guy johnson. ♪ guy: tuesday the 21st. three ad hoc p.m. in london, 10:00 a.m. in new york -- 3:00 p.m. in london, 10:00 a.m. in new york. welcome to "bloomberg markets." whatever going to call today? is it turnaround tuesday? i am calling it tepid tuesday. this is not a convincing rally at this point. alix: that is good. i totally hear your point. the 10 year, the dollar, and the vix are not really moving that much. we are still at one 31% on the 10 year -- at 1.31% on the 10 year. the bloomberg dollar index still holding those highs.

the reason why it is a turnaround situation is because everything is in the green. the s&p up 0.5%. but it is the safety trade leading the way, like utilities, health care, and consumer staples. my question becomes, what winds up happening into the close after we saw that huge volume buying and some call buying coming in as well? we are waiting for president biden. he is speaking at the united nations general assembly. we are going to take his speech in full. pres. biden: mr. president, mr. secretary-general, my fellow delegates, for all of those who dedicate themselves to the noble mission of this institution, it is my honor to speak to you for the first time as president of the united states. we meet this year in a moment of intermingled great pain and

extraordinary possibility. we have lost so much to this devastating pandemic that continues to claim lives around the world and impact so much of our existence. we are learning more than 4.5 million people, people of every nation, from every background, each death is an individual heartbreak. but our shared grief is a poignant reminder that our collective future will hinge on our ability to recognize our common humanity and to act together. ladies and gentlemen, this is a clear and urgent choice we face here at the dawning of what must be a decisive decade for our world, a decade that will quite literally determine our futures. as a global community, we are challenged by urgent and looming crises, where in light enormous and opportunities if we can

summon the will and resolve to seize these opportunities. will we work together to save lives, defeat covid-19 everywhere, take the necessary steps to prepare ourselves for the next pandemic? or will we fail to harness the tools at our disposal as more verlander and derek jiles -- more virulent and dangerous variants take hold? will we suffer the merciless march of ever worsening droughts and floods, more intense fires and hurricanes, longer heat waves, and rising seas? will we affirm and uphold the human dignity and human rights under which nations in common cause more than seven decades

ago formed this institution? will we apply and strengthen the core tenets of the international system, including the un charter and the universal declaration of human rights, as we seek to shape the emergence of new technologies and deter new threats? or will we allow those universal principles to be trampled in the pursuit of naked power? in my view, how we answer those questions in this moment, whether we choose to fight for our shared future or not, will reverberate for generations yet to come. simply put, we stand at an inflection point in history. and i am here today to share with you how the united states intends to work with partners and allies to answer these questions, and the commitment of

my new administration to help lead the world toward a more peaceful, prosperous future for all people. instead of continuing to fight the wars of the past, we are fixing our eyes on devoting our resources to the challenges that hold the keys to our collective future. ending this pandemic, addressing the climate crisis, managing the shifts in global power dynamics, shaping the roles of the world on vital issues like trade, cyber, and emerging technologies , and facing the threat of terrorism as it stands today. we have ended 20 years of conflict in afghanistan, and as we close this period of relentless war, we are opening a new era of relentless diplomacy, of using the power of our development aid to invest in new ways of lifting people up around

the world. of renewing and defending, chrissy, of proving that no matter how challenging or complex -- defending democracy, of proving that a matter how challenging or complex, government by the people is still best way to deliver for all of our people. as the united states turns our focus to the priorities and regions of the world at the end of pacific that are most consequential today and tomorrow, we will do so with our allies and earners for -- and partners through cooperation in multilateral institutions like the united nations, to amplify our speed and progress towards dealing with global challenges. it is a fundamental truth of the 21st century, within each of our countries and as a global community, that our own success is bound up in others succeeding as well. to deliver for our own people, we must also engage deeply with

the rest of the world to ensure that our own future, we must work together with our partners toward a shared future. our security, our prosperity, and our very freedoms are interconnected, in my view, as never before. so i believe we must work together as never before. over the last eight months, i prioritized rebuilding our alliances, revitalizing our partnerships, and recognizing that our e central -- that they are essential and central to securing peace and prosperity. we have secured our nato commitment. we are working with our allies toward a new strategic concept that will help our alliance better take on the evolving threats of today and tomorrow. we renewed our engagement with

the european union, a fundamental partner in tackling the full range of significant issues facing our world today. we elevated the quad partnership among australia, india, japan, and the united states to take on challenges ranging from health security to climate to emerging technologies. we are engaging with regional institutions from the african union to the organization of american states defocus on urgent needs for better health and better economic outcomes. we are back at the table in international forums, especially the united nations to spur global action on shared challenges. we are reengaged at the world health organization, and working in close partnership with covax

to deliver life-saving vaccines around the world. we rejoined the paris climate agreement and we are running to retake a seat in the human rights council next year at the u.n. as the united states seeks to rally the world to action, we will eat not just by the exhibit of our power, but god willing, with the power of our example. the united states will continue to defend ourselves and our allies against attacks, including paris threats, as we are prepared to use force is necessary. but to defend our vital u.s. interests against ongoing and imminent threats, but the mission must be clear and she will come undertaken with informed consent of the american people, and whenever possible, and partnership with our allies. to use u.s. military power us to

be our tool of last resort, not our first. it should not be used as an answer to every problem we see around the world. indeed, today, many of our greatest concerns cannot be solved or even addressed through the force of arms. bombs and bullets cannot defend against covid-19 or its future variants. to fight this pandemic, we need a collective act of science and political will. we need to ask now to get shots in arms as fast as possible and expand access to oxygen, test, treatments, -- treatments, and vaccines around the world. we need a global health threat

council armed with the tools we need to monitor and identify emerging pandemics so that we can take immediate action. already, the united states has put more than $15 billion toward global covid response. we have shipped more than 160 million doses of covid-19 vaccine to other countries. this includes 130 million doses from our own supply, and the first tranches of 500 million doses that we purchased through covax. planes carrying vaccines from the united dates have already landed in 100 countries -- the united states have already landed in 100 countries, bringing people around the world a dose of hope direct to the american people -- direct

from the american people, no strings attached. at the global covid-19 summit, i will be announcing additional measures and holding ourselves accountable on specific targets in three key challenges. saving lives now, vaccinating the world, and building back better. this year has also brought widespread death and devastation from the borderless climate crisis. extreme weather events that we have seen in every part of the world, you all know it and feel it. represent what the secretary general rightly called code red for humanity. scientists and experts are telling us that we are fast approaching the point of no return in the literal sense. to keep within our reach, the wild goal of limiting global

warming to 1.5 degrees celsius -- to keep within our reach the worldwide goal of limiting global warming to 1.5 degrees celsius. we have to keep raising our collective ambition over time. in april, i announced the united states' ambitious new goal to reduce greenhouse gas emissions from the united states by 50% to 52% below 2005 levels by 2030, as we work towards achieving a clean energy economy with net zero emissions by 2050. my administration is working closely with our congress to make critical investments in green infrastructure and electric vehicles to help us lock in progress at home towards our climate goals.

the best part is making these emphasis -- these ambitious investments isn't just good climate policy. it is a chance for each of our countries to invest in ourselves and our own future. it is an enormous opportunity to create good paying jobs for workers in each of our countries and to spur long-term economic growth to improve the quality of life for all of our people. we also have to support the countries and people that will be hit the hardest and that have the fewest resources to help them adapt. in april, i announced to the united states will double our public international financing to help developing nations tackle the climate crisis. today i am proud to announce that we will work with the congress to double that number again, including for adaptation efforts. this will make the united states the leader of public climate finance, with our added support, together with increased private

capital from other donors, we will be able to meet the goal of mobilizing $100 billion to support climate action in developing nations. as we deal with these crises, we are also encountering a new era, an era of new technologies and possibilities that have the potential to reshape every aspect of human existence. it is up to all of us to determine whether these technologies are a force to empower people or to deepen repression. as new technologies continue to evolve, we will work together with our democratic is to ensure new advances in areas from biotechnology to quantum computing, artificial intelligence, and more are used to lift people up and solve

problems, and advance human freedom, not to suppress dissent or target minority communities. the united states intends to make profound investment in research and innovation, working with countries at all stages of economic development to develop new tools and technologies, help us to tackle this challenge of the second quarter of the 21st century and beyond. we are hardening critical infrastructure against cyber attacks, disrupting ransomware networks, and working to establish clear rules of the road for all nations as it relates to cyberspace. we will reserve the right to respond this i simply to cyberattacks that threaten our people, our allies, or interests . we will pursue new rules of global trade and economic growth so that the playing field is not

tipped in the direction of one country at the expense of others , and that everyone has a right to compete fairly. we will strive to ensure the basic labor rights, environmental safeguards, and intellectual property are protected, and that the benefits of globalization are shared broadly throughout all our societies. we will continue to uphold the long-standing rules and norms that have formed the guardrails of international engagement for decades, that have been essential to the development of nations around the world. the drug commitment like freedom of navigation, adherence to international laws and treaties, support for arms control measures to reduce risk and enhance transparency. our approach is firmly grounded and fully consistent with the united nations mission and the

values we have agreed to when we drafted this charter. these are commitments we all made and that we are all bound to uphold. as we strive to deal with these urgent challenges, whether they are long-standing or newly emerging, we must also deal with one another. all of the major powers of the world have a duty, and my view, to carefully manage their relationships so we do not tipped from responsible competition to conflict. the united states will compete vigorously and lead with our values and strengths. we will stand up for our allies and oppose attempts by stronger countries to dominate weaker ones, whether through changes to territory by force, economic coercion, exploitation, or disinformation. but we are not seeking a new

cold war or a world invited -- a world divided. the united states is ready to step up and support any nation that supports peaceful resolution to shared challenges, even if we have intense disagreements in other areas. because we will all suffer the consequent as of our failure if we do not come together to address the urgent threats like covid-19 and climate change or enduring threats like nuclear proliferation. the united states remains committed to preventing iran from developing a new pair weapon. we are working to engage -- a nuclear weapon. we are working to engage iran diplomatically to return to jcpoa. we are prepared to return to

full compliance if iran does the same. we seek serious and sustained diplomacy to pursue the complete denuclearization of the korean peninsula. we see concrete progress towards a plan with attainable comments that would secure the region, as well as improve the lives of the people in the republic -- the democratic republik of korea. we know the bitter sting of terrorism is real. we have almost all experienced it. last month, we lost 13 american heroes and almost 200 innocent afghan civilians in a heinous terrorist attack at the kabul airport.

those who commit acts of terrorism against us will continue to find a determined enemy in the united states. the world of today is not the world of 2001. the united states is not the same country we were when we were attacked on 9/11 20 years ago. today, we are better equipped to detect terrorist threats, and we are more resilient in our ability to repel them and to respond. we know how to build effective partnerships to dismantle terrorist networks by targeting their finance and support systems, countering propaganda, preventing travel, as well as disrupting imminent attack. we will meet terrorist threats that arise today and in the future with the full range of tools available to us, including working in cooperation with local partners so that we need not be so reliant on large-scale military deployments.

one of the most important ways we can effectively enhance security and reduce violence is by seeking to improve the lives of people all over the world who see that their governments are not serving their needs. corruption fuels inequality, siphons off a nation's resources. it spreads across orders, dig in -- across borders and generates human suffering. around the world, we are increasingly seeing citizens demonstrate their disc and -- their discontent as they see the wealthy grow richer and richer, operating above the law, while a vast majority of the people struggle to find a job or put food on the table. to get their businesses on the ground -- businesses off the ground or some place in their children to school.

people have taken to the streets in every region to demand that their governments address people's basic needs and give everyone a fair shot to succeed and protect their god-given rights. in that chorus of voices across linkages and continents, we hear a common cry -- across languages and continents, we hear a common cry. a cry for dignity, simple dignity. as leaders, it is our duty to enter that call, not to silence it. the united states is committed to using our resources and international platform to support these voices, listen to them, and find ways to respond and advance human dignity around the world. for example. there's an enormous need -- for example, there is an enormous need for infrastructure in developing countries.

infrastructure that is low that he, feeds corruption, or exacerbates environmental degradation may only end up contributing to greater challenges for countries over time. done the right way, however, with transparent, sustainable investment in projects that respond to the country's needs, infrastructure can be a strong foundation to allow societies in low and middle income countries to grow and to prosper. that is the idea behind the build back better world. together with the private sector and our g7 partners, we aim to mobilize hundreds of billions of dollars in infrastructure investment. we will also continue to be the world's largest contributor to humanitarian assistance, bringing food, water, shelter, emergency health care, and other vital, life-saving needs to

millions of people in need. when the earthquake strikes, typhoon rages, or disaster anywhere in the world, the united states will be ready to help. at a time when nearly one in three people globally do not have access to adequate food, the united states is committed to rallying our partners to address immediate malnutrition and to ensure that we can sustainably feed the world for decades to come. to that end, the united states is making a $10 billion commitment to end hunger and invest in food systems at home and abroad. since 2000, the united states government has provided more than $140 billion to advance health and strengthen health systems, and we will continue our leadership to drive these vital investments to make

people's lives better every single day, to give them a little breathing room. as we strive to make lives better, we must work with renewed purpose to end the conflicts driving so much pain and hurt around the world. we must redouble our diplomacy and commit to political negotiations, not violence, as a tool of first resort. we must seek a future of greater peace and security for all people of the middle east. the commitment of the united states is unequivocal, and i believe that a two state solution is the best way to ensure israel's future, living alongside a viable palestinian state. we are a long way from that goal

at the moment, but we must never allow ourselves to give up on the possibility of progress. we cannot give up on solving raging civi conflicts, including in ethiopia and yemen, where warring parties are driving horrific violence, human rights violations against civilians, including the constant use of rape as a weapon of war. we will continue to work with the international community to press for peace and an end to the suffering. as we pursue diplomacy across the board, the united states will champion the democratic values that go to the very heart who we are as a nation and a people. freedom, equality, opportunity, and a belief in the universal rights of all people. it is stamped into our dna as a

nation, and critically, it is stamped dna of this institution. in the united states, we sometimes forget the opening words of the universal declaration of human rights. "the equal and inalienable rights of all members of the human family is the foundation of peace, justice, and freedom throughout the world. the founding of the united nations places the rights of individuals at the center of our system." that clarity and vision must not be ignored or misinterpreted. the united states will do our part, but we will be more successful and more impactful if all of our nations are working towards the full mission to which we are called. that is why more than 100 you nation -- 100 nations aligned

around a common statement on how we will support the people of afghanistan moving forward, laying out the expectations to which we will hold the taliban when it comes to respecting universal human rights. we all must advocate for women, the rights of women and girls to use their full talents, contribute economically, politically and socially, and pursue their dreams free of violence and intimidation. from central america to the middle east, africa to afghanistan, wherever it appears in the world. we all must call out and condemned the targeting and oppression of racial, ethnic, and religious minorities, whether it occurs in xinjiang or northern ethiopia or anywhere in the world. we all must defend the rights of lgbtqi individuals so they can

live openly and without fear, whether it is in chechnya or cameroon or anywhere. as we steer our nations towards this inflection point and work to meet today's fast-moving, crosscutting challenges, let me be clear. i am not agnostic about the future we want for the world. the future will belong to those who embrace human dignity, not trample it. the future will belong to those who unleash the potential of their people, not those who stifle it. the future will belong to those who give their people the ability to breathe free, not those who seek to suffocate their people with an iron hand. authoritarianism of the world may seek to proclaim the end of democracy, but they are wrong. the truth is the democratic

world is everywhere. it lives in the anticorruption activists, human rights defenders, the journalists, the peace protesters on the front lines of this struggle in belarus, burma, and everywhere in between. it lives in the brave women of sudan who withstood violence and oppression to force a violent dictator from power and keep working every day to defend their democratic progress. it lives in the mold opens who helped deliver a landslide victory -- in the moldovans who helped deliver a landslide victory. it lives in the young people of zambia who harnessed the power of their vote for the first time, turning out in record numbers to deny corruption and chart a new path for their country. and while no democracy is perfect, including the united states, we will continue to struggle to live up to the highest ideals deal our

divisions as we face down violence insurrection. democracy remains the best tool we have to unleash our full human potential. my fellow leaders, this is a moment where we must prove ourselves the equals of those who come before us, with vision and values and determine faith in our collective future to build united nations, broke the cycle of war and destruction, and laid foundations for more than seven decades of relative peace for growing -- of relative peace and growing prosperity. now we must work together to affirm it is greater than the outward divisions and its agreements. we must choose to do more than we think we can do alone so that we accomplish what we must together.

ending this pandemic and making sure we are better prepared for the next one. staving off climate change and increasing our resilience to the impact we are already seeing. ensuring the future where technologies are a vital tool of solving human challenges and powering human potential, not a source of greater strife. these are the challenges that will determine what the world looks like for our children and grandchildren, and what they will inherit. we can only meet them by looking to the future. i stand here today for the first time in 20 years with the united states not at war. we have turned the page. all the unmatched strength, energy, commitment, will, and resources of our nation are now fully and squarely focused on what is ahead of us, not what was behind.

i know this. as we look ahead, we will lead on the love the greatest challenges of our time, from covid climate -- from covid to climate. we will need together with our allies and partners, and cooperation with vol of those who believe as we do this is within our power to meet these challenges, to build a future for all of our people that preserves this planet. but none of this is inevitable. it is a choice. i can tell you where america stands. we will choose to build a better future. you and i, we have the will and capacity to make it better. ladies and gentlemen, we cannot afford to waste anymore time. let's get to work. let's make our better future now.

we can do this. it is within our power and capacity. thank you, and got bless you all. [applause] alix: you have been listening to president biden deliver marks before the united nations general assembly. you can follow today's session on the terminal. the speech ended very similarly to some speeches he would make on the campaign trail about building back better and leading together, but a lot was said over the last 35 minutes. joining us now is annmarie hordern onset. he spoke on afghanistan, a lot on climate. what stood out to you? annmarie: i think his three c's he continued here by and large about covid, where he started the speech, some thing that he things allies and even adversaries to the united states can collectively in a

humanitarian effort get behind. climate is where he really made news. he said they could send $5.6 billion to this developing fund -- this developing fund, saying they would double that. that would be a big deal. finally is china, but he didn't mention china by name. "global power dynamics are changing." he said i don't want a cold war. just yesterday, the humans are very gentle called the china relationship dysfunctional, and set -- -- the u.n. secretary general called the china relationship. dysfunctional, and said that is where it is headed maybe an olive branch -- relationship dysfunctional, and said that is where it is headed. maybe an olive branch to the european union, potentially those that are feeling competition with china in the asia region. this was his first speech as president at the united nations,

a setting of the tone of how he wants his administration to deal with and react to the world. it comes at a time when you have a lot of grievances right now with the president from his closest allies. of course, what is going on with france, for the first time ever recalling their ambassador from washington area but then you also have the european union saying america may be back in america, but european allies are not necessarily feeling that. alix: there was also investment to end hunger and those sorts of pledges as well. what is the schedule for the rest of the day echo there is still a lot going on back home -- rest of the day? there is still a lot going on back home. annmarie: today he is meeting with australian prime minister scott morrison. the rest of the meetings will take lease in washington.

friday will be a very big day. it is the first in person meeting of the quad, india, japan, the united states, and australia. this comes on the heels of this huge deal about nuclear submarines between australia, the u.k.and u.s. he's going to be meeting with boris johnson, modi, so all leading up to that meeting on friday. guy: thank you for the reaction to the biden speech at the u.n. general a simply, bloomberg's annmarie hordern. president biden speaking a few moments ago, announcing a doubling on the u.s. climate funding pledge. this as world leaders prepare for the climate summit that kicks off november in glasgow. here to talk about the most significant climate agreement is

alok sharma, cop26 president. they just announced that the u.s. will double their commitment to climate funding. president boris johnson -- prime mr. boris johnson saying earlier in the day that we are nowhere near enough in terms of meeting the pledge of 100 billion dollars. can you talk me through the math? where are we now that president biden has made that commitment? alok: i think recognizing the fact that collectively, developed nations have to deliver on this $100 billion a year figure which was promised back in 2009, the developed countries said that every year, $100 billion would be mobilized. so this does provide a boost,

and i think it will act as an un-blocker in terms of some of the conversations going on, and i hope it provides a spur for other donors to come forward as well with additional commitment. as i said, overall, very welcome. in terms of the numbers, the oecd published the numbers for 2019 just a few days ago. there is a lag in between from its references, but we were still below $80 billion a year. i think what we need to see is what this means, what others come forward with, and one of the things i am doing is working to put together a plan i had of cop 26 -- a plan ahead of cop26. alix: referencing president

biden's speech, he talked about the fact that there can be intense disagreements among countries, but in the end, we are all fighting together on certain things, climate being one of them, which brings me to china. china will be key to any kind of decarbonization effort and any written -- any really big climate goal. can they work on this in any meaningful way when there is so much tension in trade and human rights? alok: i have spoken to well over 100 governments. i have made visits around the world, including to china. my friend john kerry, of course, has done the same. from all of the conversations i've had, countries around the world recognize that climate change is the great leveler. it does not recognize borders. they conceded themselves what is happening in their own countries. this is not just about something happening internationally. it is happening in nations around the world, so they see

the reason why we need to work together on this. when i was in china, i had a constructive but very candid set of discussions, and i made the point to them that they have set out clear ambitions in terms of reducing the use of coal, carbon neutrality, getting to the point where they peak their carbon emissions. what we want to see his detailed policies that deliver on these commitments, and the second are those commitments in the near term that every g20 nation, every nation in the world needs to come forward with, but particularly the biggest emitters need to set those out before cop26. guy: are you worried that we are seeing the chinese link climate to other issues? it seems they are the submarine

deal with the u.s., the u.k., and australia potentially with climate. what would you say to that kind of approach? alok: my own experience is that countries around the world recognize that this is a shared endeavor when it comes to tackling climate change, and we need to do this together. that has certainly been my experience in talking not just to china, but a range of other countries over the past year, year and a half that i have been doing this work, of course there are all sort of multilateral matters that come up, but we have managed to maintain a steady drumbeat of discussions on the issue of climate, and the reason we have been able to do that is because countries recognize this matters for the lives and livelihoods of their populations, and that is why we need to get this right at cop26. alix: the difficulty is what happens in the medium-term. this is leading to record high power prices and lng prices.

that hurts. it bites countries, it bites companies. we might see some go out of business on that. guy is going to have to pay a lot more on his electricity bill come next year. how do we avoid those things? don't we need things like coal and nuclear, the things we need to phase out, and the medium-term? alok: in terms of what is happening in the gas markets, it is international. it is not just the u.k.. we have a price mechanism in the u.k. to protect people in terms of prices going up significantly. we also have various mechanism where we provide support to the most vulnerable households in our country. so i'm confident that zoomers will not huge spikes -- that consumers will not face huge spikes.

our view is that there are not going to be issues in terms of supply this winter. but there's a wider point, that this spurs all need for us to do more in terms of renewables, both in terms of offshore wind, in terms of solar, but also building forward in hydrogen, for instance, which i know is an area that a lot of governments aren't focused on. from the u.k. experience, and less than 10 years we have gone from 40% coming from coal, and by the end of 2024, we will have no more coal in our energy mix. the reason we have been able to do this is that we have the biggest offshore wind sector in the world, and we are going to quadruple that over the next 10 years. so we have demonstrated, other countries have demonstrated that the way forward is clean energy, and that is a transition that we want to see around the world. guy: do you think you will be

able to get a commitment from the chinese that they will phase out coal? that would be a huge step forward. at the moment, we feel like we are quite a long way away from that. alok: first, we are looking for all countries to commit that they will not provide financing for cold projects outside their own country. we had a historic agreement. all of the g-7 nations, including the u.s. and the u.k. and our other friends, all committed. i took part in the climate and environmental minister meeting, and we made very clear in our commitment that from 2021, we will not be financing any international coal power projects around the world. that is really big. south korea has done the same. of course we want to see china and others come forward to make the same commitments. we tried to get some agreement

on this at the g20 climate and energy ministers meeting that i took art in in july. we got lots of good commitments coming out of that point. all countries committing to coming up with ambitious commitments to cut emissions by 2030. but the one thing we did not get was the right language on coal phaseout. so we are continuing to talk, so let's see where we get on that issue. alix: thank you very much. some breaking news for you here in the u.s. the fda expected to announce a decision on the pfizer booster on wednesday. it was recommended for those 60 five and older and the immunocompromised for a booster. this is bloomberg. ♪ ♪

ritika: this is "bloomberg markets." coming up, scott minerd,

guggenheim partners ceo. this is bloomberg. ♪ guy: turning out to be a turnaround tuesday of a different kind. we went up area now we turn around and we come down again. maybe tap it is a better description after all. we have a negative s&p. we started off positively in europe. what should we be making up the? ? price action we are seeing right now -- of the price action we are seeing right now? dan beyond the new -- dan bienvenue is joining us now with his perspective. give us your perspective of what you're seeing on the screens in front of you. dan: certainly we are long-term

investors, and we keep as our focus to make sure we are really focused on the long term because our liabilities are measured in decades and generations. but certainly, we watch what is going on in its. what you're seeing here is certainly something factors. we've got markets that have been above their 200 day moving average for nearly a year now. you've got months like september and october that have historically not been great for the markets. certainly we are keeping an eye on that. when you look at everything going on out there, whether it is the evergrande situation, taper talk in the fed coming up tomorrow, certainly valuations aren't cheap across markets. equity markets, bond markets globally. so political topics, whether it is geopolitics, lots of things to keep our eye on, but earnings have been strong, and they

continue to be strong. so certainly there is a positive there as well. alix: you allude to a massive dislocation in markets, which leads me to the tina narrative, there is no alternative. how do you invest in get a return without taking on too much risk? are you inherently having to take on more risk in your portfolio? dan: that is something we are looking at now. we really set the risk appetite for the portfolio, and the idea from there is for us to really manage that portfolio to that risk appetite. that risk appetite is set by the board, staff working in conjunction with the board. we are spending a lot of time on that. your question around risks and some of the asymmetric risk between what we see in the bond market and what we see in equity markets is something we are keeping an island.

but really, our focus is about setting the portfolio up for long-term returns. our liabilities are measured in generations, i we want to make sure we set up the portfolios to succeed across the generations. guy: inflation is going to have an impact. is this temporary? is this something investors are going to have to think about? dan: i would say that in general, we probably resonate that it is transitory in some way, although it has been staying higher than i think we would have thought early on, and frankly many of the fed watchers would have thought early on. that said, certainly inflation is an important topic. it affects the liabilities as well as the assets. it is one of the reasons why we have put some of the defensive positioning into the portfolio that we have. but certainly, inflation is

something we are watching closely. alix: that investment return target is really tricky. how are you managing that risk of borrowing to get that return? dan: we have some leverage in the portfolio, but that is taken as an active risk, right around 4% of the portfolio. one of the things we are looking at in this cycle is whether we actually add borrowing at strategic leverage to the strategic asset allocation. it is something that is currently being debated at the board level. we look to be making a decision in the november timeframe. but as of now, leverage is not art of the strategic asset allocation for calpers. guy: do you think we are through the bulk of the pickup we have seen as a result of liquidity?

dan: i definitely think stimulus is tapering. you are seeing the fed talk about tapering. certainly you have seen this on the physical side, a reduction in stimulus coming out, and frankly it is some that you are seeing not only in the u.s., but seeing globally. certainly i would say the stimulus is coming down. that is not to say that there isn't a ton of liquidity in the markets. you are seeing this in equity flows and bond flows as well. guy: it has been a great pleasure. thank you for sharing. more next time. up next, the european close with fading. that is the story. the j.p. morgan chase cio a fixed income joining us next. this is bloomberg. ♪ ♪

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>> the countdown is on in

europe. this is "bloomberg markets: european close," with guy johnson and alix steel. ♪ guy: tuesday the 21st. what do you need to know? still higher, but we are off our highs. evergrande report lee missing some payments to banks yesterday. is london actually late to the party? we will speak to the chief secretary of the treasury john flynn. -- treasury john glenn