Tk, welcome back. Tom it is good to be here. It is jobs day. Im ready to go. I had my wheaties. Jonathan is that a serial . Tom it is a cereal. Lisa had fruit loops. Lisa lucky charms. Jonathan they should come with a health warning. Lets talk about amazon and apple. Apple meeting expectations after the close. Amazon is higher by 9 in the premarket, beating a raise from amazon. Evercore taking the price target from 150 to 190. Tom amazon with the pandemic and secondguessing about there is a national crisis, we delivered the boxes, we need to died in and to what we need to do. They did. Baeza went to run the Washington Post and the new guy came in. The new guy is the first real glimpse of postcovid amazon. Jonathan evercore calling this quarter and unlock for the stock. As of the stock needed it given the doubledigit gains we have had so far. Lisa that is the reason why it is bolstering the Overall Index returns even though apple is more soggy and losing is 3 trillion moniker im looking at them cut 27,000 people as well as increase some of the revenue and this is what i think is getting people excited. Tom i agree with that. And it is not just covid. While i was ill i spent time reading about the cloud and a lot of this amazon and google and microsoft is the cloud boom and you saw with amazon numbers yesterday. Jonathan you did not see it with microsoft. There were worries about the forecasts and he saw it from amazon, the difference between the two there. If you check out the treasury market, it is five 45. Every single day the yields higher. 10 year yield at 419. Tom you have covered it. What struck me was all of the different spreads that really have not broken down except threemonth 10 year. The tbills compared to the note. Lisa the 10year is the want to keep watching. It is the benchmark. It has been so consistent and working out at a time where we are not just talking about more supply but we are also talking about a Balance Sheet that has been steadily by the Federal Reserve. Who are the buyers going to be . Tom immediately hes looking at 6000 square feet. The answer is i am sorry, the 30 year Mortgage Rate broke out to a new high yesterday. 7. 39 . That is a big kind of number. Jonathan we can talk about new york suburbs later. Futures on the s p positive. On the s p building a losing streak coming off the back of a three day losing streak going into friday. Lisa the main event 8 30 a. M. , nonfarm payrolls. We have this new data dependent supposedly and were looking at the Unemployment Rate. Im watching the average Hourly Earnings and where they come in. Is this enough . Is this what the fed needs to see because it is still higher than it was before the prepandemic disruption. Saudi arabia and russia having an allnight review of the oil Market Conditions. Theyre discussing with opecplus nations. It is interesting because of yesterdays ongoing, or prolonging of the one million barrel a day cut that saudi arabia is doing one billion barrel a day cut that side of arabia is doing. Saudi arabia is doing. I think it is interesting. We do see a bit of resurgence in certain pockets and i do have a handle on that and they are hinged there, the trade lines and other things youre looking. Tom this basically an apple play . Lisa that a lot of trains and classic industrials. Tom we interviewed him once. I gave wonderful interviews. The wonderful woman from doj who wrote snowflake and was not happy about some of the questions i asked her. Jonathan that is nice that is on the record. Tell us more. But maybe you have told us enough. Steven wieting, joins us now. 8 30 a. M. Is where we have to start payrolls in america. What are you and the team looking for . Steven i think we have a reasonable consensus around a 200,000. Jobless claims have stayed low, the possibility of a stronger report is there. I think what we need to see is whether or not a slowdown is intact, and whether or not the gains we have seen in the labor force can persist while we have a slowdown. That would be the immaculate story but what is going on in the bond market, not pricing a collapse in the economy. Involves how your yields higher yields. We mentioned the bond Market Selling all. This keep in mind the Federal Reserve is at the top of the funds rate at 5. 5 looking forward. Think it is unlikely this period in which labor market is outperformed the economy, we have been in a slowdown compared to 2021 for five quarters, the labor market is not going to continue to gallop ahead. We think of be productivity gains at a slower gain for labor market compared to the economy. Jonathan how is that consistent with this statement we have seen in the yield curve . If you take out todays price action and chop out the yield curve, two year yield has moved a single basis point, the 10 year of more than 20 on the week. What explains that, how the yield curve has evolved . Steven there are several factors including japan contributing to some global tightening. A very big contributor to the global yield environment. It is scaring everybody a bit. I think the bond market deciding to the value. We have to remember the 10 year yield has anticipated fed rate cuts. We think we will get them. The fed on forecasts for 2025 for example. The yield curve has always flattened with the tightening cycle. It is always statement in a fed easing cycle. Steepened in a fed easing cycle. If we are getting through this point which the fed is simply done tightening, is not as good for the long end of the bond market and the short end privately sustainably fund rate for the tom there is thousand people have never seen this yield environment and the basic belief is a Financial System where going to die with higher yields. You and i live the higher yields decades ago. Explain how we are all not going to die with a 4. 5 10 year yield. Steven the Housing Market coming to grips at base level of demand, you mentioned at rates, it is going to hurt, but the Housing Market it is really be change in Interest Rates, the impulse to not down the Housing Market. We have gotten used to this. Where we came from in 2020 where it 10 year yield at 0. 5 , that was an aberration. We have never believed we are going to a 1980 14 yield, we do not have decades of inflation and easing Monetary Policy behind us. We had this period of covid and 25 money supply back in 2020. It is not there now. My supplies contracting. The money supply is contracting. The fed is at 5. 5 . I think were going to find these yields is about as good as were going to get. Lisa do you pile into long bonds now . You pare some of your holdings in equities as you try to understand where we are headed and captured the yield . Steven we did a quite a bit of this in the last year or so, and we are not adding to fix income holdings. We are overweight at these yield levels. We think they will be very Solid Holdings for the next few years. But theres not a lot of ability here for us to think the long end of the bond market outperformance. The yield curve steepening trend is already anticipating the fed rate cuts. The sweet spot, if you average out different maturities, we think is around five years, and there you have limited duration and sometimes you want duration for a part of your portfolio, but you have a lot of yield compared to what rates will be sustainably the next five years. You could get across Investment Grade securities. You could build a portfolio at 6 yield across different types of credit quality, still Investment Grade, or get 5 for the next six months and that is a different story. We think in the end you will want more duration in treasury bills but we are not taking massive bet on the long end of the bond market collapsing. Jonathan what did you learn from apple and slowing sales . What are you sick away from a report like that . What do you take away from a report like that . Steven is idiosyncratic for this issue. The main issue here, investors have the compartmentalize, you have highvalue, but incredibly strong durable exciting innovation in american tech stocks but for us, wealth building portfolio should be more than 30 of your total equity portfolio cross tmt. That is where we are now. You think about the rest of the world equity markets, which are trading cheap, hold your tech, but we think their opportunities especially outside of the u. S. And it is smaller Growth Stocks in u. S. Those are things were adding below average valuations. Jonathan thank you. Going into payrolls, the number we are looking for, the estimate 200,000. On unemployment looking around 3. 5 expected to stay rates on our survey at 3. 6 . Apple at the moment down by 1. 9 . The take away from apple overnight slowing sales growth, disappointing relative to expectations. Lisa even though they had betterthanexpected quarter when it comes to china. There talking about optimism and india. How much is this the Global Smartphone market that is contracting . We saw the from qualcomm significantly. They cannot get out from under it even as they consolidate market share. Tom i was surprised no one mentioned this is q3. This is q3. This the quarter supposed to slow down because they have a june and they roll out the september. Is a new toy. Heres a new product. Steven wieting says here is the fact, their of 8 between lousy june quarter and when they launch the next toy. 8 to here to september is the average over the years. Jonathan ive never been to one of the launches. Tom i do not have a black turtleneck so i cannot go. My cpa told me i wouldnt qualify for the erc tax refund, so i called innovation refunds. Their team of independent tax attorneys will work with your cpa to determine if your company is eligible. [whip sound] take the first step to see if your Small Business qualifies. This is a very sad day for america. It was also very sad seeing the failed and decay and all of the broken buildings and walls and the graffiti in washington dc. This is not the place i left. It is a very sad to see it. This a persecution of a political opponent. Jonathan that is the view of the former President Trump after appearing in washington dc in federal court. Payrolls around the corner. You know the estimate, 200,000. The price action looks like this. On s p 500, equity futures slightly positive by a 31 . Three date losing streak into friday and trying to bounce. Trying to help the balance is amazon which is up close to 9 . In the bond market, yields, higher by a couple of basis points. 419. Pick your poison. The data, probably not. The downgrade, a shrug of the shoulders by most people. The treasury supply . That is the real story coming out of the treasury. Tom that is the real story. The interest expense of the federal government is something as well. This a look at their. I would focus on, you go to bdm screen on the terminal, raw round it up to 6 . The bottom line is we are not yet to the cusp of rounding up but we get close. Lets turn to politics. The politics of the u. S. Of america. We do this so much for international audience. Wendy schiller has advisors with Brown UniversityAlfred Taubman center for american politics and. We have few months of indictments created what is the difference we have cumulative indictments. There have been three and there could be four come what is the difference, the distinction . Wendy it appears of the audience. For trump supporters, very loyal people, this is emboldens them, keeps them more loyal. Their team is losing and theyre going to be on that team and another is going to shake them. They get more emboldened but it continues to turn off independent voters who were the swing voters in the key states former President Trump loss in 2020. The audience that gets disgusted by three indictments the audience was leaving anyway. They are not going back to trump by the trump base is more emboldened and wants to defend their president. We will see the donations keep coming in, smart money donations he is using to pay his defense funds, that could be more expensive. Does the money keep flowing in . Tom i find fascinating the zeitgeist the last 24 hours. There was one idea of how small the trump audience is yet very loyal. What are the other republicans doing . Are they waiting . Are republic is moving to independents . Are they moving to a relative conservative like biden . What are the republicans doing now that i have had it have had it over the indictments . Wendy they are holding their breath and think and what do i do. Republicans are really good about coming home to the party nominee. The exception was 2020 but typically even when there is a like in 2016, republicans come home to the nominee and they get out and vote in president ial elections. The question is will anybody including desantis come up a challenge to president enough to worth investing in somebody else with the money or with your vote six months from now. I think that is a stance right now. Is this person going to make it . House republicans are with trump but the actual rankandfile we have to wait to see for six months. The rotc this meant be the nominee again and kb president again the reality this person could be the nominee and could be president again. Lisa she says she does not think donald trump will be the nominee in the end and essentially people will move away from him as it becomes clear he will not win the general election. From your vantage point, what is the Tipping Point and who is the likely person to emerge when yesterday we were talking about tim scott and how he has become the wall street darling, at least when it comes to fundraising . Wendy elaine has been in politics for a long time and it knows what she is happy about it. I have shifted. I thought he would not get the nomination and i did not see and the door to vote in the primaries to get do knock him off of his parish. C the we have to see the iowa polls. We have to see if you can get any momentum even if he is losing to trump, desantis, momentum would reignite his campaign then it becomes the obvious option but he has reliabilities. Im not sure the likability factor for desantis get him over the top and defeats trump in the primary. Lisa i think about the entire page for President Biden to run again that he is the only democratic candidate who could win against trump. Set at a time when grassroots fundraising is lackluster breed hes not getting small donations that indicate a healthy Popular Campaign and popularity ratings have flagged. As it look less likely he can win reelection does it look less like the equipment reelection if he is gets anyone other than trump . Wendy we look at the economy which at the moment seems to be settling down. The doom and gloom and i prediction seems to be diminishing. Inflation is under control when youre from now and voters are going to say, things are pretty good. Eggs are pretty stable. If trump is the nominee things are pretty stable. Jonathan wendy schiller, thank you. On the indictment we have seen so far this week. The drama goes on. Tom it is the overlay. It is unprecedented 1, 2, 3 and whatever we see out of georgia. For international audience, we have never been here. I can think of scandals over the years. One isolated thing. All of watergate which are member. Which i remember. There is no comparison to what we have right now. Jonathan we just went through the 1, 2, 3. We are talking florida, washington, new york. Tom georgia i believe would be four. I think the nature of it is something that is truly unprecedented. Jonathan one think we have to focus on is the treasury supply story. It got fuel earlier this week that the treasury had to come out and lift the estimate for issuance in this quarter froms 733 to one trillion. What others are trying to figure out is this self easy, we know interest cost are of, Something Else happening here . Tom i think it is valid and what i will point out is the idea of suddenly. Im not saying we are addicts and a leap, but you have a set of moving parts that could change rapidly where suddenly is august or end of the fiscal year. Jonathan the bond market welcome. Close to 420 on the 10 year. Lisa it is been a slow grind. Then suddenly really reached a level with the pinched announcement that crystallize a lot of things in peoples mind that got the attention of risk markets. It keeps climbing even admit this. Romany buyers are not coming in yet. Jonathan which has turned the story up. Equity futures on the s p positive by a third of 1 . On the u. S. Economy, the job report still to go. Sarah house of wells fargo coming up next. The first time you connected your godaddy website and your store was also the first time you realized. Well, we can do anything. Cheesecake cookies . The chookie manage all your sales from one place with a partner that always puts you first. we did it start today at godaddy. Com hi, im jason. Ive lost 228 pounds on golo. So when my doctor told me i needed weight loss surgery, we did it i knew i had to make a change. Golos helped me transition to a healthier, sustainable lifestyle. Im so surprised just how crazy my metabolism has fired up. I have a trust in golo cause i know it works. Golo isnt like every other program out there, and im living proof of it. announcer change your life at golo. Com. Thats golo. Com. Jonathan payrolls two hours away. On the s p 500, on the nasdaq, and i think we have a countdown clock. On the nasdaq, positive by half of 1 . Apple is down in the premarket. In the bond market, off of the back of the threeday losing streak in the equity market, it is been five days of it, yields up, up. On the two year up by four basis points. This is come at the long and, almost exclusively with higher by more than 20 the 10 year. Tom the real yield has gone from 150 to 181. You are correct that all of this is out past 10 years. 10 year is two beeps . Hardly anything. Jonathan the supply story from the treasury earlier this week. Well talk more on that later. A rare piece of decent data out of germany. An upside surprise on factory orders. The euro against the dollar 10945. The currency pair about unchanged. Coming down to the payrolls report at 8 30 a. M. Eastern time. A range of views on the street. Citi at