with alzheimer's and their loved ones. we will have that data toward the end of this year, and we are really looking forward to bringing that to patients. guy: what lessons have we learned? what are the silverlining's that
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have come out of the pandemic -- the silver linings that have come out of the pendant -- the pandemic? the conversations i have had with people in the industry have said there are a appreciations for partnerships, for trying to harness the ecosystems we make to treat all kinds of things. how do you think the industry has changed, and what does it mean for what you do at roche pharma? william: i think we have learned a tremendous amount about how fast we can go with innovation. we have been very committed to delivering new medicines for cancer, for multiple sclerosis, hemophilia, many serious diseases, will but we have learned -- but what we have learned during the pandemic is how we can use remote work, virtual partnerships to greatly accelerate things. the speed at which we stood up the studies to bring new covid therapies to the market, we can
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use those for other therapies. we also learned that we can enroll patients from different backgrounds come from diverse backgrounds. we ran a study in patients who were really underrepresented in traditional clinical studies, and african-americans, and hispanics. we even enrolled sites in africa in really short order and got a very strong results there. i thing we learned that you don't have to do something different. you have to be innovative, and you can actually accelerate div element at the same time that you have more inclusive development. alix: it was a real pleasure to talk to you. we look forward to catching up with you. we will continue our coverage of the virtual jp morgan health care conference, coming up in the next hour. we will speak to the ceo of merck therapeutics, and an agreement with pfizer for billions of dollars.
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we are just over one hour into the trading session in the u.s. it is a brutal, ugly day. the nasdaq down over to present. abigail is -- over 2%. abigail is here with the movers. abigail: the s&p 500 down one point 7%. the nasdaq down two point 3% after the nasdaq fell more than 4% last week, its worst week since march 2021. the selling of last week continuing. the transports down 1.9%. the point is there is nowhere to hide. the cyclical rotation into cyclicals and values we saw last week out of tech is moving into all parts of the market. if we going into the bloomberg terminal and take a look at the imap, even the banks, last week we had energy and banks up sharply, about 7% as folks moved out of tech and into those cyclical sectors. today you can see all 11 sectors are down in the s&p 500. the top sectors are the true defensive sectors, utilities,
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health care, staples. those are high dividend yielding sectors, so when rates go higher, and. those dividends should be less attractive, but that is not the case because there is some sense of risk off. on bottom, your communications services, your consumer discretionary. apple, twitter, amazon. those are the big decliners right now, down more than 2.3%. the big reason has every thing to do with yields backing up in a massive way. over the last week, you have the 10 year yield up recently, just touching 1.80%. take a look at the 10 year real yield, which factors in inflation, up an extra ordinary 30 basis points. folks are really afraid that rates are rising, and the bigger fear that at this point, it has to do not just with the idea that rates are rising, but that rates will keep rising because of the fed happens to tighten, we could've something similar to what happened in 2014, 2015, and 2016, when the balance sheet flattened out.
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we see this massive trajectory is going up. the fed is indicating maybe that is going to change, so if we do go flatter, what will that mean for risk assets? basically, i brutal repricing of risk on this monday. guy: does it flatten or does it actually go down? i think that is the question everybody is trying to figure out what is that equivalent to in terms of the number of rate hikes? do you have to add an extra one in on the idea that the balance sheet is going to start to be rolled out -- rolled off a little more aggressively? i think there's a lot of things here in terms of that balance sheet rolloff, and what tolerance is for market volatility. lots of things still to figure out. thank you very much, indeed. let's go from the fed to politics. house speaker nancy pelosi says there is an opportunity to add covid relief aid. here's what she told cbs costs "faced -- cbs's "face the
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nation." rep. pelosi: they have not made a request for more funding, but it is clear that the opportunity is there, and the challenge that is there from the resilience of the virus. guy: given the inflationary backdrop, how politically possible do you think that will be? the president is also focused on what is happening in geneva, focused on russia and what is going on with ukraine. joining us to the with all of this, annmarie hordern, bloomberg washington correspondent. you know the story and russia as much as anybody in easy -- in dc. we've got secretary blinken watching very closely what is happening. we are going to get a read out maybe later in the day, later on in the week. what is your sense of where the administration is in terms of these talks and what we should expect from them? annmarie: yesterday we heard
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from secretary of state antony blinken on the sunday shows, and he basically said don't expect a lot out of these talks. it is atmosphere of escalation with a gun to ukraine's head, meaning, what can you really expect given the atmosphere going into these talks and where president putin, what he has created in terms of this buildup on the ukraine border? so don't expect a lot of hard details to come out of it. it really is just the start of the beginning of these talks between the two, and we have the u.s. and russia today, and then it will go to brussels and geneva -- to vienna as well, which will include nato members and european allies. what we do know is that the u.s. has said no to two of russia's red lines, but two of what putin says he wants done. one, that ukraine could never become a member of nato. he wants a veto power on that. he also wants troops on europe's
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eastern flank, and that is something they too also doesn't agree with. so there's a question as to whether putin has created an event where these negotiations are failed before they even really begin. alix: i think them and everyone else at the same time. it is going to be a really interesting week to look behind the scenes on the rhetoric there. here in the u.s., that is undergoing the situation when it comes to policy and politics on an international level. here at home, president biden is taking a tougher tone against republicans. asked week we heard him blame donald trump directly for the attack on the u.s. capitol a year ago. pres. biden: for the first time in our history, a president had not just lost an election, he tried to prevent the peaceful transfer of power. he refused to accept the results of an election, created and sprayed a web of lies because his bruised ego matters more to him that our democracy or our
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constitution. he can't except he lost. he's not just the former president -- can't accept he lost. he's not just the former president, he's a defeated president. alix: wendy schiller, brown university professor of political science and director of the taubman center for american policy joins us now. tough tone from president biden last week. tough agenda ndc and internationally as well. does his tough rhetoric and his lean to the left in that respect make his job easier or harder to execute on his agenda? wendy: among democrats, and certainly trying to get his approval rating among the party base, this is the campaign joe biden. they have been chomping at the bed. they wanted him to go tough. they want him to go after trump. he's been reluctant because he's been trying to pass a legislate of agenda. now he has passed really
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important things, the infrastructure, covid relief early on. nonetheless, he's accomplished some things. now they want to see him engage the republicans in terms of rhetoric and mobilize their own base for 2022, and that speech last thursday was a pretty good start if you want to see that campaign version of joe biden again. guy: what does that do in terms of the democrats? does it unite them? wendy: it certainly tries. the house has to make a decision. are they web to sacrifice 2022, lose control of the house, but gain more within their democrat party? the republicans have done this. the trump wing have taken over the party, at least in the house and somewhat in the senate. that is what progressives are looking at, is the landscape. they want these programs. they want what they want. if they can't get it with this version of the democratic party,
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they will do every thing they can to remake it so they can get it in the future. that is very risky, but on the other hand, if you really believe this is the future of the party, then this is the only way to mobilize the key constituencies, and you're going to go forward with it. it is a very difficult terrain for biden to manage his own party, much less dealing with the gop. in terms of foreign intervention, a very small appetite for intervention among the american public right now. alix: the university of chicago did some research on the anniversary of january 6 and showed that half of the people who broke into the capitol arrested so far were business owners, ceos from white-collar occupations. doctors, loggers, architects, accountants. that is not the overwhelming opinion due to to get that opinion you tend to get. i wonder if the shift -- overwhelming opinion you tend to get. i wonder if the shift to the left will alienate those people
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who still believe the election was stolen. those are not a french population. -- a fringe population. wendy: we always thought of this wing of the republican party as less extreme and be less avid for trump, and what we have seen is that that is not happening. at least among men, suburban voters who are men, they are turning even more towards trump and this wing of the party. that is new for the republicans and new for our political dynamic, so that is a pretty big concern for the establishment republicans, as well as the democrats, going into the senate races in 2022. the second thing, that is a risk you take. do you continue to try to win back those voters, or do you decide that mobilizing your own base, particularly at the state level, particularly in light of some voter suppression laws being passed around the country, is that more essential to
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democratic party success in the elections themselves in november? it is a gamble, and it looks like right now, given the president's turn on voting rights, heart visiting day coming up, that the president is going to take a gamble. guy: can i come back to a point you made earlier about interventions? around 10 minutes ago, talks between the united states and russia concluded. there is clearly an appetite to take action in washington if russia were to go into ukraine in a more forceful way. we don't know exact what that could look like, but whether received some sort of invasion, there certainly seems to be language coming out of d.c. that there will be a significant response. that response will not involve boots on the ground. what do using the biden adminstration would be looking at? how tough do you think it would get, and how do you thing that will play domestically in terms of u.s. politics running into the midterms? wendy: i think the options are
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harsher sanctions, i can ask actions, and of course, that hurts europe and other european economies, and probably impacts the stock market. so americans will get indirectly harmed i any economic fallout from russian sanctions, and russia is still a trigger between republicans and democrats because republicans feel trump was unfairly treated in this russia connection and investigation. i think most people agree that didn't go well, and we've got a covid pendant that will subside, inflation has got -- inflation, we've got health care shortages. we've got to focus that agenda and make sure that agenda relates directly. guy: greatly appreciated. thank you for the analysis,
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wendy schiller of brown university. what are we going to talk about next? the u.s. up in court hearing arguments on president biden's vaccine mandate today. we are going to discuss all of that with lawrence gostin. that conversation is next. this is bloomberg. ♪ ♪
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alix: this is "bloomberg markets ." coming, rob davis, merck ceo, will be joining us at 11:30 a.m. in new york. this is bloomberg. ♪ guy: the timing is a little unclear, but we are potentially expecting the u.s. supreme court decision on president biden's vaccine mandate today. let's talk about what we should expect and what the them occasions of this ruling will be. lawrence gostin, georgetown professor, joining us
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now. thank you very much for your time today. what are you expecting? lawrence: i am not expecting anything good. if i was a betting man, i would think the supreme court will uphold the mandate for vaccines among all health facilities in the country, and i think it is likely that they will uphold that. but is also highly likely they will strike down the much more important mandate, which is the one for large businesses, businesses with 100 or more employees, from osha. it depends on how broad the language is, but it could have a hugely devastating effect not just on biden's vaccine strategy , but also the wider regulatory
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state and the federal government's ability to protect americans' health and safety. alix: some of the arguments on the flipside is that the vaccine mandate does not cover current boosters, and it feels like boosters is really where the conversation is at. there's also the question of if it eventually covers boosters, it is not realistic for everyone to get a booster every four to six months, so doesn't that kind of defeat the purpose of a mandate like this? lawrence: it is a good question. i think for right now, osha is only requiring the regular vaccination schedule, but we used to call for vaccination. in the future, it might require that you have an up-to-date vaccination, which is the's current policy, that you should be up-to-date, which would include a booster. but this is an emergency
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every -- an emergency to marie standard. i don't think we should follow a slippery slope worry about it. right now, what we do know is that even with two doses, you are really substantially protected against serious disease, hospitalizations, and deaths. this is really vital to president biden's covid-19 strategy in the united states. guy: that's fine. if the objective of the mandate is to prevent hospitalizations or deaf, that is one thing. but if the objective of the mandate is to prevent transmission, which feels like a more logical objective here, then i think you have to question the ability of the vaccines, particularly of only two vaccines, to deliver that. if we are trying to stop transmission, does mandating two shots really work in achieving that objective? lawrence: that is a really
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extraordinarily important question. the game has changed. public health experts need to say it as it is, and the truth is that while vaccines, full vaccination used to be pretty effective at preventing transmission of sars-cov-2, that is not the case anymore with the omicron variant. this is such an incredibly infectious variant, probably the most infectious on the planet today, that we are really not going to stop the spread. that is the honest answer. but what we can do is slow spread because vaccinated people don't spread as much, and more importantly, what we can do is save lives and save our health care and hospital systems in the united states. anyone who is not vaccinated
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today is taking a huge risk with themselves and with their families and their coworkers. alix: professor, we really appreciate your insight. this will not go away in terms of the lawsuits. we will have more. we are picking up some serious steam to the downside. the nasdaq 100 very near its 200 day moving average. some health care names are in the green, but it is a brutal, ugly day. all sectors in the red as the yields continue to push their way higher. this is bloomberg. ♪
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guy: it started off looking a little shaky, and the foundations really began to rattle as the day has gone on
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and the u.s. has come into the action. the stoxx 600 done by 1.64%. one sector in positive territory, that is the banking sector, and it is only flat right now. health care, luxury stocks are down pretty hard. the technology sector is where the real pain is being felt. euro-dollar still north of $1.13, but down around 0.3% today. the action in the european bond market is at the front end of the curve. that is what is happening with the german two-year yield. the selloff there continues. are we going to make it to zero on the tenure -- the 10 year? we will carry on the conversation. freddie lait, latitude investment cio, that is coming up. this is bloomberg. ♪
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guy: monday, january 10th. european stocks near session lows. there's a lot of conviction on the downside. the countdown to the close
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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 into the close here in europe. ugly session when it comes to equities. stoxx 600 down by 1.6%. we are trading one point 78. the action very much at the front end of the curve, the selloff definitely happening in the two-year portion of the german curve, but we are watching to see as well whether or not we are going to get to zero when it comes to the tenure bun -- the 10 year bund. alix:

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