Poised potentially for of for the week of losses. In the bond market, the epicenter of the headlines. 170 is the estimate on wall street. Tom we will conflate a lot of economic talk. My major message is that the market still matter. It will be fascinating to see the reaction to the jobs report. Is a good news or bad news later this morning . Tom you know how much i hate that. I get confused by it. Employment is a big deal. 170 is a generous number and the Unemployment Rate matters. Jonathan lisa, adp was bad news. Lisa if you look at the revisions they have revised upwards. Their expectation is that the whisper number is 170,000. At what point is not good news but not too bad that means economic armageddon. They are waiting for something to break the cycle. Even though we have some common markets but they are still at 4. 7 . Jonathan there is a question in a program that was what is nobody asking you about . 2024. How bizarre is that . Its weird that we just need to get through the Fourth Quarter and nobodys talking 12 months out. Tom i am old enough to remember we used to have a three year vision. With the pandemic and with the shock of this bond market with a lot of media catching up on prize. The vision is up to halloween. Jonathan pioneer, exxon lets talk about the premarket. Exxon has alltime highs. Mr. Starfield is looking to retire and pioneer may be up for sale. Tom they only have one person to sell it to. Annemarie will join us with some perspective. Citigroup has a tremendous essay. Employees, exxon and pioneer it may be a 10 to one ratio and Free Cash Flow at a 91 ratio. Jonathan its the biggest deal for exxon since 1999. Lisa is this the beginning of investment in jonathan pioneers a little bit higher. Here is the price action, future heir positive by. 2 . The euro is going nowhere. 1. 05. Lisa if we get some kind of upward surprise. We have the u. S. Jobs report the estimation is 170,000. Some people are expecting is for to be the same as last month with the declining Unemployment Rate. What will the bond market look like . I am looking forward to this discussion. Julie su will meet with Jonathan Ferro for a talk. I think it will be a fun interview. Jonathan very polite, very relaxed. Tell us what you are feeling . Lisa what was your childhood like . We have u. S. Consumer credit coming out. You are seeing Credit Card Debt rise at a significant and accelerating pace. How much of consumer strength is being fueled by debt . Is this so morningside are releveraging post poe dameron. Postpandemic. Jonathan what are you in the team looking for . I think 170 is not to higher reading. If you look at what happened in august. And enjoy stood employment was held back. They said these are trivial numbers but we know the number of strike were down and claims were low. If the reading is in line with the whisper number it wouldnt surprise me. In the big picture of things, the last three months chairman powell pointed out it was a hundred 50,000. The prior year was 430,000 for the same three months. If it is not slowing fast enough and not collapsing, it is in a gradual slowdown. Jonathan a twopronged story. It is bad news good news today. Steve i think there has been tremendous apprehension and signs of capitulation. Bloomberg measures market liquidity have we can for the treasury market. Shorts looked to be at record highs but whether or not we can come to grips and change that trend on an Employment Data point, i would be guessing. It would be fascinating to see the results. Tom well talk about the profit picture but i have to look at the ask you about the bond carnage. It is not the 1970s. Is it just disinflation to the rescue . Steve you will measure disinflation in cpi in the coming year. We were at a peak of nine and got to a low of three. By the end of next year, the shelter measures will be much lower on the cpi readings. Whether or not this is satisfying everyone about the longterm inflation look is unclear. We will take a look at real guilds at 2008 levels. If you believe the economy is slowing, this is satisfying. I have to say that the long end of the treasury market with an inverted yield curve is counting on the fed cutting rates. That is what has been embedded for a long period of time. Just the fact they were not collapsing the economy, that will be hard to maintain that in the yield curve and thus the pressure here. Its much more of a normal rate than it is in 1970 or 2020. Tom the heart of the analysis is to analyze corporate profits within the larger economic algebraic function. My theory is that corporations will adapt like they did before. Do you agree with that . Steve i do and its been a tough period to adapt. The rate of employment growth has exceeded gdp growth the most since 1974. It has been an unusual period where labor markets have out produced the economy. The edge that the labor markets have, i think its receding. Like jobless recoveries of the past will see labor markets slow. Output has a chance of gaining steam in the next two years. Lisa Mike Hartnett at bank of america said the reinvesting Asset Classes predicated on the idea of something collapsing or taken down. Something happening in the markets to cause a downturn. Are you on board with this . Steve its hard to find this area of collapse. We find that there are all sorts of things that are already happening that make it hard to generate a collapse. Why . If the inflation rate is coming down and we happen to have a low Unemployment Rate is not enough to force a collapse . I think the fed could collapse the economy if it wanted to. When we take a look at the massive delivery of multifamily apartments that are coming in the million ready for completion. Do i see that as a larger issue . No i dont. Look at the ism report, the Manufacturing Sector has been contracting and trade has been contracting, residential investing is down 20 . I think we will be in another period where the economy stays below trend and absorbing losses. It is not this clear as day decline in recovery. Lisa if we can stay at this level and nothing breaks is not a given that yields go down. On the others, you can see stalwarts do all right but the rest of the sectors will continue struggling. Steve when you see one asset class outperform another which means that they perform together to some extent. A bond yields declined there will be certain equities to do well. I think it is important to see that the bond market can still be a successful place to invest if you hold the majority with 6 yields. This is going to be higher than the cascio. Jonathan i have to ask you about what is happening in the energy patch. Exxon is engineering a purchase of pioneer. When you wake up and see a deal like that, potentially 60 billion, what you think of that . Steve i think opec deciding it will decrease market share and coproduction more than the entirety of the rise we have seen out of American Oil Producer is providing value, soft landing to every western energy producer. If you want to talk about alternatives, we are building redundancy in the Energy Market and its benefiting everyone and it means a relatively higher price that will benefit Energy Producers outside of opec. Jonathan is it a sector you like . Steve we think its a sector that will be firm, solid. I am not worried about energy and a slowdown. Jonathan thats a big change. Steve the Typical Energy sector response and recession, my view of recession is not quite thought. Its a real slow patch. The typical recession, the Energy Sector was unprofitable. We are not talking about the special case of 2020 with negative oil futures and loss. Even all of these other down torrents, we have seen oil plunged to the 30s, 20s. American producers have been cautious. Theyve been raising production slowly and conservatively and under those circumstances where there is significant supply risks around the world. Russias audio exports or 6 of global consumption. With opec cutting, has arrested decline. The Energy Sector will not suffer losses than it has in the past. Jonathan steve, it was great to catch up. This is on payrolls friday with the potential of a big deal in u. S. Energy. The estimate is 170,000 for the jobs report. Of next priya misra. From new york this morning, good morning. If youre trying to get a view of the whole organizational Financial Health and youre trying to do that through multiple systems, that makes it very, very cumbersome. Its not just tech, its not just people. Its how they Work Together to provide that experience to the customer. As a finance organization that is what you want to do. captivating music the first law of thermodynamics states that energy cannot be created or destroyed. but it can be passed on to the next generation. 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 sports tech like this Smart Fitness mirror. Im also mr. Leg day. 1989 anyone can become an agent of innovation with invesco qqq, 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. The second area we think is attractive is energy. It was the darling last year, is not a very important level right now. With xle, we are sitting at key levels. Understanding when we enter earnings season, energy is interesting. Jonathan crude is the underlying commodity heading for its biggest week since march. Speaking of deals, exxon is in talks to acquire pioneer not potentially for 60 billion u. S. Dollars. Lets tented the price action. Its payrolls with the estimate being 170,000. S p is positive 5. 26 . What a turnaround in the oil market. All the way back down to 82 53. Tom the manger thing coming down from the 100 level down to 80. A lot of the research i read, ben lightner saying gasoline makes up 3 of the inflation pot. You have the gasoline is going up prices versus the reality which is we are nowhere near hydrocarbon dependent as we were in our youth. Jonathan you see 13 Million Barrels a day. I remember a program 10 years ago when you called us saudi america. Tom i dont remember that. Annemarie looks at the basin, we will talk about the possible 60 billion deal. In 1924 in the west texas basin we went out to find it. Thats a stereotype from the movies. What is the new stereotype and why does exxon want to send more oil from lubbock and new mexico . You can see from shale production. Production has been rising close to 13 Million Barrels and projected to continue rising. What we have seen in the last decade was much about quantity over quality. Every ceo was incentivized to grow production. What you are seeing today is very much a slower growth, consolidated growth and we have seen a enormous amounts of activity. They want to take over adjacent acreage in their getting more efficient. There have been 80 companies that could be taken over. One of the very interesting things as side effects on acquires another company, the one plus one raised have become 1. 2. That is one of the reason why Production Growth is slow. Tom citigroup has a lead memo that will cover later. We hearken back to occidental taking out anadarko. Are we taking the independence out of the market . The independence is still there but what we are taking out is tons of the mom and pop shops , tiny producers, private equity owned assets. What you will have is a much more efficient sale patch shale patch at a cost were shareholders are happy. Thats fine and a 0 interest but not when Interest Rates are five, 6 . Lisa how much is this deal fueled by the idea that people are realizing that fossil fuels are not going away so quickly and if anything they will be needed during the transition. I hope that is the realization. I just got back from abu dhabi, thats the main focus. We need to decarbonized and that something we need to talk. Lets talk about not having fossil fuels at all. If Economic Growth continues, population growth continues. Energy demand will grow. If Energy Demand grows we will need all forms of energy. We are not invested enough to meet current Energy Demand. The east gets it but its much more for american and europe to come around to it. Lisa we talked about 100 a barrel and then we saw the biggest decline this week going back to march. Do you view this as too far too fast like barclays or do you see this is something as fundamental in light is were seeing in copper tracking this kind of decline . I dont think this is fundamental. This is a position driven position. Treasuries have risen for a while now. They have decoupled but they have come under macro scrutiny. On a fundamental basis, look at the first month versus the third month, thats steep still. The physical fundamentals are fine. You dont get five dollar moves on fundamentals that tends to be driven by geopolitical issues. We will move back higher again. We never go up in a straight line. You will get some consolidation and volatility in we go up again. Tom going back to Deutsches Bank a million years ago, there is excel spreadsheet of demand. Which is the single line item of demand flexibility of movement that matters in november of this year . Which geography . Which kind of oil signals were demand is setting . I would say right now, it will be the u. S. Because that is where all the macro worries are. Are we slowing down significantly. On u. S. Gasoline and diesel story, thats where the uncertainty is. Jonathan what do you mean you dont buy it . You did you can look at how much ethanol is being used in gasoline. That still says is close to 10 Million Barrels a day. The weekly numbers are all over the place. I would not Pay Attention to that. Tom friday morning inorganic chemistry with amrita. It is a better call now when we were at 85 then when we were at 95. Jonathan we will speak to close closer to halloween. Tom she is getting spicy. Jonathan apparently triple digits by halloween. Tom the estimates and forecasts on american gas were in direct correlation with the temperature of the subway stop at wall street. Jonathan coming up on the program one of the greatest signs weve heard in the past few months. On the last mile of the inflation journey. Your estimate is 170,000. From new york, this is bloomberg. Explore endless design possibilities. To find your personal style. Endless hardie® siding colors. Textures and styles. Its possible. jennifer the reason why golo customers have such long term success with james hardie™. Is because we focus on real foods in the right balance its possible. So you get the results you want. When i tell people how easy it was for me to lose weight on golo, they dont believe me. They dont believe i can eat real food and lose this much weight. The release supplement makes losing weight easy. Release sets you up for successful weight loss because it supports your blood sugar levels between meals so you arent hungry or fatigued. After i started taking release, the weight just started falling off. Since starting golo and taking release, ive gone from a size 12 to a 4. Before golo, i was hungry all the time and constantly thinking about food. After taking release, that stopped. With release, i didnt feel that hunger that comes with dieting. Which made the golo plan really easy to stick to. Since starting golo and release, i have dropped seven pant sizes and ive kept it off. Golo is real, our customers are real, and our Success Stories are real. Why not give it a try . Jonathan two hours away from the payrolls report. The price action this friday morning. In morning. Small caps are firmer, higher by 0. 5 on the russell. The s p 500 up around 0. 3 . Pause for a six week of losses. On the nasdaq, higher by zero point three the bond market, higher. On the 10 year, up another 10 basis points to 4. 74. Back down to around 4. 90 of the 30year yield. Up two basis points. The 2yearyields higher by a cos points. The euro against the dollar. The euro is negative on the week. Up on the session slightly by around 0. 1 . Your we are facing the real potential of 12 consecutive weeks of Euro Weakness against the eurodollar. That is a record losing streak already and we can add to it later. Lisa a what will it take for the euro to reach the rally, given the fact they are facing so much more difficulty than the u. S. Today stops number, if it comes off strong, what is today is the jobs number, if it comes off strong, what does that due to to the euro . Tom currencies and commodities. Whether you are going up on the vector or down, we are on the edge of the range. I dont see this being written to what lisa alludes to. The yen is at 151. The eurodollar at 1. 02. We are at that range point. Jonathan had a look of around 1. 04 back to around 1. 0 560. Tom look at Andrew Hollenhorst. Jonathan Andrew Hollenhorst at citigroup looking for 240,000. Our next guest in just a moment. Wells fargo looking for 150,000. There could be the companys biggest acquisitions is acquisition since merging with mobile back in 1969. When you put this altogether, the combination of pioneer and exxon, we could be talking about the Biggest Oil Producer comparable was some opecplus nations which is absolutely phenomenal. Lisa a from a policy perspective, does the u. S. Administration like this . On one hand, there is an antitrust push especially by this administration, but on the other hand, if you compete with saudi arabia where gasoline prices are a key component of the election, and how people feel, you could potentially lower prices and make them so efficient make them more efficient, so isnt that a good thing . Tom we will do this later in the show. But the bott