Worst streak since december. Nvidia out with earnings next week. Farfetched is farfetched. Shares plummet after cutting the outlook. China wobbles and i told you i stopped spending. Im alix steel with my cohost guy johnson. Lets overlay one more thing and that is options expiration. You have a bunch of options expiring which will lead to volatility, may be covering from the dealers, and that could exacerbate the moves into the close. Guy absolutely. What a week it has been an next week is jackson hole. Nvidia is coming out next week. We look back and see what has happened. This incredible move in the bond market. European equities have been battered this week. There has been significant pressure but the question is how big is this adjustment going to be . If we are in a 5 world, how long is it going to take to adjust . We have had many years of zero Interest Rates and qe. Alix the fact we are just talking about 5 means we should eventually talk about 6 . Guy maybe. Alix youve got to look forward and how long we get 6 . Guy i get what you are saying but i do not think the difference between 5 and 6 is the difference between 0 and 5 . Everybody thought we were going back to the world we had before the pandemic. But maybe we are going down to the world before the gfc and that is the mind shift that needs to take place. Alix yes, exactly. And then you have to reallocate. But i also wonder do we price it in or out . Is that not the right question . Guy the question i am thinking about is estee lauder. Alix invest in your face. Guy not my face. Everybodys face. The question of the day is not the invest in your face. Are we in a 5 world . Liz mccormick and kay guba join us. Greedy gouda join us kriti gupta join us. Liz the funds rate is over 5 . If we get used to 5 , why cant long end rates go to 6 . A little bit of time over and a little bit of time under weve got to brace ourselves. These rates could keep going higher. Alix kriti, what you think . Kriti i think we have hit the 5 world and we might be in it for the temporary future, but i do not think it will last. When you are looking at the pregfc world it is not the same circumstances. A big part of that question is china. If you look at the readthrough from china 15 years ago, it is not the same as it is right now to the point that a lot of this will filter through the commodity and bond sector. I do not think it is going to last. Guy let me throw another angle on that. Why have yields backed up as much as they have . It does not feel like an inflation story. It feels there are other forces at play that could have sticky effects. This is about deficits and shifts in the labor market. Go back to Government Spending as a big factor. There is a range of other factors that are potentially in the mix to keep yields higher for longer. Kriti i keep saying this, a plumbing issue because there are some any other factors. The fiscal deficit issue, the holdings of treasuries from around the world that is declining from the major players. Japan, china, saudi arabia, it is across the world. Whereas the bigger case for inflation driving yields which you pointed out came down to commodities in the last two or three years when he saw this massive rise followed by fed policy it was because commodities were rising so fast. You can make the argument for the early 2000s. Is it going to sustain . Im not convinced. Alix lets look at plumbing. Maybe i am thinking too far out. They are not going to buy treasuries and then sell it. How much of the plumbing is going into what we saw in yields . Even the bank of japan. How much of that is filtering through . Liz i love kriti but plumbing matters. You may call it technical and whatever but it is really mattering more. You have that risk and all of these forces. What is pivotal is we have rising government deficits, more Government Spending, when the economy is slowing. But the economy is not and they are plowing forward. You spoke to folks in washington. They say the democrats want to spend more, republicans want to cut taxes, that is not going to change. I think that is why people are really concerned. Maybe people are finally worrying about that. You have all of this debt coming and maybe inflation is going to come down. Maybe china weakening will help, but i do not get the sense the fed they are not going to declare victory next week. They have a long way to go before they are clear. Guy essentially we got fewer buyers. For the sake of argument lets assume we are in a 5 world. How much more adjustment to other assets have to make to get back to a world where 5 is normal . Kriti you are not going to let me go until i say it is a 5 world. Guy nope. Kriti when it comes to tech stocks i do not think you are going to see that much of a difference. You do have a catch up because if you look at the winners of the latest equity rally, yes, it is tech heavy, but the losers of the 2022 rally were tech players. They took a proportionately bigger hit than some of their other sector counterparts. I think you are missing that in the other sectors. Look at financials. The loan growth has not reflected the sustainable 5 yield. I could make the same argument for industrials. Even airlines i would argue that are borrowing and need that cash, i do not think they are ready for a 5 world. Alix it depends on when it cracks. Kriti your gas is as good as my guess is as good as mine. [laughter] alix but the domino effect. Kriti i could see that. The way you are going to gauge that in real time because this is something that can only be determined in retrospect, but as close as you get to it happening is how this issuance from these companies is actually received. So far, they are digesting well which is why i think we are used to a 5 world. But get to 6 , as small as it might be, i think it is going to get harder to get buyers for that kind of debt. Guy absolutely. Good point. Liz, is a 5 world good for the bond market . Is this something you should buy the bond market on the back off or is the compensation not there . Where do rates really need to be to attract investors and make them feel they are comfortable in getting compensated correctly . Liz there is a camp of investors someone said this morning they are on vacation for now but they really like buying bonds. These longterm investors have said we have not seen these rates in a long time. You are seeing a good amount of people, especially asset managers, saying we want to snap up 30 year, 10 year, 20 year. Guy we have not seen it during the period between now and the gfc. Does that mean it is still a good trade . Liz thats what i was going to warn. People are wanting to buy. It does not mean rates cannot go higher and not to say that i am old, but rates have been higher. We have to realize that like in the bank of america report that we are in a 5 world, things are changing. Their economists got rid of the recession call. Slow growth, fed above 4 , sticky inflation, debt building, certain demographics, deglobalization, all of this leads to and we do not have to be screaming higher yields, we can just hover here for longer. Which some people expected but that seems further off. I am not screaming mayhem and chaos but there is the argument rates could stay sticky. Alix i kind of want kriti to say 6 . [laughter] great to get your perspective. Coming up, the question of the day, are we in a 5 world and what do you do with that . We will break that down with kim forrest. This is bloomberg. You got this. Lets go. Gobble gobble. Ive seen bigger legs on a turkey rude. Who are you . Im an investor in a fund that helps advance innovative rude. Who are you . Im an investor in a fund that helps advance innovative sports tech like the Smart Fitness mirror. Mirror. Im also mr. Leg a fund that gives you access to nasdaq100 innovations. I go through a lot of pants. Before investing carefully read and consider Fund Investment objectives, risks, charges, expenses and more in prospectus at invesco. Com. Alix time for the question of the day. Are we in a 5 world and what is the impact of that . I want to point out i am looking at the nasdaq 100 down 0. 8 . You also have things like meta yesterday breaking below the 50day. Now you have meta rolling over as well. Google holding up but you wonder what kind of follow through we are going to be seeing. Guy in theory, this should be bad for longduration and tech. I think if you differentiate tech and think about the Smaller Companies without the cash flow versus the big guys with cash flow because these companies are hugely cash generative you would have thought those that could generate cash that it is worth more. This is how you get to 5 . Alix but also, you already priced in the good stuff. You have run too far, too fast. You have peaked out. Kim forrest, bogey capital bokeh Capital Investment partners. Kim i hate to go full nerd on you for the last couple of days the bond market has overreacted. It moved unbelievably high unbelievably fast given the good news about the growth in the u. S. Economy. Everybody is spun up about the fed is going to have to increase rates. The whole bond complex moved up. Now the stocks are overreacting as well because do we really believe this is the world we are going to live in . I dont think so. I think we are going to settle under 4 which would then make the prior world of a month ago look pretty good with some of the tech stocks. I would not throw things out. This is generally what happens in august where there is not a whole lot of people on the bond desk or stock desk. The markets overreacted this time. That is where we are. Guy for the sake of argument say we are in a 5 world. The risk is we are potentially in a 6 world. How different is that narrative look . Kim it is a grossly different narrative because then i believe the fed is trying to really stop the economy and throw it in reverse. Lets say we are going along at 40 Miles Per Hour because the economy is good but not great. That is 40 Miles Per Hour. But then we have 6 10year. Guy sorry, why are you assuming this is the fed . What seems to have happened this week, and judging by who i have been speaking to, this is not about what the fed is going to do. This is about the bank of japan not wanting to be a big buyer of treasuries. Potentially china being a seller of treasuries. This is about big deficits and government needing to spend. All of those mean the bond market has fewer buyers and a lot more supply that it has got to deal with and that is the adjustment we are seeing. This is not about the fed. This is not about inflation. This is a longerterm narrative beginning to develop. Kim i have always been a proponent of the u. S. , the eu, and probably somewhat japan although it is a relatively small nation. But certainly china. We all have to have proportional Interest Rates. That is what was happening last year. The u. S. Was the leader in ramping up the Interest Rates and it left the eu and china behind. China has its own issues but it is a big buyer of bonds. We have to Pay Attention to that and that is why i do not think we get to 6 . Sorry. Alix if we do not get to 6 no need to be sorry, you can have that opinion if we get to sub4 , what are you buying . Kim i am looking at the crazy stuff which will give the other host an eyeroll. [laughter] i like consumer discretionary, oh my. There is a couple of places i like and if you are holding this for three to five years, tech is a good area to go hunting right now. Guy discretionary. There is a great story on the terminal about what is happening at the university of alabama, which i think is amazing. If you think the discretionary is toast, read that story. Kim, discretionary how does discretionary stand up against Mortgage Rates at 7 , Student Loans that are going to kick in . All of these factors the headwinds seem to be growing rather than receding. Kim sure. The consumer is not one big blob. There are different segments of the consumer and we tend to Like Companies that focus on the higher social economic scale. These are people that probably have the bandwidth if they want a new house, they can buy a new house. But they are probably well settled in the house. That is not an argument. Student loans, these are high earners. They will have some issue because a Student Loans but it is not going to be do i buy that sweater or pay my mortgage . That is not the group we are going that is not the group we are going after. Guy i would never roll my eyes cannot in a million years. With alix, but with you, never. Far too polite. I think the whole story around five or six is still very much questionable. Kim forrest, enjoy your weekend. Alix, i would definitely bow my eyesa t. Alix how many times have you done it this morning . Guy on a pretty regular basis. Lets talk about what is happening in Palo Alto Networks. Investors and whether or not they should be worried. Caroline hyde is going to join us. This is bloomberg. Alix it is 22 past 7 00 on the west coast. Want to get to the top stories in the bay and beyond. Joining us now is Bloomberg Technology because caroline hyde. Usually friday afternoon you do not expect tech earnings, but palo alto is. Caroline everyone is worried they are going to announce something that the market doesnt like in terms of forwardlooking guidance. We get the encapsulation of what 123 has looked like. When youre doing that on friday in the market closes a couple of days and you are used to getting earnings on monday and tuesday, everyone is like, what is up with that. This is a company that is likely to give us 18 growth, that is not what we are used to. It has been down down down. This is going to be a big pr headache if with the p. R. Has told us so far, just a logistical issue, turned out to be some meals. Guy has the market priced in enough bad news . Have we already done that . I. E. , is the actual option to the upside rather than the downside . Caroline certainly the target is to the upside. However, a lot of analysts are saying the inbound calls and whether this has been priced in, what is happening at Palo Alto Networks as they have been a beneficiary of certain clients in the macro environment saying i want to consolidate my security provider, therefore i will buy from onestop shop. The competition is rife and people having to think about how long you want to sign up contract. I will have to see how they whether the macroenvironment. Alix we make an ipo listing next week and instacart potentially in the wings. Are these idiosyncratic things, or is the market opening again . Caroline totally wild time, given that weve seen the first backtoback losses in the nasdaq 100 for the entire year, and suddenly we get this drip feed. The markets understand what is offering. It going dollars to 10 8 billion to 10 billion valuation they are inspecting. We are to spitting offending coming next week. Will we get the detail on the price . Probably not. Instacart we understand is going to be filing next week. Overall look context is 14 billion worth of ipos this year compared to 214 thereabouts in between 21. The valuation for instacart used to be 40 billion and out 13 billion in the last private round. Guy people talk about in people talk about nvidia next week as being an event. Caroline oh, yeah, whether or not the valuation of substantiated, whether ai is becoming part of the earnings theme. Inc. About the pup we got in cisco. Think about the pup we got in cisco. Nvidia has been the onestop shop on how you bet on ai annual revenue. Guy looking for to the show. Youve got a busy week next week. Caroline hyde you can catch Caroline ConnanBloomberg Technology in 30 minutes time. This is bloomberg. Avalarahhhhhh what if tax rates change . Ahhhhhh filing sales tax returns . Ahhhhhh business license guidance . Ahhhhhh crossborder sales . Ahhhhhh item classification . Ahhhhhh does it connect with acc. . Ahhhhhh ahhhhhh ahhhhhh alix we are about an hour into the Training Session on friday. Its been quite a week. The selloff continues. Options expiring as well. Abigail is checking the moves. Abby . Abigail nasdaq 100 near session lows. The first four days since the beginning of march on weakness, not surprised we will take a look at that in the moment. We have yields down, the 10year yield down for basis points, and that should be providing relief for investors, although on the other hand, you have bonds rallying and stocks down. Crude oil down a little bit. That is a risk as had pitted that is a risk asset. It is staying above wti crude committee dollars per barrel. To alixs point, its what we have been seeing all week. Down 2. 64 . This is the worst week since the end of february or beginning of march. Weve had this big rally this year, but over the last couple weeks, not so much. What is the driver . Its what weve been talking about, the dollar. Take a look at this roller coaster ride for the dollar. We are breaking this downtrend on this big move higher on the year, down. 5 . Over the last three to four weeks, up 3 to 4 . No wonder risk assets are getting a bit roiled. Alix great stuff can really appreciate that. Challenging results for retail stocks. Farfetche tumbling. It is basically a luxury online retailer. They are just a lot of sales on luxury stuff. I want to bring in simone foxman. There are execution issues with farfetch for short. What is the macro read today . Simone flagging weakness in the u. S. Consumer and a slow asian consumer to come back. That playing into both of what we are seeing, both cutting annual outlook. Estee lauder has been coming for a long time. Farfetch had much better earnings last quarter. Part of this may be not just the execution risks, but there were High Expectations seeing this luxury as important. We knew about Estee Lauders problems. We knew they were struggling to adapt to an asian consumer that is a larger part of the business. That is a little more bacon than what is happening with farfetch. Guy can you talk to me about the execution issues . What are that . You listen to european like creek companies and they talk about a slowdown in the u. S. , but not that dramatic. Simone the slowdown both of these committees were talking about seems much larger, and frankly mirrors what we have heard from the likes of all the retailers in the united states, whether it is target, whether it is walmart, talking about how the aspirational consumer, particularly the middle class or lower middle it has been trying to spend more and has been spending more through the pandemic, really seeming to be struggling. That is a key consumer for both of these brands. Estee lauders execution risks really dealing with asia. Asia is about a third of its business. And it just has not been adjusting to that problem so well. Continuing to see that this quarter for sure. Alix i also want to point out that there is a story, secondread story on the bloomberg right now students spending 20,000 on rolex and cartier for bama rush. It has gotten competitive in certain schools. Parents are hiring consultants to get their daughters in, which i read as well. A banker went on to talk look at these videos, guy and priced out what people were wearing. Who knows where they buy these things and if they will return it after, but that is not slowing the consumer. Guy these children are dressed very differently than i was at university, which involved rugby tops in sports tops, which i had for the entire university appearance. This is crazy. I dont understand the severity thing that is something we dont have by any stretch of the amount i dont understand the sorority thing, that is something we dont have in the same way here by any stretch of the imagination. If you believe this is important honestly, i dont understand the sorority thing. Im glad you explain what farfetch was, because ive never heard of it. Im not sure im the right person to be talking about any of this. Alix no, youre not frozen we can show no, youre not. We can throw a shade on the 20,000 for the sororities, but this goes back to the farfetch story. Are you buying a discount on the retail level or are you buying it realreal . We talked to the president earlier this week. Are you going to resell it . Guy you really thought about this, havent you . Alix yeah am i more excited talking about this or contango . Guy thats a combine the two, i think it would be amazing. [laughter] the whole rental thing, that is amazing to me, that you can rent it. I get the discount stuff, buy some of the stuff on discount. But in theory i thought whoever is pricing this would take that into account. Im getting to logical about this. The rental thing, to be that is possible. Maybe that is impossible. But this is insane. In the competitive nature of u. S. Universities, obviously we have seen huge court cases a relevance in terms of getting kids into the right schools, but now into the right sorority, and you have to have all of his gear . Amazing. Who says there is not access still in the world . Excess still the world . If that is not an example, i dont know what is. Alix simone once in, but kate is telling us we need to go. Simone just quickly, maybe these bama students are not the aspirational consumer. Their parents are paying for it. Alix gosh, i hope so. [laughter] if im 18 and i can get a 20,000 cartier, rock on. Guy contango would be a great name for a luxury brand. Alix steel, this is a whole new career potentially. This is your label, contango. Simone you guys together. Guy there you go i will be a fashion advisor. Coming up next believe me, that would be a bad idea we are going to talk about a subject and much more comfortable with, large trucks. Gas powered large trucks, as in the gaspowered large trucks. This is bloomberg. Alix this is Bloomberg Markets. You are looking at live pictures of the principal room. Coming up on monday, tune into etf iq. This is bloomberg. Its time for etf friday. Katie greifeld has been taking a deep dive into the world of etfs. What other flows like as tech cells off . Katie as always, there is an etf for that. Driv, autonomous and electric vehicles etf, the largest tvrelated etf evrelated etf it is still up 19 on the year to date basis. You look at the lefthand side of the truck and you can see it is pretty much a Straight Line down, down 14 in the month of august. Definitely some of the euphoria has cooled. Lets zoom out and look at the fiveyear chart. We had started to see some of the enthusiasm come back since the end of 2022. That is fizzled. We are so far away from the halcion days of 2021, but still up over 63 on a fiveyear basis. That is outperforming the s p 500 but a bit below the nasdaq 100. It is an ev fund, but a lot of tech stocks in there. A lot of the chipmakers. We have the likes of tesla as well. Traditional automakers in the likes of toyota. These are exactly the names that have been getting slammed recently. That goes a long way to explaining, but again, the euphoria has come out of names such as driv. Alix super appreciate it, thank you so much. Lets talk about ev trucks. Noble natural gas trucks. National renewable natural gas trucks. The stock did close at a 52week i yesterday. Lets get more on this. The founder and ceo joins us now. Theres a couple things to break down, but i want to start with the trucks. You are in fleet trials. Give us a sense how close you are to scaled up reduction. We went public back in 20 and it was our kickoff to go commercialize this powertrain solution. We have been doing that last few years and we are months away from beginning to deliver two fleets in the start of production. We are now just starting fleet trials. We will be doing at the next couple weeks where weve been taking our assets and putting them into the hands of fleets so they get to experience it in their operation. We are about to launch the product and get it out into commercial deployment. Guy these look like really big trucks, thomas. How far do they go . What kind of range are we talking about . What kind of infrastructure needs to exist around them together is into Service Operation story to work . Thomas so, you are hitting all the normal problems that electric vehicles have, charging problems, is there available grid electricity. Our vehicle is a classic semitruck, it holds 80,000 pounds of total vehicle weight. Normally and electric truck gets 100, 200 miles of range. Our truck uses an onboard generator to charge the batteries as the vehicle is driving. We get 1000 miles range. This operates much more like a diesel truck. You are not range limited come and we can use existing natural gas reviewing infrastructure. Refueling infrastructure. Alix a lot is changed since i last spoke to on my commodity show, many things. Theres been a lot more money pumped into the green transition. Theres been an antiwoke, antigreen pushback. And the Federal Reserve raising rates by 500 basis points. Im curious how all of that affects the interest. Do what your customers want change frequently now . Thomas it has. Its evolved. A couple years ago we were talking about Anything Electric they were going to adopt. Now they are looking at it and saying we really need to make sure this makes economic sense for our fleet if we are going to adopt this. It needs to be better than a diesel truck, or need to bring us a ton of benefits. We are able to do that with a vehicle because we are leveraging renewable natural gas to fuel it. It is one dollar to 1. 50 a gallon. We can give them the economic benefit. But we have also seen happen in the Trucking Industrys overall prices have gone up. Vehicle costs have nearly doubled from where we were a couple years ago. Pricing is a lot more. Guy rates have come down but a lot thousand has that changed the economics . Big Trucking Companies have gone out of business supply of existing vehicles into use market. Talk about as the Trucking Industry evolves postpandemic what the supply demand story looks like. Are people still buying new trucks right now . Do they want new trucks right now . Thomas there is surprisingly a supply shortage of new trucks. That is changing. Fleets are holding the assets longer. Some are buying used trucks as opposed to brandnew. We are seeing that impact the space. The area that has been most impacted by now the thought was that would be many thousands of electric truck out on the road, and we are still at the point where it is hundreds of trucks out there. Wes are expect fleets are exposing interest in elective occasion. It is just a longer rampup than what was expected. Alix how much has to do with the demand or the supply . With rates they are, you may want them, but having the finance to buy them as a whole different story. How is that affecting demand . Thomas fleets are saying we are knocking to take the increased cost burden onto our Balance Sheet. We are not going to take the increased cost burden onto our Balance Sheet can we need the end customer to take it out. The shipper is going to want to pay the extra amount. Some committees have a strong esg initiative, they are willing to pay. Others that just want the lowestcost solution, they are not. That is one of the areas where ours is very differentiated from a conventional plugin or Hydrogen Fuel cell vehicle, wherein about three years this could have a positive roi or payback for the fleet compared to a diesel truck. Guy how many of these trucks are financed . Im assuming most of them are. Does the economics change at yields where they are right now . You have gone from a zero Interest Rate world to a 5 Interest Rate world. What is your industry look like in this world . Thomas they want to do the same thing with electric trucks, and as you pointed out, that adds a lot of cost to the overall solution. That is where going back to the point earlier, we are seeing a slower rampup of electrification. The interest is still there. That is where we have grounded in and we need to make sure this makes economic sense, and the only way to do that is to use a low cost source of electricity or power, which for us is going to be natural gas. The gird is more the grid is more than diesel in many instances and hydrogen is much more. Alix tell us how the financing affects your business. On your last Earnings Call you said you had enough cash to get you through 2024, and after conditions were right you could maybe issue new shares. If we have rates stay at 5 , does that change your calculus, how you can ramp up and perform . Thomas if you look at most of our competitors in the space, everyone is trying to raise capital now. Within a year they will be out. For hyliion, we expect we could get through the end of 2024 and maybe 2025 without needing to raise. It puts us in a position where we can be opportunistic about when we do raise. We will start stationary deployments about generator technology, which is a stationary power solution, so we can power a building like this offer that generator. That will happen next year as well. We think those will be good catalysts to pull more capital into the company guy which one of those two things will end up making more money . At the moment we have power shortages, grid shortages. You look at what is happening in hawaii right now, what is happening in california. Do you think the future of your business is in trucks come or is it could be in fixed power, as youre getting into . Thomas we are in a trucking right now. Your trucking is a very big focus. But as you are pointing out, stationary is a big addressable market. If we can use the same generator in a truck that we could use for stationary power, that gives us two total adjustable markets that are very large. Stationary we think could be very differentiated. Our generator, we acquire this technology out of ge about a year ago, and it is fuelagnostic, very low maintenance, low cost of operation. In many states we would be able to produce electricity at your facility for cheaper that you could buy from the grid. Guy that is quite an impressive proposition. It seems like the business is evolving fairly quickly. Dont be a stranger. Come back, keep us updated. Thank you very much indeed. Ok, coming up, the 1. 5 trillion credit market just set afresh record for the largest loan we have ever seen. We will dive into the details. This is bloomberg. The biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. It still does. What can you do with spy . Alix time for wall street beat. We look at private credit loans they are growing bigger and bigger and breaking records. Joining us is sonali basak. Sonali we are looking at the clearing a significant dent in the system. Alix finally. Sonali finally. When you think of what will happen in the second part of the year, there are deals in the pipeline that are already there where it will be an interesting story of how they are financed, or there are going to be new deals that we may see, back we may see come back. We also saw a record deal when you look at finasteride, and the idea that more than 5 billion of the package was put together by private lenders. Very importantly, one of those lenders was blue hour. I had a conversation with the resident of blue ow the president of blue owl. He was telling me in the next couple of years you could see deal package of 10 million put together by the private lenders. He told me that over a 12month span, he has gotten at least 60 views of more than a billion dollar deals. If you think 5 billion is rare, imagine a 10 billion deal a couple used on the road. Guy blue owl, cool name. They finally get to market and then the secondary market doesnt look very clever. Does that tell me about how ultimately federal this processes . Fragile the process is . Sonali it does. The interesting part about this particular deal according to our colleagues on the leverage financed desk, they were able to make enough interest to make up for some of the losses that the banks would have borne otherwise. There are other implicit costs here. The cost is tied to not doing other deals in the timeframe. Because of capacity acres of capacity to do them moving forward. Another 5. 5 billion nearly deal in the private credits based that could have died earlier this year, because they couldnt get the deal done. Dues those do those come back because of capacity . You do see this issue with the leverage loan market because defaults are rising. We are also watching the markets see issues when it comes to the actual quality of the loans themselves and the reasons they are being used. Leverage loan volumes, new underwriting has fallen off by 30 . The fact that there is no capacity saves you a little bit here. There is not enough new Deal Movement here to get people to stay away from the market, should the market come back to life. Guy it is Getting Better but not all the way. Sonali, really lovely work this week. Busy week indeed and another one coming up i suspect for sonali. Another 2. 60 today, it is not downs after being battered it has not bounced after being battered yesterday. Bloomberg talked to the company, they are not looking at buybacks. They feel that that faith has been shaken a little bit. Germany still in a 5 world. Germany probably isnt, italy could be. Socgens European Equity strategist joining us in the next hour. We have a lot to talk about. This is bloomberg. When you automate sales tax with avalara, you dont have to worry about things like changing tax rates or filing returns. Avalarahhh ahhh at cdw, we get the importance of clear communication. And when your teams are spread out, thats not always easy. 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Guy european stocks are down on the day, definitely down on the week. The startthe cat to the close starts right now the countdown to the close starts right now. The countdown in europe, this is european markets Bloomberg Markets european close with guy johnson and alix steel. Guy 447 where we are. We are down on the week, moving aw