Time to recover. We have doubt. We expect choppy conditions to come in the months ahead. Choppiness heading into the next couple of quarters. Jonathan joining us now is priya misra. Fantastic to have you with us on the show. Clearly this recovery is stalling and you are getting incrementally more bullish on treasuries. Is that right . Priya i am. The data is better than my we were looking for. We were looking for data to improve and it is coming in better than that. In the backdrop we have rising covid infections in the u. S. And globally, which means we have to live in this environment for a while. That will hurt the opening, perhaps delay, slow down. It will affect consumer confidence. Event. A very big a different policy proposals on both sides. That is going to make risk assets hard to price. Things look pretty positive in august. We are near the lower end of the trading range in the 10 year. Are going backe to that 60, 80 basis point range. Jonathan there is a ton of risk on the horizon. It is the pandemic, the crisis, the struggle to normalize. We are going to face an extended period of time below potential, capacity. Inflation expectations are drifting higher. If you are below potential capacity for an extended amount of time, that is a. Isinflationary world why are we pricing in higher . Policythe fed will make to inflation. We actually think that they will linksuce Forward Guidance to inflation. The market is not pricing in inflation expectation, but the spread will let the economy run if inflationblink moves higher, which is more of a risk premium story. Look at real rates. They are near alltime lows. If the fed had this in mind, they would not have hiked. Inflation was below the 2 level. Jonathan they have been talking about the symmetrical approach to inflation for a while, have been conditioned by their experience in the labor market, that they should wait for unemployment to go lower. Maybe target something closer to 3, 4. How do they formalize that in Forward Guidance . Do you have an antiof what that looks like in the coming meetings . Priya where they have been more clear is on the inflation front. I have more confidence that we are not hiking between 2 and 2. 25. It all boils down to what is structural unemployment. Probably 4, 4. 5. Officials are making the economy run hot for a while, actually draw people into the labor market. They are not just targeting the Unemployment Rate but bringing people back into the labor force, minorities, lowwage workers. Whatever threshold it is, it will be much lower than what it was in the last. Jonathan what im curious about in the years to come is in the previous crisis, the United States was able to engineer recovery. Europe could not do it, japan could not do it. Every time we end up in a crisis like the one we are in right now, we add debt to recover from it. The tolerant for higher Interest Rates seems to diminish over time. Re we facing the same situation in the u. S. . Priya i think we are. When people tell me more debt means higher rates, actually think it means lower rates. I think this is arguing for lower real rates. Pessimistic, but we needed more fiscal support after this pandemic than after the lehman crisis. We have had a global disco stimulus aspect as well. I Hope Congress is talking about another plan. They need to go much bigger. That is the way you get more debt. Central banks everywhere are willing to take these down. This is the time where they should be doing stimulus to build a longer bridge to the other side. Jonathan what should the stem this look like . Isnt about size or composition . Enhanced Unemployment Benefits will expire. We have tremendous support of consumption in america. In the back end of the summer, there is a fear of hitting this air pocket of demand. What do you see in negotiations . Priya the two sides are pretty far apart. Payroll tax on one side, the democrats do not want that. Providing more of an income cushion for those that have not gotten their jobs back. The talk was in april, we would all be back to work in july, but we are not. As states are reopening, we see whats happening with the virus. It is certainly putting a slowing on the reopening. Providing more support to businesses that are cashstrapped, providing for the consumer, that has to be a part of this to be effective. The market stimulus is there. You look at how equities are. They dont need to do much for the markets. They need to do things for the real economy. Lending programs have not really taken off. This is about getting cash to businesses and consumers. Hopefully, that is what the next package looks like. Jonathan lets get to the final spread, the week ahead. Eu leaders wrapping up stimulus talks in brussels this weekend. Congress getting back to work in washington, d. C. On monday. Ecb officials speaking dropped the week. On thursday. S friday, u. S. Market pmi and flash pmis out of the eurozone. Audience a the condensed version of real yield. If it is a success, we will roll something out much longer, but we have to do the rapidfire round together. Three quick questions. Yield i0year believe we have lost priya misra. So im afraid we are going to have to go. Priya misra of td securities. That is unfortunate. We will continue the coverage right here from new york city. This was our best try and bring back the program. From new york, this was bloomberg real yield. This is bloomberg. Vonnie this is Bloomberg Markets. Im vonnie quinn. Coronavirus is affecting everything from education to media from the way we work. Will hear from Michael Lomax of the United Negro College fund, randi weingarten, president of the American Federation of teachers, and scott crowe. First, lets get it quick check on the markets. The s p 500 up. 2 . Certain stocks making big moves. The dollar index is weaker by. 4 thanks to a stronger euro. European leaders meeting this weekend. We will talk more about a rescue fund. Gold up. 6 . Lets get an update on all the Market Action that we saw this week with scarlet fu. Scarlet i am keeping a close eye on tech. Tech is one of the worst performers, down 1. 3 . That has been the case over the past couple of days as well. The commentary about how these megacap companies are dominating the s p 500, perhaps too much concentration. Tech then, you have seen shares underperformed. 500 is a chart of the s p infotech relative to the s p. That sharp rotation into cyclicals and you are seeing it happen again. Respondents said that they felt long u. S. Tech was the most crowded trade out there. You mentioned some big movers. Netflix at the top of the chart. The company reporting earnings that for the most part were fine for the Second Quarter but the outlook missed the mark. 2. 5 million subscribers is what netflix expects, only half of what wall street anticipated. Viacom, theyfox, are down today over concern about marketing budgets. Media is a laggard for the week, along with chip companies, retailers, Software Services as well. Mostly this week is about banks, stayathome stocks. As we head further into the earnings season, what should we looking for . Scarlet big Cap Tech Companies start reporting earnings. People are looking for the kind of reception it gets as a precursor to how they will respond to tech earnings. Microsoft really gets going next week. Ibm, texas instruments. A couple of other names there as well. Twoon was due to report weeks from now but it got pushed back to the end of august, so not clear why that is but we know that last time around amazon announced it was spending more money than investors had anticipated, certainly to bolster its Delivery Network also tohe pandemic, but keep its warehouses clean and employees safe. Vonnie i imagine there is a lot to do for companies this quarter. Scarlet fu, thank you. Ahead, funding schools of historically black universitys. We will discuss that with Michael Lomax, president and ceo of the United Negro College fund. This is bloomberg. Vonnie this is Bloomberg Markets. Im vonnie quinn. Couple of headlines. One out of new jersey. Virus transmission rates have risen to the highest level in weeks. A headline out of new jersey, virus transmission rates have risen to the highest level in weeks. Yellen also urging substantial fiscal support to state and local governments. Helpedmer fed chair stewart the u. S. Through the last financial crisis. She and ben bernanke er speaking to a house are speaking to a house panel. Meantime, its a time of increased tension in racial equality. Our next guest has worked to improve that his entire career. Michael lomax is the president and ceo of the United Negro College fund. Ofn worked off and endowment 100 million or so, they have Just Launched a new fun with the goal of raising 6 billion and 10 billion for scholarships and other programs. Great to see you. Give us some statistics about the United Negro College fund, how you fund students, and why it is so important this funding keeps rising. Are a 76yearold organization, we raised 750,000 that first year. We have raised 5 billion over those 76 years. We have awarded scholarships to over 500,000 students who have gone on to earn a college degree. We have also supported historically black colleges throughout that time. Annually, we support students to the tune of 100 million a year. We are also seeing 50 of black students are the First College attendees in their home. Its incredibly important to keep those numbers rising. We have seen some other historic black colleges and universities go to the bond market recently. Why is that not a good idea for these particular colleges and universities . Bondel when you go to the market, you get good rates but you are borrowing, and you have to pay that back. In the very volatile times like right now, it may make sense if you can get a lower Interest Rate and you already have debt, to refinance. We think borrowing based on enrollment projections in 2020 may be challenging because you are not sure whether you will be able to maintain the enrollment, whether enrollment will decline. We face an existential moment for black College Students who are going to college because the black community has been hardest hit by covid, severe unemployment, students who have been going to college may not be able to return to college because they dont have the resources to pay tuition, or they are the only breadwinner left in the family. Is working tocf do everything that we can to ensure that when our colleges are able, they open with strong enrollment, that their students have the resources to be able to remain there, and that they get the education they need to not be the first in their family to go to college, so that they become the first of many in their family that go on to, which, and they get all the benefits of a college education, which includes getting a better job, joining the middle class, and not being eligible for telegrams, which is the number 1 pell grants, which is the number one way that the Government Supports the lowest income students. Hbcus students who go to are low income, and 50 of them are the first in their family. Alsoe many of them competing with liberal schools that have billions in endowments michael they are not really competing. Thatlite schools, the ones set the highest selection standards, they are skimming a small percentage of black students. Historically black colleges have had the highest enrollments they have had in generations. When you add onto that predominately black institutions, schools where about 60 of their students are africanamerican, then these account for almost half a Million Students attending college. There are a whole bunch of lowincome students who are trying to break the cycle of poverty by going to college, but very few of them get accepted to the most elite institutions with the big endowments. Those institutions have the lowest savages of low income students. Even their black students are wealthy. Mainly in the bond market, some institutions had a lower credit rating, which makes it more expensive. Competing for philanthropic dollars, talk about your new fund. Uncf inheard about recent weeks because of reed donation but it is a tiny drop in the donations that are out there. Michael there is a huge amount of wealth in america right now, it is highly concentrated. The generosity has been largely focused on elite private and Public Institutions that dont really serve a low income, firstgeneration black student. Areinstitutions there 101 historically black colleges and universities. They enrolled 10 of the black students going to college. But they produce 20 of the graduates and 25 of the stem graduates. They are high impact institutions. The student to graduate from there, within a decade after graduation, are earning around 71,000 a year. They are engines of social mobility. These institutions have not been the darlings of the philanthropic world. Saying is invest in historically black colleges. Uncf is creating a strategic Impact Investment fund which will do the following. With morelp scholarship support for the lowest income students so that they dont have to borrow and debt. Te with heavy and we are going to build endowments. American colleges and universities are some of the wealthiest in the world. Harvard university alone has a 40 billion plus endowment. When you add up the endowments historically black universities and colleges, it is less than 10 of harvards endowment. We believe we have to challenge american philanthropy. The wealthiest, the most successful, and the most generous, to begin to invest in those institutions that are the workforce, serving the black community, moving them out of poverty and into the middle class, helping them to be the last in their family to be poor, and the first to be college graduates. Vonnie tell us when you are targeting, 6 billion, 10 billion over the longterm, and you have just started on this. Give us an idea of what sold this to Reed Hastings, if all of that was not enough . Michael Reed Hastings is one of the most innovative people. E is a contrarian he always takes the opposite position. With one another on the board of Charter Schools for the last 15 years but we have also built a strong friendship. Patty quinlan, his wife, and Reed Hastings, are committed to ending inequality in america. They believe education is the best lever. They have supported k12. Patty has been involved in criminal justice reform. They understand historically black colleges are making a big difference in the lives of their students. They can make an even bigger difference if they have the resources to help those students. Morehousem to visit college last year. They decided to make an initial to morehouse, spellman, and others. They are already seeing the return on that investment. Memphis alson in made a 40 million gift to at historically black college. Vonnie we will follow this as it goes along. Get in touch with Michael Lomax to make your donation. The United Negro CollegeFund President and ceo. Thank you. T and ceo. Thank you. Mark im Mark Crumpton with bloomberg first word news. Supreme Court Justice ruth eater ginsburg has been getting treatment for a recurrence of cancer. She is receiving chemotherapy for layins on her liver. She says treatment has been successful and she has been able to keep up with her work and says she is fully able to stay on at her post. As her vibeburg bouts of cancer amid a slew of Health Applications in recent years. Across the United States, public theyials are warning that could impose lockdowns again if people dont act to hold the research of coronavirus. Angeles,s of los miami, and houston have offloaded the prospect. Persuasion is not working to stop the record numbers of cases and deaths. A new poll says six out of 10 americans disapprove of the way President Trump is handling the coronavirus pandemic. According to the survey by the Washington Post and abc news, more than half of the public says they disapprove strongly. In march, more than half approved of the way the president was dealing with the crisis. New york ready is ready for phase for every opening starting monday, according to mayor bill de blasio. Indoor dining, museums, and malls will remain closed. It comes as hospitalizations has dropped to a fourmonth low. Statewide, more than 400,000 infections have been reported, the highest figure for any state. Global news 24 hours a day, onair, and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im Mark Crumpton. This is bloomberg. Amanda im amanda lang in toronto. Welcome to Bloomberg Markets. Vonnie im vonnie quinn in new york. We are joined by our bloomberg and Bnn Bloomberg audiences. Here are the top stories we are following from around the world. Reopening schools in a pandemic. We will discuss the troubles schools, teachers, and parents face with randi weingarten, the mannequin federation of teachers president. Shares of netflix and drop after delivering a technet subscriber forecast. We will break down the companys earnings. Asices face record vacancies employees shift to remote work. We will discuss the commercial Real Estate Market with scott crowe of centersquare investment. Eyes on the