5 things to start your day

Tech earnings, OPEC meeting, and the other worry about the Fed. Outlook Google parent Alphabet Inc.’s fourth-quarter results comfortably bea [View in browser]( [Bloomberg]( Tech earnings, OPEC meeting, and the other worry about the Fed. Outlook Google parent Alphabet Inc.’s fourth-quarter results [comfortably beat estimates](, sending the tech behemoth’s shares more than 10% higher in pre-market trading. The company also announced a [20-1 share split](, a move that could help entry to the Dow Jones Industrial Average. In tech earnings today, Meta Platforms Inc., the company formerly known as Facebook, is expected to report strong advertising revenues and possibly, maybe, update investors on what exactly the [metaverse is](. Spotify Technology SA also reports, with the company [still facing controversy]( over its Joe Rogan podcast. Oil Euro-area inflation data for January published this morning showed energy prices rose a massive [28.6% from a year earlier](. Safe to say, energy prices remain firmly in focus, and expectations are high ahead of today’s OPEC+ meeting. While some analysts say that the spike in crude prices might force the cartel to increase production quotas beyond the penciled-in [400,000 barrels per day](, there remains a huge problem with [ramping up output]( for some members. To add to supply problems in Europe, the region’s major oil distribution hub has been forced to halt operations due to a [suspected cyberattack](. In the market this morning, Brent was at [$89.40 a barrel]( with WTI one dollar lower. Other Fed worry While much of the speculation about how the Federal Reserve plans to tighten has been focused on [how big and how fast rate hikes will be](, Goldman Sachs Group Inc. analysts are warning about the volatility likely to stem from running down the central bank’s balance sheet. Strategists say the move will hurt liquidity in the Treasury market while also [boosting volatility]( and affecting how different parts of the U.S. rates market are valued [relative to one another](. The Fed plans to end purchases next month and could allow the balance sheet to shrink through the [roll off of holdings]( by the end of the year. Markets rise With earnings season continuing to produce strong results, some signs of [easing tensions over Ukraine](, and investors calming down somewhat about Fed prospects, equities continue their recent run up. The quiet overnight session due to much of Asia being on holiday saw Japan’s Topix index closing 2.1% higher. In Europe the Stoxx 600 Index had gained 0.6% by 5:50 a.m. Eastern Time. S&P 500 futures pointed to [plenty of green at the open](, the 10-year yield was at 1.797% and gold rose. Coming up... Jobs week kicks off with ADP Employment Change numbers at 8:15 a.m. U.S crude inventories data at 10:30 a.m.  may show a [surprise drop in stockpiles](. Brazil’s central bank is forecast to raise the benchmark rate above 10% for the first time in nearly five years when it announces its decision at 4:30 p.m. AbbVie Inc., New York Times Co., Qualcomm Inc., T-Mobile US Inc. and Ferrari NV are among the many companies reporting results. What we've been reading Here's what caught our eye over the last 24 hours. - [Big bonuses are back]( for Wall Street bankers. - A major homebuilder sees [no improvement coming]( to the supply chain in 2022. - Ether’s correlation with stocks reaches a [record high](. - Distressed-debt investors send out their own [distress signal](. - Cathie Wood’s ARKK sees [end to outflows]( as bearish bets wane. - Banker [linked to Kyrgyz fraud]( emerges with alias at U.K. fintech. - [Inside Trickbot](, Russia’s notorious ransomware gang. And finally, here’s what Joe’s interested in this morning The mainstream hasn't been talking about it much, but when the supply chain disruptions really started hitting, everyone started learning about the so-called "[bullwhip effect](." Basically you get these situations where product availability starts to become very hazy and unpredictable and firms make decisions that can result in alternating periods of extreme shortages or extreme gluts. There's been so little easing on the supply chain front ([see the latest on housing here]() that the idea of major gluts feels pretty quaint. But it might be a mistake to write off the possibility entirely. I was reading through the [Dallas Fed Manufacturing Survey](, and came across this comment from one of the respondents. It's just one respondent, obviously, but it stands to reason that if there are persistent fears of shortages, and customers not being able to get their goods, that they'll react by over-ordering now. That might work out for the customer (maybe), but it of course, makes forecasting a nightmare. Does the end company know if that ordering represents panic ordering or a new sustained level of high demand? It's impossible to say and we don't have nearly enough insight. But it stands to reason that forecasting for any business is extremely tough right now, and that it's impossible to get a sense of steady-state "normalized" demand. One can imagine some suppliers ramping into these orders, and then a glut materializing, as demand got pulled forward. There was something similar to this in a [NYT article]( about dwindling warehouse space, and how that's another major bottleneck in the logistics system. Here there's also evidence of defensive spending to build up capacity: Adding to the space crunch, companies aren’t just amassing goods for future sales, they are also stockpiling warehouse space when they can, even if they aren’t yet able to fill it, said Greg Sanguinetti, president of Pro Group Logistics in Sparks, Nev. “Companies are grabbing warehouses with 50 percent more space than they need,” he said. “They are lowering operating margins just to increase infrastructure so they have it.” You can see how the situation can ripple. Maybe some company is experiencing panic buying from their customers for some widget, and then they panic acquire more warehouse space just in case. It's hard to know how widespread this all is, but you can see at least some patterns of behavior where things move viciously in the other direction, and some players are suddenly sitting on large unsold inventories or built out capacity that doesn't end up getting used. Follow Bloomberg's Joe Weisenthal on Twitter [@TheStalwart]( Like Bloomberg's Five Things? [Subscribe for unlimited access]( to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. Follow Us Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. You received this message because you are subscribed to Bloomberg's Five Things - Americas newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. [Unsubscribe]( [Bloomberg.com]( [Contact Us]( Bloomberg L.P. 731 Lexington Avenue, New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](