>> friday, the 27th of january, european equities are drifting into the end of the week once again it is our story, single stocks, the earnings narrative. next week, that's about the macro. ecb, bank of england, but this week we are still dealing with earnings. we will deal with the details and work our way to the next hour. the countdown through the close starts now. ♪ announcer: the countdown is on in europe. this is "bloomberg markets: european close" with guy johnson and alix steel. guy: let's give you numbers,

let's tell you what is going on, 4:54 is where we are trading on the stoxx 600, it has not been a bad week. we are up by .1% in aggregate. it is fairly patchwork, a tight picture here, because it is down single stocks and countries affected by that. this down by 2.7%. i'm gonna are you a load of numbers. if you look at the vestas numbers, they are still dealing with the fallout from contracts -- from getting contracts wrong is probably the best way to put it. the markets are looking through ash beginning to look to this idea and thing is getting fixed and corrected. stocks down by nearly 3%. lvmh with the big story this time yesterday. the stock has eased off a little bit with just -- we are just shy of 800. the numbers yesterday look fairly good, particularly looking forward in the market.

-- forward, and the market that fairly badly. you saw a slowdown into last year and pick up in the beginning of this year. the market focused on the former yesterday, beginning of today they focused on the latter. we are even stevens are now. the stocks trading 798, higher again early on. alix: heading into the numbers, it is no surprise of -- no surprise of getting an easing. s&p is down .1% but the economic data is interesting and set us up for the soft landing scenario. incomes rising, savings rising, spending is slowing, core inflation slowing a bit. you are seeing of thanh of lowe's into europe, still trickling in somewhat into the u.s. but the money into spy, the etf that tracks s&p is slowing. that is an interesting fact as well. idiosyncratic stuff, hasbro cutting its work hours. cutting its workforce but the stock is down 6%. usually you cut when the market likes it but because the holiday

season was not great, amex totally different story. i stock up by about 10%. a huge positive outlook for 2023. i wanted to get the stocks next as a readthrough from intel, down by 1.2% but some of its peers were making a run for it. we know that intel was bad so was that good for other chip guys? if they are taking intel's market share or it was this a cyclical downturn for the industry and we are not there yet? intel needs a v-shaped recovery so feeling back some of the layers is interesting here. guy: we will come back and talk about those layers through the hour. let's talk about what is happening here in the u.k., earlier on today, jeremy hunt visited here at bloomberg. he dismissed calls for u.k. tax cuts and push back against the idea of green energy subsidies, think inflation reduction act in america and what europe is planning. he spoke to anna edwards earlier

today. >> for the moment we do not have the headroom for major tax cuts but if i was going to prioritize where i would like to see tax cuts, it would be business tax cuts that give us this speech even more competitive tax. it is important to note that we have the second lowe's business taxes as a portion of gdp amongst major countries so the u.k. is already very competitive but we want to do better. >> investment has been lagging behind in recent years the g7 average but not just the g7 average but all members of the g7. what can you do to close down the gap? what are the levers you would look to be pulling? >> if we become the most productive and entrepreneur a country in europe, this would make us the most productive. i think that would make a very compelling case for investment. that is why i outlined a plan and i think we have an exciting

vision. i think we have the opportunity with our universities, financial services, and technology strengths to be a silicon valley. >> the u.s. worried about inflation, they brought in their inflation reduction act. big subsidies in some shape or form for various industries. you said this morning some elements of the policy worry you. your collie describes the policy is dangerous. what is it that worries the u.k. government about the policy? >> we think if we are going to have the transition tonight zero, we should and if it from free and open trade between all countries that share that ambition. that will mean we get there more quickly, more cost-effectively than if we go it alone. so we have concerns but we are optimistic that the u.k. will play a leading role in the clean energy transformation. we had 40% of our electricity from renewables. we are the second largest in

europe, largest when it comes offshore winds. >> we do our own subsidies though. >> we will announce our plans. i have no doubt we will be able to present a package that makes us highly competitive but i do not think subsidies necessarily the best way. i think what people want is creativity, innovation, ideas, a climate, a regulatory structure that encourages investment. guy: people seem happy with the inflation reduction act. we come back and talk about this in a moment and figure out what the messages from the chancellor , jeremy hunt. a little breaking news and not so good for david sullivan. alix: no, here you go, goldman cutting his pay by 30% to 25 million dollars. the base pay is $2 million and you have the variable of $23 million but that is a 30% pay cut. we are going to go through the

details in a moment and talk to her of this. this is the 2022, and that is pretty interesting. guy: it is. i guess after the share price or not -- reaction, numbers were released and maybe unsurprising, i guess also they are probably working too many violence out there, the big play right now. we will come back and talk to chanelle he about this and get details -- sonali about this. let's talk about the u.k.. we're joined by two guests. fellow, let me start with you, no tax cuts, no subsidies, the u.k. struggles with permitting and that nimby stuff that goes with it. everybody is very happy, very excited about the inflation reduction act in the united states and everyone thinks europe could be doing something similar. what on earth -- where on earth does that leave the u.k. and its prospects economically? michael: -- >> so the u.k. does not have a lot of money left.

there was a report saying the budget walk dog -- watchdog told the chancellor they don't have money to spend so there is not much -- money for subsidies. what he's trying to pivot two is what our existing strengths so he looks at science sector, universities, you mentioned creative industries and he is basically saying the deep capital markets and he says what we have here, a legal sort of framework we have forever, he says we have these basic templates in place that will make the u.k. and attractive destination as we have always been. it really was a reminder, and there's an awful lot more than that. you did get a few comments from groups that described the speech as empty. there really was not much. empty talks about what is left in the bank as well. there are difficulties for the treasury. alix: for sure i get that but how can the u.k. then compete? i get open capital markets and

the idea but we have hundreds of billions of dollars flowing into this kind of investment in the u.s.. the eu has a ton of money there too. how can the eu possibly catch up? >> i think the u.k. has problems. growth. there are lots of causes for that but economists have tried to unravel whether it is to do within for structure, education, social ability, there a lot behind that picture but there's no doubt we have had a lost decade when it comes to productivity growth and economic growth will come from increasing productivity and from expanding the workforce and there, brexit had an undeniable impact, a report out earlier this week showed they lost about 30,000 workers in the u.k. economy. mostly in the low-wage sectors,

hospitality, the care sector, and all of that is having in impact. what can he do? he can conceivably try to ease things on the immigration front. we have a liberal immigration policy but there are fees and bureaucracy associated. it is not going to be a quick fix. i think they are probably doing a lot of the right things but it also takes investment which requires tax revenue and there we have seen brexit they had to u.k. growth which is also hurting tax revenue. all he can do is talk to the considerable expense of the u.k. economy but it is not answering this big question about how do you get to growth, how do you improve the growth trajectory. guy: this should be the perfect environment for brexit, shouldn't there? this should be the idea we are unshackled from the rules that we could do it we want, that we could subsidize industries where we want to, where we are not worried about where brussels

would say. where has not gone? >> it turns out the size of the economy matters quite a, geography matters, trade deals meant to compensate for the loss of eu trade, and i think the war in ukraine has changed the thinking where we are more conscious of the need to be in a more harmonious relationship with the eu than maybe before that and protocol through a wrench in the works and made it hard to do anything that is just going to interfere with the ability to have some kind of resolution to the protocol and get trade back on at least either a more positive footing so they can try to work out kinks of the trade agreement as the labour opposition are promising to do. alix: politically, where does it leave the tax-cut situation? politically, where is that

convio? >> the most important tax cut is to cut taxes on business investment and he said we are incredibly competitive against ocd countries but that is -- ocd countries. we will see a corporation tax from 19 to 25% and we will not be awfully competitive. the idea was to cut investment so at that point, provide investments of businesses were incentivized to -- guy: business thought they were coming. >> they were told they were coming and there was always the implication that would be replaced and it does not look like that would be replaced. there's not money for tax cuts. if i could it would be business tax cuts the ones i would cut so he wants to generate the productivity but says i can't. the big story is stability saying we have the trust budget, we need stability and the biggest tax cut is a cut on

inflation. that is going to come automatically because energy prices are coming down. he's basically saying we have to lean back on our existing strengths. that's what we have at the moment in that is kind of like a sales pitch, he says you forgotten how good we are? so, and invest because the u.k. is a very investable country. alix: stability is not sexy. >> brexit does give you some wriggle room on regulations so little on the edges the solvency changes are going to push more money potentially into the startup scaler side of the economy and he does turn us into silicon valley mark two. alix: potentially. thanks a lot. thank you both much. we want to get to the update on the breaking news. goldman sachs ceo david solman taking a 30% pay cut to 25 million dollars according to the company. sonali basak joining us.

>> there are few things to walk through here. the base salary is usual staying flat, it's a variable compensation down from your record levels a year ago. it is closer to where it was in 2018 when he was about $23 million. 2021 was a record so some pressure on pay was expected but when you look at it compared to rivals, it is a steeper drop. according to sources familiar, this is in line with lower pay when it comes to the partners with senior management of the firm. guy: i guess that is what is happening, is this a message to the troops? >> it certainly is. pay is going down because firmwide, compensation is going to go down. he could not have been clearer, he said it on television at the end of last year, it is very much in line from what i understand. last year was still overall pretty decent year. there were areas that came out

very strong at the company. remember this comes weeks before it is investor day at the end of february where all the tension is if you look at goldman sachs and the path forward for david goldman -- for david solomon and goldman sachs. if you look at what the board said, the firm performance of the the number one thing in comparison to the year prior as well as the strategic evolution of the firm which is in question again when you look at the end of february. alix: so how much does he have to change markets and consumer division to get that? >> he said over and over bringing the platform solution to business at his -- as it is known, they a lot of the market lending business here, but i think i want to point out one more time that we are seeing these banks handle compensation around their ceos differently. jamie dimon package was unchanged, james gorman has fallen 10%, david solid -- david

solomon is three times as much at 30% of a drop to $25 million. guy: you look at the share price -- >> i would take it. guy: nevertheless looking out of the earnings season, that is reflective of some of these pay. thank you very much indeed. bloomberg sonali basak over goldman sachs. coming up, bank of america says investors are piling into european stocks. they are doing so the fastest pace in nearly a year. our next guest will join us, multi--- multi-asset strategist. this is bloomberg. ♪

guy: let's talk about european outperformance. investors have been chasing european stocks, doing so at their fastest pace in almost a year. u.s. inflows remain muted which is interesting according to bank of america. here for perspective is ubs global wealth management strategist. we have seen a startlingly strong start for the year for

european assets. should we be chasing? is this a rally that scott's legs? >> it has been a pain trade for long time, the rest of the world versus the u.s., but we think we are in a period where the rest of the world will continue to be outperforming the u.s.. there's a few factors find it. firstly, this high inflation and high interest rate backdrop is fundamentally better for access for the rest of the world and in the u.s. because the growth vice in the u.s. tends to give underperformance when inflation is high in interest rates are high. the second valuations are clearly lower and the rest the world and u.s. and has not had a dramatic impact in the past. we think that is starting to correct. the third factor is the economic trajectory from here. we are at a point where china is accelerating the reopening and confidence is coming back to europe now that the winter will be passed without a major energy

crisis. at the same time, u.s. economy is slowing from here and that leaves question marks about how the consumer would hold up. alix: isn't this also based on the weather not being supercold and energy storage staying full and warm ukraine that does not continue? >> that is true but we are getting later into winter. we have not had the energy crisis as expected so a lot of investors have been shying away from europe, perhaps nervous about this risk of a deep recession if we were to see energy shortages emerging this winter. starting to think perhaps we will not get the major risk materializing, maybe there's a good time to look at attractive cyclical companies in europe that could benefit from a real x -- a re-acceleration to the summer. guy: there's an argument that says this is hedge fund short covering, reinstate --

institutions not chasing a, what do think of that? >> people have been negative on europe but i think we have had global equity markets falling substantially over the course of the past year and people thinking about using inflection point in 2023 when and where the economies are turning around, there is fundamentally more confidence europe is in a position that they can accelerate from from here and as well as emerging markets which we also like and think there is more potential opportunity there to benefit from inflection points then in the u.s. where there is more uncertainty about direction. >> if we have this fed going 25 and ecb 50, does that change the game? that ecb continues to hike more strongly. guy: investors will focus more on the growth and earnings backdrop in 2023. generally the picture for central banks is fairly clear over the course of the next few months. we might see a couple more increases in the ecb relative to the fed but we do not think that

changes too much on the equity side. people will be looking at that and earnings and growth performers. we think there the emerging markets and europe after that are likely to be seeing stronger growth performance then what is ahead and where the u.s. will be accelerating. guy: in terms of where you think, where does this ultimately take us? where can we -- how much can we close the valuation gap? how much can we close and how far away from the point do you think we are? >> we are expecting an outperformance in the 5% to 10% range and we are not closing that substantial gap partly in place because the cyclical position and the u.s. has more high-tech names and growth names which means a should fundamentally trade at a higher valuation. nonetheless, we think the gap is big enough that investors on a tactical basis to be allocating more toward europe, those investors have been shying away

from making strategic allegations -- allocations toward other markets in china, they can be looking to do that rather than hold on to the u.s. over weights. alix: thanks a lot. kiran ganesh, we appreciated. this is bloomberg. ♪

guy: it's time for the last call or as we call it in europe, the last orders. it's friday night in london after all. time to take a look at the stocks in europe, my kids like super driver, market does it, nearly 80% over today basis. it is being punished today, a signal on the consumer, one worth paying attention to. the wholesale business is underperforming so keep an eye on that. let's take a look at the housing market. high mortgages will hit demand. there's already evidence for

that, a 40% price target. then we have at&t, has it been upgraded by j.p. morgan? the closes next. this is bloomberg. ♪ -- close is next. this is bloomberg. ♪ ahhhhhh filing sales tax returns? ahhhhhh business license guidance? ahhhhhh -cross-border sales? -ahhhhhh -item classification? -ahhhhhh does it connect with acc...? ahhhhhh ahhhhhh ahhhhhh i screwed up. mhm. ahhhhhh i got us t-mobile home internet. now cell phone users have priority over us. and your marriage survived that?

you can almost feel the drag when people walk by with their phones. oh i can't hear you... you're froze-- ladies, please! you put it on airplane mode when you pass our house. i was trying to work. we're workin' it too. yeah! work it girl! woo! i want to hear you say it out loud. well, i could switch us to xfinity. those smiles. that's why i do what i do. that and the paycheck.

guy: fairly uninspiring maps coming through to the close with their it in europe we are fairly flat pretty much across the country. they are all barely budging in terms of the session we see today but on the week, we are higher. we are higher by around .6% on the stoxx 600. it has been a fairly decent five days. we are up at 454. we came into the year at 425, lo actually, for 27 is where we probably came in so we are trading for 54 and continues to be a decent game. we are in the digestion phase about earnings. next week will be big macro we are this week, into the earnings situation. we will continue with that and we can then put a macro overlay

on it. a single stock week rather than a top-down story. let's dig into the sector to break down what has been happening. european chick -- european chip stocks, a really good performance here. st micro is a company focused on the automotive sector and you've got a pick your chip stocks related to the head markets at the moment. that certainly seems to be the narrative. look at the second-best performing sector, cars up by 3.4%. bottom under the market, the defenses are down there, food and beverage down, grocery sector, health care, utilities, that is the defensive end of the european story and it has underperformed while the more cyclical and has done better which i think is interesting in terms of the narrative and tells us where europe is now. let's talk about single stocks and get an idea what is happening, superdrive pummeled, down by 17.69%, causing a big

issue. that is not been punished for that. maybe there is m&a stories to be had in the leaf learning environment. this company up by 6.4%, the private company bausch is taking a decent size stake in this country so maybe -- company so maybe there is m&a to be had. i think the message from consumer is less good. that was the week dominated by single stocks. it does continue next week, monday we get earnings and again there will be a big consumer narrative there, getting an idea of what michael o'leary has to say about what he thinks the wind season into spring will look like. then we get into the macro themes, ubs i think will be fascinating. it will tell us a little bit about what is happening with european banking, a little bit about wealth management and the macro story so that will be an interesting narrative to pay attention to on tuesday, fantastic interviews lined up there. then into the real meat,

wednesday, eurozone cpi, that will be something the market will pay a huge amount of attention to. then to these guys, bank of england rate decision, ecb rate decision, that's the big story of the week. where does the surprise come? is it the bank of england going to any five basis points? is it the ecb continues with the hawkish narrative? i think that will be the story certainly we are watching at the back end of week. alix: it will be fun. maria tadeo will be in for the decision. currently in london. what are economists expecting? what are you looking for? >> what i'm not looking forward to his being in frankfurt in minus temperatures but these of the things i will do for you, for the show, from 7:00 a.m. in the morning until it ends, the bitter end. overall to answer your question,

every economist and ecb watcher i speak to says the ecb has no choice come next week other than height 50 basis points. to answer the question you also have to go back to the december. we talked about it on the show, it was a hawkish guidance and it was mentioned many times the story of inflation was not done and the european central be a hit and stay so the market is so well guided to 50 basis points that they do not do it it would be an enormous surprise. also massive commune occasions issue. i think the meat will be the first conference and whether or not we see more nuance because of the data. a lot of it better than expected where she continues to say we have to go hard because of core inflation. guy: this meeting feels less about this meeting end more about the next meeting. everybody is anticipating we get 50 basis points, maybe we get detail on what the story will be

with qt. it is really about march, does the ecb follow-up with further 50 basis point hikes is the question the market is asking now. are we going to hear a clearly defined narrative that will be the case? >> you nailed it. i want to mention a note from deutsche bank saying 50 basis points, not a surprise, but they expect there will be a signal from the european of another 50 basis points come march. to me, the focus will be the press conference, do we get to nuance in the language or is this going to be the christine lagarde we heard in december, very hawkish. this is not a hit and remove but a hit and stay the course. if you look at the different media appearances she has had ever since the break from december, not a lot has changed in the language. guy: it will be cold, chilly. maria tadeo, breaking it down all for us. maybe they will let her inside again this time. >> i have my ways.

guy: i would seriously impressed -- was seriously impressed you managed to achieve that. thank you very much indeed, looking forward to coverage here let's go to frankford now. the chief european economist joins us at morgan stanley. it's of course the economist and the ecb as well. it is great to get your thoughts on what will happen next week. what do you think will be the message we get from christine lagarde? 50 basis points looks like a done deal for this meeting. what comes after? >> hello from frankford. i can reassure you it is not -10. it is rather pleasant. in terms of sometimes you get sun here as opposed to london where it was rather gray. back to the ecb, we are spec and 50 as maria was saying, i think everybody else is expecting and ecb has been essentially pre-committing to this 50 basis point hike ever since december.

there is not a single governing council member that spoke against this course of action. in that sense, it is indeed the right framing because it is all about marge come all about signaling how are they going to continue. if you think about the framing of the fight against inflation in december, there was a need from the perspective of the ecb if you sought mechanically, taking the projections that show core inflation overshooting in 2025 and was clear more tightening needs to be on the road. the increased the rate pricing from 285i think to 325 by 50 basis points. ever since the economy has improved in a sense that there is less likelihood of a shallow recession in the near term and of course that in itself takes away from the pressures on

inflation, so it does not change the horror story so basically you would want to continue, signal more is to come. alix: more to come, does that mean they can downshift to 25 in march considering the outline you gave us? >> so the messaging that has been receiving, it was clear, marches the next time they can protections and they want to look carefully at that, how the outlook of march looks compared to december. i would not expect an awful lot has changed, maybe a little more headline coming down more rapidly than december was expected. natural gas prices decline further so the energy situation is a little better. at the same time, the economy improving relatively strongly or more strongly than expected in december also gives rise to the suspicion of further wage pressures coming on their way so

i would say yes, 50 in march is likely and is our call. i would also say in keeping with good practice, this continues to be data-dependent and we will reassess the situation in march. guy: what i have been surprise about through this whole process is how well behaved the btp market has been, the italian bond market, spreads have not blown out. looks like the situation is under control. does that give the ecb the green light to go even further? and does it also maybe give us the green light to signal more when it comes to the qt program, given the fact the market is behaving, is this the opportunity for the ecb to accelerate that. >> i would consider this from the respect of the policymakers, my take is they consider this separate.

to the extent this threat rising could be an issue for monetary policy, from the perspective of policymakers, the instrument takes care that risk so they can entirely concentrate on their task on bringing rates to the level needed to bring inflation back. you can have a debate on where that number is and that is the discussion now so we have the easy part behind us so they have reached neutral territory last week and the interview saying this. i would say academically it is like the debate of where his core inflation going to be at 2025, very improvised estimate, as we have a big discussion about this. so how can you have an inflation path eligible he bullish interns

of that but that is realistic in terms of economic backdrop we are having. against that, the side rates go lower. i would say the italian spread is not prominently in that discussion. guy: for now. we will see what happens whether they can deliver on what is promised. you very much indeed, thank you for the economic and weather update. chief european economist over at morgan stanley. let's check where european stocks have wrapped things up. this is a positive pitch we saw few minutes ago so we ticked a little higher but not by much. the ftse, dax, and this are eking out gains. there will be more coverage on the cable show i-5 a club p.m. london time, 12:00 p.m. in new york. we will continue the conversation anna had earlier with jeremy hunt. you can find the podcast on spotify and itunes. alix: coming up, visa had a upbeat quarter. the stock is up by 2.5% right

now and we will have the company's cfo next. this is bloomberg. ♪

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alix: this is bloomberg mark -- >> this is bloomberg markets. coming up, the cftc commissioner joining bloomberg tv at 2:30 p.m. new york time. this is bloomberg. >> keeping you up-to-date from news from around the world, bloomberg learned vladimir putin is planning a new offensive in ukraine. the russian president is preparing his country for a conflict with the u.s. and allies that he expects to last for years. the kremlin wants to show its forces can regain the initiative after months of losing ground. forcing ukraine and his backers to some kind of truce. customers using american express spent a record amount last quarter and the creek car giant critics revenue profit will

surge well above estimates. amex has been tweaking rewards on many cars that helped add millions of new cardholders last year. global news, on-air and on "bloomberg quicktake," powered by more than 2700 journalists and analysts in 120 countries. alix: let's stay in that space, visas stock up by 2.5% and beat earnings estimates and analysts pumping price targets today. a large part of the success across the border, travel. here with more is the company's cfo. good to see you and always good to talk to you. talk about the cross-border travel, a huge gainer for you. can you give me an idea of where the pockets of strengths are coming in where the weaknesses still are? vasant: sure. thanks for having me. business as you know has been in recovery ever since all this started opening and we've seen recovery so far but there is more to come. it has been very strong in europe in and out, our europe

cross-border business is well above 2019 levels and america has been strong for long time and state open through most of the pandemic and was a favorite destination because it was open with restrictions. the middle east and africa benefit from the fifa world cup and in general has also stated fairly open. where we had things still recovering is obviously asia. asia was late to open, asian businesses still below 2019 levels both in and out. most of asia is open except for china. japan just opened up almost 50 points soon after opening and china is beginning to open. the other area not quite back to 2019 levels is inbound travel to the u.s.. that we think is because the dollar is strong. as the dollar has become a bid, we have seen the pickup. so there is room for recovery in the business and still recover left, it is in asia, into the

u.s., and the travel from china. china has opened but it will take time before the travel picks up, airline capacity has to be knocked down, ticket prices, visa and so on, so all in all, some more to come but a lot has already happened. guy: good morning, it is guy. as you highlighted, a lot of the pickup in europe is driven by americans using the strong dollar to travel and enjoy european attractions, does as that reverses, is it basically a zero-sum game, as the dollar loses ground in european stocks over to the united states, do you lose out on the same amount of americans going to europe, does one cancel the other out? vasant: there is a ton of pent-up demand and i'm sure you heard that from the airlines. there is more demand than airline capacity in some cases

on some of these roads. and yes, europe has been a big beneficiary, not just from u.s. travel but we have seen travel from other parts of the world going to europe, perhaps because the u.s. was expensive, yes there will be shifts but we think the demand is so high and there is so much pent-up demand from many years of people owning travel that at least for the foreseeable future we do not think it is a zero-sum game. we are not anticipating across world of business continuing to recover through this year. has room to recover before gets back to what you might call the pre-covid line but we do think there is room for all of it. alix: to that point, we are getting a lot of layoffs in different sectors, it was tagged banks, industrials, now hasbro. i knew that -- i know this is a u.s.-focused question but do you feel the pent-up demand can continue if we keep getting layoffs, if the hard data that starts to rollover, what is your

visibility? vasant: we have been clear we are not economic forecasters. we have stayed out of that comic forecasting business, we leave that to the economists and nor is our business a leading e spending as and will not spend something to weeks from now. i only know when you do it. so i would be careful to say the consumer has been resilient all year in the u.s., consumer spending is up 45.6% over 2019, which is an over trendline and that has been true the entire year in 2022 and has not changed yet. that is what we can speak to, as to what might happen, we leave that to others. we can tell you the consumer remains remarkably stable in their spending at this point. guy: you are in san francisco as

alex said, tech is laying people off, what about you guys, do you feel any need to protect the middle of the margin story. are you confident you have the right set up right now, is there the opportunity to hire more as others layoff? are you -- how are you thinking about your staffing needs? vasant: we have been very disciplined through the pandemic. we do not kick carried away in that we have had a steady increase in investment in our business. hours is a long cycle business, you have to invest today if you want revenues in the future. we did not go overboard, we did not over hire, hopefully. our headcount is off but investments are up but we have started to moderate that p i do not expect us to come back in terms of having layoffs, we will wait and see what the recession is like if there is one. what we might do is moderate the level of spending which we are already doing and also planned

changes we would make an the level of investment in our business, we will continue to invest but might moderate it and postpone things and mike to sized to do prioritize things. i doubt we would have layoffs. what we might do is moderate the rate of increase. alix: so you have levers to pull. at the same time, u.s. things are trained to increase exposure to the parent company. talk about how you retain market share in that environment. are you worried you are losing customers there? vasant: we will keep doing what we have always done, deliver the most frictionless experience when it comes to digitally, make a very secure and reliable, offer a variety of surfaces -- services where you can get your money back, make the security and fraud levels as low as we can make them, and as long as we can do that, we think we perk -- we become the preferred method people use. we have a plan people trust, we have been around for long time, people have come to believe we

never let them down whether it is reliability, security, fraud, or resolution and that is how you win this game, on the merits, on the capabilities you offer, on being a superior service. guy: on that note, we will leave it. thank you much and you for joining us. vasant prabhu, visa's cfo. this is bloomberg. ♪ lomita feed is 101 years old. when covid hit, we had some challenges. i heard about the payroll tax refund that allowed us to keep the people that have been here taking care of us. learn more at getrefunds.com. the first time your sales reached 100k

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alix: stocks getting a nice boost today, amex leading the way for the s&p and abigail is tracking the moves. >> this is an interesting dichotomy because you have the stocks higher but also bonds down. that is the way it should be but over the last year or so, when yields are higher, stocks tend to go down and that is not the case. it tells you investors are digesting rising rates. you can also see the vix or the

fear index, i've told many times it does not measure fear it measures uncertainty, in any case it is lower, suggesting for or uncertainty both a little more than they had been. we are looking at an up january. speaking about, lots of higher sectors on the week, not surprisingly, taking a look at the banks, up 4.13%. yields are higher but not so much higher. the stocks, despite being done more than 7% and the awful outlook, technology and autos, autos up 24 percent, having everything to do with tesla. relative to intel, two of the key markets, the desktop and data center ai dropping on a year-over-year basis. one positive area, autos up but that awful guide for intel. guy: the exposure to pcs, more of the auto expose chip stocks wing well. thank you very much indeed. frank lutz, file ceo joining

balance of power with a little political analysis coming up. this is bloomberg. ♪ when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh

>> from the world of politics to the world of business, this is "balance of power" with david westin. david: from bloomberg world headquarters in new york to our television and radio audiences worldwide welcome to "balance of power." we started in africa where janet yellen is on a 10 day tour to talk about issues with emerging-market debt and also african countries on the issue of russia and